In a speech yesterday before the Municipal Analysts Group of New York in New York City, Gov. Phil Murphy said his 2024 state budget will include a “significant” school aid increase. “School funding is still going to be a multi-million-dollar up, the biggest up in the budget,” he said. “That will ultimately reach its mountain top with the budget I’ll be announcing.”

Currently New Jersey’s state budget devotes $20.5 billion to school funding, the largest allocation for the 2023-2024 fiscal year. Per student funding is $20,500, slightly behind New York and Connecticut and ahead of all other states. Last year Murphy added $1 billion to K-12 school spending, which, according to Education Law Center, left him $250 million short of his promise to fully fund the state finance law called the School Finance Reform Act by 2025.

Yet during his speech Murphy noted that things are tight: tax revenues are short of projections, down $530 million or 3% compared to last year. Also, district spending in New Jersey has been buttressed by $2.8 billion from federal emergency COVID aid in the Biden Administration’s American Rescue Plan, which runs out next year.

It is hard to make the math work.

Here is John Reitmeyer, NJ Spotlight’s budget and finance guru:

“The state had been in this circumstance where it had a lot of extra money flying around for things like boosting pension payments and increasing K- 12 school aid funding,” he said. “Now, we may be in a little tighter environment.”

Sales tax revenues that are still being counted from holiday shopping could help, and Reitmeyer said the governor could also dip into surplus or cut spending. But he said more bills are coming due.

“There’s a whole new set of challenges that have to be confronted, and they include what to do with NJ Transit, what the next Transportation Trust Fund renewal is going to look like, and also how potentially the state will manage its next fiscal year if it’s going to be playing out in a much tighter revenue environment,” Reitmeyer said.

[photo credit] Flickr: Phil Murphy