Provides that school districts with unpaid balances on certain borrowed funds are not subject to State school aid reductions; requires use of surplus funds to repay borrowed funds.

This bill (A4608) prevents New Jersey school districts with unpaid State-issued loans from facing reductions in their state school aid. It directly affects districts that borrowed funds through advance State aid payments (authorized under P.L.2006, c.15) or emergency aid (authorized under P.L.2007, c.260), which would otherwise trigger aid cuts under the state funding formula. Instead of automatic aid reductions, these districts must use their full surplus funds (undesignated general fund balance) to repay the borrowed amounts, as reflected in their annual budgets. The bill applies to districts with outstanding balances on such loans and requires repayment through surplus funds rather than future aid reductions.