LEGISLATIVE FISCAL ESTIMATE
SENATE COMMITTEE SUBSTITUTE FOR
SENATE, No. 3081
STATE OF NEW JERSEY
221st LEGISLATURE
DATED: MAY 16, 2024
SUMMARY
Synopsis: Establishes Stabilized School Budget Aid Grant Program to restore
certain portions of State school aid reductions; permits certain school
districts to exceed tax levy growth limitation in 2024-2025 school
year; appropriates $44.7 million.
Type of Impact: State expenditure increase from the Property Tax Relief Fund. Local
school district revenue increase.
Agencies Affected: Department of Education. Local school districts.
Office of Legislative Services Estimate
Fiscal Impact 2024-2025 School Year
State Expenditure Increase Up to $48.2 million
Local Revenue from Increased
Property Tax Levies Up to $221.4 million
The Office of Legislative Services (OLS) concludes that this bill may cost the State up to $48.2
million to provide aid grants equal to 45 percent of proposed State school aid reductions in the
2024-2025 school year. Information contained in the State aid notices for the 2024-2025
school year distributed by the Department of Education in February 2024 indicate total
Statewide reductions of $107.2 million.
The OLS also estimates that, pursuant to the bill, a total of 159 school districts may request
increases to their tax levies. The OLS estimates that if all 159 districts received approval for
the maximum levy increase permitted by the bill, local school districts may realize a revenue
increase of up to $221.4 million in the 2024-2025 school year. The OLS notes that the bill
does not require school districts to implement the tax levy increases authorized by the bill;
therefore, the estimated amount of school district tax levy increases is a maximum.
Office of Legislative Services Legislative Budget and Finance Office
State House Annex Phone (609) 847-3105
P.O. Box 068 Fax (609) 777-2442
Trenton, New Jersey 08625 www.njleg.state.nj.us
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BILL DESCRIPTION
This bill establishes in the Department of Education a Stabilized School Budget Aid Grant
Program. The purpose of the program is to provide aid grants to eligible school districts equal to
45 percent of the amount of the school districts’ State school aid reductions, as calculated under
current law for the 2024-2025 school year. The bill appropriates $44.7 million to fund the
program.
The bill also permits school districts, which experienced reductions in State school aid in the
2024-2025 school year compared to the 2020-2021 school year, to request certain increases in their
adjusted property tax levies above the amounts permitted under current law. The maximum
amount of the adjusted tax levy increase pursuant to the bill is the difference between the amount
of State school aid allocated to a school district in the 2020-2021 school year and the amount of
State school aid allocated to the district in the 2024-2025 school year. However, the bill prohibits
a school district from increasing its adjusted tax levy by more than 9.9 percent of the prior year’s
tax levy. The authorization to increase the adjusted tax levy pursuant to the provisions of the bill
would not apply to SDA districts.
FISCAL ANALYSIS
EXECUTIVE BRANCH
None received.
OFFICE OF LEGISLATIVE SERVICES
The OLS concludes that this bill may cost the State up to $48.2 million to provide aid grants
equal to 45 percent of proposed State school aid reductions in the 2024-2025 school year.
Information contained in the State aid notices for the 2024-2025 school year, which were
distributed by the Department of Education in February 2024, indicate total Statewide reductions
of $107.2 million. The OLS estimates that 152 school districts will be eligible for aid grants
pursuant to the bill.
The OLS also estimates that, pursuant to the bill, a total of 159 school districts may request
increases to their tax levies. The OLS estimates that if all 159 districts received approval for the
maximum levy increase permitted by the bill, local school districts may realize a revenue increase
of up to $221.4 million in the 2024-2025 school year. The OLS notes that the bill does not require
school districts to implement the tax levy increases authorized by the bill; therefore, the estimated
amount of school district tax levy increases is a maximum.
Section: Education
Analyst: Abigail Chambers
Associate Fiscal Analyst
Christopher Myles
Senior Fiscal Analyst
Approved: Thomas Koenig
Legislative Budget and Finance Officer
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This legislative fiscal estimate has been produced by the Office of Legislative Services due to the
failure of the Executive Branch to respond to our request for a fiscal note.
This fiscal estimate has been prepared pursuant to P.L.1980, c.67 (C.52:13B-6 et seq.).