Prohibits application of State aid growth limit to State school aid provided in 2026-2027 school year; appropriates $332.6 million.

2026-2027 Regular Session Introduced by Dawn Fantasia and 3 co-sponsors

The bill exempts 2026-2027 State school aid from the growth limit, ensuring districts receive their uncapped aid amounts with $332,570,597 funding.

Introduced, Referred to Assembly Education Committee

Summary of Bill A 5178 (Session 222, New Jersey)

Purpose and intent

This bill provides a temporary exception to New Jersey’s State aid growth limits for the 2026-2027 school year. It ensures that school districts can receive the full amount of State school aid calculated for 2026-2027 prior to any growth cap being applied.

Key provisions

1) Exemption from State aid growth limit
- The Commissioner of Education must not apply any State aid growth limit to increases in State school aid for 2026-2027.
- Specifically, if a district’s uncapped State school aid for 2026-2027 (as calculated in the March 2026 State school aid notice) would be reduced by the growth limit, the reduction is prohibited.
- Definitions:
- State school aid: The sum of equalization aid, transportation aid, special education categorical aid, and security categorical aid.
- Uncapped State school aid: The district’s total in these categories calculated before applying any growth limit.

2) Funding appropriation
- The bill appropriates $332,570,597 from the Property Tax Relief Fund to the Department of Education to implement its provisions.

3) Effective date
- The act takes effect immediately upon enactment.

Amount and funding context

Total appropriation: $332,570,597 to preserve the 2026-2027 State school aid level without the growth cap reduction.

This funding is intended to offset the impact of the existing State aid growth limit in the 2026-2027 school year.

Affected entities

New Jersey public school districts receiving State school aid (equalization, transportation, special education categorical aid, and security categorical aid) will be protected from reductions due to the growth limit for the 2026-2027 school year.

The Department of Education administers the aid and would allocate funds consistent with the bill’s provisions.

Procedural and timeline notes

Legislative action history shows introduction on June 1, 2026, and referral to the Assembly Education Committee.

If enacted, the provision applies specifically to the 2026-2027 school year, aligning with the Governor’s FY 2027 Budget language that otherwise imposes a 6% growth limit on State school aid relative to 2025-2026.

The bill is designed to provide immediate effect upon enactment.

Practical impact and considerations

Districts would receive the full calculated 2026-2027 State school aid amounts, potentially increasing predictability of funding and avoiding reductions caused by the six-percent growth cap.

The appropriated funds are dedicated to this purpose, ensuring the targeted districts are fully compensated for the 2026-2027 year.

Finally, the bill does not alter the growth limit framework for years after 2026-2027; the exemption is explicitly for the 2026-2027 school year.