The New Jersey Assembly has overwhelmingly approved legislation sponosred by Assemblyman Avi Schnall (D-Lakewood) that would require unspent state aid allocated for nonpublic school nursing and security services to instead be used to support nonpublic school transportation.

The bill passed the Assembly by a 78-1 vote.

Under the legislation, if a school district does not spend all of the state aid it receives for nonpublic school nursing services or nonpublic school security services, the unexpended funds would continue to be refunded to the state after the close of the school year. However, rather than remaining in the state’s general accounts, the refunded money would be dedicated to increasing the maximum per-pupil reimbursement for nonpublic school transportation in a future school year.

Current law requires districts to return any unused nursing or security aid to the state but does not earmark the refunded security funding for another nonpublic school program. The bill would also codify that unspent nursing aid and unspent security aid both be directed toward increasing the statutory transportation aid limit.

In FY 2024 alone, New Jersey districts refunded more than $21 million in unspent nonpublic school aid — about 14 percent of total entitlements. Lakewood, which serves the largest nonpublic school population in the state, refunded roughly $8.5 million that year, including $3.5 million in Auxiliary Aid and Transportation funds and $3 million in Handicapped Aid.

The legislation amends two existing statutes governing state support for nonpublic school nursing services and nonpublic school security services.

Each year, school districts receive state aid based on the number of students enrolled in nonpublic schools within their boundaries and the annually adjusted per-pupil support limits for those programs. If districts spend less than the amount received, they are required to refund the unused balance by Dec. 1 of the following school year.

Supporters of the measure say redirecting unused funds would help address growing transportation costs for nonpublic school students while ensuring state aid dedicated to nonpublic education continues to benefit those students rather than reverting for unrelated purposes.

The bill takes effect immediately upon enactment. It must also receive approval from the Senate before it can be sent to the governor for consideration.