New Jersey’s Department of Education has taken control of the Toms River Regional school district’s budget for the second consecutive year, blocking a threatened bankruptcy filing but setting the stage for a bruising 12.9% school tax hike to fill a yawning funding gap.
The state’s intervention effectively ends a months-long stalemate between Toms River’s elected school board and Trenton over how to close a persistent budget shortfall. The showdown came to a head after the district repeatedly missed deadlines to adopt its $293.5 million budget for 2025–26, including a planned $21.3 million spike in its property tax levy.
Under the state’s directive, the district’s roughly $106.7 million funding gap — which Trenton says is necessary to meet “adequacy” standards under the state’s school funding law — will be plugged through higher property taxes.
District officials, meanwhile, had warned of financial ruin if forced to approve the budget on their own, floating the possibility of Chapter 9 bankruptcy and voting to retain legal counsel for a potential court filing. The state’s decision preempts that move, for now.
At the heart of the district’s troubles is New Jersey’s S2 school funding formula, which slashes aid to districts with declining enrollments. Toms River Regional has lost $175 million in state support in recent years under that formula, officials said, while facing rising costs for staff, programs, and student support.
The Education Department, for its part, made clear it expected no further excuses. “While the department acknowledges the difficulty inherent in school district budgeting decisions, the state and the public hold their school district leaders to the highest standards and expect them to rise to this challenge,” its statement said. “This is not only an expectation, but is required under state law.”
With the state’s budget now imposed, the path forward appears less chaotic — but comes at a steep cost for Toms River taxpayers, who will see sharply higher bills even as frustration with Trenton’s school funding policy simmers.