The issue is among the most difficult facing lawmakers because school aid is one of the largest factors in determining local property taxes.

Christie revealed last week that those negotiations were progressing but that no deal has yet been reached.

Credit ratings agency S&P Global weighed in on the issue on Monday, warning that many New Jersey districts would feel pinched financially if their aid remains flat, particularly those with increasing enrollment.

Christie spokesman Brian Murray said in a statement that the report was more proof of how budget initiatives like school funding were being squeezed by the state's rising costs for public employee pensions and health care. 

"More than $670 million of new state money is going to subsidize pension and benefit payments, nearly $500 million for teachers alone. That is why the governor's call to examine ways to buttress these pension systems with additional assets and reforms should be a top priority between now and June 30," Murray said.

With that as the backdrop, parents and school officials packed the Assembly Budget Committee's Monday hearing featuring acting Commissioner of Education Kimberley Harrington.

No members of the group were permitted to speak during the hearing, but their presence sent a message as they wore colored T-shirts representing their districts and signs highlighting the fact that about 190 school districts are considered overfunded compared with 401 underfunded districts.

"We need a solution, and we need it now," Chesterfield Township Committeewoman Andrea Katz said after the hearing. "Anything else is unacceptable."

Finding a solution has proved elusive.

Harrington, who has served as acting commissioner since the fall, admitted as much during the over three-hour hearing, as she was repeatedly peppered with questions about the funding situation.

"How can we say that we're properly funding — not just the Patersons and the Newarks and Camdens, but the many districts you see (represented) throughout this very room — in a fair way when we know there are also districts that are overfunded?" Assemblyman Benjie Wimberly, D-35th of Paterson, asked at the onset.

Harrington responded that the state has consistently been about $1 billion short of the total school aid needed to provide all districts with the aid called for under the 2008 formula, which is weighted based on district wealth, enrollment, and populations of impoverished or other special needs students.

"We cannot afford the (School Funding Reform Act of 2008). We have to find a way to right-size the formula," she said, adding later that without adequate funding the administration opted to keep aid largely flat for all districts.

That has created problems for many districts that experienced enrollment increases without receiving additional aid. Conversely, several other districts have continued to receive the same amount of aid, despite enrollment decreases or demographic changes.

"The department's position is we're making difficult decisions with limited dollars and trying to do the best we can to spread that across," Harrington said.

Assemblyman Declan O'Scanlon, R-13th of Little Silver, said the state had no hope of finding the $1 billion needed to properly fund schools without enacting new pension and benefit reforms for public employees. He said just promising to fully fund the formula without those reforms was akin to promising your daughter "a unicorn with sparkles painted pink."

Assembly Majority Leader Lou Greenwald, D-6th of Voorhees, said lawmakers have already reached bipartisan agreements on thorny issues such as transportation funding, pension and benefit reforms and others. He said finding a similar compromise on school funding was crucial.

"This inability to fund public education will ultimately lead to the destruction of what is a very good public education system," Greenwald said.

Prior to the hearing, Sen. Jennifer Beck, R-11th of Red Bank, held a news conference with some of the protesting parents and school administrators where she called on lawmakers to take steps to provide at least some additional aid to the most underfunded districts.

"We don't care how that happens. We just need additional dollars," she said.

Beck said at least $11 million in funding could be redistributed from 46 districts that are considered overfunded because they are receiving aid above and beyond what the existing funding formula deems necessary.

"I think that's low-lying fruit, where legislators can come together and provide our underfunded districts with some increased resources as we figure our way out of what is an incredibly complicated school funding formula," she said, adding millions more are still needed.

Beck was joined by Delran Superintendent Brian Brotschul. He said implementation of the school funding formula has been "disastrous at best" for Delran, which has been forced to cut some of its prekindergarten programs, raise taxes and crowd classrooms because its aid has not increased with enrollment.

"We have overcrowded schools. We have significantly overtaxed citizens in Delran Township, and we are no longer in a position to sit back and do nothing," Brotschul said.

Assemblyman Troy Singleton, D-7th of Palmyra, said he expected the Legislature would agree on some form of action on school funding before the new fiscal year begins.

"It's important we do something, because the status quo is unacceptable for suburban and urban districts," Singleton said after the hearing, adding that he supports using the existing formula to divvy up the available aid rather than keeping amounts largely flat for all districts.

That would likely increase aid for underfunded districts like Delran and Chesterfield, but cause others that have been held harmless for enrollment increases over the years to lose significant sums.

Singleton said running the formula was the fairest solution, but he suggested that the redistribution be phased so that districts losing aid have more time to plan for the losses.

Katz said she was encouraged by the hundreds of fellow parents and school officials from across the state who are calling for immediate action on the issue.

"We are a force to be reckoned with, and we are going to move this mountain," she said.

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