Lakewood School District May Be in Line for State Fiscal Monitor

John Mooney | April 25, 2014 | Education
Financially strapped district may be faltering under responsibility of servicing 20,000 students not in public school

school bus
Lakewood has long been one of New Jersey’s most intriguing — and sometimes most troubled — school districts, and the spotlight is about to get brighter.

State and local officials are set to meet in Trenton today to discuss plans for the state to step up its role in the Ocean County district, including the appointment of a fiscal monitor, according to an official close to the decision who asked to remain anonymous.

It would be the seventh district in New Jersey to be assigned a fiscal monitor, a step below the state taking over the district altogether. The state currently has fuller control of at least some operations in four other districts.

The impetus in Lakewood is a growing fiscal crisis in which officials have said the district of 5,700 students could run out of money in May, spending down its $143.4 million budget. The board voted last month to seek a $5 million loan to make it through the year.

But what has put the squeeze on the Lakewood budget is not simply serving the district’s public’s schools. It also is picking up at least part of the tab for 20,000 additional children who typically attend private schools, including hundreds of yeshiva for the community’s large Orthodox Jewish community.

Lakewood spends close to $20 million a year to provide transportation for those students to attend their schools, as required by state law. In addition, the high special education costs are also borne by the district, again as required by the state.

“This situation cannot go forward,” said state Sen. Robert Singer (R-Ocean), who is expected to attend the meeting today in the offices of acting Education Commissioner David Hespe.

“These are serious times, and we have numerous responsibilities,” Singer said yesterday. “The first is to the schoolchildren and making sure they receive a good education.”

Singer said he had yet to be briefed on the state’s plans, but indicated he would support a state monitor and other state assistance to get the district on a better fiscal track.

“We can’t continue to hold children and their parents hostage,” he said. “The bitter pill that you sometimes have to take can only be administered by an outside person.”

The exact dollar amount of the district’s deficit unclear, but is typically pegged at $3 million to $5 million. One option is for the state to effectively bail out the district through a loan or emergency aid to get it through the year.

But Singer and others said it should be a last resort. “If they’re $5 million short this year, what does it mean to the taxpayers next year?” Singer said. “If they are in a true deficit, that’s not an option for anybody. It’s a sign they can’t handle their finances.”

Efforts to reach Lakewood school board members last night were unsuccessful.

But the long-term challenges are equally tricky, given the extraordinary circumstances of having so many children not in the public schools but drawing district services. And what has been left is a district rife with problems, from chronic low-performance of its schools, inadequate supplies in the classrooms despite spending over $20,000 per student, and questionable business dealings.

Even before today’s expected action, the state has increasingly stepped up its oversight over the district in the past decade, including strong interventions over the past two years through the Regional Achievement Centers created under former Commissioner Chris Cerf.