The Shamong Township School District Board of Education has a bill to pay, although the exact amount of that bill is still being debated by school district attorneys and the state.
The issue centers on an early retirement benefits program approved by the Shamong Township BOE more than a decade ago in November 2004, with the goal of incentivizing early retirement of employees in the district in a move to save money.
However, over the past year, the state Division of Pensions and Benefits, which oversees all pensions and benefits for public employees, has argued that Shamong’s early retirement benefits program was never properly approved by the state, and therefore the district now owes the state money.
New Jersey court cases in the past have interpreted state statute to mean that boards of education cannot negotiate early retirement incentive programs without first having state approval.
District business administrator Marie Goodwin updated the board about the issue at its most recent meeting.
“Before I actually came here, I’m sure you’re aware back in 2004, the school district approved an early retirement benefits program, and apparently it was not authorized by the state of New Jersey, so now the state of New Jersey wants their money,” Goodwin said. “The original liability was $909,000.”
According to Goodwin, that original number has since been reduced, and as of the most recent update in the form of a letter from the Division of Pensions and Benefits on Feb. 3, the state is now asking for about $600,000 instead. Complicating the matter is the district and state’s lack of specific information concerning the program’s approval, or lack thereof.
“It’s been submitted to the attorneys. It’s going back and forth with the attorneys, because it’s just hard to find information,” Goodwin said.
“They’re saying it was approved. I guess it was approved here, and the state is saying no, but they don’t really have any kind of validation that it wasn’t, so our attorneys are trying to go back and forth.”
As Goodwin is preparing the district’s annual budget, she suggested to the board that as the number is reduced, and hopefully continues to be reduced, the board should possibly prepare for a day when it has to pay at least some of the money.
“Maybe we should prepare to pay a couple hundred thousand of that at some point,” Goodwin said.
However, Goodwin also said she believed the district could still do better than the $600,000 amount it was currently faced with.
“Eventually, we’re probably going to have to pay something,” Goodwin said. “At $600,000, I say keep fighting.”
Superintendent Christine Vespe said she received the original bill after she started with the district in the summer of 2013, and also cited a lack of information regarding the situation as the 2004 BOE that approved the original program is completely different than the current board.
“A year ago, I turned it over to the attorneys and said ‘this is what I have on it, this is what I can find in the files on it, the business administrator and superintendent who were here at the time are no longer here,’” Vespe said.
Echoing Goodwin’s statements, Vespe said the district would continue to work toward getting the bill reduced regardless, and the board would be updated as she and Goodwin learned more.
“It is now a $300,000 reduction, so we are continuing to get updates,” Vespe said.
