Toms River Schools, one of the largest districts in New Jersey, voted to apply for bankruptcy in Chapter 9 after refusing to raise real estate taxes for another 12.9%.
This comes after last year’s 9.3% increase, which in the total amount of 22% for homeowners in two years.
Civil servants ordered the district to give this tax budget to this tax budget or immediately close all programs.
However, superintendent Michael Citta said that summer classes would continue and call the state’s “illegal and immoral” state requirements. The submission of bankruptcy suspends debts and litigation, while the district reorganizes its finances.
Loss of assistance $ 175 million sparks of crisis
During the seven years of changing the school financing in New Jersey, TomS River’s budget reduced $ 175 million from the budget and forced to release 250 teachers/employees, sale of schools and wrapped classrooms.
Although state aid has increased slightly this year, the district still faces a deficit of $ 22 million.
Republican legislators accuse Governor Murphy’s “defective and politically managed” formula of funding and claims to punish Ocean County for the vote of Republicans.
Residents already pay some of the highest real estate taxes in America, while schools consume more than 50% of local tax accounts in many cities.
Rare bankruptcy signals wider problems
The threat of bankruptcy of Toms River, very rare for the district with good AA-Credit rating, could rattle investors. His bonds have recently been traded with high yields and signaling market concerns.
This is not isolated: 9 New Jersey districts like Lakewood and Jackson also face desperate cuts for loss.
The new state budget of Governor Murphyho $ 58.8 billion boasts a record financing of schools overall, but offers Toms River no relief. The district is now competing to submit chapter 9 paperwork before a potential state dispute and promises, “We will not leave our students.”
The district with more than 14,000 students criticized the decline in state aid in 2024 financial reports.
“The district continues to monitor all means to resolve the loss of state aid, even through legal and legislative channels, given the glaring and known material shortcomings in the pattern of state aid, which still create unfair allocations,” according to Bloomberg.
(Tagstotranslate) Toms River School
