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Layoffs, loan seen as deficit remedies

deficit_web

By Ron Leir
Observer Correspondent 

BELLEVILLE –

Last week, the Belleville school community learned the awful truth: The township’s public school district is $3.6 million in the red and deep cuts are being made to get the district right for the coming school year.

And the situation could actually have been worse: CPA Jeffery Bliss, a partner with Lerch, Vinci & Higgins, the Belleville Board of Education’s Fair Lawn auditors, told a massive crowd assembled in the high school auditorium June 23 that overexpenditures for the current school year totaled $4.8 million.

But to soften the blow, the board is applying its surplus funds to restore a portion of the money it now needs to balance its budget by June 30, according to BOE Secretary/ Business Administrator Raymond Jacobus.

In a phone interview last week, Jacobus told The Observer that in April, he met with Executive County Schools Superintendent Joseph Zarra and Belleville Schools Superintendent Helene Feldman to sound the alarm of a looming deficit and to outline specifics.

That warning led to the state Department of Education sending former IRS agent Tom Egan to Belleville in May as a monitor, entrusted with the task of getting the school budget in order and then petitioning for a state loan to be paid off, with interest, over a multi-year period.

Egan understood the areas defined to be in deficit but, as further validation to strengthen the school board’s loan application, the monitor called in a public school auditor to make the case, Jacobus said.

“The state is certainly going to look favorably on an experienced school auditor to come up with an explanation,” he added.

Jacobus said the auditor’s report indicated two areas where overspending was most evident: about $1.9 million in salaries for instructional and administrative personnel and about $900,000 in tuition fees for outside placements of special needs students. Other areas of overspending, as reported by northjersey.com, were about $370,000 for special education transportation, about $280,000 for energy costs and about $250,000 for legal services.

“Within two weeks,” Jacobus said, “the monitor will send this report to the state requesting the loan amount. We will have to discuss that with the State Treasurer and the state Commissioner of Education.”

Whatever the amount turns out to be, the district will have to carry repayment of the debt as part of its budgetary obligations, Jacobus said. “The deficit will take a number of years to no longer affect the district.”

In the case of Elmwood Park, for example, that district is now in the second year of a 10-year loan repayment process, Jacobus said.

In the meantime, he said, “we have to reduce the deficit” in preparation for the school year that begins July 1.

To that end, Jacobus said, “we did lay off a substantial number of employees.”

He said there has been a “reduction in force” – which, under state school law N.J.S.A. 18A:28-9, is defined as layoffs made for “reasons of economy or because a reduction in the number of pupils or of change in administrative or supervisory organization of the district or for other good cause….”

So far, he said, the district is not renewing the contracts of 75 non-tenured teachers for the 2014-2015 school year – nearly 19% of its 400 teachers – nor is it bringing back 21 non-instructional personnel, a combination of administrative, secretarial and custodial employees.

In May, Jacobus said, the school board rehired tenured staff, including some teachers, and several non-tenured staff for the coming school year. At the July 14 meeting, he said, the district plans to hire “some additional non-tenured staff.’’

As the district reviews its “minimum staffing needs” for the upcoming school year, along with budgetary limits, “[subject and grade] certifications will dictate the possibility of whether they’re brought back or not,” according to Jacobus and Feldman.

That review may extend into August, Jacobus said.

It won’t be an easy process, Jacobus said, since “the board will be looking for reductions” in staffing and in various “programs,” such as special needs education.

Asked if certain noninstructional programs, such as interscholastic sports, could be subject to cuts, Jacobus said: “Athletics will be last on the list – at least, that’s our goal.”

Before last Monday’s meeting began, several hundreds of New Jersey Education Association members from around the state convened outside the high school for a rally supporting their Belleville colleagues.

The Belleville Education Association, which represents some 400 teachers and 37 noninstructional employees, according to BEA President Michael Mignone, has been outspoken in its criticism of the school board’s prioritizing funding a $2 million elaborate school security system instead of fixing old classroom computers and restoring school supplies.

“We expected there’d be cuts,” Mignone said last week. “This is exactly what our concerns were, as far back as October. We foresaw this happening and here we are. Undoubtedly, this is going to affect our educational system and our members. The budget projected [for 2014-15] has less [than the current school year] for books and supplies – and we didn’t get any supplies last time. And our technology is still outdated.”

As for the new security system, Mignone said that while the middle school and high school students have been equipped with the special electronic ID tags, which can be used to help locate missing students, the kids in elementary schools don’t have them. He said the BEA is contesting the district’s allegedly selective placement of cameras in teacher lounges while refraining from installing them in certain administrative offices and in school hallways. A hearing on that grievance is awaited by the state Public Employment Relations Commission (PERC).

Mignone himself is awaiting a final arbitration session on his suspension from teaching duties on two “conduct unbecoming” charges and one of “insubordination.”

“When you have fiscal irresponsibility, everyone is expected to reap havoc and the board should be held accountable for that,” Mignone said.

The Observer asked the state Department of Education whether board members would be subject to any type of punitive action for having “overexpended in violation of N.J.A.C. 6A:23.2.11 (b),” as certified in May by the board secretary/business administrator.

Here is the response offered by DOE spokesman David Saenz: “In May of this year, the New Jersey Department of Education placed a fiscal monitor in Belleville to address fiscal deficiencies in the school district. Fiscal matters that are brought to the attention of the Department of Education are thoroughly reviewed by appropriate staff, including the fiscal monitor. It would be premature and speculative to comment on any specific issue until the proper officials have had time to review the matter and reach a decision on the next steps.”

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