Leonia presents tentative $45M budget; board warned of enrollment decline and rising health costs

Leonia school officials presented a tentative $45 million 2025–26 budget at the board meeting, warning that falling enrollment and continuing double‑digit health‑insurance cost increases are the primary drivers of pressure on the district’s finances. The district’s business administrator outlined revenue declines in state and federal grants, a projected drop in tuition revenue and plans to use reserves and capital withdrawals to smooth the levy impact on taxpayers.

The budget matters because it would set the tax levy voters and property owners see on bills and determines services and capital work for the coming school year. Business Administrator Eric Tomasiewicz told the board that the proposed budget reduces overall district spending by about $1.4 million from this year and relies on a limited set of one‑time reserves and grant receipts to limit the tax increase to “a little less than 4 percent.”

Tomasiewicz said the district projects a drop of about 70 students on roll next year, which affects state aid and tuition revenue from send/receive arrangements. “We’re projecting on‑roll student enrollment to decrease 70 students from our current year enrollment numbers,” he said. He added that the district’s general fund is roughly $43.3 million, special revenue about $650,000 and debt service about $1.2 million, for a combined budget near $45 million.

Officials attributed much of the revenue change to enrollment‑driven state aid adjustments and to the end or reduction of several one‑time federal grants. Tomasiewicz said general fund state aid is down about $400,000 and special‑revenue (grant) funding is down about $600,000; tuition revenue tied to nonresident students and the send/receive relationship is projected to fall by “a little less than $1 million.” He said some revenue lines — including SREC auction proceeds and a pending extraordinary‑aid grant — are not final until the auction or the state award is completed.

Board members pressed administrators on several cost drivers. Health‑insurance premiums were the board’s top concern: the budget models a roughly 15 percent increase in benefits expense, equal to about $1 million. Tomasiewicz told the board the district had evaluated privatizing benefits but that their current claims experience made privatization more costly. “We had to project 15 percent; if it comes in lower we’ll realize surplus, but we must plan conservatively,” he said.

Transportation was another focus. The district plans to lease seven electric buses under a five‑year schedule and install chargers; Tomasiewicz said the first buses are expected to arrive within weeks and the first principal and interest payments will begin next year. The district received a Department of Environmental Protection grant covering most charger installation and part of the incremental bus cost, he said; the lease will cover the balance. Board members discussed partnering with other municipalities and selling limited advertising or charging access, but raised legal and insurance questions that the administration said they will examine further.

Capital projects and reserves also shaped the tentative plan. Tomasiewicz outlined recent and in‑progress capital work — roof replacement funded in part by a ROD grant, door and science‑wing repairs covered largely by insurance recoveries, FEMA‑assisted drainage mitigation and other projects funded from capital reserve — and said withdrawals from capital reserves are lower next year because several projects are completing. He noted a $496,000 planned withdrawal from the maintenance reserve to cover routine facility work and said the district had used enterprise fund balances (for example, food service) to offset some operating costs built up during the COVID era.

On special education compliance, the business administrator described a required corrective action plan tied to documentation practices for state reimbursement thresholds; he said the plan was written by the director of special services and reviewed by the county. The board did not receive a detailed narrative of the underlying compliance shortfall at the meeting beyond a district statement that “we had to clean up our documentation” to meet state SEMI requirements.

Administrators emphasized that the budget shown is tentative and will be submitted to the county for review; the public hearing was scheduled for May 6, subject to county sign‑off, and the board may revise the figures before final adoption. Tomasiewicz said the district budgets conservatively — for example, projecting about 80 percent of recurring grant awards — and will monitor actual expenditures and revenues over the spring. “From now till May 6, the district can make changes on the budget,” he said.

Public commenters and board members praised the presentation while urging long‑term planning. Resident Arthur Jay commended the administration’s work and urged continued consolidation of leases, copiers and software to reduce recurring costs. Board members and administrators said they plan a demographic study and strategic plan to guide future staffing and capital decisions.

Formal votes at the meeting included approval of the consent agenda items by roll call; the board did not adopt the tentative budget at this meeting, which functioned as a presentation and opportunity for questions and public comment. The administration said it will submit the tentative budget to the county by the next business day and return to the board for the public hearing and final adoption cycle.

Officials said the principal near‑term fiscal risks are (1) final state aid and grant awards, (2) enrollment trends and tuition receipts from send/receive arrangements, and (3) health‑benefit premiums. Administrators recommended monitoring those lines and noted that any unspent appropriations or lower‑than‑projected benefit claims would flow to excess surplus or reserves.

The board set no further formal budget actions at the meeting beyond the review and scheduled public hearing; administrators will return with any county changes and with the public hearing packet in May.