NJ News & Views

[Editor's Note: At 10:59 a.m. on April 4, 2010, this story was edited for style, content and accuracy.]

Lakewood High School will soon have new neighbors.

At the periphery of the 40-acre site, a wooded buffer surrounded by a chain link fence separates public school athletic fields from single family homes and non-public schools under construction.

The Cabinfield Creek, a state-protected waterway that aids in stormwater management, is located on the fenced-off wooded parcel. It continues to flow underground from Lakewood to Jackson and into Monmouth County.

It also flows under the adjacent construction site.

Somerset Development LLC is building The Gardens at Village Park on the corner of Somerset Avenue and East County Line Road in the R-12 zone. Although the homes are described as single family, each will include a rented attic and a rented basement. The residential component of the development is located on two parcels totaling 1.5 acres. The two parcels of land are assessed at a total of $299,200.

Adjacent to the homes and facing Somerset Avenue, The Teen Center for Education is also under construction on 1.58 acres of land assessed at $438,800.

Non-public schools are eligible to apply for a property tax exemption.

Closest to the athletic fields is a 4.47-acre undeveloped parcel formerly owned by the Buckalew family of Lakewood. In 2005, J.F. Hart Inc. acquired the property, assessed that year for $51,000, and conveyed it through Ocean Realty LLC to real estate investors Michael Fabrikant and Mark Levy of Fab-Lev LLC in Freehold for $14,000.

Following the township's revaluation, the property was reassessed in 2006 for $670,500.

In 2007, Fabrikant and Levy sold the property for $10 to Congregation Yeshiva Bais Yisroel of 401 Private Way - a non-existent address, according to township records.

Yeshiva Bais Yisroel is also the name of an Orthodox Jewish college on Avenue J in Brooklyn.

The word "yeshiva" refers to the Jewish tradition of learning while sitting at the feet of a master.

By the time of the great Talmudic Academies in Sura and Pumbedita in ancient Babylonia, "yeshiva" came to refer to the educational institution itself and not just the classroom or learning session. The Talmudic Academies in Babylonia were known as shte-ha-yeshivot, which translates as "the two colleges."

The equivalent women's institution is called Beis Yaakov.

A yeshiva gedola (senior/great yeshiva) usually refers to post-high school institutions, while a yeshiva ketana (junior/small yeshiva) can refer to institutions that enroll boys of elementary as well as high school age.

The term "yeshiva" is sometimes also used as a generic name for any school that teaches Torah, Mishnah and Talmud to any age group.

By the 1800s, every town rabbi had the right to maintain a number of full-time or part-time pupils in the town's beth midrash (study hall, usually adjacent to the synagogue). Their cost of living was covered by community taxation.

Taxpayers continue to subsidize a tradition of religious scholarship that attracts many more students to town than local or state government can support. Despite the increasing financial burden on taxpayers, Lakewood has continued to promote public policy that fosters the growth of tax-exempt properties.

On September 24, 2009, the Lakewood Township Committee unanimously voted to adopt an ordinance on second reading that rezoned the town for development as a Planned Educational Campus (PEC).

The ordinance as written bases the need for the zoning change on the growing number of college level educational institutions in town.

Under the ordinance, residential housing located on a 3-acre campus is eligible for a tax exemption as faculty or dormitory housing.

The township stands to lose thousands of dollars in property tax revenue on Somerset Avenue alone following redevelopment of the block as a Planned Educational Campus.

The parcel owned by Congregation Yeshiva Bais Yisroel is already tax-exempt.

So is Lakewood High School.

The buffer and fence may not provide enough privacy for either public or private property owners on Somerset Avenue.

On March 10, the Lakewood Board of Education voted to approve a contract with Yard World, LLC in the amount of $18,189 to erect a fence at Lakewood High School for "enhanced security."

According to the resolution, the district will not be paying the cost.

American taxpayers will.

"There is no cost to the district as the cost will be paid by the Township of Lakewood through the Community Development Block Grant," the resolution stated.

The Community Development Block Grant (CDBG) is funded through the United States Department of Housing and Urban Development (HUD). Since 1974, the CDBG program has awarded annual grants on a formula basis to municipal and state governments that address a wide range of community development needs.

HUD described the program's goal on its Web site.

"This is a program that uses an innovative approach to revitalization, bringing communities together through public and private partnerships to attract the investment necessary for sustainable economic and community development," HUD reported to visitors.

A reporter for NJ News & Views made an Open Public Records Act (OPRA) request for the purchase order with Yard World. District Business Administrator/Board Secretary Robert Finger said in an e-mail response that the district did not have a purchase order for the project. He referred the reporter to the township for the document.

Lakewood Township Clerk Mary Ann Del Mastro told NJ News & Views that she did not have a purchase order either. Del Mastro said the Lakewood Township Committee has not yet awarded any CDBG grants, despite the board resolution that it was not paying for the residential fencing with district funds.

On March 18, the board introduced its tentative budget for the 2010-11 school year.

On March 26 at 8 a.m., the board held a public hearing of the budget. According to Finger, no one that attended the hearing discussed the budget, which the five board members that attended the meeting unanimously voted to approve.

On March 31, the Asbury Park Press reported the board's adoption of the proposed 2010-11 school budget.

"The $137.9 million budget, which calls for a more than 9 percent jump in the tax levy, was approved at an early morning public hearing Friday that attracted just a handful of residents," reporter Zach Patberg told readers. "The 9.7-cent tax rate increase brings the tax levy to $79.2 million, meaning someone with a home assessed at $350,000 will pay $339.15 a year in school taxes."

Patberg also reported a warning by Finger in the event voters defeated the proposed increase in the school tax levy.

"The township school board's proposed 2010-11 budget will not force layoffs for the district, as long as voters adopt it as is," Finger reportedly told Patberg. "If not, staff reductions could be discussed at subsequent Township Committee meetings when looking for budget cuts."

The Lakewood Township Committee reviews defeated school budgets as part of a system of government checks and balances, even though the Lakewood Board of Education is a separate sovereign governing body.

While the township committee can vote to reduce the size of the proposed budget, the board of education reserves the right to decide where to make any cuts.

The board can also appeal any township committee reductions of the proposed school budget to the state, but the process usually takes months - long after the start of the new school year.

Despite threats of layoffs if voters defeat the proposed increase in the school tax levy, the board is already poised to hire more staff.

It has no other choice.

Two days before the board held its budget hearing and voted to adopt the tentative budget as the proposed budget for 2010-11, the March 24 meeting agenda included the hire of seven non-public school consultants, paid for with Title I and Title I ARRA Federal entitlement funding, two substitute/supplemental nurses, and the appointment of Dr. Marbella Barrera to the position of Director, Testing and Assessment at the pro-rated salary of $75,000 for three days per week, from April 1-June 30, 2010.

The agenda included an explanation for her hire.

"For the past six years the district has been provided with test results data from an outside contractor," the agenda stated. "However, no comprehensive analyses have been performed and no viable understanding of the students’ strengths and weaknesses has permeated to the teacher or principal level. The absence of concrete analyses has negatively contributed to the quality of instruction and the interventions provided."

Last year, the Asbury Park Press reported that the district was no longer designated as a District In Need of Improvement under the No Child Left Behind Act.

According to the agenda's explanation, that is no longer the case.

"Six out of six schools in Lakewood are “failing schools” as assessed by No Child Left Behind regulations," the agenda's explanation continued. "It is critical for the district to transform these failing schools. Quantitative data is crucial to making the Lakewood Schools successful."

The agenda described a "critical need" for Barrera's services.

Despite the consequences of all six public schools being designated schools in need of improvement, Finger said the board tabled Barrera's hire.

If a district's public school students fail to meet benchmark testing under the NCLB program, sanctions include a requirement that at least 20 percent of Federal Title I funding be used to improve their academic performance.

The board has not always spent Title I funding to achieve that goal.

In October 2008, the state Auditor began a forensic audit of the Lakewood School District on the recommendation of the state Department of Education (DOE). A spokesman for the DOE told NJ News & Views last month that the audit was recommended after the Lakewood board authorized questionable Title I expenditures.

At the end of the 2006-7 school year, the Lakewood board reported a budget deficit of more than $1 million.

The board may have doubled that shortfall the following year, according to the proposed budget for 2010-11.

Under the proposed 2010-11 Budget's Advertised Recapitulation of Balance, the Lakewood board reported an Unassigned General Operating Budget audited balance on June 30, 2008 of -$2,104,715.

Last year, the board reported a positive balance of $1,274,672 instead of a deficit.

This year, the board estimates an even greater year-end audited balance of $1,899,677, but a lower year-end audited balance in 2011 of $1,225,000.

Finger denied that the district recorded an Unassigned General Operating Budget Balance deficit at year-end in 2008. Finger attributed the deficit to a state error, but could not produce any correspondence between the district and the state challenging the amount before the tentative budget was introduced on March 18.

The Fund Balance for a government is the same as owner's equity in private business. It is the excess of assets over liabilities. If all revenues of a particular year are not spent, the balance is added to the Fund Balance.

If more is spent than is received, the balance is deducted from the Fund Balance. A portion of Fund Balance is restricted because the remaining funds are for outstanding purchase orders, projects or school budget balances.

The "leftover funds" are referred to as Unrestricted Fund Balance. They are sometimes used to cover one-time expenses, such as emergency repairs and state budget shortfalls.

New Jersey will need to close an estimated $11 billion budget shortfall this year.

Maintaining adequate reserves provides the district with protection against revenue variances that may occur during the year. If a district's unreserved General Fund Balance falls below 2-3 percent of projected General Fund Revenues, the district must provide a plan to avoid a financial emergency. The financial emergency situation is the equivalent of bankruptcy in the private sector.

A spokesman for the state Auditor told NJ News & Views that a report of their findings would not be released until after the April 20 School Elections.

The spokesman also said no forensic audit had been ordered for the 2007-8 Lakewood school year budget.

One of the largest district expenses is contracted student transportation. Over a decade ago, the board sold its fleet of school buses, despite a growing demand for student transportation services.

Last year, the Lakewood board passed a proposed change in the district's transportation policy on first reading that would have eliminated non-remote busing, which is not eligible for state reimbursement.

The board did not hold a required second reading of the policy change following public opposition to it.

Under current board transportation policy, all students that request non-remote transportation, referred to as courtesy busing, will receive it unless there is no bus route service available. If no bus route is available, the student's family can apply for Aid In Lieu of (AILO) to cover the cost of transportation to class.

During the 2008-9 school year, the district received $3,982,997 in Categorical Transportation Aid.

The following year, the district received $5,936,131 in Categorical Transportation Aid.

Next school year, the district will only receive $1,050,137 in Categorical Transportation Aid.

In contrast, the district will spend far more than it receives to transport students to class that the state defines as living within walking distance.

During the 2008-9 school year, the district spent $15,350,587 to transport public and non-public school students to class.

During the 2009-10 school year, the district will spend a revised $17,091,264 to transport public and non-public school students to class.

Next year, the district has appropriated $19,492,247 - an additional $2,400,983 - to transport public and non-public school students to class - despite an overall decrease of $4,885,994 in state aid for reimbursement of remote bus transportation.

Under state policy, districts may ask voters to approve an increase in excess of last year's 4 percent budget cap to cover the loss of state aid.

NJ News & Views asked Finger if the Lakewood board had requested a waiver to the 4 percent budget cap so that it could raise needed revenue.

"The budget includes automatic waivers for health benefit increases and state aid reductions," Finger responded in a March 24 e-mail."These waivers do not require county superintendent approval."

NJ News & Views also asked Finger if the board had discussed or taken action to revise its transportation policy to eliminate non-remote busing.

Finger said it had not.

At the November 18, 2009 board meeting, members not only approved non-remote bus routes for public and non-public school students, they also approved payment for bus transportation to a summer camp, according to meeting minutes.

The board reportedly approved payment of district bus transportation to Camp Vacamas in West Milford, New Jersey as a Supplemental Educational Services provider. The board authorized payment for instructional services with Title I funds at a cost of $195 per student for a weekend program and $70 per student per day for a daily program, including meals for both programs.

Camp Vacamas is a non-profit sleepaway camp for inner city children aged 7-13.

The board also approved non-remote bus transportation to class at Lakewood High School and Lakewood Middle School.

All six Lakewood public schools are not only designated by student test scores as In Need of Improvement, but according to township violation notices issued to the board in recent years, in need of repair.

Last year, the Lakewood Board of Education considered going green in order to finance the repairs of all six public school roofs. That option won't be possible, according to an e-mail Finger provided under the Open Public Records Act (OPRA).

"We have reviewed electric bills and done extensive site visits with early indication that virtually all roofs are in need of significant repair," James Bryan of RAI Services said in an October 26, 2009 e-mail with the district. "We have determined that there is no way we can roll roof repairs into a PPA solar project cost and reach any reasonable investor returns."

Bryan said the district would need "a top notch balance sheet and great credit" to qualify for the project, which he acknowledged it did not have.

He proposed an alternative to installing solar panels on all public school roofs that would have financed their repair.

"If the BOE would like to address a single school that might have workable roofs, we can do that, but that too is a long shot because project is small," Bryan wrote in the e-mail. "My best advice, get the roofs repaired (we can certainly do that work), then approach the solar issue."

According to Finger, the board does not have any capital improvement projects planned through the 2010-11 budgeting process. Instead, he said the board planned to enter into another lease-finance agreement to repair the public school roofs, which Ocean County Superintendent of Schools Bruce Greenfield confirmed on February 19.

If the district cannot make the annual required payment on each of the six school repairs, it could risk losing them through such an agreement without state intervention - and this year the state may not be able to afford emergency financial assistance.

Unless the board finances the repair of all public school roofs as soon as possible, members continue to expose taxpayers to costly litigation resulting from illness or injuries sustained by anyone visiting, working or attending class there.

The board has budgeted $400,000 for legal services during the 2010-11 school year.

That may not be enough if board attorney Michael Inzelbuch raises his $250 per hour fee this year as he did last year.

Inzelbuch is not only board attorney, he is also a board employee. In 2002, the same year the board appointed Inzelbuch board attorney, members also voted to appoint him a special education consultant with premium family benefits and a pension.

NJ News & Views recently asked Finger to provide for inspection all ethics disclosures Inzelbuch was required to file each year he was employed as board employee.

Finger said in an e-mail response that Inzelbuch did not have to file a disclosure because he did not have the authority to spend district funding.

On November 23, 2009, Inzelbuch, who is also the board Parliamentarian, authorized district funding for his services to research an issue covered under the state's Open Public Meeting Act.

The November 23, 2009 meeting minutes, which the board approved, did not record a board vote or a request by board President Abraham Ostreicher to have Inzelbuch research whether or not Lakewood advocate Colin Lewis could videotape the meeting - which Inzelbuch, as Parliamentarian and board attorney, should have been able to advise the board was permitted by state law.

According to the meeting minutes, Inzelbuch stopped Lewis from continuing to videotape the meeting.

"Mr. Inzelbuch asked the gentleman filming the meeting to stop and stated the policy had to be reviewed," the November 23 meeting minutes stated.

In a 26-page letter Inzelbuch sent the board two days after the meeting, he advised his employer that Lewis could videotape the meeting if he provided the board with written notice beforehand.

Total cost to taxpayers: $312.50.

Lewis and other Lakewood advocates have continued to lobby the board for increased funding to public school students.

For years, district administrators told the media that public school enrollment never changed from 5,100 students each school year.

For years, public school enrollment has actually been falling.

While fewer Lakewood students attend the district's public schools, in recent years their numbers have grown.

According to the proposed 2010-11 school budget, public school enrollment increased this year and is expected to increase again next year.

On October 15, 2008, the district reported a total enrollment of 4,371 regular full-time public school students.

On October 15, 2009, the district recorded an enrollment increase of 106 public school students for a total of 4,477 regular full-time students.

On October 15, 2010, the district estimates an enrollment of 4,509 regular full-time students - a smaller increase of just 32 new students.

In contrast, non-public school enrollment is three-to-four times greater and growing faster than public school enrollment.

Over 20,000 Lakewood students attend the township's public and non-public schools.

Each year, fewer property owners are supporting their education.

In 2009, the township committee closed a multi-million dollar budget shortfall by deferring a payment of more than $10 million in July school taxes to the district.

This year, the state has taken local district surplus statewide to close a multi-billion dollar shortfall of its own.

A week before the budget hearing, heavy downpours saturated Lakewood High School grounds and the neighboring construction site on Somerset Avenue. Sheets of rain pummeled asphalt roadways and cement driveways throughout the night, pooling in large potholes in the street and the public school parking lot entrance.

Several hundred yards from the high school parking lot, the small copse of trees enclosed by a chain link fence stood in solitary shadow on the empty athletic fields where the Cabinfield Creek flows.

Providing neither adequate privacy nor drainage, the trees and the creek are a metaphor for the deepening divide between Lakewood's past and its future.

Four years ago, a reporter interviewed Chet Galdo, then president of the Lakewood Board of Education, about the possible need for privacy fencing at the high school as vacant land adjacent to it was developed.

That same year, the Jackson Board of Education entered into an agreement with residents of Westgate, Lakewood's largest Orthodox Jewish development, to install privacy slats on chain link fencing at Liberty High School's practice field in exchange for a water and sewer easement at Westgate. The Jackson board agreed to pay for the privacy slats with taxpayer funds paid as compensation to condemn a portion of Westgate where the easement was located.

Galdo insisted that the Lakewood board would not install a similar privacy fence at taxpayer expense even if the high school's Orthodox neighbors requested it.

"We have a practice field there and we will continue to use it," Galdo said in the February 23, 2006 edition of The Tri-Town News. "We will never put lights there, but we will use it."