New Jersey § 52:27-57

§ 52:27-57.

Whenever such school district, or the municipality with which such school district

is coterminous, has been or shall be in default for twelve months in the payment of

interest on any of its bonds or notes or other written evidence of indebtedness (except

where the same is under litigation as to its validity, or where the validity thereof

has been denied by formal notice given by the school district or municipality, and

no suit, action or proceeding to enforce the same has been commenced by the holder);

or whenever any such school district or municipality has been or shall be in default

for six months in the payment of any part of its regular pay roll, or, in the case

of the municipality, in the payment of any sums due from the annual tax levy to the

state, county or school district, then in any event no action taken by the legal voters

of the school district shall be effective in so far as it purports to raise by tax

in any year any sum or sums for any purpose or purposes, except to provide for the

payment of the interest on or principal of any debt or obligation of such school district

or for the setting aside of necessary reserve or sinking funds therefor, in excess

of such limits as may be fixed by the commission.