This bill authorizes the forgiveness of up to $10 million in funds owed to the State by public school districts that have borrowed money from the State to supplement their general fund budgets since the enactment of P.L.2018, c.67. The Commissioner of Education and the State Treasurer are tasked with forgiving the outstanding balance owed as of the date of enactment. Additionally, if a school district has applied for a loan prior to the enactment date, the Commissioner and Treasurer will issue the full amount upon approval and forgive up to $10 million of those borrowed funds. The bill defines borrowed funds to include loans and advanced State aid payments, along with any associated interest or fees.

The legislation aims to address the financial hardships faced by certain school districts due to significant cuts in state aid, particularly under the implementation of P.L.2018, c.67. The sponsor highlights the severe impact of these cuts, including job losses and program eliminations, as well as the inability of districts to close budget shortfalls through traditional means such as property tax increases. The bill is seen as a temporary measure to alleviate the debt burden on affected districts while a more permanent solution to school funding is sought.