A5357

An Act concerning the consolidation of municipalities and amending P.L.2007, c.63.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. Section 30 of P.L.2007, c.63 (C.40A:65-30) is amended to read as follows:

30. a. A local unit that plans to study the feasibility of a shared service agreement, joint meeting contract, or municipal consolidation may apply to the director for grants or loans to fund the study, including consultant costs, and to fund one-time start-up costs of a shared service agreement or joint meeting contract or municipal consolidation. The director, in consultation with the Commissioner of Education, shall establish a program to be known as the "Sharing Available Resources Efficiently" program, or "SHARE," to accomplish this purpose, and, in consultation with the commissioner, shall promulgate rules and regulations necessary to effectuate the purposes of the program.

b. The director, in consultation with the commissioner, shall provide guidelines and procedures for the submission of SHARE grant and loan applications.

c. Applications for shared service study funds:

(1) May require such local match of funds, as is determined by the director for the studies if the director finds that the local unit is financially capable of providing such matching funds.

(2) Shall not require a local match of funds for consolidation studies under sections 1 to 37 of P.L.2007, c.63 (C.40A:65-1 et al.) or the "Municipal Consolidation Act," P.L.1977, c.435 (C.40:43-66.35 et al.).

(3) Grants for implementation of shared services may include financial assistance for terminal leave benefits, but not for early retirement incentives related to pension contributions.

d. Applications for one-time start-up costs shall provide that:

(1) Local units may apply for financial assistance for the one-time start-up costs necessary to implement shared services or the consolidation of municipalities. Costs that may be financed through the issuance of debt or capital lease agreements shall be excluded from this program.

(2) The director may set limits on aid awards and negotiate the various provisions, costs, payment provisions, and amounts of grants or loans to ensure that the shared service is cost effective and in the public interest. Financial assistance for costs associated with terminal leave benefits shall be limited to the lesser of the officer or employee's regular base rate of compensation that is paid for the terminal leave benefit pursuant to an applicable employment contract, local practice, local ordinance, or State law.

(3) In the case of a municipal consolidation, the consolidated municipality shall be reimbursed for not less than 50 percent of the one-time start-up costs incurred to effectuate the consolidation. If there are insufficient funds available for this purpose through the SHARE program, the State shall reimburse the consolidated municipality from any other State funds that may be available, including, but not limited to, any funds appropriated for Consolidation Implementation.

e. The director may provide technical support programs to assist local units in applying for grants or aid for studying shared services.

(cf: P.L.2007, c.63, s.30)

2. This act shall take effect immediately.

STATEMENT

This bill amends the “Uniform Shared Services and Consolidation Act,” P.L.2007, c.63 (C.40A:65-1 et al.) to require that in the case of a municipal consolidation, the consolidated municipality would be reimbursed by the State for not less than 50 percent of the one-time start-up costs incurred to effectuate the consolidation. If there are insufficient funds available for this purpose through the "Sharing Available Resources Efficiently" (“SHARE”) program created pursuant to the “Uniform Shared Services and Consolidation Act,” the State would reimburse the consolidated municipality from any other State funds that may be available, including, but not limited to, any funds appropriated for Consolidation Implementation.