The state Senate on Monday gave final legislative approval to a bill designed to provide loans to any school district operating on a deficit. The legislation would also establish state monitoring over such districts’ financial operations.

The “School District Fiscal Accountability Act,” S-1469 (Turner, Allen, Bryant)/A-2684 (Conaway, Conners), was prompted by the Willingboro school district’s current financial situation.

Under the bill, the state Department of Education would create a “School Deficit Relief Account” to provide advance aid payments to the district upon recommendation of the commissioner of education.  The advance payments would be repaid through automatic reductions in the district’s state aid in future years.

In addition, the state would appoint a monitor to oversee the fiscal management and expenditures of district funds, to develop and implement a plan to resolve the financial situation, and to oversee all district staffing. The measure also calls for a forensic audit of district finances.

Next stop for S-1469 is the governor’s desk.