UPDATE: Board of Ed Decides to Replenish Budget With New State Aid

The Board of Education has decided to use newly-granted state aid to patch holes in the 2011-12 and 2012-13 budgets.

The district received $698,692 in aid after Gov. Chris Christie signed the new state budget, increasing aid to school districts by $850 million over the previous year. The new aid effectively restored last year's aid and increased it by an additional $30 million.

In his superintendent's report at the board meeting at Madison High School on Tuesday night, Rossi said "we are going to use (the money) in this year's budget - a portion of it now, then carry it over in next year's budget."

School districts around the state had four options on how to distribute the new aid -- apply it toward tax relief for the 2011-12 school year, apply it to the 2011-2012 budget, carry over the aid as revenue in the 2012-13 budget or take no action and have it become surplus.

If the Madison district chose to distribute the money as tax relief, it was originally to inform county offices of it decision by 4 p.m. on Tuesday. The county, however, on Tuesday pushed the deadline to Friday, according to Rossi. The other distribution options did not carry a deadline.

For his part, Christie strongly suggested that districts apply the aid toward property tax relief. Districts such as Madison, however, had been cutting programs and limiting services because of the recent shortfalls.

Board Vice President Patrick Rowe, who also leads the board's finance committee, said, "Ideally, we could use [the aid] in this year's budget, especially for something like the roof at Central Avenue School," which needs replacement.

Despite Rowe's comment about how the money might be allocated, the board did not suggest or take action on any specific budget items. 

"The rest of the money we should probably use for next year because we already know that we are a half-million dollars in the hole," Rowe said. "We also have no idea whether we will see this money next year."

Two years ago, every school district in the state had its budget reduced by five percent. For places like Madison, that meant a state aid number of zero. This past year one percent of the state aid was restored. For Madison that equated to roughly $349,000. 

But on July 13, when the state budget was formulated, the New Jersey legislature allocated additional money for each school district. Christie subseqently vetoed parts of the budget affecting aid for schools, but school districts still came away with one percent in state aid for a total of two percent restored against the five percent loss a few years earlier.  

Board President Lisa Ellis earlier had said that at a minimum, the funding formula that is the current law should be fully funded. She said that doing so would provide the district with approximately $1.6-1.7 million in aid annually. 

"But the damage was done by the loss of all our aid last year and the limited restoration this year," Ellis said. "A net loss of approximately $2.7 million dollars will be difficult to recover from even if the formula is fully funded in 2012-13."