New Jersey Statutes Title 18A. Education 18A § 56-8

Moneys belonging to the school fund shall be invested by the division of investment in the department of the treasury in the bonds of the several school districts of this state, or in the bonds of the United States, this state, or any county or municipality of this state. No investment shall be made in the bonds of any municipality the total indebtedness of which, including the school debt, shall exceed 30% of the assessed valuation of all the real and personal property therein; but in ascertaining the total indebtedness credit shall be allowed only for such moneys or property as shall be in the sinking fund. No investment shall be made in the bonds of any county the total indebtedness of which shall exceed in the aggregate 15% of the total assessable valuation of all taxable property therein.

Interest on such bonds shall be a part of the income of the school fund.