The school tax won't be going up as much as originally proposed. School officials said Monday night during the Board of Education meeting the proposed 2010-11 budget calls for a 1.2 percent tax increase.

School officials said at the last school board meeting two weeks ago taxes would increase by 4 percent, the highest tax increase allowed under state statutes. But the application of more excess surplus and other measures are allowing school officials to drop the tax increase to 1.2 percent.

BOE Finance Committee Chairman Jeff Waters said with the current economy school officials could no longer justify having a high number in excess surplus, and they started to draw it down a year ago. The plan was to do so over two or three years. A year ago $1.5 million in excess surplus was spent to keep the tax increase down at 2 percent.

"We're doing that again," Waters said. "We're listening to the community... Carrying a large surplus is not acceptable."

The board will still carry $2 million in operating surplus and $2 million reserves, which is allowed under state law.

State officials had proposed school aid be cut based on how much excess surplus a district holds. But state officials are coming off that stance, Waters said, based on what Bret Schundler, new education commissioner, said at a meeting in Summit last week.

The other part that is helping keep taxes down is the money left over from the bond used to pay for the middle and high schools additions. There will be at least $2 million, Waters said, and it will be used to pay the principle on the bond.

There also is moderate cuts to staffing, mainly based on retirements, as school officials "took a sharp pencil" to those areas, Waters said. They have been more aggressive to cuts on non-staffing costs.

But there are only so many non-staffing costs that can be cut. "At some point it's like trying to squeeze blood from a stone," Waters said. Staff and its associated costs are becoming more of an issue for the district.

Schools Supt. Richard Brodow said the "preliminary" budget faces the financial realities and does not have "fat and frills." School officials realize the realities of the economy, but they are protecting the interest of children. Cuts were made where the program in the classroom would not be impacted, Brodow said.

The budget called is being called preliminary mainly because school officials won't receive state aid figures until March 16. Waters said they anticipate a 15 percent cut in state aid, but that could change. Changes in how much state aid is cut would change the proposed budget. More information would be provided at the school board meeting on March 22.

But the proposal wasn't good enough, specifically for the advocacy group We Love Millburn. WLM President Ralph Inglese issued an ultimatum to the board to issue a budget with no tax increase at its March 22 meeting. In that case We Love Millburn would support the proposed 2010-11 budget.

"If you submit a budget that proposes any tax increase, our organization will unleash a campaign at the local, county and state level to have this school system investigated for violations of state regulations and for fiscal mismanagement," Inglese said. WLM plans to show how the board is a prime example of "what's wrong in New Jersey," citing how county and state officials its members have contacted "have already showed great interest."

Inglese said the organization understands education in a top school district doesn't come cheap, but Millburn doesn't have the best in everything. There isn't cutting edge technology and arts programs offered by other schools. Students are in trailers in some overcrowded schools. Parents hire tutors and there are endless fees for sports and activities.

Plus the school budget has increased 100 percent while school enrollment has increased 27 percent in the last 10 years, he said. "You and many of this town have become complacent as a result of our top ranking, but the fiscal mismanagement of this district has affected our students and threatened the value of our town's most valuable asset—our schools," he said.

Mark Zucker, a board member, said he views the comments from WLM as a threat, not an ultimatum. It's not the time to make threats because they'll lead to more costs with lawyers when there are other important things on the table.

Samuel Levy, a board member, said WLM should show what laws and regulations the board is violating. There are repercussions associated with accusing the board of fraud and violating the law. If the violations are presented, school officials can respond to them.

Zucker said he was disappointed to see some people suggest the teachers are overpaid when they are paid $70,000 to $90,000. In the New York metro area, that is barely middle class, he said. Teachers are the foundation of a community because they educate children. Without kids growing up with an education, a nation will fall apart.

But teachers need to understand they are part of the budget and the community and their health care costs need to be more realistic, Zucker said. If he is chairman of the negotiating committee a year from now, he said, he anticipates a more difficult contract.

Debra Fox, a school board member, said in her time in town her taxes have tripled. But her first budget was the one with a 2 percent tax increase. She doesn't think the current board is the one to be blamed for past high costs.