In a hearing before an administrative law judge, the Lakewood Public School District argued their case to dismiss New Jersey’s effort to place the financially troubled district under full state control, arguing that the state has failed to meet the legal standard required for a takeover.

During a 30-minute hearing before Administrative Law Judge Susan Scarola, attorneys for the district challenged the New Jersey Department of Education’s attempt to assume control of the school system, marking the first in-person court proceeding since the state launched its takeover bid in January.

Lakewood new school board attorney, Joshua Forsman, argued that the state’s intervention effort should be halted because the district does not meet the statutory criteria for full state intervention. Under New Jersey law, the state may assume control of a school district only if it demonstrates deficiencies in instruction and program, fiscal management, governance, and personnel administration.

TLS first reported earlier this year that Lakewood will contest the takeover attempt.

The district maintains that Lakewood has not failed in all of those categories and therefore is not eligible for a state takeover. District officials have also argued that many of Lakewood’s longstanding financial challenges stem from unique demographic factors and state-mandated costs rather than local mismanagement. The district serves approximately 4,100 public school students but is also legally mandated to provide transportation and special education cost for the township’s unusually large nonpublic school population.

The hearing stemmed from a motion to dismiss filed by the district after the state initiated takeover proceedings earlier this year. In January, the Department of Education filed an Order to Show Cause seeking full state intervention, citing years of fiscal, operational, and educational deficiencies and relying heavily on a 2025 Appellate Division ruling that found Lakewood public school students were experiencing an ongoing constitutional deprivation of their right to a thorough and efficient education.

State officials contend that years of financial instability, repeated state loans, and persistent operational problems justify intervention. The district has received hundreds of millions of dollars in state loans over the past decade to balance its budget.

Lakewood has disputed those claims, arguing in court filings that the state has long been aware of the district’s structural financial burdens and has failed to provide a sustainable solution. District officials have also noted that state monitors have been involved in Lakewood’s operations for years and that student performance measures do not support the state’s assertions of widespread failure.

The takeover effort was initiated by former Education Commissioner Kevin Dehmer during the final days of the Murphy administration. Since then, Governor Mikie Sherrill appointed Lily Laux as commissioner, leaving her administration to determine whether to continue pursuing the intervention.

If Scarola grants the district’s motion to dismiss, the matter would return to the commissioner, who could choose to restart the takeover process or abandon it altogether.

If the judge denies the motion, the case would proceed to a full administrative hearing on whether the state should assume control of the district.

No ruling was issued from the bench, and Judge Scarola is expected to decide the motion at a later date.

If the takeover proceeds, Lakewood would join a small group of New Jersey districts that have been placed under state supervision, including Newark, Paterson and Jersey City. Under a full intervention, the locally elected school board would be largely sidelined, with a state-appointed superintendent assuming authority over operations, finances and academics.

In other news, the Lakewood Board of Education has appointed Samuel Melnick to fill the vacancy created by the departure of longtime member Ada Gonzalez, who resigned last month.

Gonzalez, 74, was first elected to the board in 2006, cited unspecified health conditions in her letter of resignation.