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Series of ‘Path to Progress’ Fiscal Reform Bills Gain Committee Approval

Panel Endorses 9 Bills That Focus on County & Municipal Government

Trenton — A Senate committee today endorsed a series of bills that will produce savings and efficiencies for county and municipal government as part of a broader effort to address the mounting fiscal problems in New Jersey.

The nine bills, approved by the Senate State Government, Wagering, Tourism and Historic Preservation Committee, are part of the “Path to Progress” report developed by the 25-member Economic and Fiscal Policy Workgroup.

The bipartisan Workgroup issued its report and recommendations in August of 2018, which included a category for “County & Municipal Government Reform and Shared Services.”

“The reforms and recommendations proposed by the Workgroup provide a blueprint to achieve the operational and structural reforms needed to restore financial stability for the state and affordability for the residents of New Jersey,” said Senator Sweeney (D-Gloucester/Salem/ Cumberland).  “For local government, the impact will be on property taxes, education costs, the expense of local services, pension payments and the spiraling costs of health benefits. These reforms will have a positive impact for taxpayers and for local services.”

The bills approved by the committee today would provide state funding for counties to appoint coordinators to expand shared services, establish a County and Municipal Study Commission within the legislative branch to continue to find efficiencies and make recommendations to the Legislature, and establish an Office of Local Government Efficiency in DCA to provide resources to towns and counties considering shared services. The measures would also authorize county police departments to provide services to municipalities, have municipalities, counties and school districts meet regularly to consider shared services, and require safeguards in the shared agreements for performance evaluations and dispute resolutions.

Bills Approved By Committee on June 13, 2019:

  • 3760 Requires municipalities, school districts, and local authorities to discuss shared service agreements. (Ruiz/Singleton/Sarlo)

The bill would require the governing body of a municipality, the board of education of each district, and the governing body of each local authority to hold a public meeting at least twice a year to evaluate shared service agreements and discuss entering into new agreements. Any municipality that violates the requirements of the bill would incur a five percent reduction in formula aid.

  • 3761 Establishes County and Municipal Study Commission. (Sweeney/Cardinale)

This bill would establish the County and Municipal Study Commission as a permanent commission in the Legislative Branch of State Government. The commission would study county and municipal government with a long-term perspective to identify opportunities to deliver local government services in a more efficient manner and to reflect the changes to the fiscal circumstances of the State and local government, development patterns, technology, and expectations for local government services.  The Commission would make regular recommendations to the Legislature.

  • 3762 Concerns assessment of real property. (Sweeney/O’Scanlon)

This bill would permit any county to adopt the provisions of the “Property Tax Assessment Reform Act,” which provides for county-based real property assessment. The bill would also require that the true value of real property be determined by the municipal-wide reassessment of that real property performed by municipal assessors when the ratio of assessed value to true value is lower than 90 percent or greater than 110 percent.

  • 3763 Renames joint meetings as regional service agencies. (Addiego/Bateman/Sarlo)

This bill would amend the “Uniform Shared Services and Consolidation Act” and other laws that refer to “joint meetings” to “regional service agencies.” Joint meetings created prior to the enactment of the bill would be grandfathered.

  • 3764 Requires counties to appoint shared service coordinators. (Andrzejczak/Bucco)

This bill would require each county to appoint a county shared service coordinator who would be responsible for promoting and facilitating shared service agreements between local governments in the coordinator’s county, including the county itself. The bill would provide State grants to offset total compensation by up to $95,000. An appropriation of $2 million is included for this purpose.

  • 3765 Establishes Office of Local Government Efficiency. (Singleton/Bucco)

This bill would establish the Office of Local Government Efficiency in DCA. The office would be charged with working to promote and facilitate the regionalization and innovative delivery of local government services with the aim of lowering property taxes. Under the bill, Rutgers would be charged with providing training courses on delivery local government services through shared service agreements, joint contracts, and alternative service delivery methods.

  • 3767 Establishes pilot program to permit use of generally accepted accounting principles. (Sarlo/Thompson)

Under the bill, the governing body of a pilot county or pilot municipality may apply to the Director of the Division of Local Government Services in the Department of Community Affairs to participate in the pilot program to use the generally accepted accounting principles (GAAP). The pilot program would operate for approximately three years. Within six months after each participating county and municipality has submitted its third annual financial statement using the GAAP standards, the division would be required to submit a report to the Legislature concerning the pilot program.

  • 3768 Requires shared service agreements to include certain provisions. (Singer/Bateman)

The bill would require that share service agreements between local governments include the following provisions in addition to requirements under current law: 1) performance evaluation criteria; 2) procedures for determining any fee adjustments; 3) alternative dispute resolution procedures; and 4) exit procedures to govern the dissolution of the agreement.

  • 3769 Permits county police department to provide police services to municipalities. (Madden/O’Scanlon)

This bill would authorize a county police department and force to enter into a shared service agreement pursuant to the “Uniform Shared Services and Consolidation Act” with any municipality located in the county to provide any, or all, police services to the municipality that a municipal police department and force is authorized to perform itself.

The Sponsors of the Bills:

“In the months since we’ve released the Path to Progress Report, we have had numerous conversations with the general public on how we can collectively achieve a more efficient and affordable New Jersey. Affordability is the number one problem facing New Jersey, and it is clear that we can no longer ignore the systemic problems that are crippling our State’s future. The time is now to enact substantial and meaningful corrections to how the State operates before it’s too late.” Senator Troy Singleton (D-Burlington)

“Shared Services can be a great way for municipalities to operate government efficiently. Sharing the cost for services can also lead to property taxes decreasing for both home and business owners across the state. The Path to Progress initiative has the answers to so many of New Jersey’s problems. It is important we implement these to make New Jersey more affordable for everyone.” Senator Dawn Addiego (D-Atlantic/Burlington/Camden)

“Municipalities around the state offer first class services to the people of New Jersey and that cannot change. The problem is when these services become a burden, rather than a benefit. Police and fire departments are crucial to ensuring the safety and wellbeing of our communities, but policing small towns can be extremely costly. By expanding shared services we can lower costs while maintaining the quality of services provided, ensuring they are a benefit, not a burden, to New Jerseyans.” Senator Fred Madden (D-Camden/Gloucester)

“Sharing services is an invaluable option for local leaders who want to do more to help combat New Jersey’s property tax crisis. We have seen what a difference this practice has made in communities like Princeton – but there is no doubt that consolidation of any kind can be extremely complicated and contentious. S-3768 and S-3763 both aim to improve the clarity, communication, and cohesion of this process, so that municipalities statewide can embrace the cost-saving opportunity to share services, in a way that meets the individual needs of their communities.” Senator Kip Bateman (R-Somerset)

“Our bipartisan reforms would lower the property tax burden for families across New Jersey. We are committed to seeing these reforms become law, which is why we are taking proactive steps to ensure that the local officials who will hopefully soon be charged with implementing these changes have the guidance they need to put these cost-saving plans into action. By establishing an Office of Local Government Efficiency, and requiring counties to appoint a shared services coordinator, we can ensure that our communities have the knowledge they need to take full advantage of the savings Path to Progress can provide.” Senator Anthony Bucco (R-Morris)

“GAAP principles are used by most local governments around the country because they are meant to ensure financial statements are consistent, and easy for accountants to analyze. It’s no secret that this state needs to get its fiscal house in order. Using these accounting standards can help taxpayers and local officials better understand where their money is going. By establishing the ‘GAAP Pilot Program,’ we can put New Jersey on the same playing field as other states, and hopefully improve the way our local governments manage financial reports.” Senator Sam Thompson (R-Middlesex)

“Providing the most efficient and effective government services translates into real savings for taxpayers. To help achieve this goal, we are requiring all levels of local government to improve intercommunication in order to generate more shared service agreements. When government entities work more collaboratively, it produces better quality services for all. This is an important component of the Path to Progress reforms in helping make our state more affordable.” Senator Steve Oroho (R-Sussex)

“New Jersey has more towns per square mile than any other state in the nation. Municipal taxes make up more than 28 percent of our property tax bills, and counties tax another 18 percent on top of that. We need to reduce redundant layers of government to ease our state’s mounting property tax problem. Establishing a permanent County and Municipal Study Commission will help us holistically analyze and pinpoint opportunities to save taxpayers money and increase government efficiency.” Senator Gerald Cardinale (R-Bergen)

“One of the best ways to lower the cost of government is to encourage counties and municipalities to work together. More often than not, this fiscally-responsible practice has proven to be a win-win for the people of New Jersey. By allowing county police officers to provide police services in local municipalities, we can save taxpayers money and increase efficiency, without sacrificing public safety. I hope that communities across New Jersey will take advantage of this opportunity to share services and save lives.” Senator Declan O’Scanlon (R-Monmouth)