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Ocean Township faces up to $1.9 million budget shortfall; board to consider 2.69% tax-levy increase
Summary
Board finance staff said the district narrowed a projected $3.6 million deficit to $1.7 million through cuts and reserve withdrawals but warned a state aid guidance could push the gap back to about $1.9 million. The board plans to present a tentative budget and a proposed 2.69% levy increase for approval at its March 11 meeting.
The Township of Ocean School District reported a projected budget shortfall for fiscal 2026 that could reach approximately $1.9 million, and district staff told the board on Feb. 25 that they will ask trustees to approve a 2.69% increase in the local tax levy when the tentative budget is filed in March.
Conway, the district presenter, told the board the district initially identified about a $3.6 million imbalance between revenues and planned expenditures. After staff reviewed capital requests, personnel needs and technology purchases, and proposed shifts to this year's spending, that gap was reduced to about $1.7 million.
Conway said the district can draw $250,000 from its maintenance reserve (leaving roughly $2.4 million in the fund) and has identified roughly $957,000 of capital requests that could be postponed or scaled back. She added that adjustments to health‑benefit estimates tied to unfilled positions trimmed the health‑care waiver forecast by about $138,000. "Between the last estimate that we gave you, which was in the $3.6 million range, to our current number ... we are able to reduce $3.6 down to $1.7," Conway said.
District staff also warned trustees that new guidance from the state Department of Education could reduce certain categories of state aid by as much as 3% compared with this year. "If I apply that 3% potential loss, that would be another $167,000 less of state aid, so that pushes us back up to $1,900,000 in the deficit," Conway said. The presenter said the governor’s budget address triggered the aid release process and that the district expects formal aid figures from the state within 48 hours of the governor’s speech.
To close the remaining shortfall, administration proposed a 2.69% increase in the district's tax levy for 2025, which the presenter said is composed of the 2% cap increase, the projected health‑care waiver and about $200,000 of available "cap banking" funds. Conway told the board the district must approve a tentative budget at the March 11 meeting and adopt a final budget by March 19.
Board members asked how the reductions would affect class sizes and personnel. Conway said the district has deliberately not backfilled a number of vacant positions since August and that, while some positions will be held open to create savings, further cuts — including supply and personnel reductions — could be necessary if state aid falls or resignations occur. "Yes, could absolutely result in different class sizes than we have right now," she said.
Trustees discussed longer‑term options for large capital items — for example, turf replacement at the stadium — and emphasized that some capital deferrals are "kicking the can down the road." The presenter said the district will continue to review priorities and look for opportunities to shift projects into the current fiscal year where possible.
The board did not take a final vote on the proposed levy increase during the Feb. 25 meeting. Administration said the levy and the tentative budget will be brought to the board for approval on March 11 once the state has issued final aid figures.
