The Children’s Center of Monmouth County, Inc., Monmouth County v. New Jersey State Department of Education, Office of School Finance, 10/31/19, (#289-19)

289-19
New Jersey Commissioner of Education
Final Decision
The Children’s Center of Monmouth
County, Inc.,
Petitioner,
v.
New Jersey Department of Education, Office of School
Finance,
Respondent.
Synopsis
Petitioner, The Children’s Center of Monmouth County (CCMC) – a private school for students with disabilities
– appealed the determination of the respondent, the New Jersey Department of Education’s Office of School
Funding (NJDOE; OSF), to classify a portion of an employee’s salary for the 2012-2013 and 2013-2014 school
years as a “non-allowable expenditure”. CCMC also appealed OSF’s determination that the write-off of certain
uncollected accounts receivable is a “non-allowable expenditure”. The parties filed cross motions for summary
decision. The cross motion of the respondent OSF on the issue of write-offs was granted in July 2018, finding
that the costs were not allowable as a matter of law. 	A hearing on the issue of the employee’s salary was
conducted in April 2019, and the ALJ’s Initial Decision was issued on August 12, 2019.
The ALJ found, inter alia, that: private schools for children with disabilities are governed by N.J.S.A. 18A:46-2,
which authorizes the NJDOE to promulgate regulations governing the tuition rates that approved private schools
for students with disabilities (APSSD) may charge local public school districts; OSR reviews audited financial
statements of APSSDs to ensure compliance with regulations, including N.J.A.C. 6A:23A-18.2, which pertains
to private school employee salaries; in the instant matter, respondent asserted that the employee whose salary
was partially disallowed was serving in a non-recognized job title and his salary was properly capped at the
maximum permitted pursuant to N.J.A.C. 6A:23A-18.2(r); the petitioner argued that the position in question
aligns to the duties and requirements of the recognized position of “Assistant Director” provided in
N.J.A.C. 6A:23A-18.1, but included extra duties related to law, affirmative action and compliance. 	The ALJ
concluded that the employee in question was acting as a Director of Law and Compliance, and not as Assistant
Director of the school and his salary was properly capped. Accordingly, the ALJ affirmed the determination of
the OSF, and dismissed the petition.
Upon a comprehensive review of this matter, the Commissioner agreed with the findings and conclusion of the
ALJ. Accordingly, the Initial Decision of the OAL was adopted as the final decision in this matter and the
petition was dismissed with prejudice.
This synopsis is not part of the Commissioner’s decision. It has been prepared for the convenience of the reader. It has been neither
reviewed nor approved by the Commissioner.
October 31, 2019

OAL Dkt. No. EDU 08259-17
Agency Dkt. No. 82-4/17
New Jersey Commissioner of Education
Final Decision
The Children’s Center of Monmouth
County, Inc.,
Petitioner,
v.
New Jersey Department of Education, Office of
School Finance,
Respondent.
The record of this matter, the Initial Decision of the Office of Administrative Law
(OAL), the exceptions filed by petitioner The Children’s Center of Monmouth County (CCMC),
and the reply thereto by respondent New Jersey Department of Education, Office of School
Finance (Department) have been reviewed and considered.
This matter involves a challenge to the Department’s audit findings that the write-
off of uncollected debts and a portion of an employee’s salary were unallowable costs for
purposes of calculating the tuition rate for educating students at CCMC, an approved private
school for students with disabilities (APSSD). The Administrative Law Judge (ALJ) granted the
Department’s motion for summary decision regarding the write-off on July 20, 2018, finding that
the costs were not allowable as a matter of law. 	On August 12, 2019, the ALJ issued an
Initial Decision, concluding that disallowing the salary of Peter Kalac, an employee of CCMC,
was proper.

2
In its exceptions, which largely reference its briefs below and present the same
arguments, 	petitioner 	argues 	that 	the 	ALJ’s 	decision 	regarding 	the 	write-off 	failed 	to
acknowledge that the Department’s guidance regarding back-billing was equivocal. 	According
to the petitioner, while the regulation might contemplate APSSDs billing sending districts prior
to the second year following the Department’s certification of the final tuition rate, the
Department has sometimes supported the position of sending districts that they are under no
obligation to pay until after the conclusion of an audit or appeals, which could take years.
Petitioner contends that this representation was unrebutted and should have been accepted as fact
by the ALJ for purposes of the motion for summary decision. Furthermore, petitioner claims that
its efforts to collect the debts were hampered by the Department through a 2013 memo that
discouraged districts from honoring the school’s requests for payment.
Regarding the disallowance of compensation for Peter Kalac, petitioner argues
that it is unclear why the ALJ believed that Mr. Kalac’s testimony was “not credible”. If the ALJ
believed that Mr. Kalac misstated the facts when he testified that he actually performed the
specific duties of Assistant Director as spelled out in the regulations, his testimony was never
challenged by the Department; this served to unfairly blindside petitioner since there was no
challenge to Mr. Kalac’s testimony on that point at the hearing. If the ALJ rejected as a matter
of law Mr. Kalac’s belief that his overall workload fit the definition of an Assistant Director
because of the extra duties he performed, those extra duties were expressly why the Department
disallowed his compensation, in which case petitioner points to its post-hearing brief for its legal
argument. 	Finally, petitioner contends that the ALJ failed to consider the Department’s prior
approval of Mr. Kalac’s job title and duties.

3
In a reply that also reiterates arguments made below, the Department argues that
N.J.A.C. 6A:23-18.2(m) is clear that billing must occur in the second school year following the
school year for which the charge was agreed upon and that an APSSD must undertake reasonable
efforts to collect outstanding tuition. 	In light of these requirements, the Department contends
that the ALJ properly found that CCMC’s efforts to bill sending districts up to nine years beyond
the billing timeframe in N.J.A.C. 6A:23-18.2(m) were not reasonable. 	The Department also
submits that petitioner’s arguments regarding the 2013 memo mischaracterize it. Moreover, the
Department notes that the memo was issued two months after CCMC sent bills for the prior
decade, and even if the memo provided a valid excuse for CCMC’s failure to engage in efforts to
pursue collection after its issuance, it does not excuse CCMC’s failure to make any attempts to
collect sooner.
Regarding Mr. Kalac, the Department argues that the ALJ’s credibility finding
was supported by the record and that his testimony was rejected because of the extra job duties
he performed, which is a proper application of the relevant law to the facts presented. 	The
Department notes that no documents in the record support petitioner’s contention that the
Department had previously approved Mr. Kalac’s job title and duties.
After a comprehensive review of the record, the Commissioner concurs with the
findings of the ALJ. 	Regarding the bad debt write-offs, N.J.A.C. 6A:23A-18.2(m)1 clearly
contemplates that APSSDs will timely bill sending districts for the difference between tentative and
final tuition rates. Petitioner admits that it failed to send tuition adjustment bills for the 2002-2003
through 2010-2011 school years until October 2013. Rather than making reasonable efforts to collect
these debts, petitioner made no effort at all for up to ten years. 	Such a lengthy delay is precisely
1 The regulations governing APSSDs were revised in July 2017. This decision references the regulations that were
in place at the time of the events at issue in this case.

4
what the regulation was intended to prevent. 	See 49 N.J.R. 1855(a) (“a reasonable effort is a
sufficient measure to prevent an APSSD from including the amounts for which the APSSD failed to
timely bill as a ‘bad debt’ in the tuition charged to sending school districts” (emphasis added)).
Furthermore, although petitioner seeks to lay the blame for its failure to collect at the feet of the
Department, the Department’s actions are separate and distinct from petitioner’s. 	Neither the
Department’s position that sending districts are not obligated to pay tuition adjustment bills until
after an audit or appeals,2 nor its 2013 memo regarding tuition adjustment, excuse CCMC’s failure to
send tuition adjustment bills for the ten years prior to that time. 	Similarly, petitioner’s efforts to
collect the bills after 2013 cannot cure its earlier failure.
Regarding the salary disallowance, Mr. Kalac’s employment contract lists his title as
Assistant Director of Law, Affirmative Action and Compliance, which was not included in the list of
recognized job titles published by the Department. Moreover, looking beyond the title itself to the
job duties performed by Mr. Kalac, the Commissioner accepts the ALJ’s finding that Mr. Kalac’s
testimony was not credible.3 Furthermore, his job description lists fourteen responsibilities, eleven
of which are not included in the regulatory definition of Assistant Director. 	Because the vast
majority of his responsibilities are unrelated to defined Assistant Director tasks, the Commissioner
agrees with the ALJ and concludes that Mr. Kalac’s role was significantly different from the role of
2 The record includes an email in which the Department acknowledged that some sending districts want to receive a
desk review certification letter before remitting payment to the APSSD. The Department continues by stating, “this
is often a policy within the sending districts [sic] business office and/or governance manuals” and encourages
petitioner to work with the sending district. It is not clear from this email that the Department’s position is that
sending districts are not obligated to pay until after an audit or appeals, and – because the timing of the sending
district’s payment is not the subject of this matter – the Commissioner declines to reach any conclusion on this issue.
However, assuming for purposes of argument that a sending district is not obligated to pay until after an appeal or
audit, it would not relieve the APSSD from timely billing the sending district, as is required by N.J.A.C. 6A:23A-
18.2(m).
3 Despite petitioner’s exceptions arguing that the ALJ’s finding on this point was unclear, the Commissioner finds
that the ALJ’s credibility finding was clear and pertained to the nature of Mr Kalac’s overall role; as the ALJ stated,
“the testimony of Mr. Kalac that he was acting as an Assistant Director was not credible.”

5
Assistant Director and therefore he served in an unrecognized job title.4 	The maximum salary for
unrecognized job titles during the school years at issue was restricted to $110,610, pursuant to
N.J.A.C. 6A:23A-18.2(r), and prorated to $44,244 for Mr. Kalac’s part time employment. His salary
of $60,000 exceeded the maximum allowable amount by $15,676, which the Department and the
ALJ properly found was a non-allowable cost.
Accordingly, the Initial Decision is hereby adopted as the final decision in this
matter; and the petition is dismissed with prejudice.
IT IS SO ORDERED.5
COMMISSIONER OF EDUCATION
Date of Decision: 	October 31, 2019
Date of Mailing: 	October 31, 2019
4 Any prior approval by the Department of Mr. Kalac’s salary is irrelevant to its audit for the years in question here.
Petitioners’ assertion regarding prior approvals is not supported by any documents in the record, and while the
Department did not rebut this assertion, neither did it concede it. Nonetheless, the Department is not precluded from
applying the requirements of N.J.A.C. 6A:23A-18.2(r) to disallow the excess salary in the audits at issue here, even
if the salary was previously allowed.
5 This decision may be appealed to the Appellate Division of the Superior Court pursuant to P.L. 2008, c. 36
(N.J.S.A. 18A:6-9.1).

New Jersey is an Equal Opportunity Employer
State of New Jersey
OFFICE OF ADMINISTRATIVE LAW
INITIAL DECISION
OAL DKT. NO. EDU 08259-17
AGENCY DKT. NO. 82-4/17
THE CHILDREN’S CENTER OF
MONMOUTH COUNTY, INC.,
Petitioner,
v.
NEW JERSEY DEPARTMENT OF
EDUCATION, OFFICE OF SCHOOL
FINANCE,
Respondent.
David B. Rubin, Esq., for petitioner, The Children’s Center of Monmouth
County, Inc.
Jaclyn 	M. 	Frey, 	Deputy 	Attorney 	General, 	for 	respondent, 	New 	Jersey
Department of Education, Office of School Finance (Gurbir S. Grewal,
Attorney General of New Jersey, attorney)
Record Closed: July 29, 2019 	Decided: August 12, 2019
BEFORE SARAH G. CROWLEY, ALJ:

OAL DKT. NO. EDU 08259-17
2
STATEMENT OF THE CASE AND PROCEDURAL HISTORY
Petitioner, The Children’s Center of Monmouth County, Inc. (CCMC), a private
school for students with disabilities, appeals the determination of respondent, the
Department of Education’s Office of School Finance (OSF), to classify a portion of an
employee’s salary for the 2012-2013 and 2013-2014 school years as a “non-allowable
expenditure.” 	CCMC also appealed OSF’s determination that the write-off of certain
uncollected accounts receivable is a “non-allowable expenditure.” 	CCMC filed its
appeal with the Department of Education and the Department transmitted the matter
to the Office of Administrative Law (OAL) as a contested case. N.J.S.A. 52:14B-1 to -
13; N.J.S.A. 52:14F-1 to -13. On March 8, 2018, CCMC moved for summary decision.
On March 26, 2018, OSF cross-moved for summary decision maintaining that its
decisions were proper as a matter of law. The parties presented oral argument before
the undersigned on May 25, 2018, and the cross-motion of the state on the issue of
the write-offs was granted. 	The undersigned ruled that the uncollected accounts
receivables were non-allowable as a matter of law. 	The petitioner’s motion for
summary decision on other issues was denied. 	The hearing was conducted on April
18, 2019, and the record closed after written summations from the parties were
received on July 29, 2019.
STATEMENT OF FACTS
CCMC is an approved private school for students with disabilities in accordance
with N.J.A.C. 6A:23-18.1 et. seq.6 	As far back as 2002, CCMC contracted with
various New Jersey public school districts to receive preschool disabled children and
charge 	the 	sending 	districts 	a 	tentative 	tuition 	rate 	for 	educating 	the 	students.
Pursuant to N.J.A.C. 6A:23-18.1; N.J.S.A. 18A:46-21, the actual cost per student is
later calculated and submitted to the Commissioner of Education (Commissioner) for
approval.
6 The regulations governing private schools who receive public students with disabilities, N.J.A.C.
6A:23-18.1 et. seq. were revised in July 2017. See 49 N.J.R. 365(a); 49 N.J.R. 1855 (a). Because the
current regulations were revised, some substantially, this decision references the then existing
regulations that petitioner was required to adhere to, which included the 2012-2014 regulations.

OAL DKT. NO. EDU 08259-17
3
In 	accordance 	with 	N.J.A.C. 	6A:23A-18.9,7 	CCMC 	obtained 	independent
audited financial statements for the 2012-2013 and 2013-2014 school years. 	CCMC
submitted 	the 	financial 	statements, 	which 	detailed 	the 	tuition 	costs, 	to 	the
Commissioner for approval. 	Ibid. 	The Department of Education's Office of School
Finance (OSF) is responsible for reviewing CCMC's audited financial statements to
ensure compliance with Department's guidelines and regulations.
On June 17, 2016, OSF issued two letters informing CCMC that its audited
financial statements for the 2012-2013 and the 2013-2014 school years conflicted with
the Department's regulations. 	Specifically, the OSF informed CCMC that it “reviewed
the audited financial statements for the 2012-2013 school year” and found that the
employment contract of
Mr. Peter Kalac reflects the unrecognized administrative
position title of Director of Law, Affirmative Action and
Compliance. 	In accordance with N.J.A.C. 6A:23-18.2(r),
private 	schools 	for 	students 	with 	disabilities 	may 	use
unrecognized administrative job titles, but the maximum
salaries of these titles are restricted in accordance with
N.J.A.C. 6A:23A-18.5(a)9 . . .
Mr. Kalac's part time salary of $60,000 is in excess of the
prorated part time lowest maximum salary of $44,244 . . .
As such, the excess salary of $15,756 and the associated
benefits must be considered non-allowable costs when
calculating the Certified Actual Cost Per Student.
The petitioner argues that the disallowance of Kalac’s salary was improper and
that his salary and benefits should not have been disallowed just because he had an
unrecognized job tittle. They also argue that they should have looked beyond his title
to what his job duties were. The only issue is what these duties were and whether the
salary of Peter Kalac which exceeds the maximum allowable salary under the statute
is allowable.
7 Current N.J.A.C. 6A:23A-18.10.

OAL DKT. NO. EDU 08259-17
4
TESTIMONY AND FINDINGS OF FACT
For petitioner
Peter Kalac testified regarding his job duties and his role at the school. 	He is
an attorney by trade and he practices school law and workers compensation. 	He
started getting involved in the IDEA and saw that Districts were not doing a good job
of serving children with disabilities, so he decided to open a school in Monmouth
County. 	The school opened in 1990 for children with disabilities, mostly autistic
children. 	He created the job title for himself and it was part of the contract. 	He also
served as legal counsel handling anything from workers compensation to lawsuits
regarding injuries at work. 	He had a lot of issues with workers compensation, so he
handled a lot of that for the school. However, he was also involved in school plans as
well, and went to one meeting a month, where they discussed everything from hiring
to termination.
He was also the affirmative action officer and met with someone in State about
their hiring practices. He dealt with a lot of Human Resources issues with employees.
He testified that Assistant Director was an accurate description of what he did, but
they had labeled it something else. 	If they had told him it was a problem, he would
have changed it. 	He testified about the contract and the job duties listed in the
contract. 	On cross-examination, it was pointed out that there are several things that
are not listed but he handled as an assistant administrator for the school. He testified
that a great deal of what he did was related to his practice involving school law issues
and representing school boards. He reemphasized that if he knew it was an issue, he
would have given himself a different title.
For respondent
Elsie 	Sadler 	Williams 	is 	an 	auditor 	for 	the 	New 	Jersey 	Department 	of
Education. She was responsible for the audit conducted of the petitioner in this case.
She has been with the Department since 2001 and is responsible for fiscal oversight
of private schools for children with disabilities. 	She testified that most of the funding

OAL DKT. NO. EDU 08259-17
5
comes from Local Education agencies in the form of tuition reimbursement. 	She was
involved in the audit of the Children’s school from 2011- 2012, 2012-2013 and 2013-
2014. 	Mr. Kalac’s job title was not listed as one of the authorized job titles, so
payment above the maximum allowance was not permitted. 	If they are not using
appropriate titles that is why it is held to the lowest maximum tile and since he was
only a part-time employee, it was adjusted accordingly.
Ms. Williams testified that the school argued that his job title aligned with that of
the Assistant Director. 	However, she reviewed the job description, and disagreed,
finding that his job duties were more of a legal nature. 	She testified that if someone
wanted approval for a title that was not recognized, they could have gone to the
County Superintendent and obtained approval to have someone work outside a title.
It appeared to her that not only was he performing duties outside the scope of the
assistant director, he had a different job title. 	If he had the correct job title, they may
not have flagged it, but looking at his duties, it was clear to her that he was not acting
as an assistant director, and thus, the maximum permitted salary was appropriately
capped. A director of law and compliance is not an authorized position. She believed
upon review of what he was doing that he was in fact acting as a director of law and
compliance and not the assistant director of the school. 	Accordingly, the salary was
properly capped.
The resolution of the issue in this case requires that I make a credibility
determination regarding the critical facts. 	The choice of accepting or rejecting the
witnesses’ testimony or credibility rests with the finder of fact. Freud v. Davis, 64 N.J.
Super. 242, 246 (App. Div. 1960). In addition, for testimony to be believed, it must not
only come from the mouth of a credible witness, but it also has to be credible in itself.
It must elicit evidence that is from such common experiences and observation that it
can be approved as proper under the circumstances. 	See Spagnuolo v. Bonnet, 16
N.J. 546 (1954); Gallo v. Gallo, 66 N.J. Super. 1 (App. Div. 1961). 	A credibility
determination requires an overall assessment of the witnesses’ story considering its
rationality, internal consistency and the manner in which it “hangs together” with the
other evidence. Carbo v. United States, 314 F.2d 718,749 (1963). A fact finder is free
to weigh the evidence and to reject the testimony of a witness, even though not

OAL DKT. NO. EDU 08259-17
6
directly contradicted, when it is contrary to circumstances given in evidence or
contains inherent improbabilities or contradictions which alone, or in connection with
other circumstances in evidence, excite suspicion as to its truth. In re Perrone, 5 N.J.
514. 521-22 (1950). 	See D’Amato by McPherson v. D’Amato, 305 N.J. Super. 109,
115 (App. Div. 1997).
Having had an opportunity to carefully observe the demeanor of the witnesses,
it is my view that the testimony of Mr. Kalac that he was acting as an Assistant
Director was not credible. Moreover, his own testimony contradicted such a finding. It
is clear that his background was in law, and he was acting as a director of law and
compliance and not a director of school. 	Therefore, I FIND as FACT that Mr. Kalac
was the assistant director of law and compliance at CCMC.
LEGAL ANALYSIS
Private schools for children with disabilities are governed by N.J.S.A. 18A:46-
21. 	This enabling statute authorized the New Jersey Department of Education to
promulgate regulations governing the tuition rates that approved private schools for
students with disabilities (APSSD) may charge local public-school districts. Brookfield
Schools v. New Jersey State Dep’t of Ed., Div. of Finance, EDU 11447-10, Initial
(June 15, 2011) adopted Comm’r (July 28, 2011).
To 	that 	end, 	the 	OSF 	reviews 	audited 	financial 	statements 	to 	ensure
compliance with the Department’s regulations, including N.J.A.C. 6A:23A-18.2,8 the
regulation pertaining to private school employee salaries. 	N.J.A.C. 6A:23A-18.2,
states, in pertinent part:
(o) An APSSD shall reference as guidance the list of
maximum 	allowable 	salaries 	by 	job 	title 	and 	county,
according to the job titles contained in N.J.A.C. 6A:9, which
pertain 	to 	approved 	private 	schools 	for 	students 	with
disabilities that is published by the Commissioner . . .
8 Current N.J.A.C. 6A:23A-18.3.

OAL DKT. NO. EDU 08259-17
7
(p) 	An 	APSSD 	shall 	reference 	as 	guidance 	a 	list 	of
maximum allowable salaries by administrative and job titles
and county according to the job titles contained in N.J.A.C.
6A:9 and 6A:23A-18.1 which pertain to approved private
schools for students with disabilities that is published by
the Commissioner . . .
(r) An APSSD shall employ staff pursuant to the list of the
recognized job titles in accordance with N.J.A.C. 6A:9 that
require certification and N.J.A.C. 6A:23A-18.1 that require
a 	bachelor's 	degree, 	which 	is 	published 	by 	the
Commissioner. 	An approved private school for students
with disabilities shall only hire staff or consultants in job
titles that require certification or a bachelor’s degree if such
titles 	are 	included 	on 	the 	list, 	or 	if 	such 	titles 	are
unrecognized 	job 	titles 	that 	are 	approved 	annually 	in
accordance with N.J.A.C. 6A:9B-5.5. The APSSD may use
unrecognized 	administrative 	job 	titles, 	but 	maximum
salaries for the titles are restricted in accordance with
N.J.A.C. 6A:23A-18.5(a)(9). 	If an APSSD hires staff in
administrative or support job titles such as but not limited to
Chief 	Executive 	Officer 	or 	Chief 	Financial 	Officer, 	the
maximum salaries of such job titles shall be limited to the
maximum salary of a director in accordance with N.J.A.C.
6A:23A-18.2(p).
[N.J.A.C. 6A:23A-18.2(o), (p), (r).9]
For the 2012-2013 and 2013-2014 school years, the Office School Finance
listed the following approved administrative positions for private schools:
• 	0700 Director
• 	0701 Assistant Director
• 	0702 Executive Director
• 	0703 Business Manager
See Annual Information – Private Schools for Students with Disabilities –
Recognized Job Titles – Effective July 1, 2012 – Attachment 1 Office of Fiscal
Research 	and 	Data 	Planning 	(May 	24, 	2012),
https://www.nj.gov/education/finance/fp/psd/1213/annual.shtml; 	see 	also 	Annual
Information – Private Schools for Students with Disabilities – Recognized Job Titles –
9 Current N.J.A.C. 6A:23A-18.3(o)(p)(q).

OAL DKT. NO. EDU 08259-17
8
Effective July 1, 2013 – Attachment 1 Office of Fiscal Research and Data Planning
(June 11, 2014), https://www.nj.gov/education/finance/fp/psd/1314/annual.shtml.
N.J.A.C. 6A:23A-18.110 defines Assistant Director as:
An individual whose job function includes a majority of the
following: 	the formulation of school goals, plans, policies,
and budgets and the recommendation of their approval to
the school's board of directors; the recommendations for all
staff appointments and other personnel actions, such as
terminations, suspensions and compensation, including the
appointment of the business manager to the school's board
of 	directors; 	responsibility 	for 	school 	operations 	and
programs 	including 	administration, 	supervision 	and
evaluation 	of 	administrators, 	supervisors, 	and 	all 	other
school staff. 	The holder of this job title shall hold a
bachelor's degree from an accredited institution but is not
required to hold a school certification.
[N.J.A.C. 6A:23A-18.1.]
Pursuant 	to 	N.J.A.C. 	6A:23A-18.2(r),11 the 	Commissioner 	determined 	that
“whether 	salaries 	and 	fringe 	benefits 	of 	certain 	employees 	should 	properly 	be
considered in establishing tuition rates payable to [APSSDs] requires one to look
beyond titles and determine what the employee actually does.” 	Youth Consultation
Serv. v. Dep’t of Ed, EDU 03573-06, Initial (Aug 6, 2007) adopted Comm'r (Oct 4,
2007) https://njlaw.rutgers.edu/collections/oal/html/initial/edu03573-06_1.html.
In Youth Consultation Serv., the OFPP found that a private school improperly
charged the salaries of certain staff, functioning in unrecognized position titles, as part
of its certified tuition rates. 	Ibid. The court, in its finding of facts, held that the duties,
and not title alone, determined whether the position was an unrecognized title. 	Ibid.
For example, the court held that "the duties of those individuals designated as Head
Teachers (an unrecognized title) . . . primarily involve direct student instruction and not
the continuing direction and guidance of the work of instructional personnel." 	Ibid.
Thus, "their duties correlate to those of certified Teachers of the Handicapped rather
10 Current N.J.A.C. 6A:23A-18.2.
11 Current N.J.A.C. 6A:23A-18.3(q).

OAL DKT. NO. EDU 08259-17
9
than Supervisors and that the lack of a Supervisor's certificate is not a basis for
disallowing their salaries and fringe benefits." Ibid.
The Supreme Court also found that "[a]s Yvonne Montemurro is charged with
authority and responsibility for the continuing direction and guidance of the work of
instructional personnel, I conclude that she is a supervisor within the meaning of
N.J.A.C. 6A:9-12.3(c) rather than occupying an administrative position" as [the private
school designated.] 	Thus, her salary and fringe benefits are disallowed by N.J.A.C.
6A:23-4.5(a) 6 and 10." Ibid.; see also Cerebral Palsy League of Union County v. N.J.
Dep’t of Educ., EDU 11301-07, Initial Decision (June 14, 2010), adopted, Comm’r
(July 29, 2010) (stating disallowances that involve job duties is required to be guided
by 	the 	actual 	job 	functions 	of 	the 	employee 	at 	issue.)
https://njlaw.rutgers.edu/collections/oal/final/edu11301-07_1.pdf.
In the instant matter, OSF asserts that the Recognized Job Titles List in effect
during the relevant time permitted the position of Assistant Director. 	However, Mr.
Kalac's 	employment 	contract 	listed 	the 	administrative 	title 	of 	“Director 	of 	Law,
Affirmative Action and Compliance.” 	In accordance with N.J.A.C. 6A:23A-18.2(r),
although an APSSD may use an unrecognized title, it is restricted to a maximum
salary of $44,244. 	CCMC concedes that Mr. Kalac's title includes additional words –
of Law, Affirmative Action and Compliance – that were not included in the approved
title 	of 	Assistant 	Director, 	it 	argues 	that 	his 	actual 	job 	duties 	align 	with 	the
requirements of "Assistant Director" provided in N.J.A.C. 6A:23A-18.1,12 and simply
include extra duties related to Law, Affirmative Action, and Compliance. However, the
testimony of Mr. Kalac demonstrates that although some of the duties he performs
correspond with the definition of an Assistant Director provided at N.J.A.C. 6A:23A-18,
the majority of Mr. Kalac duties related to legal issues and compliance. 	I therefore,
CONCLUDE that Mr. Kalac was acting as a Director of Law and Compliance, and not
an Assistant Director of the school, and thus his salary was property capped and he is
not entitled to reimbursement above the maximum permitted pursuant to N.J.A.C.
12 Current N.J.A.C. 6A:23A-18.2.

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6A:23A-18.2(r). Accordingly, the decision of the OSF is AFFIRMED and the appeal is
DISMISSED.
CONCLUSION
Accordingly, I CONCLUDE, that the duties of Peter Kalac mainly that of a legal
and compliance director and not the assistant director of the school, and thus the
salary disallowance was proper.
ORDER
I 	hereby 	ORDER 	that 	the 	petitioner’s 	appeal 	is 	DISMISSED 	and 	the
determination of the OSF is AFFIRMED.
I 	hereby 	FILE 	this 	initial 	decision 	with 	the 	COMMISSIONER 	OF 	THE
DEPARTMENT OF EDUCATION for consideration.
This recommended decision may be adopted, modified or rejected by the
COMMISSIONER 	OF 	THE 	DEPARTMENT 	OF 	EDUCATION, 	who 	by 	law 	is
authorized to make a final decision in this matter. 	If the Commissioner of the
Department of Education does not adopt, modify or reject this decision within forty-five
days and unless such time limit is otherwise extended, this recommended decision
shall become a final decision in accordance with N.J.S.A. 52:14B-10.

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11
Within thirteen days from the date on which this recommended decision was
mailed to the parties, any party may file written exceptions with the COMMISSIONER
OF THE DEPARTMENT OF EDUCATION, ATTN: 	BUREAU OF CONTROVERSIES
AND DISPUTES, 100 Riverview Plaza, 4th Floor, PO Box 500, Trenton, New
Jersey 08625-0500, marked “Attention: 	Exceptions.” 	A copy of any exceptions must
be sent to the judge and to the other parties.
August 12, 2019
DATE 	SARAH G. CROWLEY, ALJ
Date Received at Agency:
Date Mailed to Parties:
SGC/cb

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APPENDIX
WITNESSES
For petitioner:
Peter Kalac
For respondent:
Elsie Sadler Williams, Auditor
EXHIBITS
For petitioner:
None
For respondent:
R-1 	Children’s Center of Monmouth County, Inc.’s 2012-2013 Annual Fiscal
and Program Information Forms
R-2 	Children’s Center of Monmouth County, Inc.’s Financial Statements and
Auditor’s Report for Fiscal Year Ended June 30, 2013
R-3 	Children’s Center of Monmouth County, Inc.’s 2013-2014 Annual Fiscal
and Program Information Forms
R-4 	Children’s Center of Monmouth County, Inc.’s Financial Statements and
Auditor’s Report for Fiscal Year Ended June 30, 2014
R-5 	July 10, 2015 Letter from Elise Sadler-Williams to Joseph Merola, Jr.
regarding 2012-2013 school year
R-6 	Department 	of 	Education’s 	Calculation 	of 	Peter 	Kalac’s 	Maximum
Allowable Part-Time Salary
R-7 	July 10, 2015 Letter from Elise Sadler-Williams to Joseph Merola, Jr.
regarding 2013-2014 school year
R-8 	October 26, 2015 Letter from Children’s Center of Monmouth County,
Inc.’s Executive Director Joseph Merola, Jr. to Elise Sadler-Williams with
Peter Kalac’s contract and job description attached

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R-9 	June 16, 2016 Letter from Elise Sadler-Williams to Joseph Merola, Jr.
regarding 2012-2013 school year
R-10 	June 17, 2016 (*restated) letter from Elise Sadler-Williams to Joseph
Merola, Jr. regarding 2012-2013 school year
R-11 	Memo and List of Recognized Job Titles, 2012-2013
R-12 	Table of Maximum Salaries for the 2012-2013 School Year
R-13 	June 17, 2016 letter from Elise Sadler-Williams to Joseph Merola, Jr.
regarding 2013-2014 school year
R-14 	Memo and List of Recognized Job Titles, 2013-2014
R-15 	Table of Maximum Salaries for the 2013-2014 School Year
R-16 	June 22, 2016 Letter from Robert A. Fodera, CPA to Elise Sadler-
Williams
R-17 	December 1, 2016 Letter from David B. Rubin to Michael Mindlin
R-18 	April 10, 2017 Letter from Michael Mindlin to David Rubin, Esq.