Moorestown district faces $3.5 million shortfall; board weighing 3.02% tax-levy option and broad program cuts

Moorestown Township Public School District officials told the board on March 9 that the draft 2026–27 budget faces a roughly $3.5 million shortfall driven mainly by sharply higher health-benefit costs and delayed state aid.

"We started the budget process with really high conservative estimates and then adjust over time," Mr. Heiser said, noting the district received final benefit numbers late and that health benefits rose by about $3 million, a 17.63% increase. He said the district was beginning the year about $1.6 million “in the hole” before considering salary increases.

The shortfall is compounded by a delay in the state aid notice tied to the governor’s budget address; staff said the district would not have the official state-aid number until roughly March 12–13, leaving less than 24 hours before the board’s next public agenda to refine the budget. "The governor's address is slated for tomorrow," staff said, adding the state then has 48 hours to release district aid notices.

Why it matters: the board must adopt a budget to submit to the county on March 17 and finalize adoption on April 28. Without improved state aid or other revenue, staff warned the district could close the gap only by increasing the tax levy, drawing limited reserves, or cutting programs and staff.

Tax-levy option and fiscal tradeoffs The administration built a 3.02% tax-levy increase into the draft budget, which staff said would raise the general-fund levy from about $73.5 million to $75.8 million and produce an average annual tax impact on the average assessed home of roughly $627 (about $52 per month). To reach that topline without voter approval, the district plans to use a $750,000 portion of a health-benefit adjustment and other available adjustments.

If the board does not adopt additional taxing authority and state aid does not increase, administrators outlined a menu of possible reductions: increasing K–5 class sizes to 30, eliminating or outsourcing positions (estimated at about 43 staff members tied to a $3.5 million gap), cutting world-language and advanced-art offerings, reducing advanced-level coursework, trimming clubs and sports, and restructuring cabinet-level responsibilities.

State aid and extraordinary aid context Staff said the district’s state aid has been subject to caps tied to S2 legislation that reversed several years of phased-in funding. "It would have yielded about another $1.2 almost $1.3 million in state aid that we should have received," Mr. Heiser said when contrasting uncapped formula results and actual aid awarded. Extraordinary aid tied to special-education reimbursements also remains variable: staff noted the district spent nearly $9 million in one year to receive about $2.4 million in reimbursement under the current reimbursement schedule.

Next steps Board members asked for clarifying breakdowns and follow-up analysis, including cohort-by-cohort technology costs and a clear tally of positions tied to potential reductions. The board will receive state-aid notices and updated numbers in the coming days and must act to submit the budget to the county by March 17. Mr. Heiser told the board there is no action expected out of the executive session that followed the public meeting.

Provenance: Drafting and figures cited were presented throughout the meeting budget workshop, primarily in the staff presentation beginning with the March 9 workshop introduction and the financial slides described by Mr. Heiser.