'We Will Run Out Of Money': School Aid Bill Falls Short, Toms River Superintendent Says

TOMS RIVER, NJ — While the state touts a pair of bills as the solution for school districts facing steep cuts because of school funding reductions, Toms River Regional School District officials say the bills only partially help cover the district's $26.5 million budget gap.

Toms River Superintendent Michael Citta said the announcement last week by Gov. Phil Murphy and the state Department of Education of the signing of two bills that aim to help the 140 districts affected by the S2 cuts would still leave the district facing deep staff layoffs and program cuts to its proposed $291 million budget.

Bill A4161 provides $44.7 million in a Stabilized School Budget Aid Grant Program for grants of 45 percent of a school district’s state school aid cut for the upcoming school year. It also allows districts seeing aid cuts to increase their property tax levy by up to 9.9 percent — above the 2 percent cap under the School Funding Reform Act.

"What it means today is we would get $1.2 million back and have the ability to raise another $13 million from taxpayers," Citta said at the Toms River Regional Board of Education meeting on May 14. "We are still $12.4 million short if the board decides to increase the taxes."

"If we don't get the balance of those dollars we will run out of money next April or May," Citta said.

Toms River Regional is slated for a $2,798,243 reduction in state aid for the 2024-25 school year, the final year of the S2 aid cuts. under Murphy's budget announced in early March.

That is just a piece of the funding gap. During the school budget process in the spring of 2023, Citta had warned the district would be facing a $26 million gap this year. That was due to two factors: the end of federal pandemic grant money that was being used to pay $6 million in special education tuition, and the delayed impact of a $14.5 million state aid cut in the 2023-24 budget that was partly filled by the district selling a piece of property to Toms River Township and partly filled by supplemental aid that the district had to make up for this year.

Citta has said if the district were to cut $26.5 million from its budget, 368 staff positions would be eliminated and it would create class sizes of 230 or more at the elementary school level. Read more: 368 Job Cuts, 'Ridiculous' Class Sizes In Toms River: What Slashing $26.5M Would Mean

Under the bills signed May 14, Toms River Regional would have the ability to increase the property tax levy up to 9.9 percent of the levy of 2023-24 — a percentage that would translate to about $325 per year for Toms River homes assessed at $400,000, business administrator William Doering said.

It was not clear how much support a tax increase of that level has on the school board, and Citta said that while that would raise $13 million, the district would still be $12.5 million short.

He was holding out hope of a solution that closes the full $26.5 million gap and avoids deep cuts to the teaching staff, which would push class sizes impossibly high.

The bills Murphy signed also give districts facing deep cuts — including Toms River Regional — until 5 days after the state finalizes its 2024-25 budget to approve their 2024-25 school year budgets, which could mean finalizing matters in early July.

Toms River Regional's school board did not vote on a final budget on May 14 for that reason, while district officials continue to talk with state officials about possible solutions to close the remaining $12.5 million gap.

Board members expressed frustration at the ongoing situation and the cuts that were first billed, in 2016, as removing so-called adjustment aid that was put in place when the School Funding Reform Act of 2008 took effect in 2010. Toms River and dozens of other districts initially received aid that was supposed to diminish over time as school funding was balanced out.

Toms River's adjustment aid, however, was fully eliminated as of 2021, Doering has said.

The law permitting a 9.9 percent increase in the property tax levy is the first movement in addressing the Catch-22 created for so many districts in 2024-25 in addressing the S2 cuts.

While those districts, including Toms River Regional, have been blasted by S2 advocates as not paying their fair share of property taxes to support their schools, the laws that had been in place left those districts with no real mechanism to recapture the aid that was being cut. They were governed by the 2 percent cap on property tax levy increases, and the option of putting a larger tax increase to voters in a referendum was unworkable, because the earliest a referendum could be held was September — meaning if voters approved a property tax levy increase, it wouldn't take effect until well after the school year began, and after job and program cuts already had been made.

In addition, districts were not permitted seek funding via referendum for items that are part of providing a thorough and efficient education. With S2 cuts usually far exceeding the 2 percent cap, districts have found themselves farther and farther in the hole on reaching what the education department has defined as "adequacy."

Adequacy is the amount the state education department says is the amount a district should be spending per pupil to provide that thorough-and-efficient education.

In this budget cycle, the state took one additional measure off the table when it announced it would not allow districts to seek loans — in actuality advances on future state school aid — to close funding gaps for 2024-25.

For years, Toms River district officials touted the district's low spending; it has consistently had one of the lowest per-pupil spending levels for districts of 3,500 students or more for the last 10 years or more. Citta has said being the lowest-spending district is no longer a badge of honor, because children are being shortchanged on their education.

Board member Anna Polozzo, who has been vocal on the battle over S2 cuts and is the board's legislative representative, said various people at the state level have said Toms River Regional should just "cut everything that is not mandated," which includes kindergarten, some of the sports programs and clubs, Advanced Placement courses, and more.

"I'm tired of begging these people to let us educate our children," Polozzo said.

"We haven't gotten any response to our specific budget situation," Citta said. He and Doering have had multiple conversations and answered dozens of questions from state education department officials about the specifics of the district's budget for weeks. But he was holding out hope for a solution.

"We have not been approved or rejected" on the tentative budget submitted, Citta said. "We are not waving the white flag."

"The decision makers are willing to work with us," Citta said. And if the district continues to face horrid cuts, "we will take other measures to protect ourselves."