LEGISLATIVE FISCAL ESTIMATE
SENATE, No. 4
STATE OF NEW JERSEY
212th LEGISLATURE
DATED: JANUARY 5, 2007
SUMMARY
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Synopsis: |
Provides for various school district accountability measures. |
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Type of Impact: |
Reduction in related local education costs. |
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Agencies Affected: |
School districts.
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Fiscal Impact |
Year 1 |
Year 2 |
Year 3 |
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Local Savings Indeterminate - See Comments Below |
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· The Office of Legislative Services (OLS) has determined that it is not possible to estimate the fiscal impact of this bill.
· This bill includes various provisions designed to increase public school district accountability in budgeting and personnel matters. The provision of the bill that may have the most immediate impact on savings within school districts require that all school districts, as a condition of receiving State aid, implement a number of efficiency standards, including: examining all available group options for every district insurance policy and opting for the most cost effective plans; taking steps to maximize the district’s participation in the federal Universal Service Program (E-rate) and the ACT telecommunications program; participating in the Alliance for Competitive Energy Services (ACES) program; taking steps to maximize participation in the Special Education Medicaid Initiative (SEMI) Program; and refinancing all outstanding debt for which a 3 percent net present value savings threshold is achievable.
· Although the above requirements are expected to result in cost savings, the OLS is not able to estimate the potential savings that would result from the implementation of each requirement.
BILL DESCRIPTION
Senate Bill No. 4 of 2006 includes various provisions designed to increase public school district accountability in budgeting and personnel matters. The bill requires that all school districts, as a condition of receiving State aid, implement a number of efficiency standards, including: examining all available group options for every district insurance policy and opting for the most cost effective plans; taking steps to maximize the district’s participation in the federal Universal Service Program (E-rate) and the ACT telecommunications program; participating in the ACES program; taking steps to maximize participation in the SEMI Program; and refinancing all outstanding debt for which a 3 percent net present value savings threshold is achievable.
The bill also does the following: codifies proposed regulations regarding travel and expense reimbursement for school board members and district employees; institutes various budget and personnel compensation reporting requirements in school districts; prohibits a school district from renegotiating, extending, amending, or otherwise altering the terms of a contract with a school administrator unless notice is provided to the public prior to the action by the board and a public hearing is held; authorizes the Commissioner of Education to recommend that the State Board of Examiners revoke the certification of a school administrator if the commissioner believes that the person’s conduct warrants such action or the district is not in compliance with GAAP accounting standards; provides that the approval of the commissioner is required for the buy-out of a superintendent’s contract; expands the circumstances under which the commissioner may appoint a State monitor to ensure public funds are properly expended; authorizes the Board of Examiners to review the certification of superintendent or business administrator of any district in which conditions exist that would allow the appointment of a State auditor; expands the authority of the commissioner to order a compliance audit of school district spending; and revises training requirements for school board members.
The bill implements recommendations 13, 14, 15 and 16 of the November, 2006 Report of the Joint Legislative Committee on Public School Funding Reform.
FISCAL ANALYSIS
EXECUTIVE BRANCH
None received.
OFFICE OF LEGISLATIVE SERVICES
While Senate Bill No. 4 of 2006 includes various provisions designed to increase public school district accountability in budgeting and personnel matters, the OLS believes that the requirements outlined below may have the most immediate impact on savings within school districts.
The bill requires that all school districts, as a condition of receiving State aid, implement a number of efficiency standards, including: examining all available group options for every district insurance policy and opting for the most cost effective plans; taking steps to maximize the district’s participation in the federal Universal Service Program (E-rate) and the ACT telecommunications program; participating in the ACES program; taking steps to maximize participation in the SEMI Program; and refinancing all outstanding debt for which a 3 percent net present value savings threshold is achievable. This provision is identical to the requirements imposed upon Abbott districts in the FY 2005, FY 2006 and FY 2007 Appropriations Acts as a condition for receiving Education Opportunity Aid. According to the Department of Education, data on the cost savings realized in Abbott districts as a result of the requirements is not available.
Although the above requirements outlined in the bill may result in cost savings, the OLS is not able to estimate the potential savings that would result from the implementation of each requirement. Absent any data on the fiscal impact of the above requirements on Abbott districts, the OLS has determined that it is not possible to estimate the fiscal impact of the bill.
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Section: |
Education |
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Analyst: |
Senior Fiscal Analyst |
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Approved: |
David J. Rosen Legislative Budget and Finance Officer
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This legislative fiscal estimate has been produced by the Office of Legislative Services due to the failure of the Executive Branch to respond to our request for a fiscal note.
This fiscal estimate has been prepared pursuant to P.L. 1980, c.67.