Lakewood schools attorney made $5M in six years as district financial woes deepened

LAKEWOOD – Board of Education attorney Michael Inzelbuch pocketed more than $5 million in legal fees in the past six years while serving as a leader in a district that recently requested $93 million in loans to balance the budget, analysis by the Asbury Park Press shows.

Inzelbuch was paid more than $800,000 by the Lakewood School District in 2021-2022 and 2022-2023, according to documents obtained and analyzed by the Press. That's after receiving more than $1 million in the two years prior.

“He is the highest paid, by far, public employee in the State of New Jersey,” said David Sciarra, founder of the New Jersey Education Law Center, which tracks such issues. “Governor, supreme court chief justice, he’s by far making the most money of anybody who is paid through public tax dollars.”

More: Murphy calls Lakewood school board lawyer's $1 million annual taxpayer pay 'eye-popping'

Inzelbuch has drawn past criticism from state educators, legal observers and Gov. Phil Murphy, who once called his salary “eye-popping.” Lakewood School district has been in acute financial distress for many years, recently asking for a $93 million loan from the state to help cover the costs of busing tens of thousands of private school students in the region, as required by law.

Inzelbuch said via email that he has earned his fees by keeping the district going through difficult times, from Covid-19 to labor negotiations.

“The legal process I established has proven successful while lowering overall costs and expenses,” he said in a statement. “Remaining open during Covid despite legal threats, negotiating competitive salaries for teaching staff and bringing stability for our students and overall community, successfully advocating for the district and all of its students in a variety of forums.”

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Inzelbuch became board attorney for the second time in 2017. Prior to that, Lakewood's legal costs had boomed, in part because clients represented by Inzelbuch had sued the district more than 80 times.

Superintendent Laura Winters and Board President Moshe Bender did not respond to requests for comment.

Lakewood lawyer fees far beyond neighboring schools

Lakewood has 4,539 public school students, according to the Department of Education, although it also must provide transportation and other services to more than 42,000 private school students in a growing mostly Orthodox community.

By comparison, larger neighboring districts such as Toms River Regional Schools and Jackson Township Schools report legal fees that are a fraction of Lakewood’s.

Toms River, which has triple the enrollment of Lakewood at 15,000 students, spent just under $300,000 on legal fees last year, while Jackson, which has 7,400 students, paid $164,000.

Marlboro, which has 4,500 students, spent $175,418 last year, while other districts closer to Lakewood’s enrollment, such as Pemberton in Burlington County and Millburn in Essex County, spent just $123,000 and $173,000, respectively.

Inzelbuch, meanwhile, received $837,061 in 2022-2023, after taking home $828,625 the year before.

More: Lakewood $1M school board attorney monthly fees shrink after APP report

“It’s too high,” said Arthur Lang, a Lakewood High School teacher and attorney who has led a 9-year-old lawsuit against the state seeking more funding for the district. “You have a district that is struggling for cash and he is the highest paid lawyer in the state.”

The key to Inzelbuch’s largess is a combination of a $50,000 monthly base pay, as well as additional income from what is described as “litigation services.”

Inzelbuch's contract states he serves as board general counsel at a rate of $475 per hour, "not to exceed $50,000" per month. The agreement does not guarantee that amount but caps his monthly expenses as general counsel at $50,000. The contract also states the "actual payment for each month will be based on hours worked times the hourly rate."

But he has routinely billed additional hours for what he terms litigation and other expenses at the same $475 per hour.

When the higher billing amounts came to light in 2021, Inzelbuch received criticism from education and legal experts, as well as Gov. Murphy, who called the totals “eye-popping.”

Also at issue has been the process in which Inzelbuch submits invoices for his district work, failing to list specifics of time spent on each task for which he bills, despite his contract requiring such detail.

His monthly board attorney invoices offer no details on time spent on each task or an hourly rate, noting just descriptions of work each day and a monthly tally that always reaches the $50,000 cap.

Inzelbuch's supporters say the expense is worth it.

Jennifer Patella, librarian at Oak Street Elementary School and director of the district’s after-school tutoring program, called Inzelbuch an “asset to the district.”

“When he was not here, I don’t believe we were getting as many things accomplished as we have,” said the 17-year district veteran. “He seems to be pushing for more things for our students and our staff. The programs we have now far exceed what we have had in the past. I think they work well together, Michael and the board and the superintendent.”

"Fiscal distress" and dents mark school budgets

Lakewood Schools finances have come under scrutiny in recent months as district officials have requested a $93 million state loan to help balance the 2023-2024 school budget.

If granted, it would bring the district’s state loan debt to more than $198 million for past loans dating back almost a decade.

In addition, the district has been lobbying for a change to the state funding formula that bases state aid on the district’s public school population. But it does not take into account some 42,000 nonpublic school students that require transportation, special education services and other needs mandated by the state.

More: Lakewood schools borrowed millions from New Jersey and still can't pay its bills

In the past year, a state appeals court ruled that the New Jersey Education Commissioner must review the funding formula and seek changes for Lakewood, while a state auditor report declared the district was in “severe fiscal distress.”

The district’s state aid has also become an issue in the upcoming school board race, which has drawn a full slate of challengers for the first time since 2014.

Three of the challengers for the three seats up for grabs have dubbed their slate, “Fixing the Formula.” All three incumbents are seeking re-election.

But none of the challengers or incumbents would comment on Inzelbuch’s situation or the current fiscal issues.

“I prefer not to comment on Micheal Inzelbuch except he does work very hard for ALL the students in the district,” challenger Avi Schubert said via email. “I hope you understand.”

History of high legal bills

Inzelbuch’s salary had increased regularly since he was rehired as board attorney in 2017.

He was paid $625,109 during the 2017-2018 school year, $721,644 in 2018-2019, and more than $1 million each in 2019-2020 and 2020-2021.

Inzelbuch had previously served as board attorney from 2002 to 2012, when he was dismissed after two new board members were sworn in that year. The board voted to replace him with a law firm on retainer.

When he was rehired in 2017, district officials conceded his salary was high, but they also said they expected the move to lower legal bills that had exceeded or come close to $1 million annually during the previous five years.

“For example, in 2016 -2017 the district expended approximately $1.8 million in legal fees plus more than $3 million in associated costs over a period of years,” Inzelbuch said via email.

But many of the previous legal costs were due in part to Inzelbuch, who, as a plaintiffs' lawyer, had sued the district in at least 80 cases on behalf of families with children requiring special education services. He also represented other children with special needs in hundreds of cases against districts across the state.

More: NJ Auditor: Lakewood schools deserve special 'state aid' to address finances

The lawsuits helped push the district's legal bills to an estimated $1.2 million during the 2016-2017 school year, officials said at the time — with $474,800 in payments by Lakewood to Inzelbuch alone to cover his attorney fees and expenses incurred in successfully representing parents in legal actions against the district.

Former state monitor Michael Azzara said in 2017 that having Inzelbuch working for the schools instead of suing the district made the salary cost-effective.

A new state-appointed fiscal monitor, Ronald Fisher, was hired in February 2022. The fourth monitor in 10 years, Fisher, a veteran education administrator, previously served as an assistant state monitor in Atlantic City. He replaced David Shafter, who had held the post since 2018.

State law requires that a monitor be in place in a district as long as its state debt remains, which could be at least several more years for Lakewood given the tens of millions still owed to Trenton.

Joe Strupp is an award-winning journalist with 30 years’ experience who covers education and several local communities for APP.com and the Asbury Park Press. He is also the author of three books, including Killing Journalism on the state of the news media, and an adjunct media professor at Rutgers University and Fairleigh Dickinson University. Reach him at jstrupp@gannettnj.com and at 732-413-3840. Follow him on Twitter at @joestrupp

This article originally appeared on Asbury Park Press: Lakewood schools attorney is NJ's 'highest paid, by far' public employee