A 3881 is sponsored by Morales, Carmen Theresa (Democrat), Angelozzi, Anthony (Democrat), Reynolds-Jackson, Verlina (Democrat), Stanley, Sterley S. (Democrat), and Coughlin, Craig J. (Democrat).

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New Jersey 222nd Legislature Status: Introduced 5 D cosponsors

A 3881 — Requires Commissioner of Education to take certain action concerning preliminary State school aid notices and school district budgets and creates New Jersey Education Funding Portal; modifies certain provisions in school funding law.

Last action June 15, 2026 — REP/ACA REF AAP

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Introduced
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In Committee
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Passed General Assembly
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Passed Senate
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To Executive
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Enacted

This bill has been introduced in the General Assembly. Introduced January 13, 2026. It must pass committee before a floor vote.

Next likely step: a committee referral and hearing.

Odds of enactment

Low chance

Based on the sponsor, cosponsors, and committee posture, this bill has a low chance of becoming law.

Upgrade to see the exact probability and what's driving it.

A statistical estimate from our own model of past outcomes — an insight, not a guarantee. Policymaking is volatile.

Prognosis

Advancing 36% · moderate confidence

Introduced

Current position in the legislative process.
5 sponsors

3 primary, 2 co-sponsors signed on.
Single-party support

Sponsorship is currently within one party (5 D).
Cleared a recorded vote

Passed 1 recorded vote so far.

Based on stage, sponsorship breadth, committee status, recorded votes, and cross-state momentum — a description of the observable signals, not a prediction.

In plain language

This bill modifies school funding law and creates a New Jersey Education Funding Portal.

The legislation requires the Commissioner of Education to handle preliminary state school aid notices and school district budgets. It also creates a portal to provide information on education funding in New Jersey.

What this means for you

Families: Families can access a new portal that provides clarity on education funding and school aid.

Summary

St. school aid & district budgets-modifies cert provisions in school funding law

Bill Text

What changed in the latest version

344 added · 127 removed

Plain-language change summary

The amendment modifies Section 5 of P.L.1996, c.138 (C.18A:7F-5) by specifying that "cost of living" refers to the Consumer Price Index as defined in another statute. Additionally, it outlines that the commissioner must inform each district of specific financial data within 30 days after approving the Educational Adequacy Report. This change provides clarity on how educational funding details will be calculated and communicated to school districts, which may affect budget planning and resource allocation for their programs.

A3881 1R [First Reprint] ASSEMBLY, No.

CURRENT VERSION OF TEXT ~~Introduced~~As ~~Pending~~reported ~~Technical~~by ~~Review~~the byAssembly ~~Legislative~~Education ~~Counsel.~~Committee on June 15, 2026, with amendments.

1. 1[1. Section 5 of P.L.1996, c.138 (C.18A:7F-5) is amended to read as follows:

P.L.2024, c.60, ~~s.1)~~s.1)]1 2.11. Section 5 of P.L.1996, c.138 (C.18A:7F-5) is amended to read as follows:

5. As used in this section, "cost of living" means the CPI as defined in section 3 of P.L.2007, c.260 (C.18A:7F-45).

a. Within days following the approval of the Educational Adequacy Report, the commissioner shall notify each district of the base per pupil amount, the per pupil amounts for full-day preschool, the weights for grade level, county vocational school districts, at-risk pupils, bilingual pupils, and combination pupils, the cost coefficients for security aid and for transportation aid, the State average classification rate and the excess cost for general special education services pupils, the State average classification rate and the excess cost for speech-only pupils, and the geographic cost adjustment for each of the school years to which the report is applicable.

Beginning with State school aid calculated for the 2026-2027 school year, the commissioner shall annually, no later than the end of the first week in December, provide each district with a preliminary State aid notice that details the minimum amount of State aid payable to the district in the succeeding school year pursuant to the provisions of P.L.2007, c.260 (C.18A:7F-43 et al.).

Annually, within two days following the transmittal of the State budget message to the Legislature by the Governor pursuant to section 11 of P.L.1944, c.112 (C.52:27B-20), the commissioner shall notify each district of the maximum amount of aid payable to the district in the succeeding school year pursuant to the provisions of P.L.2007, c.260 (C.18A:7F-43 et al.) or the amount of aid payable to the district in the succeeding school year pursuant to the State budget message, and shall notify each district of the district's adequacy budget for the succeeding school year. The commissioner shall, on the same date, notify each school district of the projected Statewide property value rate and the projected Statewide income rate to be used in the calculation of a district’s local share in the year following the succeeding school year. For the 2008-2009 school year and thereafter, unless otherwise specified within P.L.2007, c.260 (C.18A:7F-43 et al.), aid amounts payable for the budget year shall be based on budget year pupil counts, which shall be projected by the commissioner using data from prior years. Adjustments for the actual pupil counts of the budget year shall be made to State aid amounts payable during the school year succeeding the budget year. Additional amounts payable shall be reflected as revenue and an account receivable for the budget year.

Notwithstanding any other provision of this act to the contrary, each district's State aid payable for the 2008-2009 school year, with the exception of aid for school facilities projects, shall be based on simulations employing the various formulas and State aid amounts contained in P.L.2007, c.260 (C.18A:7F-43 et al.).

The commissioner shall prepare a report dated December 12, 2007 reflecting the State aid amounts payable by category for each district and shall submit the report to the Legislature prior to the adoption of P.L.2007, c.260 (C.18A:7F-43 et al.). Except as otherwise provided pursuant to this subsection and paragraph (3) of subsection d.

of section 5 of P.L.2007, c.260 (C.18A:7F-47), the amounts contained in the commissioner's report shall be the final amounts payable and shall not be subsequently adjusted other than to reflect the phase-in of the required general fund local levy pursuant to paragraph (4) of subsection b.

of section 16 of P.L.2007, c.260 (C.18A:7F-58) and to reflect school choice aid to which a district may be entitled pursuant to section 20 of that act.

The projected pupil counts and equalized valuations used for the calculation of State aid shall also be used for the calculation of adequacy budget, local share, and required local share. For 2008-2009, extraordinary special education State aid shall be included as a projected amount in the commissioner's report dated December 12, 2007 pending the final approval of applications for the aid. If the actual award of extraordinary special education State aid is greater than the projected amount, the district shall receive the increase in the aid payable in the subsequent school year pursuant to the provisions of subsection c.

of section 13 of P.L.2007, c.260 (C.18A:7F-55). If the actual award of extraordinary special education State aid is less than the projected amount, other State aid categories shall be adjusted accordingly so that the district shall not receive less State aid than as provided in accordance with the provisions of sections 5 and 16 of P.L.2007, c.260 (C.18A:7F-47 and C.18A:7F-58).

In the event that the commissioner determines, following the enactment of P.L.2007, c.260 (C.18A:7F-43 et al.) but prior to the issuance of State aid notices for the 2008-2009 school year, that a significant district-specific change in data warrants an increase in State aid for that district, the commissioner may adjust the State aid amount provided for the district in the December 12, 2007 report to reflect the increase.

b. Each district shall have a required local share. For districts that receive educational adequacy aid pursuant to subsection b.

of section 16 of P.L.2007, c.260 (C.18A:7F-58), the required local share shall be calculated in accordance with the provisions of that subsection.

For all other districts, the required local share shall equal the lesser of the local share calculated at the district's adequacy budget pursuant to section 9 of P.L.2007, c.260 (C.18A:7F-51), or the district's budgeted local share for the prebudget year.

In order to meet this requirement, each district shall raise a general fund tax levy which equals its required local share.

No municipal governing body or bodies or board of school estimate, as appropriate, shall certify a general fund tax levy which does not meet the required local share provisions of this section.

c. Annually, on or before March 4, or on or before March 20 in the case of a school district with an annual school election in November, each district board of education shall adopt, and submit to the commissioner for approval, together with such supporting documentation as the commissioner may prescribe, a budget that provides for a thorough and efficient education.

Notwithstanding the provisions of this subsection to the contrary, the commissioner may adjust the date for the submission of district budgets if the commissioner determines that the availability of preliminary aid numbers for the subsequent school year warrants such adjustment.

Notwithstanding any provision of this section to the contrary, for the 2005-2006 school year each district board of education shall submit a proposed budget in which the advertised per pupil administrative costs do not exceed the lower of the following:

(1) the district's advertised per pupil administrative costs for the 2004-2005 school year inflated by the cost of living or 2.5 percent, whichever is greater;

or (2) the per pupil administrative cost limits for the district's region as determined by the commissioner based on audited expenditures for the 2003-2004 school year.

The executive county superintendent of schools may disapprove the school district's 2005-2006 proposed budget if he determines that the district has not implemented all potential efficiencies in the administrative operations of the district. The executive county superintendent shall work with each school district in the county during the 2004-2005 school year to identify administrative inefficiencies in the operations of the district that might cause the superintendent to reject the district's proposed 2005-2006 school year budget.

For the 2006-2007 school year and each school year thereafter, each district board of education shall submit a proposed budget in which the advertised per pupil administrative costs do not exceed the lower of the following:

(1) the district's prior year per pupil administrative costs;

except that the district may submit a request to the commissioner for approval to exceed the district's prior year per pupil administrative costs due to increases in enrollment, administrative positions necessary as a result of mandated programs, administrative vacancies, nondiscretionary fixed costs, and such other items as defined in accordance with regulations adopted pursuant to section 7 of P.L.2004, c.73. In the event that the commissioner approves a district's request to exceed its prior year per pupil administrative costs, the increase authorized by the commissioner shall not exceed the cost of living or 2.5 percent, whichever is greater;

or (2) the prior year per pupil administrative cost limits for the district's region inflated by the cost of living or 2.5 percent, whichever is greater.

(1) A district's general fund tax levy shall not exceed the district's adjusted tax levy as calculated pursuant to sections 3 and 4 of P.L.2007, c.62 (C.18A:7F-38 and 18A:7F-39).

(2) (Deleted by amendment, P.L.2007, c.260) (3) (Deleted by amendment, P.L.2007, c.260) (4) Any debt service payment made by a school district during the budget year shall not be included in the calculation of the district's adjusted tax levy.

(5) (Deleted by amendment, P.L.2007, c.260) (6) (Deleted by amendment, P.L.2007, c.260) (7) (Deleted by amendment, P.L.2004, c.73) (8) (Deleted by amendment, P.L.2010, c.44) (9) Any district may submit at the annual school budget election, in accordance with subsection c.

of section 4 of P.L.2007, c.62 (C.18A:7F-39), a separate proposal or proposals for additional funds, including interpretive statements, specifically identifying the program purposes for which the proposed funds shall be used, to the voters, who may, by voter approval, authorize the raising of an additional general fund tax levy for such purposes. In the case of a district with a board of school estimate, one proposal for the additional spending shall be submitted to the board of school estimate.

Any proposal or proposals submitted to the voters or the board of school estimate shall not:

include any programs and services that were included in the district's prebudget year net budget unless the proposal is approved by the commissioner upon submission by the district of sufficient reason for an exemption to this requirement or include any new programs and services necessary for students to achieve the thoroughness standards established pursuant to subsection a.

of section 4 of P.L.2007, c.260 (C.18A:7F-46).

A district without a board of school estimate may also submit to the voters at a special election authorized pursuant to section 2 of P.L.1995, c.278 (C.19:60-2), a separate proposal or proposals for additional funds for the subsequent budget year, including interpretive statements, specifically identifying the program purposes for which the proposed funds shall be used. A proposal submitted at a special election shall comply with the requirements of this paragraph and section 4 of P.L.2007, c.62 (C.18A:7F-39). A separate proposal or proposals for additional funds may only be submitted on a date of a special election once during a school year. Nothing in this paragraph shall be construed to prohibit the submission to the voters of a question or questions for the approval of a capital project or projects on the same special election date as the submission of a separate proposal or proposals for additional funds.

In the case of a school district in which the annual school election has been moved to November pursuant to subsection a.

Show all 77 changed lines (37 more)

of section 1 of P.L.2011, c.202 (C.19:60-1.1), the school district may submit a separate proposal for additional funds for the budget year, or a separate proposal for additional funds for the subsequent budget year, or separate proposals for additional funds for each of those budget years. In the event that a school district submits a separate proposal for additional funds for the subsequent budget year and the separate proposal is approved, the school district shall not add to its adjusted tax levy for the subsequent budget year any amount authorized pursuant to subsection e.

of section 4 of P.L.2007, c.62 (C.18A:7F-39).

The executive county superintendent of schools may prohibit the submission of a separate proposal or proposals to the voters or board of school estimate if he determines that the district has not implemented all potential efficiencies in the administrative operations of the district, which efficiencies would eliminate the need for the raising of an additional general fund tax levy.

(10) Notwithstanding any provision of law to the contrary, if a district proposes a budget with a general fund tax levy and equalization aid which exceed the adequacy budget, the following statement shall be published in the legal notice of public hearing on the budget pursuant to N.J.S.18A:22-28, and posted at the public hearing held on the budget pursuant to N.J.S.18A:22-29:

"Your school district has proposed programs and services in addition to the core curriculum content standards adopted by the State Board of Education. Information on this budget and the programs and services it provides is available from your local school district." (11) Any reduction that may be required to be made to programs and services included in a district's prebudget year net budget in order for the district to limit the growth in its budget between the prebudget and budget years by its tax levy growth limitation as calculated pursuant to sections 3 and 4 of P.L.2007, c.62 (C.18A:7F-38 and 18A:7F-39), shall only include reductions to excessive administration or programs and services that are inefficient or ineffective.

(1) In the case of a district having a board of school estimate, other than a Type II district with a board of school estimate, which has a proposed budget that includes a general fund tax levy and equalization aid in excess of the adequacy budget, the general fund tax levy shall be submitted to the board for determination of the amount that should be expended. If the board of school estimate reduces the district's proposed budget, the district may appeal any of the reductions to the commissioner on the grounds that the reductions will negatively impact on the stability of the district given the need for long term planning and budgeting. In considering the appeal, the commissioner shall consider enrollment increases or decreases within the district, the impact on the local levy, and whether the reductions will impact on the ability of the district to fulfill its contractual obligations. A district may not appeal any reductions on the grounds that the amount is necessary for a thorough and efficient education.

(2) In the case of a district having a board of school estimate, other than a Type II district with a board of school estimate, which has a proposed budget that includes a general fund tax levy and equalization aid at or below the adequacy budget, the general fund tax levy shall be submitted to the board for determination. Any reductions may be appealed to the commissioner on the grounds that the amount is necessary for a thorough and efficient education or that the reductions will negatively impact on the stability of the district given the need for long term planning and budgeting. In considering the appeal, the commissioner shall also consider the factors outlined in paragraph (1) of this subsection.

In addition, the board of school estimate shall be required to demonstrate clearly to the commissioner that the proposed budget reductions shall not adversely affect the ability of the school district to provide a thorough and efficient education or the stability of the district given the need for long term planning and budgeting.

(3) In lieu of any budget reduction appeal provided for pursuant to paragraphs (1) and (2) of this subsection, the State board may establish pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), an expedited budget review process based on a district's application to the commissioner for an order to restore a budget reduction.

(4) When the board of education or the board of school estimate authorize the general fund tax levy, the district shall submit the resulting budget to the commissioner within 15 days of the authorization.

f. (Deleted by amendment, P.L.2007, c.260) g. (Deleted by amendment, P.L.2007, c.260)1 (cf:

P.L.2025, c.234, s.1) 2.

P.L.2007, c.260, s.4) 3.

Section 10 of P.L.2007, c.260 (C.18A:7F-52) is amended to read as follows:

~~10.~~ 10. ~~Each~~ ~~school~~ ~~district~~ ~~and~~ ~~county~~ ~~vocational~~ ~~school~~ ~~district~~ ~~shall~~ ~~receive~~ ~~equalization~~ ~~aid~~ ~~predicated~~ on a ~~local~~ ~~share~~ ~~determined~~ by ~~district~~ ~~property~~ ~~wealth~~ ~~and~~ ~~district~~ ~~income.~~

Each a. school ~~Each~~district ~~district's~~and county vocational school district shall receive equalization aid predicated on a local share ~~shall~~determined beby ~~calculated~~district asproperty ~~follows:~~wealth and district income.

~~LSHARE~~a. =Each ~~(EQVAL~~ x ~~PVR~~ x ~~50%)~~ + ~~(INC~~ x ~~INR~~ x ~~50%)~~ ~~where~~ ~~EQVAL~~ is ~~the~~ ~~average~~ of ~~the~~ district's ~~[prebudget~~local ~~year]~~share ~~equalized~~ ~~valuation~~ ~~amounts~~ ~~for~~ ~~the~~ ~~preceding~~ ~~three~~ ~~school~~ ~~years,~~ ~~except~~ ~~that,~~ ~~when~~ ~~calculating~~ ~~the~~ ~~average,~~ ~~the~~ ~~value~~ ~~used~~ ~~for~~ ~~the~~ ~~prebudget~~ ~~year~~ shall be ~~the~~calculated ~~lesser~~as offollows: ~~the~~ ~~actual~~ ~~equalized~~ ~~valuation~~ ~~for~~ ~~that~~ ~~year~~ ~~and~~ ~~the~~ ~~equalized~~ ~~valuation~~ ~~for~~ ~~the~~ ~~year~~ ~~preceding~~ ~~the~~ ~~prebudget~~ ~~year~~ ~~multiplied~~ by ~~1.05.~~ ~~For~~ ~~the~~ ~~2026-2027~~ ~~school~~ ~~year,~~ ~~the~~ ~~value~~ ~~used~~ ~~for~~ ~~the~~ ~~prebudget~~ ~~year~~ ~~shall~~ be ~~the~~ ~~equalized~~ ~~valuation~~ ~~for~~ ~~the~~ ~~year~~ ~~preceding~~ ~~the~~ ~~prebudget~~ ~~year~~ ~~multiplied~~ by ~~1.05;~~

LSHARE = (EQVAL x PVR x 50%) + (INC x INR x 50%) where EQVAL is the ~~Statewide~~average ~~property~~of the district's [prebudget year] equalized valuation amounts for the preceding three school years, except that, when calculating the average, the value ~~rate~~used ~~determined~~for ~~pursuant~~the toprebudget ~~subsection~~year c.shall be the lesser of the actual equalized valuation for that year and the equalized valuation for the year preceding the prebudget year multiplied by 1.05. For the 2026-2027 school year, the value used for the prebudget year shall be the equalized valuation for the year preceding the prebudget year multiplied by 1.05;

PVR is the Statewide property value rate determined pursuant to subsection c.

INC is the average of the district's income for the calendar year ending two years prior to the prebudget year and the two calendar years prior to that, except that, when calculating the average, the value used for the calendar year ending two years prior to the prebudget year shall be the lesser of the actual district income for that year and the district income for the year preceding that year multiplied by 1.05. For the 2026-2027 school year, the value used for the calendar year ending two years prior to the prebudget year shall be the district income for the year preceding that year multiplied by 1.05;

and INR is the Statewide income rate determined pursuant to subsection c.

b. b. The local share for each county vocational school district shall be calculated as follows:

LSHARE = (COLSHARE/COAB) x AB where COLSHARE is the sum of the local shares for all school districts in the county calculated pursuant to subsection a.

COAB is the sum of the adequacy budgets for all school districts in the county calculated pursuant to section 9 of [this act] P.L.2007, c.260 (C.18A:7F-51);

and AB is the county vocational school district's adequacy budget calculated pursuant to section 9 of [this act] P.L.2007, c.260 (C.18A:7F-51).

c. c. For the 2008-2009 school year, the property value rate shall be set at 0.0092690802 and the income value rate shall be set at 0.04546684. For subsequent school years the values for the property value rate and the income value rate shall be annually determined by the commissioner as follows:

the property value rate shall be determined such that equalization aid equals the Statewide available equalization aid for all districts determined according to [this act] P.L.2007, c.260 (C.18A:7F-43 et al.) had each school district's local share equaled the product of the property value rate and the district's ~~five-year~~1[five-year] three-year1 average equalized valuation and each county vocational school district's local share equaled the product of the county vocational school district's adequacy budget and the average local share, expressed as a percent, of the school districts located in the county;

and the income rate shall be determined such that equalization aid equals the Statewide available equalization aid for all districts determined according to [this act] P.L.2007, c.260 (C.18A:7F-43 et al.) had each school district's local share equaled the product of the income rate and the district's 1three-year average1 income and each county vocational school district's local share equaled the product of the county vocational school district's adequacy budget and the average local share, expressed as a percent, of the school districts located in the county.

In the event that these rates, when used in accordance with the provisions of this section and assuming that each district's general fund levy is equal to its local share, do not result in equalization aid for all districts equal to the Statewide available equalization aid, the commissioner shall adjust these rates appropriately, giving equal weight to each.

STATEMENT This bill modifies certain provisions of school funding law, including requiring the Commissioner of Education to take certain action concerning preliminary State school aid notices and school district budgets, and creates the New Jersey Education Funding Portal.

The bill requires that the commissioner annually, no later than the end of the first week in December, provide each district with a preliminary State aid notice that details the minimum amount of State aid payable to the district in the succeeding school year. Additionally, within two days following the transmittal of the State budget message by the Governor, the commissioner is to notify each district of the projected Statewide property value rate and the projected Statewide income rate to be used in the calculation of a district’s local share in the year following the succeeding school year.

The bill also amends provisions of law governing to Educational Adequacy Report to require that the Legislature adopt a concurrent resolution to approve the report or that advises the Governor of the Legislature’s specific objections to the report, rather than deeming the report to be approved unless a concurrent resolution is adopted objecting to all or part of the report.

The bill also revises the definition of equalized valuation and district income used in a school district’s calculation of local share to provide that both measures are equal to the average of the district’s values for the preceding three years, except that, when calculating the average, the value used for the prebudget year is to be the lesser of the actual value for that year and the value for the year preceding the prebudget year multiplied by 1.05. For the 2026-2027 school year, the value used for the prebudget year shall be the value for the year preceding the prebudget year multiplied by 1.05.

Additionally, the bill allows a school district which is proposed to experience a State school aid reduction to first submit its budget to the commissioner no later than five days following the enactment of the appropriations act for the budget year and to revise the district’s budget at any point within the first six months of the budget year.

The bill also requires the Department of Education to establish a New Jersey Education Funding Portal on the department’s Internet website which is to make available to school districts and members of the public the data inputs and calculations used by the department in formulating State school aid for all school districts. The portal is to allow individuals to adjust certain data inputs for a school district, including enrollment, equalized property values, and district income, and provide an estimate of the impact of these changes on the district’s State aid.

Finally, the bill stipulates that, for the 2026-2027 school year, the Statewide property value rate and the Statewide income rate are to be the same as the rates used in the 2025-2026 school year, and the total amount of Statewide equalization aid available for the 2026-2027 school year is to equal the sum of each school district’s allocation of equalization aid.

Latest

A3881 ASSEMBLY, No.

A3881 1R [First Reprint] ASSEMBLY, No.

CURRENT VERSION OF TEXT ~~Introduced~~ ~~Pending~~ ~~Technical~~ ~~Review~~ by ~~Legislative~~ ~~Counsel.~~

CURRENT VERSION OF TEXT As reported by the Assembly Education Committee on June 15, 2026, with amendments.

1. Section 5 of P.L.1996, c.138 (C.18A:7F-5) is amended to read as follows:

1[1. Section 5 of P.L.1996, c.138 (C.18A:7F-5) is amended to read as follows:

P.L.2024, c.60, ~~s.1)~~ 2.

P.L.2024, c.60, s.1)]1 11. Section 5 of P.L.1996, c.138 (C.18A:7F-5) is amended to read as follows: