New Jersey’s 2026-2027 legislative session commenced in January, and committees began to meet again last week to consider legislation. Bills relevant to boards of education are highlighted below.

Legislators have already introduced thousands of bills in the new session, many of which have been reintroduced after not being signed into law in 2024-2025. If a bill does not become law in one session, it must be reintroduced in a subsequent session and start anew at the beginning of the legislative process, regardless of how much progress it previously made. The New Jersey School Boards Association is monitoring all bills relevant to boards of education and will continue to post timely Legislative Updates in School Board Notes to highlight recent legislative action.

For the most up-to-date information regarding specific legislation, please visit the New Jersey Legislature’s website.

Senate Community and Urban Affairs Committee

The Senate Community and Urban Affairs Committee met on Thursday, Feb. 5 and approved the following bills relevant to boards of education:

Sharing PILOT Revenue with Schools S-1807 would require municipalities to share certain revenues from payment-in-lieu-of-taxes (PILOT) agreements with school districts, unless the municipality enters into an agreement with the school district and the entity receiving the PILOT to provide one or more special projects for the school district. In addition, it would require municipalities to provide notice to the county, school districts, and the Division of Local Government Services within the Department of Community Affairs when a municipality considers and approves a property tax exemption. If the municipality, school district, and entity receiving the PILOT seek to enter into an agreement to provide special projects to the school district instead of remitting a portion of the PILOT, the superintendent of any school district of which the municipality is a constituent would lead negotiations on behalf of the board of education concerning the agreement.

As amended, a school district would be required to use any PILOT revenue received as part of an agreement other than a special project to reduce its property tax levy. The payment amount would be subtracted from a district’s maximum possible levy as determined by the two-percent tax levy cap formula. Districts would not be required to deduct payments received under special project agreements from their tax levy.

The amount a municipality would be required to share with school districts, if the parties do not opt for an alternative agreement, would depend on whether the relevant property is residential, nonresidential, or mixed-use. Specifically, for a residential property, the amount would be equal to the product of the number of school-age children who attend a public or regional school district that serves the municipality and reside in the project, and the base per-pupil amount determined by the Commissioner of Education in the previous school year. Alternatively, for nonresidential or mixed-use properties, this amount would be equivalent to five percent of the PILOT or an in-kind contribution equal in value to that amount. Additionally, the remitted portion of the PILOT to the school district would not be permitted to exceed the percentage of the amount of property taxes which would be distributed to the school district. When an amount is remitted to more than one school district, the amount would be divided among those districts in proportion to each district’s share of the total school tax levy in the municipality.

The NJSBA testified in support of the intent of the bill, citing Association policy beliefs that municipalities should be required to include the board of education in the consideration and development of any PILOT agreement that has the potential to increase student enrollment and that the board of education should be a member of the municipal negotiation committee with equal rights and decision-making authority to provide input and receive appropriate portions of community benefits. However, the NJSBA expressed concerns with the amendments that would require a district to use PILOT revenue to offset its tax levy. While appreciative of the opportunity to provide taxpayer relief, the NJSBA is concerned that such a provision would limit a district’s ability to absorb an increase in students generated by new housing, would decrease the total revenue a district is able to raise pursuant to the existing two-percent tax levy cap, and would create a structural imbalance at the conclusion of the PILOT agreement due to a long-term cumulative shortfall.

Mercury Floor Removal S-1370, as amended, would prohibit the issuance of construction permits for flooring in schools or childcare centers unless the flooring materials are certified by the manufacturer as mercury-free. In cases where the building has flooring that may contain mercury, the applicant may take the following actions: (1) certify that the existing flooring is mercury-free; (2) certify that an air quality assessment has been conducted to test if mercury vapor levels are within safe limits as recommended by the New Jersey Department of Health; (3) if unsafe mercury levels are found, implement mitigation measures such as adjusting HVAC systems to reduce mercury vapor to acceptable levels; (4) if testing still reveals high mercury levels, the implementation of further mitigation measures or the removal of the flooring; and (5) if all mitigating measures fail, the removal and proper disposal of the flooring.

If flooring must be removed, it must be completed within six months after the final air quality assessment, unless the NJDOH grants a one-time, six-month extension due to factors beyond the applicant’s control, such as supply chain delays or contractor issues. All removal and disposal of flooring must comply with regulations established by the Department of Environmental Protection.

The NJSBA supports the bill. The Association successfully obtained amendments in the 2024-2025 session to include the NJDOH’s February 2020 guidance (Evaluation and Management of Mercury-Containing Floors in New Jersey Schools) and its recommendations for exposure mitigation strategies that schools can implement based on airborne mercury levels relative to the recommended maximum contaminant level. These amendments will allow school districts to certify adherence with the NJDOH’s guidance as an alternative to full removal of existing flooring during a flooring project, which could save districts money while protecting the health of students and staff.

To view the full text of any of the bills summarized above, please visit the New Jersey Legislature’s website.