A New Jersey state commission has approved an increase in health insurance premiums for the state’s school districts of 25% and for local governments of 16%.

The State Health Benefits Commission voted in favor of the hike July 22, after a consulting firm hired by state officials recommended the move, citing the rising cost of health care nationally, a change in benefits and an increase in employees using the plan, according to the Newark Star-Ledger.

Aon, the consultant for the state, projects health care for employees in New Jersey’s more than 250 school districts will cost $1.84 billion next year, according to the report.

Nearly 300,000 current and retired employees of the school districts are enrolled in a state program created expressly for them last year, with a 33% increase in enrolled employees this year.

Frank Belluscio, a spokesman for the New Jersey School Boards Association, told the paper that the difference between the high cost of private health care coverage and the state plan was one of the driving factors in the increase.

The executive director of the New Jersey League of Municipalities said that if the state doesn’t help its towns with rising health care costs, an increase in property taxes, municipal layoffs and fewer services could greet residents.