Provides adjustment to school district tax levy cap for expenditures associated with opening of new school facility during budget year.

A1104

ASSEMBLY, No. 1104

STATE OF NEW JERSEY

222nd LEGISLATURE

�

PRE-FILED FOR INTRODUCTION IN THE 2026 SESSION

Sponsored by:

Assemblyman JOE DANIELSEN

District 17 (Middlesex and Somerset)

SYNOPSIS

���� Provides adjustment to school district tax levy cap
for expenditures associated with opening of new school facility during budget
year.

CURRENT VERSION OF TEXT

���� Introduced Pending Technical Review by Legislative
Counsel.

��

An Act
concerning the tax levy growth limitation for school
districts and amending P.L.2007, c.62.

����
Be It
Enacted
by the Senate and General Assembly of
the State of New Jersey:

���� 1.��� Section 3 of P.L.2007,
c.62 (C.18A:7F-38) is amended to read as follows:

���� 3.��� a.� Notwithstanding the
provisions of any other law to the contrary, a school district shall not adopt
a budget pursuant to sections 5 and 6 of P.L.1996, c.138 (C.18A:7F-5 and
18A:7F-6) with an increase in its adjusted tax levy that exceeds, except as provided
in subsection e. of section 4 of P.L.2007, c.62 (C.18A:7F-39), the tax levy
growth limitation calculated as follows: the sum of the prebudget year adjusted
tax levy and the adjustment for increases in enrollment multiplied by 2.0
percent, and adjustments for an increase in health care costs,
expenditures
incurred in connection with the opening of a new school facility during the
budget year,
and increases in amounts for certain normal and accrued
liability pension contributions set forth in sections 1 and 2 of P.L.2009, c.19
amending section 24 of P.L.1954, c.84 (C.43:15A-24) and section 15 of P.L.1944,
c.255 (C.43:16A-15) for the year set forth in those sections.

���� b.��� (1)� The allowable
adjustment for increases in enrollment authorized pursuant to subsection a. of
this section shall equal the per pupil prebudget year adjusted tax levy
multiplied by EP, where EP equals the sum of:

���� (a)�� 0.50 for each unit of
weighted resident enrollment that constitutes an increase from the prebudget
year over 1%, but not more than 2.5%;

���� (b)�� 0.75 for each unit of
weighted resident enrollment that constitutes an increase from the prebudget
year over 2.5%, but not more than 4%; and

���� (c)�� 1.00 for each unit of
weighted resident enrollment that constitutes an increase from the prebudget
year over 4%.

���� (2)�� A school district may
request approval from the commissioner to calculate EP equal to 1.00 for any
increase in weighted resident enrollment if it can demonstrate that the
calculation pursuant to paragraph (1) of this subsection would result in an
average class size that exceeds 10% above the facilities efficiency standards
established pursuant to P.L.2000, c.72 (C.18A:7G-1 et al.).

���� c.���� (Deleted by amendment,
P.L.2010, c.44)

���� d.��� (1)� The allowable
adjustment for increases in health care costs authorized pursuant to subsection
a. of this section shall equal that portion of the actual increase in total
health care costs for the budget year, less any withdrawals from the current expense
emergency reserve account for increases in total health care costs, that
exceeds 2.0 percent of the total health care costs in the prebudget year, but
that is not in excess of the product of the total health care costs in the
prebudget year multiplied by the average percentage increase of the State
Health Benefits Program, P.L.1961, c.49 (C.52:14-17.25 et seq.), as annually
determined by the Division of Pensions and Benefits in the Department of the
Treasury.

���� (2)�� The allowable adjustment
for increases in the amount of normal and accrued liability pension
contributions authorized pursuant to subsection a. of this section shall equal
that portion of the actual increase in total normal and accrued liability
pension contributions for the budget year that exceeds 2.0 percent of the total
normal and accrued liability pension contributions in the prebudget year.

����
(3)�� The allowable
adjustment for expenditures incurred in connection with the opening of a new
school facility during the budget year authorized pursuant to subsection a. of
this section shall include costs associated with the new facility related to
new teaching staff members, support staff, materials and equipment, custodial
and maintenance expenditures, and such other required costs as determined by
the commissioner.

���� e.���� (Deleted by amendment,
P.L.2010, c.44)

���� f.���� The adjusted tax levy
shall be increased or decreased accordingly whenever the responsibility and
associated cost of a school district activity is transferred to another school
district or governmental entity.

(cf: P.L.2010, c.44, s.4)

���� 2.��� This act shall take
effect immediately and shall first be applicable to the next school budget year
following enactment.

STATEMENT

���� This bill authorizes an
adjustment to the school district tax levy cap for expenditures incurred by the
district in connection with the opening of a new school facility during the
budget year.� The allowable adjustment will include costs associated with the
new facility that are related to new teaching staff members, support staff,
materials and equipment, custodial and maintenance expenditures, and other
costs as may be determined by the Commissioner of Education.� It is unrealistic
to expect a school district� to� accommodate� within� its base� 2% tax� levy
increase the new costs that will be incurred by the district in the first year
that it opens a new school facility.� This bill will allow a school district to
increase its tax levy in that first year of the school�s operation to reflect
these new facility-related expenditures.