Gov. Phil Murphy on April 14 signed into law legislation to extend the state’s fiscal year by three months, to Sept. 30, and delay the state income tax filing deadline. The legislation also requires the state treasurer to report by May 22 how the shutdown of most tax-generating businesses has affected state revenues. The report could indicate whether the state will be able to provide the aid promised to school districts in the governor’s original Feb. 25 budget proposal. Details follow.
COVID-19 Fiscal Mitigation Act A3918/S2338 was passed on April 13 by both houses of the legislature, voting remotely due to the public health emergency. This legislation extends the end of the current fiscal year from June 30 to Sept. 30. It also delays state tax filing deadline by three months, from April 15 to July 15.
The bill also calls on the state treasurer to report on the financial condition of the state by May 22. The report will provide updated revenue collection data as well as projections for fiscal year 2021; an assessment on the current economic conditions; and a plan for state spending for the three-month continuation of the current fiscal year. Finally, the legislation calls on the governor to present a revised budget message for FY 2021 by Aug. 25.
At this point, it is not clear how these changes will impact state aid to local districts. The May 22 treasurer’s report should provide a better picture of how realistic it is for districts to expect the state aid they were told to build into their FY 2021 budgets.
Delay of Payments to Districts Not Posted Also notable from the Senate session was what action was not taken. A3902, which would allow municipalities to delay payments to school districts during an emergency, was not considered by the Senate. The bill had previously passed the Assembly. It needs Senate approval before it can go to the governor for final consideration.
Dr. Lawrence S. Feinsod, NJSBA executive director, pointed to advocacy by NJSBA, the education community, and local school boards as a key element in putting the brakes on the legislation.
“The resolutions and other communication from local school boards expressing opposition to A3902 played a critical role,” he said. “NJSBA will continue to monitor the situation closely. We look forward to working with the Senate and Assembly leadership during this difficult time for our communities.”
NJSBA continues to advocate for changes to the bill that would protect school districts in emergencies such as the current pandemic.
Virtual or Remote Instruction A3904/S2337 permits use of virtual or remote instruction to meet the minimum 180-day school year requirement under certain circumstances. The bill requires the superintendent, with board approval, to submit a plan for virtual learning during states of emergency. The bill also requires school districts to continue to pay the salaries and benefits of union, non-union and third party service workers during states of emergency. NJSBA, although supportive of the provisions that would provide continuity of instruction during the current crisis, raised concerns about the expense of the mandated hold harmless provisions for employees and service providers. NJSBA urged the legislature to ensure that this new mandate is fully funded as many districts have experienced unanticipated and unbudgeted expenses as a result of the COVID-19 shutdown. The governor signed the bills April 14.
Family Leave Expansion Both houses of the Legislature also unanimously approved S2374/A3913, which concerns family leave benefits during epidemic-related emergencies. On April 14, Gov. Murphy signed the bill, which would be retroactive to March 25, 2020. The bill would expand the state’s Family Leave Act (FLA) to allow workers to take time off to care for an ill family member during the coronavirus crisis. These amendments to the FLA will allow employees forced to care for family members during the COVID-19 outbreak to take up to 12 weeks of family leave in a 24-month period without losing their jobs. The bill would also include school closings as an acceptable use of family leave.