Superintendent frames options to close near‑$3M shortfall: tax levy increase, 28 minimum job cuts and reserve use

Holmdel Township School District officials told the board on Wednesday that the administration plans to present a not‑to‑exceed 2026–2027 budget that relies on a mix of health‑plan changes, use of the full state healthcare waiver and personnel reductions to close a multi‑million‑dollar deficit.

Superintendent Dr. Casone said the district began the process with an approximate $7 million shortfall and reduced it substantially by moving many employees into a different health plan, which he said saved the district "over $2 million," and by proposing use of the full healthcare waiver, which he estimated would generate "another $3 million," putting the remaining deficit just under $3 million. He told the board the administration will present a detailed budget at the March 25 meeting and must submit the not‑to‑exceed budget to the county executive superintendent by Feb. 27.

Why it matters: officials described three levers available to close the gap—raise local revenue, cut staff and programs, or some hybrid. Dr. Casone said the district is constrained by a long‑standing 2% tax‑levy cap, calling that policy a key driver of the structural deficit, and warned that without additional local revenue the district would need deep personnel and program cuts.

What the administration told the board - Contract outcome: negotiators described a three‑year agreement with the teachers' association that the administration characterized as "budget neutral" for year one, meaning concessions and scheduling adjustments offset the first‑year costs (the superintendent noted a first‑year contract baseline of 3.15% and said the association conceded time valued at about $150,000). "We were able to negotiate an agreement that was budget neutral," he said. - Health‑plan savings and waiver: the superintendent said more than 129 employees moved from legacy plans into a different plan, saving "over $2 million," and that the healthcare waiver, if used in full, would generate roughly $3 million in additional levy capacity. - Tax impact: board members estimated the proposed levy increase (adjusted for debt service) at about 6.94%, which the superintendent translated to roughly "$700 a year" for the average household or about "$65 a month." ("It's not a small amount of money," he said.) - Personnel reductions: the administration said the balancing package includes a minimum of 28 full‑time position eliminations (19 certificated positions), plus seven hourly and four part‑time roles; exact positions and affected people will be detailed in the next budget presentation. The superintendent said cuts have been made quietly in past years through attrition but that further reductions would be more painful. - Use of one‑time proceeds: the superintendent said the town committee is considering buying a local property (referred to in discussion as the Lubkerk/Loveird house) with an estimated valuation near $900,000 and recommended any proceeds be placed in the district's reserves to rebuild fund balance.

Board discussion and next steps Board members debated transparency, communications and long‑term strategy. Several members urged public participation ahead of the vote. Business administrator Deb (speaking during the meeting) noted the district received an extra week this year to present its not‑to‑exceed budget because the state delayed finalizing aid figures; she told the public that the budget must be transmitted to the county superintendent by Feb. 27.

Several board members pushed back on the notion that the district has been fiscally irresponsible, saying past budgets used banked cap and other one‑time tools to manage prior shortfalls. Others warned that repeatedly relying on local property‑tax increases is not a structural solution and urged advocacy at the county and state levels for changes to school funding.

On scheduling and staffing: administrators and the superintendent explained why staffing remains relatively high despite enrollment declines—legacy scheduling models (including additional professional periods and an expansive rotating middle‑school elective schedule) require more staff to operate. The administration said middle‑school scheduling is being revisited and that any changes would be brought to the board with community input.

Quotes that captured the ledger and choice facing the district included: "We started at about a $7 million deficit... we were able to whittle that down," and "If we don't choose to raise taxes, we will have to cut people and programs," both attributed to the superintendent. A board member said: "Allowing the district to increase school taxes more is not reform. It's just an admission of failure at the state level." Another urged residents to show up: "If you want to help shape this and have your input heard and considered, you have to show up this week," said a board member.

What happens next: the administration will present a detailed budget at the March 25 meeting; the board is expected to vote next week on a not‑to‑exceed figure that must be submitted by Feb. 27 to the county executive superintendent for review. The board's final decisions will determine whether the budget relies primarily on the healthcare waiver and local levy increases, or on deeper program and personnel cuts.

Reporting note: quotes and figures in this article are drawn from the Holmdel Township School District board meeting transcript; the district's detailed budget document and the formal not‑to‑exceed submission will provide final numbers and item‑level impacts.