ASSEMBLY, No. 3829







Sponsored by:


District 2 (Atlantic)

Assemblyman  JOHN F. AMODEO

District 2 (Atlantic)


Co-Sponsored by:

Assemblyman DiCicco






     Permits public referendum on certain bond ordinances in municipalities operating under the Walsh Act.



     As introduced.


An Act concerning certain bond ordinances by local units and amending R.S.40:74-5.


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


     1.    R.S.40:74-5 is amended to read as follows:

      a.   If within 20 days after the final passage of an ordinance, except ordinances, or any portion thereof, fixing the salaries, wages or compensation of the employees of the municipality, as defined in section 3 of the New Jersey Employer-Employee Relations Act, P.L.1941, c. 100 (C. 34:13A-3), [or] ordinances authorizing [an improvement or] the [incurring] refunding of an indebtedness, [other than for current expenses, where other requirements are made by law,] or ordinances which by their terms or by law cannot become effective in the municipality unless submitted to the voters, or which by its terms authorizes a referendum in the municipality concerning the subject matter thereof, a petition signed by electors of the municipality equal in number to at least 15% of the entire vote cast at the last preceding general election at which members of the General  Assembly were elected protesting against the passage of such ordinance, be presented to the board, it shall thereupon be suspended from going into operation and the board of commissioners shall reconsider the ordinance within 20 days of the presentation of the petition to the board.  If the ordinance is not entirely repealed, the board shall submit it, in the manner provided in paragraph b. of R.S. 40:74-14 and R.S. 40:74-15 to R.S. 40:74-18 to the vote of  the electors of the municipality.  The ordinance shall be submitted either at the next general election or regular municipal election, whichever shall first occur, not less than 40 days from the final date for withdrawal of the petition as provided for in this section, except that if no such election is to be held within 90 days of that date, a special municipal election shall be called for that purpose, and be held not less than 40 nor more than 60 days from the final date for withdrawal of the petition as provided for in this section.  An ordinance so submitted shall not become operative unless a majority of the qualified electors voting on the ordinance shall vote in favor thereof.

     The names and addresses of five voters, designated as the Committee of the Petitioners, shall be included in the petition.  If within 10 days after final adverse action by the board or after the expiration of the time allowed for board action, as the case may be, a written request, signed by at least four of the five members of the Committee of the Petitioners, is filed with the municipal clerk requesting that the petition be withdrawn, the petition shall have no effect.

     b.    In lieu of the protest procedure set forth in subsection a. of this section, any ordinance authorizing the incurrence of any indebtedness, except for those ordinances as specified in subsection a. of this section, may be subject to debt-authorization referendum procedures set forth under R.S.40:49-27.

(cf: P.L.1982, c.145, s.9)


     2.    This act shall take effect immediately.





     This bill would amend R.S.40:75-5, a section of the “Walsh Act,” to permit public referenda on bond ordinances.  In lieu of the public referendum procedures set forth under R.S.40:75-5, this bill would allow bond ordinances that authorize the incurrence of any indebtedness, except for current expenses and expenses regarding the compensation of municipal employees, to be subject to debt-authorization referendum procedures provided under R.S.40:49-27, a section of the “Home Rule Act.”  A refunding bond ordinance would not be subject to referendum.

     In Retz v. Saddlebrook, 69 N.J. 563 (1975), the New Jersey Supreme Court distinguished between bond ordinances for existing obligations and bond ordinances to appropriate funds by stating that the “no referendum” provision of N.J.S.A.40A:2-18 applies to bond ordinances to fund existing obligations or notes or bonds issued or authorized pursuant to the “Local Bond Law,” while bond ordinances to appropriate funds are subject to referendum under the “Home Rule Act.”  In 1978, following the distinction made by Retz, the Superior Court of New Jersey, in Lawrence v. Schrof, 162 N.J. Super. 375 (Law Div. 1978), stated that the provisions of the referendum process are to be liberally construed to “confer the greatest possible power of local self-government and to encourage citizen interest and participation …”, with specific reference to ordinances which relate to a municipality’s exercise of its power granted by the Legislature.  Id. at 382. 

     Application of the debt-authorization referendum provisions established under N.J.S.A.40:49-27 by all municipalities furthers the intent of the Legislature to confer the greatest possible power of local self-government and encourages citizen interest and participation in the municipality’s financial decisions which ultimately impact the citizens of the municipality.