LEGISLATIVE FISCAL ESTIMATE TO

[First Reprint]

SENATE, No. 285

STATE OF NEW JERSEY

DATED: April 1, 1996

      Senate Bill No. 285 (1R) of 1996 provides that no school board shall pay supplemental compensation to a school administrator for any unused sick leave which is credited to the employee at the time of termination of employment for reasons other than retirement or shall pay supplemental compensation in excess of $15,000 to a school administrator for any unused sick leave which is credited to the employee at the time of retirement. A cap of $15,000 is currently applicable to the unused sick leave of State employees who retire from a State-administered retirement system, and no supplemental compensation is paid to State employees who terminate employment prior to retirement. The bill applies to policies adopted, or contracts entered into, on and after the effective date of the act.

      The Office of Legislative Services (OLS) is unable to provide an estimate of the fiscal effect of the bill on local funds because the current practice of paying terminated or retired employees for unused accumulated sick leave is discretionary and not uniformly applied by school boards. In addition, the Department of Education does not collect data on the payments which are made. OLS notes, however, that there would likely be significant savings for those school boards which provide any supplemental compensation for unused sick leave at the time of termination of employment or supplemental compensation at the time of retirement in excess of $15,000.

This fiscal estimate has been prepared pursuant to P.L.1980, c.67.