Facing increased costs for out of district placements and a potential reduction in state aid, Hopewell Valley Regional School District (HVRSD) officials expect challenges in maintaining all existing programs and services.
School district administration had an early-stage budget overview discussion with the school board and public for the 2025-26 school year.
One of the main budget priorities each year is maintaining all of the school district’s programs and services. With the challenges, “we won’t be able to,” said Schools Superintendent Rosetta Treece.
“We have to be real about that,” she said. “We are not going to be able to as I have said in the past. We were hoping natural attrition would take care of some of it, but we can’t continue to keep doing what we are doing.”
Treece added that it is looking bleak for a lot of school districts and getting difficult to maneuver around the lack of state funding.
Robert Colavita, assistant superintendent for business, said New Jersey Department of Education Acting Commissioner Kevin Dehmer told school districts to prepare for a reduction at the New Jersey School Board Association’s (NJSBA) workshop conference in October.
And although, the district is considered fully funded based upon the school funding formula having received seven years of state aid increases including an additional $500,000 in the 2024-25 school year, “the COVID-19 money has been exhausted, and they do not know what revenues they are going to have for 2025-26,” Colavita said.
School officials are hoping for the state aid to remain flat in the upcoming 2025-26 school year budget.
“I am building the budget based on a flat state aid, but we are also going to consider what a 5%, 10%, 15% reduction means to us,” Colavita said. “A 15% reduction in state aid is about a $1 million.”
The top three cost drivers of the school year budget are staffing, healthcare benefits and out of district placements.
Staff salaries and health benefits make up the majority of the budget.
“Another big driver that is affecting us is out of district placements,” Treece said. “I am saying this because with the new students that are coming in, we budget ahead, and we know we have a plan for our students here.
“We put money aside for those unexpected tuitions. Right now, we have a number of students coming in the district that have Individualized Education Plans (a written document outlining a student with disability or special needs education), private nurses, [and] care professionals that we have to honor that we did not budget for.”
Since July 1, the school district has had six students move into the district who were already placed in out of district placements. The specialized placements are very costly, according to the district. HVRSD honors the IEPs that come into the district and there is a 30-day review.
“Every year we talk about the true rainy day surplus fund that we have, the 2%,” Colavita said, noting in his career of 20-plus years, he has never had to dip into the surplus. “We may have to. We may have to take money out of our rainy day to cover this.
“Now you can’t do that until you can justify that you have taken every bit of your budget out to cover those costs. It is a lengthy process. The short of it is we will start stripping money from other parts of the budget to cover those shortfalls first.”
Additionally, when it comes to finance and facilities, the school district will be examining green building options by exploring grant opportunities and options. They have so far not determined a green building option that applies to HVRSD.
They are prioritizing a district wide initiative to maintain school district gardens. The Green Sustainability Committee has been holding regular meetings with the green team to coordinate efforts.
“The green teams have met and are looking at coordinating efforts to maintaining our outdoor spaces,” Treece said.
