Breaking News: State “Loans” Lakewood $28 Million

Late yesterday the Asbury Park Press reported that the state would accede to the request by the Lakewood Board of Education and board attorney Michael Inzelbuch by handing over a loan of $28,182,090 to close the district’s budget gap. Of course this is not a loan: currently Lakewood “owes” the state $47 million that it will never be able to pay back. Everyone knows this. This is not a loan but an expression of the state’s abdication of responsibility for fair funding. The list of under-funded districts is long. Yet we continue the tradition of special treatment for Lakewood, which expresses itself in profligate gifts from the state and disavowal of sensible accountability.

The winners are the Lakewood Board and Inzelbuch. The losers are state taxpayers and non-ultra Orthodox Lakewood families.

A few notes:

The state is gifting the money even though, per below, “the district has not fully documented or verified the exact nature and extent of the projected deficit.” Technically the district has to start paying back the loan next year

Here is the complete letter from the State Assistant Commissioner Glenn Forney to Superintendent Laura Winters, which notes “numerous errors” in the proposed budget,  that the district has “rejected the Department’s attempts to cooperate with and assist it in resolving its financial problems,” and “the district failed to provide the relevant records requested by the Department’s experts that would reveal details about the district’s troubles and inform the best way to resolve them.” But here’s the money!

Inzelbuch n the Lakewood Scoop:  “As to the naysayers -and the negative aspersions cast – I ask: “When was the last time a bank provided a $28 million dollar loan on faulty paperwork?? C’mon, who you kidding?” But, of course, that is exactly what the state is doing.

From the Asbury Park Press:

The two-page letter also chides the Lakewood Public School District for a lack of cooperation with state education officials. The letter says the New Jersey Department of Education could not recommend the district receive a grant — money the broke district would not have to pay back — to plug the budget gap because the district failed to cooperate and turn over necessary details about the shortfall.

“In short, the district has rejected the Department’s attempts to cooperate with and assist it in resolving its financial problems,” the letter from Forney reads. “It has refused to provide timely, complete and accurate back-up documentation that would support its request for an additional $28,182,090 grant of state aid. Under these circumstances, the Department cannot justify approving this request as an outright grant of additional state aid.”

The elephant in the room: there is no way that Lakewood will ever pay back the “loan.”

 

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