An administrative law judge has refused to throw out New Jersey’s attempt to take over the Lakewood Township School District, keeping a fight that began in January on the path toward a decision about who runs the Ocean County system.
The ruling does not install the state, and it does not decide that a takeover is justified. Administrative Law Judge Susan Scarola rejected the district’s motion to dismiss, and the education commissioner may seek full state intervention, The Lakewood Scoop reported. The Lakewood Board of Education has appealed.
A Procedural Win, Not a Takeover
District attorney Joshua Forsman said the ruling did not determine whether full state intervention is warranted and that further administrative proceedings remain. He also said the district respectfully disagrees that the proposed intervention is justified.
Scarola wrote that the district showed insufficient compliance with quality performance indicators, the Asbury Park Press reported. State officials have cited years of academic, financial and operational problems. Another hearing is set on the state’s claim that a takeover is necessary, according to that account. The district did not immediately respond to an NJ.com request for comment.
A filing in the education commissioner’s docket had urged Scarola to dismiss the takeover effort unless it was coupled with adequate assured funding. That was the filing’s position, not a finding the judge adopted, according to the Department of Education docket document.
What State Control Would Change
The Department of Education filed an Order to Show Cause on Jan. 14 to start the takeover process, NJ.com reported. If the state Board of Education approves, the takeover would suspend local control, place the district under state management and strip the elected board of most of its authority.
In January, the school board said a takeover would not be warranted or in the community’s best interest. Approval is still a separate step. The appeal now sits between Scarola’s procedural ruling and any final decision by state education officials.
A Public District Built Around Private Schools
Lakewood is a predominantly Orthodox Jewish community, and the public system is small beside the private religious schools around it. In October 2024, 4,112 students were enrolled in the public schools, compared with more than 50,000 attending private religious schools, New Jersey Monitor reported.
State law requires the district to provide transportation, or transportation money, for eligible private school students. Students qualify if they live more than 2 miles from an elementary or middle school, or more than 2.5 miles from a high school. Critics have said private-school busing costs and tuition funding for many special education students have crippled the district’s finances.
The district has said the state funding formula does not account for its unusually high number of private school students and that it receives insufficient funding. That argument is the local answer to a state case framed around academic, financial and operational failure. The two claims are not the same thing: one is about how Lakewood is funded, the other about whether local governance should be suspended.
Loans, a Monitor and a Surplus
A state monitor has been appointed to the district since April 2014. From fiscal 2015 through 2023, Lakewood received seven state aid advance loans totaling $165.1 million, the New Jersey State Auditor reported. As of fiscal 2023, excess surplus totaled $32,620,211.
For the period from July 1, 2018, through Sept. 30, 2023, the auditor said tested transactions were generally related to district programs, reasonable and properly recorded. The same review noted issues meriting management’s attention. The ledger is therefore not a simple story of missing money or a clean bill of health. Lakewood has lived for more than a decade with a monitor and repeated advance loans, and it closed fiscal 2023 with a surplus large enough to matter in any argument about whether the books alone justify a takeover.
What Earlier Takeovers Delivered
New Jersey previously took over districts in Jersey City, Paterson, Newark and Camden amid concerns about mismanagement and poor test scores. Newark returned to local control in 2020 after 25 years, Paterson in 2021 after 30, and Jersey City in 2022 after 33, NJ Spotlight News reported. Camden remained under state management in the January reporting.
A report covered by Chalkbeat found Camden test scores began improving in 2007, at least six years before the takeover, and found no evidence that state control caused the upward trend. Scores also began improving that year in Newark, Paterson and Jersey City. District figures cited in that 2021 account put Camden’s graduation rate at 69 percent, up from 49 percent in 2012, and the dropout rate at 11 percent, down from 21 percent.
A 2023 Brookings study, as summarized by NJ Spotlight News, found takeovers on average do not improve math or reading, though they appeared to improve budgeting and long-term financial health. For Lakewood, that split is the practical question. The state’s case is about academics and operations as well as money, while the research record is stronger on financial management than on test scores.
The Next Decision Is Still Someone Else's
Scarola’s order leaves the commissioner free to press for full intervention and leaves the board free to say the premise is wrong. The appeal challenges the decision to let the case proceed. It does not, on the record now available, settle whether Lakewood’s elected board keeps most of its authority.
If the state Board of Education eventually approves, local control would be suspended in a district whose public enrollment is a fraction of the private religious school population it is legally required to help transport. Until that vote, the monitor who has been in place since 2014 remains the state’s existing foothold, and the takeover remains a proposal with a court path, not a completed transfer of power.
