Exempts school refunding bond issuances from prior Local Finance Board approval under certain circumstances.*

S4064 SCS

SENATE COMMITTEE SUBSTITUTE FOR

SENATE, No. 4064

STATE OF NEW JERSEY

222nd LEGISLATURE

�
ADOPTED
MAY 11, 2026

Sponsored by:

Senator� LINDA R. GREENSTEIN

District 14 (Mercer and Middlesex)

Senator� SHIRLEY K. TURNER

District 15 (Hunterdon and Mercer)

Co-Sponsored by:

Senator McKnight

SYNOPSIS

���� Exempts school refunding bond issuances from prior
Local Finance Board approval under certain circumstances.

CURRENT VERSION OF TEXT

���� Substitute as adopted by the Senate Education
Committee.

��

An Act
concerning refinancing of school district debt
and amending P.L.1969, c.130.

����
Be It Enacted

by the Senate and General Assembly of the State of New Jersey:

���� 1.��� Section 5 of P.L.1969,
c.130 (C.18A:24-61.5) is amended to read as follows:

���� 5. a. A certified copy of any
refunding bond ordinance shall be filed with the Director of the Division of
Local Government Services in the Department of Community Affairs before
adoption, together with a complete statement in form prescribed by the director
and signed by the chief financial officer of the school district as to the
outstanding bonds to be funded or refunded by issuance of the refunding bonds.�
Except as provided in subsection b. of this section
,
no refunding bond
ordinance or any resolution performing, determining
,
or authorizing
matters or acts in connection with refunding bonds shall take effect until the
consent of the local finance board shall have been endorsed upon a certified
copy thereof as adopted.

���� Any certification or
endorsement of consent made by the local finance board or by a majority of the
members thereof or by the secretary thereof pursuant to its direction as to any
issue of refunding bonds shall, after the issuance of
[
such
]

the

refunding bonds in reliance thereon, be conclusive as to its validity or
regularity and shall not be contested in any action or proceeding relating to
[
such
]

the

refunding bonds instituted after the issuance of
[
such
]

those
bonds.

���� The county, municipality
,

or school district may enter into any contracts or agreements to implement the
refunding program, including agreements with banking institutions with respect
to the application of moneys deposited in a sinking fund for the payment of the
refunding bonds at their maturity date to the purchase of obligations of the
United States Government or obligations the principal of and interest on which
are guaranteed by the United States Government or obligations of any agency or
instrumentality of the United States Government without regard to any
limitations as to the investment or deposit of moneys.

���� b.��� Refunding bonds to
realize total debt service savings on outstanding obligations may be issued
without the approval of the Local Finance Board in the Department of Community
Affairs when authorized by conditions set forth in rules and regulations of the
Local Finance Board and upon a resolution adopted by 2/3 vote of the full
membership of the board of education of the district.�
The rules and
regulations promulgated by the Local Finance Board pursuant to this subsection
shall, at a minimum, provide that prior approval of the Local Finance Board is
not required for refunding bonds issued by school districts in which the
present value savings are at least two percent.

(cf: P.L.2003, c.264, s.8)

���� 2.��� This act shall take
effect immediately and shall first apply to the first full school year
following the date of enactment, except that the Local Finance Board and the Commissioner
of Education may take any administrative action in advance as shall be
necessary for the implementation of this act.