Red Ink in Newark Mars State Takeover

More than four years into state control of its operations, the troubled Newark school system has developed a $58 million hole in its budget that New Jersey officials are being forced to fill in order to stave off program or salary cuts in the state's largest district.

The shortfall comes at a time when enthusiasm for state takeovers is ebbing nationwide, and it has already added new questions about the wisdom of running a city's schools from the state capital.

While no one would claim that New Jersey has completely turned around the three districts in which it has seized control—Newark, Jersey City, and Paterson—state officials have often cited vastly improved budget and management practices as a major accomplishment. Now, even...

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