Republican Gov. Chris Christie faces a decision on legislation that would put $10 million into an account for removing lead paint from homes.
The Democrat-led Legislature sent the governor the measure after he publicly committed last month to putting the money toward lead abatement.
Christie's announcement followed months of calls from Democratic lawmakers to put the funds into a dormant program with the same goal of lead abatement.
The legislation would replenish the Lead Hazard Control Assistance Fund, which a tax on paint cans was supposed to finance when it was created in 2004.
Christie also sought $10 million to pay for lead testing at 3,000 public schools.
The announcement came after 30 Newark schools shut off water fountains in March because of elevated lead levels.