School board accounts for $1.17M state aid reduction with cuts, surplus funds

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The Manalapan-Englishtown Regional School District Board of Education has used a combination of budget reductions and additional revenue to accommodate a sudden reduction in state aid as the start of the 2018-19 school year approaches.

Under Gov. Phil Murphy’s initial proposal in March, the district’s state aid package for the 2018-19 school year was expected to total $19.94 million. Using that number as directed by state officials, district administrators crafted a $94 million budget for the upcoming school year.

However, the district’s state aid amount changed in mid-July when Murphy and leaders in the state Legislature renegotiated New Jersey’s school aid funding and trimmed Manalapan-Englishtown’s state aid to $18.77 million – a loss of $1.17 million from what the district had been told it would receive.

That action in Trenton left district administrators with the option to reduce funding for certain line items in the budget and/or to add revenue without raising additional funding from taxpayers for 2018-19.

During a meeting on July 31 at district headquarters in Englishtown, board members voted unanimously to appropriate $587,106 from unassigned general fund surplus (savings) to add to the budget and to cut $578,238 from the budget to account for the $1.17 million loss in state aid, without reducing the $94 million budget.

As detailed by Business Administrator Veronica Wolf, the reductions were made in the following accounts: Energy (natural gas), $115,000; Energy (electricity), $29,938; Other Retirement Contributions-Public Employees Retirement System, $300,000; and Unemployment Compensation, $133,300.

A resolution passed by the board states that with the changes, the district will still be able to provide a thorough and efficient education to students as required by the state.

Wolf said that as the board developed a budget for 2018-19, “we planned for some reduction in our state aid, but we did not expect (the reduction) to be as much as it was. According to the state, we are over-funded by the state, and according to the state, we spend more than we are supposed to.”

The bill that was signed into law by Murphy on July 24 applies to 2018-19 and to the following six school years. Superintendent of Schools John J. Marciante Jr. previously informed board members the district’s state aid is expected to be reduced by $12.9 million through the 2024-25 school year.

Board member Brian Graime asked Marciante how he plans to inform residents about what transpired in the district this summer regarding the budget.

Marciante said he will hold a parent meeting at 7 p.m. Sept. 13 at the Manalapan Englishtown Middle School, Millhurst Road, Manalapan, to discuss the state aid cuts as well as a referendum the board is planning to place before voters.

In a back-to-school letter to parents, he wrote, “The future of the Manalapan-Englishtown regional schools will be determined by how the community addresses these two issues.”

During a meeting on Aug. 7, Marciante informed the board that he and municipal representatives from Manalapan and Englishtown, along with other school superintendents, met with state Education Commissioner Lamont O. Repollet on Aug. 2 to discuss the school funding issue.

“I feel I was able to express the significance of the impact of the (new state law) and what will happen to this district in the future,” Marciante told board members.

Marciante said the state’s current funding formula is treating school districts as if they are still operating in 2008, with less technology and significantly fewer security concerns than are the reality as the 2018-19 school year begins.

In a letter to Repollet following the Aug. 2 meeting, he wrote, “State aid decisions which have a significant impact on the education of children throughout the state are being made through the implementation of a formula which is not consistent with the intent of the law.

“It is imperative that this situation be corrected before the 2019-20 budgets are developed. The education of far too many children will be negatively impacted if we allow the 2008 cost model to be the basis of school funding for another year.

“I implore you to immediately establish a committee to develop the Educational Adequacy Report and submit this report to the Legislature on Jan. 1, 2019.”

Marciante told board members Monmouth County superintendents are discussing a strategy moving forward as they seek to mitigate the potential damage reduced state aid could cause to their districts during the next six years.