SENATE COMMUNITY AND URBAN AFFAIRS COMMITTEE

 

STATEMENT TO

 

SENATE, No. 2794

 

with committee amendments

 

STATE OF NEW JERSEY

 

DATED:  JUNE 13, 2011

 

      The Senate Community and Urban Affairs Committee reports favorable and with committee amendments Senate Bill No. 2794.

      Under current law, the Local Unit Alignment, Reorganization, and Consolidation Commission (LUARCC) examines the consolidation of municipalities, the merger of autonomous agencies into their parent municipal or county government, and the sharing of services between municipalities or between municipalities and other public entities.  This bill, as amended by the committee, would clarify LUARCC's powers to recommend specific consolidations and mergers under current law.  The provisions of Title 11A, Civil Service, would not apply to an employee affected by a shared services agreement recommended by LUARCC.

      The amended bill would require LUARCC to include in every consolidation proposal and every shared services proposal an estimate of the savings that will result from implementation of the proposed consolidation or sharing of services.  The bill allows local units to contest LUARCC's estimate of savings by appeal to the Commissioner of Community Affairs.

      Current law provides for public hearings when municipal consolidations are being considered.  As amended, the bill provides that when a LUARCC recommends a municipal consolidation, the commission must be present at one or more of those public hearings.  The bill also requires LUARCC to hold at least two public hearings whenever the commission recommends a sharing of services.  As amended, the bill requires LUARCC to consider the ability of the public entity to comply with all State and federal laws and regulations when studying a potential consolidation or shared service.

      Under the amended bill, as under current law, LUARCC-recommended consolidation or shared service proposals would become effective upon adoption by a majority of the voters of each affected municipality.  If the voters of a municipality do not approve a shared services proposal or if a municipality or other entity identified in a proposed shared services agreement does not enter into and implement the proposed shared services agreement within 14 months following the effective date of the proposal, the State would annually reduce that municipality's State aid by the amount of savings that was estimated by LUARCC.

      Additionally, the amended bill clarifies the Legislature's intention that LUARCC have sufficient resources to fulfill its statutory obligations by empowering LUARCC to request specific resources from the State and localities and to contract for necessary services. The bill, as amended by the committee, would appropriate funds to LUARCC to cover the costs of operations and to fund extraordinary expenses of local units needed to implement a LUARCC-proposed consolidation plan or shared service agreement.

      As amended, the bill also provides that when local units enter into, renew, or extend shared service agreements or joint meetings pursuant to the “Uniform Shared Services and Consolidation Act,” or any other law providing for the sharing of services, the provisions of Title 11A, Civil Service, would not apply to employees affected by the shared service agreement or joint contract.

      The committee amended the bill to remove the provisions of the bill that would have permitted LUARCC to order a municipality or other public entity to enter into a shared services agreement.  The committee amendments also provide that when LUARCC recommends a consolidation or sharing of services, it must consider the impact of the consolidation or sharing of services on the public entity’s ability to comply with State and federal laws and regulations.