SENATE BUDGET AND APPROPRIATIONS COMMITTEE

STATEMENT TO

[Third Reprint]

ASSEMBLY, No. 4854

with committee amendments

STATE OF NEW JERSEY

DATED:  NOVEMBER 13, 2025

      The Senate Budget and Appropriations Committee reports favorably and with committee amendments Assembly Bill No. 4854 (3R).

      As amended, this bill modifies the laws governing the allocation of State aid for auxiliary services and remedial services to nonpublic school students. 

      The bill specifically requires the Commissioner of Education to establish a process by which school districts are to be reimbursed for costs that are incurred to provide auxiliary and remedial services for eligible nonpublic school students.  Pursuant to the bill, school districts are to be reimbursed for costs within the limits of applicable maximum per service aid amounts, as established by the commissioner.  The maximum per service aid amounts are to be determined by dividing the amount annually appropriated to provide auxiliary and remedial services in the annual appropriations act by the average number of documented services delivered in the prior three school years.  In the second full school year following the date of enactment of the bill and every third school year thereafter, the commissioner is required to conduct a survey, which would collect from service providers information as the commissioner deems necessary to calculate the average and range of costs incurred to provide services.  The commissioner is required to report the findings of the survey to the Governor and the Legislature and use the report to inform recommendations on the annual appropriations to provide auxiliary and remedial services.

      In distributing State aid for auxiliary and remedial services, the commissioner is required to ensure that, to the greatest extent possible, the amounts annually appropriated for auxiliary services and remedial services are fully exhausted by the end of the school year for which the maximum amounts are established, and that the amounts appropriated are equitably distributed among school districts applying for reimbursement.  To the extent permitted by federal law, the commissioner may establish limits on the duration and frequency of certain auxiliary and remedial services in order to ensure that the greatest number of eligible students are provided services throughout the school year and that, to the greatest extent possible, the amount annually appropriated for the services is available to reimburse school districts during the entirety of the school year. 

      The reimbursement process to be implemented by the commissioner pursuant to the bill would permit school districts to apply quarterly for reimbursement payments.  The details of the reimbursement process are to be annually announced on July 15 of the school year, and districts can begin submitting for reimbursement on September 1.  Reimbursements are to be made to school districts throughout the school year until the full amount annually appropriated as State aid for nonpublic school auxiliary and remedial services has been fully expended.

      School districts seeking reimbursement under the bill are required to submit applications on a quarterly basis and adhere to all established submission guidelines, accounting and budgeting guidance, documentation requirements, and defined timelines for reimbursement. 

      In order to ensure the full reimbursement of eligible costs, the bill also removes provisions of law setting forth the calculation of both categories of aid.  Under current law, State aid allotments for an upcoming school year are calculated by multiplying the applicable per pupil service cost by the number of students who were previously identified as eligible to receive each service. 

      The bill also removes sections of current law that: (1) require school districts to refund unexpended State aid for nonpublic auxiliary and remedial services; and (2) require the commissioner to prorate State nonpublic auxiliary and remedial services aid amounts downward, in the event that the amount of State aid appropriated for those purposes is insufficient.

      As amended and reported by the committee, Assembly Bill No. 4854 (3R) is identical to Senate Bill No. 4312 (1R), which was also amended and reported by the committee on this date.

COMMITTEE AMENDMENTS:

      The committee amended the bill to provide that the bill is to be effective immediately and first apply to the first full school year following the date of enactment.

FISCAL IMPACT:

      The Office of Legislative Services (OLS) finds that this bill would raise annual State expenditures for auxiliary and remedial services for nonpublic school students by increasing service utilization and potentially, on a periodic basis, provider reimbursement rates. The OLS, however, lacks the information necessary to quantify the annual State expenditure growth. While the bill provides a triennial impetus for provider rate increases, the higher rates would not be automatic and would be contingent upon approval by the Governor and the Legislature, which the OLS cannot reasonably anticipate.

      Local school districts deliver the auxiliary and remedial services to nonpublic school students on behalf of the State. Accordingly, higher State program costs would increase the annual expenditures of local school districts, offset by higher reimbursements from the State.

      In the second full year following the bill’s enactment and every third year thereafter, the bill may increase State expenditures from requiring the Department of Education to conduct a provider rate survey. The OLS, however, has no insights into whether the department would rely on existing staff to conduct the survey, hire additional staff, or engage a vendor.