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Court Hears Arguments on Superintendent Salary Caps

John Mooney | September 21, 2012

Cap or limit? Legal or not? Three-judge appellate panel takes the case under consideration.

Former Commissioner of Education Rochelle Hendricks
Former Commissioner of Education Rochelle Hendricks

Gov. Chris Christie’s caps on school superintendent salaries have drawn plenty of questions as to whether they are fair and fitting for schools, and their leadership --as well as to taxpayers.

Yesterday in an 11th floor courtroom in the Essex County Courthouse in Newark an even more fundamental question was debated: are the caps that have roiled school districts statewide legal?

Almost two years after the caps were put in place, lawyers for the state and for administrators faced off before a three-judge state appellate court panel hearing challenges to the limits. Basically, most district superintendents earn between $120,000 and $175,000, depending on student enrollment

Two different complaints were heard in the oral arguments, both contending that Christie and his education commissioner at the time, Rochelle Hendricks, did not have the authority to enact the limits under state statute.

The lawyers for the three superintendents and the New Jersey Association of School Administrators argued that while the Legislature empowered the administration to review and approve superintendent contracts to save money, it never intended the stark limits imposed by regulation in February 2011.

The lawyers cited separate statutes that give local boards the authority to set salaries and also prohibit them from cutting those salaries during a superintendent’s term in office.

Arguably, the biggest impact of the law has been in prompting superintendents to step down when their contracts expire at the higher pay, rather than take salary cuts. Nearly 100 New Jersey superintendents retired in the past year, and half of all districts have seen the job turn over since the new limits were enacted.

Standards or Salaries

The lawyers contended that the state was permitted under 2007 law to set “standards” or benchmarks, but the Legislature specifically stayed away from capping salaries.

“We can look to the plain language of those statute: there is nothing in the expressed language that allows the commissioner to cap the salaries of school superintendents,” said Andrew Babiak, attorney for Passaic City Superintendent Robert Holster.

Holster saw his pay drop from $218,000 to $177,000 when his last contract expired this past year. He also has filed a separate complaint against his own board for failing to follow required steps in the contract dispute.

Maria LePore, attorney for the administrators association, cited several places where the Legislature in that statute called for salary limits on other positions, including the state’s own executive county superintendent who was reviewing the contracts.

“You presume the Legislature understood the terms when it drafted statute,” she said. “They certainly know what salary meant, and they chose to exclude it.”

But the three judges on the panel appeared skeptical about the plaintiff's arguing that there was a blurring between what was a standard and what was a limit.

Judge Jose Fuentes, the presiding judge, said the judiciary itself faces significant standards in its work, more than just guidelines. “The word standard as we use it limits us in significant ways,” he said.

Judge Victor Ashrafi quizzed the lawyers on where they would draw the line: “Would it have been authorized under the regulation if it said benchmark that the salary be set at $165,000, and if they exceeded it, they would have to justify it or the county superintendent would reject it?”

At still another point, Fuentes questioned if the administration had indeed deprived the local boards of the power to sett salaries. “It limited the board,” he said. “It didn’t deprive it, it just limited it.”

Although briefer, their questioning of the state’s lawyer, Deputy Attorney General Michael Walters, wasn’t much easier.

“There were absolutely no restrictions on the authority of the commissioner in the expressed language,” Walters said to open. “The Legislature kept it very broad for a purpose.

“Understanding what was going on, there were excessive perks as well as salary,” he said. “There were reimbursements of pension payments, there were clothing allowances. With that in mind, it was not surprising the Legislature did not say salary.”

Retroactive Limits

But another argument was tougher. One issue in the challenge was whether the administration could effectively impose the limits retroactively on superintendents whose contracts were expiring as the regulations went into place.

For several months before the regulations were enacted, then-commissioner Hendricks prohibited any new contracts from being reviewed by her county offices. Several times during that period, Christie himself said he would bar boards and superintendents from slipping under the deadline.

But the judges asked that if the contracts were approved by the local boards beforehand, where was the state’s authority to block them. “Why should regulations apply retroactively, why should that not enjoy some grandfatherly protection until the contract is renewed the next time,” Fuentes asked.

“What you have is the superintendent who’s right to roll over had already occurred,” Ashrafi added, “even if the contract had not yet expired.”

The arguments lasted about an hour, with the panel saying it would take the case under consideration. Its decision will be closely watched, and likely appealed no matter who wins, but in closing, the panel gave all the lawyers at least some reason for hope.

“Thank you very much,” Fuentes said as the lawyers started packing up their papers. “Well argued on both sides.”

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