[First Reprint]

 

SENATE COMMITTEE SUBSTITUTE FOR

SENATE, No. 1

STATE OF NEW JERSEY

219th LEGISLATURE

  ADOPTED FEBRUARY 11, 2021

 


 

Sponsored by:

Senator  STEPHEN M. SWEENEY

District 3 (Cumberland, Gloucester and Salem)

Senator  VIN GOPAL

District 11 (Monmouth)

 

Co-Sponsored by:

Senators Singer, Oroho, A.M.Bucco, O'Scanlon, Singleton and Bateman

 

 

 

 

SYNOPSIS

     Encourages sharing of services; makes appropriations.

 

CURRENT VERSION OF TEXT

     As amended by the Senate on March 25, 2021.

  

 


An Act promoting the more effective operation of local government and the sharing of services among local units, amending P.L.2007, c.63, amending P.L.2007, c.54, making appropriations, and repealing various statutes.

 

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

 

     1.    Section 2 of P.L.2007, c.63 (C.40A:65-2) is amended to read as follows:

     2.    The Legislature finds and declares:

     a.     Historically, many specialized statutes have been enacted to permit shared services between local units for particular purposes.

     b.    (1) Other laws, permitting a variety of shared services, including interlocal services agreements, joint meetings, regional service agencies, and consolidated and regional services[,] exist but have not been very effective in promoting the broad use of shared services as a technique to reduce local expenses funded by property taxpayers.

     (2)   The goal of encouraging and facilitating the provision of local and regional services through a shared service agreement, joint contract, or consolidation that results in cost savings that may be passed along to property taxpayers over time, is an important goal of the State of New Jersey, and delays caused by disputes over Civil Service rules and tenure provisions resulting from a shared service, joint meeting, regional service agency, or consolidation must be resolved expeditiously to ensure that such provisions do not hinder that goal.

     c.     It is appropriate for the Legislature to enact a new shared services statute that can be used to effectuate agreements between local units for any service or circumstance intended to reduce property taxes through the reduction of local expenses.

     d.    It is contrary to public policy that the tenure rights of certain local personnel should effectively prohibit shared services agreements for the services provided by those local personnel, thereby depriving property taxpayers of property tax relief.

     e.     In order to evaluate the efficiencies related to the sharing of services of certain local personnel having tenure rights in office, it is appropriate to create a pilot program in seven counties of the State which embody urban, suburban, and rural characteristics to study the sharing of the services of these personnel between municipalities by allowing for the dismissal of such a tenured local official, as necessary, in order to promote and effectuate the sharing of a service.

(cf: P.L.2018, c.140, s.2)

      2.   Section 4 of P.L.2007, c.63 (C.40A:65-4) is amended to read as follows:

      4.   a.  (1)  Any local unit may enter into an agreement with any other local unit or units to provide or receive any service that each local unit participating in the agreement is empowered to provide or receive within its own jurisdiction, including services incidental to the primary purposes of any of the participating local units including services from licensed or certified professionals required by statute to be appointed.

      In the case of pilot municipalities, tenure rights shall not prohibit the sharing of services for a municipal clerk, a chief financial officer, an assessor, a tax collector, a municipal treasurer, or a municipal superintendent of public works.  The statutory requirements that each municipality must appoint a municipal clerk, a chief financial officer, an assessor, a tax collector, a municipal treasurer, a municipal engineer, and a principal public works manager shall, for those pilot municipalities, permit and include the provision of the services of any of those municipal employees through a shared service agreement pursuant to the provisions of P.L.2007, c.63 (C.40A:65-1 et seq.).  The shared service agreement shall be subject to the provisions of subsection d. of this section and of section 3 of P.L.2013, c.166 (C.40A:65-4.2).

      In a shared service agreement between pilot municipalities for the services of a municipal clerk, a chief financial officer, an assessor, a tax collector, a municipal treasurer, or a municipal superintendent of public works, the agent-party, as that term is used in subsection d. of section 7 of P.L.2007, c.63 (C.40A:65-7), shall select for employment under the agreement one of the employees of the pilot municipalities that are party to the agreement who was employed in that same capacity prior to the approval of the agreement.

      (2)  Notwithstanding any law, rule or regulation to the contrary, any agreement between local units for the provision of shared services shall be entered into pursuant to sections 1 to 37 of P.L.2007, c.63 (C.40A:65-1 et al.); provided, however, that agreements regarding shared services that are otherwise regulated by statute, rule, or regulation are specifically excluded from sections 1 to 37 of P.L.2007, c.63 (C.40A:65-1 et al.).

      (3)  The board is authorized to render a decision in the determination of the statutory basis under which a specific shared service is governed.

      b.   [Any] Every agreement entered into pursuant to this section shall be filed, for informational purposes, with the Division of Local Government Services in the Department of Community Affairs, together with an estimate of the cost savings anticipated to be achieved by the local units that are the parties to the agreement [in the case of an agreement between pilot municipalities], pursuant to rules and regulations promulgated by the director.

      c.   In the case of a pilot municipality, a tenured municipal clerk, chief financial officer, assessor, tax collector, municipal superintendent of public works, or municipal treasurer may be dismissed to effectuate the sharing of a service entered into pursuant to the provisions of P.L.2007, c.63 (C.40A:65-1 et seq.) and such dismissal shall be deemed to be in the interest of the economy or efficiency of the participants in the shared service agreement.

      d.   In the case of a pilot municipality, a tenured municipal clerk, chief financial officer, assessor, tax collector, municipal superintendent of public works, or municipal treasurer who has been dismissed to effectuate a shared service agreement entered into pursuant to the provisions of P.L.2007, c.63 (C.40A:65-1 et seq.) shall be reappointed to his or her former position, and shall regain his or her tenured status, if the shared service agreement is cancelled, or expires, within the two-year period immediately following the dismissal of that person.

      e.   Notwithstanding any law, rule, or regulation to the contrary, a local unit or units may enter into a shared service agreement with a federal military base, to the extent permitted by 10 U.S.C. s.2679, under which services would be provided to the extent a local unit involved in the agreement is empowered to provide those services within its own jurisdiction.  This subsection shall not be construed to impact existing federal or State civil service laws, rules, or regulations with respect to federal employees or employees of a local unit.  Where federal law and State law conflict regarding the content and duration of such agreements, federal law shall control.

(cf:  P.L.2017, c.21, s.1)

 

     3.    Section 11 of P.L.2007, c.63 (C.40A:65-11) is amended to read as follows:

      11.    a.  When a local unit contracts, through a shared service [,] agreement or joint [meeting, or regional service agency] contract to have another local unit, joint meeting or regional service agency provide a service it is currently providing using public employees and one or more of the local units have adopted Title 11A, Civil Service, then the agreement shall include an employment reconciliation plan in accordance with this section that shall specifically set forth the intended jurisdiction of the Civil Service Commission.  Unless otherwise agreed to by the parties, the local unit that will be providing the service shall be responsible for filing the reconciliation plan with the Civil Service Commission.  An employment reconciliation plan shall be subject to the following provisions:

      (1)  [a determination of those employees, if any, that shall be transferred to the providing local unit, retained by the recipient local unit, or terminated from employment for reasons of economy or efficiency, subject to the provisions of any existing collective bargaining agreements within the local units.]  (Deleted by amendment, P.L.     , c.           )

      (2)     [any employee terminated for reasons of economy or efficiency by the local unit providing the service under the shared service agreement shall be given a terminal leave payment of not less than a period of one month for each five-year period of past service as an employee with the local unit, or other enhanced benefits that may be provided or negotiated.  For the purposes of this paragraph, "terminal leave payment" means a single, lump sum payment, paid at termination, calculated using the regular base salary at the time of termination.  Unless otherwise negotiated or provided by the employer, a terminal leave benefit shall not include extended payment, or payment for retroactive salary increases, bonuses, overtime, longevity, sick leave, accrued vacation or other time benefit, or any other benefit.]  (Deleted by amendment, P.L.    , c.         )

      (3)     [the Civil Service Commission shall place any employee that has permanent status pursuant to Title 11A, Civil Service, of the New Jersey Statutes that is terminated for reasons of economy or efficiency at any time by either local unit on a special reemployment list for any civil service employer within the county of the agreement or any political subdivision therein.] (Deleted by amendment, P.L.     , c.        )

      (4)     when a proposed shared service agreement or joint contract affects employees in local units subject to Title 11A, Civil Service, of the New Jersey Statutes, [an employment reconciliation plan shall be filed with the Civil Service Commission prior to the approval of the shared service agreement.  The commission shall review it for consistency with this section within 45 days of receipt and it shall be deemed approved, subject to approval of the shared service agreement by the end of that time, unless the commission has responded with a denial or conditions that must be met in order for it to be approved.] the parties to the proposed shared service agreement or joint contract, as appropriate, may request relaxation of the provisions of Title 11A, Civil Service, of the New Jersey Statutes, along with the corresponding rules and regulations, including but not limited to selection and appointment, to require employees of the local units who are not subject to Title 11A, Civil Service, of the New Jersey Statutes prior to the execution of a shared service agreement or joint contract to become civil service employees for the purpose of creating a uniform employee pool from which the new shared service or joint contract provider shall hire employees until the pool is exhausted. This expedited designation of a person as a civil service employee for the purpose of creating a uniform employee pool, without regard to the normal processes, including testing and employment lists, shall provide employees so designated with civil service rights.

      (5)  when an action is required of the Civil Service Commission by this section, parties to a [planned] proposed shared service agreement or joint contract may consult with that commission in advance of the action and the commission shall provide such technical support as may be necessary to assist in the preparation of an employment reconciliation plan or any other action required of the commission by this section.

     (6)   a determination of those employees, if any, that shall be transferred to the providing local unit, regional service agency, or joint meeting, retained by the recipient local unit, or terminated from employment for reasons of economy or efficiency.  These employment decisions made by the local units on whose behalf the plan is submitted shall be subject to the provisions of any existing collective bargaining agreements within the affected local units that would be applicable specifically to the employees being transferred, retained, or terminated, as appropriate.  In the event of any conflict in the operation of collective bargaining agreements of the affected local units as it pertains to such employment decisions, the dispute shall be settled by the parties using mediation or, if that is unsuccessful, by binding arbitration, conducted by the Public Employment Relations Commission.

     (7)   the Civil Service Commission shall place any employee who has permanent status pursuant to Title 11A, Civil Service, of the New Jersey Statutes, and who is terminated for reasons of economy or efficiency at any time by either local unit on a special reemployment list for any civil service employer within the county of the shared service, regional service agency, or joint meeting, or any political subdivision therein, except that an employee who has turned down a reemployment opportunity in a position that is one with the same or substantially similar job duties as, the same title and series as, the same or substantially similar hours of work as, and a location within a 25-mile radius of, the position from which the employee was terminated, shall be removed from the special reemployment list.  For the purposes of this paragraph, a reemployment opportunity shall meet the requirement of the “same or substantially similar hours of work” if the reemployment opportunity has the same starting and ending times of work, and at least the same numbers of hours per work week as the job from which the employee was terminated.

     (8)   when an employee of a jurisdiction that has not adopted Title 11A, Civil Service, of the New Jersey Statutes, is transferred and given a civil service job title pursuant to a shared service agreement or joint contract, then upon termination of the agreement or contract that employee shall remain an employee of the jurisdiction to which the employee was transferred, and subject to the provisions of Title 11A, Civil Service, of the New Jersey Statutes.

     b.    [If all the local units that are parties to the agreement are subject to the provisions of Title 11A, Civil Service, of the New Jersey Statutes, the Civil Service Commission shall create an implementation plan for the agreement that will: (1) transfer employees with current status in current title unless reclassified, or (2) reclassify employees into job titles that best reflect the work to be performed.  The Civil Service Commission shall review whether any existing hiring or promotional lists should be merged, inactivated, or re-announced.  Non-transferred employees shall be removed or suspended only for good cause and after the opportunity for a hearing before the Civil Service Commission; provided, however, that they may be laid-off in accordance with the provisions of N.J.S.11A:8-1 et seq., and the regulations promulgated thereunder.] The final decision of which employees shall transfer to the new employer is vested solely with the local unit that will provide the service and subject to the provisions of any existing collective bargaining agreements within the affected local units.  Any layoff or termination of personnel for reasons of economy or efficiency to effectuate a shared service agreement shall be made after the local unit that is providing the service determines which employees shall transfer from a recipient local unit to the providing local unit.  Any layoff or termination of personnel for reasons of economy or efficiency to effectuate a joint contract shall be made after the management committee determines which employees shall transfer from a contracting local unit to the joint meeting or regional service agency.

      c.   (1)  (a)  If the local unit that will provide the service pursuant to a shared service agreement or joint contract is subject to Title 11A, Civil Service, of the New Jersey Statutes, but the local unit to receive the service is not subject to that Title, and the contracting local units desire that some or all employees of the recipient local unit are to be transferred to the providing local unit, the Civil Service Commission shall vest [only] those employees [who have been employed for one year or more in permanent status pursuant to N.J.S.11A:9-9] in appropriate titles, seniority, and civil service tenure with the providing local unit based on the duties of the position, information provided by the recipient local unit, and the recommendation of the local unit providing the service.  The final decision of which employees shall transfer to the [new employer] local unit that will provide the service is vested solely with the local unit that will provide the service [and subject to the provisions of any existing collective bargaining agreements within the local units] , subject to the provisions of any collective bargaining agreements in effect within the providing local unit affecting any position into which an employee would be transferred.

      (b)     (1)  If the local unit that will provide the service is not subject to the provisions of Title 11A, Civil Service, of the New Jersey Statutes, but the local unit that will receive the service is subject to that Title, and some or all employees of the recipient local unit are to be transferred to the providing local unit and thereby become permanent employees of the providing local unit, any civil service rules incorporated by reference into a collective bargaining agreement applicable to the employees of the recipient local unit shall continue to apply to the transferred employees until the expiration of the collective bargaining agreement.

      (2)     The transferred employees shall be subject to layoff procedures prior to the transfer to the local unit that will provide the service.  The current employer of an employee who is being laid off for reasons of economy due to the implementation of a joint contract or shared service agreement, in consultation with the new employer, shall provide the employee with notice of the layoff at least 45 days prior to the layoff date, unless a collective bargaining agreement, employment contract, or personnel policy sets forth a different notice requirement.  In the case of a shared service agreement, only an employee who has permanent status pursuant to Title 11A, Civil Service, of the New Jersey Statutes shall have a right to appeal the good faith of such layoff by the current employer to the Civil Service Commission, which may consolidate all such appeals.  All appeals shall be filed within 20 days of the final notice of such layoff.  A layoff shall not be carried out until any appeal of the layoff has been decided.  The Civil Service Commission shall adopt rules and regulations, pursuant to the “Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), setting forth permissible   grounds for an appeal pursuant to this paragraph.

      (3)     Except as otherwise provided in subparagraph (b) of paragraph (1) of this subsection, once transferred, an employee shall be a permanent employee of the new employer and subject to any collective bargaining agreements, employment contracts, personnel policies, and provisions that exist for the new employer.  The final decision of which employees shall transfer to the new employer is vested solely with the local unit that will provide the service, subject to the provisions of any existing collective bargaining agreements within the affected local units.  In the event of any conflict in the operation of collective bargaining agreements of the affected local units as it pertains to such employment decisions, the dispute shall be settled by the parties using mediation, conducted by the Public Employment Relations Commission.  If mediation is not successful, the dispute shall be settled by binding arbitration, conducted by the Public Employment Relations Commission.

      d.   [If the local unit that will provide the service is not subject to the provisions of Title 11A, Civil Service, of the New Jersey Statutes, but the local unit that will receive the service is subject to that Title and the parties desire that some or all employees of the recipient local unit are to be transferred to the providing local unit, the transferred employees shall be granted tenure in office and shall only be removed or suspended for good cause and after a hearing; provided, however, that they may be laid-off in accordance with the provisions of N.J.S.11A:8-1 et seq., and the regulations promulgated thereunder.  The transferred employees shall be subject to layoff procedures prior to the transfer to the new entity.  Once transferred, they will be subject to any employment contracts and provisions that exist for the new entity.  The final decision of which employees shall transfer to the new employer  is vested solely with the local unit that will provide the service and subject to any collective bargaining agreements within the local units..]  (Deleted by amendment, P.L.     , c.       ) (pending before the Legislature as this bill.           )

(cf: P.L.2019, c.433, s.5).

 

     4.    Section 18 of P.L.2007, c.63 (C.40A:65-18) is amended to read as follows:

      18.    a.  When a joint meeting or regional service agency merges bargaining units that have current contracts negotiated in accordance with the provisions of the "New Jersey Employer-Employee Relations Act," P.L.1941, c.100 (C.34:13A-1 et seq.), the terms and conditions of the existing contracts shall apply to the rights of the members of the respective bargaining units until a new contract is negotiated, reduced to writing, and signed by the parties as provided pursuant to law and regulation promulgated thereunder.

      b.   The Public Employment Relations Commission is specifically authorized to provide technical advice, pursuant to section 12 of P.L.1968, c.303 (C.34:13A-8.3), and mediation services to integrate separate labor agreements into single agreements for the joint contract.  The commission may order binding arbitration, pursuant to P.L.1995, c.425 (C.34:13A-14a et al.), to integrate any labor agreement.

      c.   When local units enter into a joint contract that results in the merger of bargaining units, if a dispute arises over the representation of employees in the merged unit, the Public Employment Relations Commission is authorized to provide technical advice pursuant to section 12 of P.L.1968, c.303 (C.34:13A-8.3), and mediation services to resolve representation disputes.  If disputes over representation cannot be resolved through advice and mediation, the Public Employment Relations Commission shall determine the appropriate units for purposes of collective negotiations and shall conduct secret ballot elections in such units to permit employees to select their majority representative pursuant to the commission’s rules and regulations.  Agreements between majority representatives regarding the representation of employees in a merged unit shall be binding on the new employer.

(cf: P.L.2019, c.433, s.9)

 

     5.    Section 22 of P.L.2007, c.63 (C.C.40A:65-22) is amended to read as follows:

     22.     a.  The management committee shall comply with the requirements of sections 10 and 11 of P.L.1983, c.313 (C.40A:5A-10 and C.40A:5A-11) regarding the submission and approval of an annual budget to the Director of the Division of Local Government Services in the Department of Community Affairs, or to the Commissioner of Education, as appropriate.

     b.    The management committee, not later than November 1 of each year, shall certify to the participating local units the total costs and expenses of operation, other than acquisition and construction costs, of the services, public improvements, works, facilities, or undertakings for the ensuing year, in accordance with the terms and provisions of the joint contract, together with an apportionment of the costs and expenses of operation among the participating local units in accordance with the method of apportionment provided in the joint contract.  It shall be the duty of each participating local unit to include its apportioned share of such costs and expenses of operation in its annual budget, and to pay over to the management committee its apportioned share as provided in the joint contract.  Operations under the budget and related matters shall be subject to and in accordance with rules of the Local Finance Board or the Commissioner of Education, as appropriate.  The Local Finance Board shall be responsible for the determination of the appropriate rule-making authority with regard to each joint contract.  For the first year of operation under the joint contract, a participating local unit may adopt a supplemental or emergency appropriation for the purpose of paying its apportioned share of the costs and expenses of operation, if provision therefor has not been made in the annual budget.

(cf: P.L.2007, c.63, s.22)

 

      6.   Section 2 of P.L.2007, c.54 (C.52:27D-502) is amended to read as follows:

      2.   For the purposes of this act:

      "Commission" means the "Local Unit Alignment, Reorganization, and Consolidation Commission" established pursuant to section 3 of P.L.2007, c.54 (C.52:27D-503); and, on and after the effective date of P.L.      , c.     (C.     ) (pending before the Legislature as this bill), shall mean any other entity created, or designated, by an act of the Legislature to perform the duties required pursuant to P.L.2007, c.54 (C.52:27D-501 et seq.).

      "Local unit" means a municipality or fire district, and shall not include a school district, regional school district, or county.

(cf:  P.L.2007, c.54, s.2)

 

     7.    Section 3 of P.L.2007, c.54 (C.52:27D-503) is amended to read as follows:

     3.    a.  There is established in but not of the Department of Community Affairs, the "Local Unit Alignment, Reorganization, and Consolidation Commission."

     b.    The commission shall consist of [nine] eleven voting members: the Commissioner of Community Affairs (or a designee) and the State Treasurer (or a designee), who shall both serve ex-officio; and [seven] nine public members, and shall be appointed as follows: one member appointed by the President of the Senate, one member appointed by the Minority Leader of the Senate, one member appointed by the Speaker of the General Assembly, one member appointed by the Minority Leader of the General Assembly, and [three] five members, no more than two of whom shall be of the same political party, appointed by the Governor, with the advice and consent of the Senate.  [Of] With respect to the [three] five public members appointed by the Governor, one member shall reside in a northern county (Bergen, Essex, Hudson, Morris, Passaic, Union, Sussex, or Warren), one member shall reside in a central county (Hunterdon, Mercer, Middlesex, Monmouth, or Somerset), and one member shall reside in a southern county (Atlantic, Burlington, Camden, Cape May, Cumberland, Gloucester, Ocean, or Salem).  1[The] After the effective date of P.L.    , c.     (pending before the Legislature as this bill), the Governor shall appoint a fourth and a fifth public member.1  The fourth public member appointed by the Governor shall be a member of either the New Jersey State Policemen’s Benevolent Association (PBA), the New Jersey State Firefighters’ Mutual Benevolent Association (FMBA), the Communication Workers of America (CWA), or the American Federation of State, County, and Municipal Employees (AFSCME), representing State or local public employees.  The fifth public member appointed by the Governor shall be a person with at least 10 years of experience as a municipal administrator, manager, or chief financial officer.  No appointee shall be an elected official of a local unit or county unless that person has significant experience in shared service initiatives and demonstrated success at having implemented such agreements at the local level.

     c.     Members of the commission shall serve without compensation, but shall be reimbursed for expenses actually incurred in the performance of their duties.

     d.    The members shall be appointed within 60 days following the effective date of this act.  The public members shall serve for terms of five years and until the appointment and qualification of a successor; except that in making the first appointments to the commission, one person shall be appointed to serve for one year, one for two years, one for three years, one for four years, and four for five years.  The length of the respective term of each member of the first commission shall be determined by lot at the organization of the first commission.  

     1The initial term of the two additional public members appointed by the Governor pursuant to the provisions of P.L.    , c.        (pending before the Legislature as this bill) shall be five years.1

     A public member may be reappointed.  Any vacancy in the membership of the commission shall be filled in the same manner as the original appointment was made for the unexpired term only.

(cf: P.L.2007, c.54, s.3)

 

8.  Section 5 of P.L.2007, c.54 (C.52:27D-505) is amended to read as follows:

     5.    a.    (1) The commission shall study and report on the structure and functions of county and municipal government, including local taxing districts, their statutory bases, including the fiscal relationship between local governments, and the appropriate allocation of service delivery responsibilities from the standpoint of efficiency, including whether some municipal services and functions would be more efficiently provided by counties.  The study of the transfer of the municipal tax assessment function to the county through the appointment of a county assessor and deputy county assessors in a pilot county pursuant to the "Property Assessment Reform Act," sections 1 through 15 of P.L.2009, c.118 (C.54:1-86 et seq.), shall be conducted in consultation with the Director of the Division of Taxation in the Department of the Treasury.

     (2)   The commission shall recommend legislative changes which would encourage the more efficient operation of local government.  These changes may include the structural and administrative streamlining of county and municipal government functions, including but not limited to, the transfer of functions from one level of government to another, particularly the delivery of some municipal services and function by counties, and the use or establishment of regional service delivery entities.

     (3)   The commission shall also consider optimal service levels, ratios of employees to population served, cost structures for service delivery, and other best practices.

     Within two years following the effective date of P.L.2007, c.54 (C.52:27D-501 et al.), the commission shall report its findings to the Governor, the President of the Senate, and the Speaker of the General Assembly; provided, however, that findings concerning the transfer of the municipal tax assessment function to the county through the appointment of a county assessor and deputy county assessors shall be reported on or before February 1 of the sixth year next following the effective date of P.L.2009, c.118 (C.54:1-86 et al.).

     b.    Based on its findings pursuant to paragraph (3) of subsection a. of this section, the commission shall develop criteria to serve as the basis: for recommending the consolidation of specific municipalities [,] and the merger of specific existing autonomous agencies into the parent municipal or county government, [or] and for recommending the sharing of services between municipalities or between municipalities and other public entities, including but not limited to counties, fire districts, school districts, and regional school districts[Recommendations for sharing services may result from a study focusing exclusively on the sharing of services or may result from a study examining potential consolidation.  Municipalities to be considered for consolidation shall be within the same county and shall also be situated within the same legislative district.]

     The criteria to govern a study to examine consolidation or the sharing of services shall include, but need not be limited to:

     (1)   a consideration of geographic factors, such as a shared boundary, or in the case of the recommended consolidation of more than two local units, that the consolidated local unit will have a contiguous boundary;

     (2)   an analysis of the economic costs and benefits of consolidation or the sharing of services, as the case may be, including potential tax savings and reductions in government costs through economies of scale;

     (3)   measures to ensure that costs and benefits of consolidation or service sharing are distributed equitably across the entire community; [and]

     (4)   measures to safeguard the interests of communities in the municipalities for which consolidation or sharing of services is recommended, including the impact of a recommended consolidation or sharing of services on the ability of the public entity to comply with applicable State and federal laws and regulations and on the overall quality and efficient delivery of those services; and

     (5)   measures to evaluate and assess potential health and safety impacts associated with consolidation or sharing of services, if the consolidation or sharing of services relates to fire services or police services.  1In the case of the sharing of fire services or police services, the commission shall request that a collective bargaining unit, representing fire or police personnel affected by the proposed shared service, make an independent analysis concerning the impact that the shared service would have on the health and safety of its members, and the commission shall incorporate the collective bargaining unit’s analysis into the commission’s findings1.

     The commission shall [give priority to] only study local units that [volunteer to be studied] , as of the effective date of P.L.    , c.     (C.     ) (pending before the Legislature as this bill), neither participate in a shared service agreement nor have undertaken independent shared services studies or negotiations.

     When the commission's study is one that could potentially serve as the basis for a recommendation that, if not acted upon, could result in a reduction of State aid pursuant to subsection f. of section 8 of P.L.2007, c.54 (C.52:27D-508), then the recommended model, (1) must be projected to be capable of maintaining the same level of service or improving the services provided by the participating municipalities; and (2) must project either a meaningful savings or a slowed rate of growth of costs to result over a reasonable period of time.

     c.     (1)     (a) Based upon criteria developed pursuant to subsection b. of this section and in consultation with the local units that are being studied, the commission shall undertake studies to examine the sharing of services between specific municipalities or between municipalities and other public entities.  The commission also may undertake studies to examine the consolidation potential for specific municipalities, but the studies or recommendations shall not be subject to potential reductions in State aid pursuant to subsection f. of section 8 of P.L.2007, c.54 (C.52:27D-508).

     (b)   In undertaking its studies, the commission shall conduct one on-site consultation session in each local unit being studied, with the governing bodies, or their designees, and affected officials and other public entities under consideration for consolidation or the sharing of services.  If the consultation sessions are subject to the "Senator Byron M. Baer Open Public Meetings Act," P.L.1975, c.231 (C.10:4-6 et seq.), the commission shall reimburse the local units for any expenses incurred.

     (c)   Each consolidation proposal or shared services proposal shall:

     (i)    detail the current delivery service being considered for the shared service proposal, including personnel, equipment, and cost;

     (ii)   detail the cost, including personnel and equipment for the proposed shared services;

     (iii) include an estimate of the total net savings that will result from implementation of the proposed consolidation or sharing of services;

     (iv)  provide options for the delivery of the shared services and an explanation of why those options are not optimum;

     (v)   include a transcription of the public hearings held pursuant to paragraph (3) of this subsection; and

     (vi)  include any other pertinent information.

     (d)   The commission shall provide written notice of a recommendation, including any economic analysis, made pursuant to this subsection to the governing body of each local unit that is the subject of the recommendation, together with documentation supporting the commission's recommendation.

     (e)   A local unit may request the commission to undertake a study to examine the local unit's potential for consolidation or the sharing of services.  A county may request the commission to undertake a study to examine the county's potential for providing specific shared services to constituent municipalities, however, no county shall be included in a study that could potentially serve as the basis for a recommendation that, if not acted upon, could result in a reduction of State aid to a municipality pursuant to subsection f. of section 8 of P.L.2007, c.54 (C.52:27D-508) unless the request to undertake the study is agreed to by the governing bodies of the affected municipalities through the adoption of resolutions stating support. 

     (f)   The results of any economic analysis performed by or on behalf of the commission shall be submitted to the State Treasurer for a review of the accuracy of the analysis prior to releasing a recommendation pursuant to this subparagraph.  At the same time, the results of the economic analysis shall be submitted to the affected municipalities and other public entities. No recommendation for a shared service that is submitted to the State Treasurer by the commission shall be made unless the commission finds that the current level of service will be maintained or improved for each affected municipality and that each affected municipality will realize a cost savings.  The State Treasurer shall, within 90 days of receipt, weigh any contrary information or evidence submitted by affected municipalities and other public entities and then either certify the recommendation, or prepare a memo of objections for the commission.  The local unit shall, within 90 days from the date that the commission submits the economic analysis, either certify the recommendation or provide, either electronically, by e-mail, by letter, or by personal delivery, a written objection along with supporting documentation to the State Treasurer.  The commission shall work with the State Treasurer in satisfying the objections prior to resubmitting a recommendation for review and certification.  In accordance with the results of its studies, the commission may recommend the consolidation of specific municipalities, or the sharing of services between specific municipalities or between municipalities and other public entities.

     (g)   (i) The commission shall provide written notice to the governing body of each municipality that is the subject of a recommendation, together with supporting documentation and the State Treasurer’s certification of, or objections to, the economic analysis.  A notice recommending the sharing of services shall state that the governing bodies have 14 months from the date of the notice to approve a certified recommendation for a shared service, or that they need not take any action with respect to a recommendation for a shared service that was not certified by the State Treasurer.

     (ii)   A municipality may contest the total net savings estimate contained in the commission's proposal by appeal to the Commissioner of Community Affairs within 30 days of receipt of the recommendation.  The commissioner shall have 15 business days to review the analysis and the challenge in order to determine whether the analysis should be adjusted.  The commissioner may extend the review time for the appeal if the commissioner deems a hearing is necessary. 

     (2)   When a municipal consolidation is recommended by the commission, the commission shall substitute for a joint municipal consolidation study commission that would be formed pursuant to section 7 of the "Municipal Consolidation Act," P.L.1977, c.435 (C.40:43-66.41) or any other statute governing municipal consolidation, and no voter approval shall be required to create the study commission.  The commission shall be present at one or more of the public hearings required pursuant to subsection d. of section 25 of P.L.2007, c.63 (C.40A:65-25).

     (3)   When a sharing of services is recommended by the commission, the governing body of each affected municipality shall hold one public hearing in each municipality that would be affected by the recommendation, in a place that is easily accessible to its residents.  At least one member of the commission shall attend these public hearings to answer residents’ questions.  A public hearing required by this paragraph shall be advertised in the official newspaper of the local unit at least seven days prior to the public hearing, posted in each local unit's official buildings and on each local unit's official Internet website, if one exists, and shall also be posted by the commission on its Internet website.  The commission shall reimburse the local units for any expenses incurred in holding the public hearings required under this paragraph.

     d.    When a consolidation or shared service is recommended by the commission, the commission shall recommend State funding for any extraordinary expenses necessitated by the consolidation plan or shared service agreement.  The commission shall recommend that this funding be provided either by funds made available to the commission for that purpose or by the Legislature or State Treasurer as part of the annual State budget process.

(cf: P.L.2009, c.118, s.16)

 

     9.    Section 6 of P.L.2007, c.54 (C.52:27D-506) is amended to read as follows:

     6.    a.  (1)  The ["Local Unit Alignment, Reorganization, and Consolidation Commission"] commission shall work in conjunction with the Local Finance Board and the Division of Local Government Services in the Department of Community Affairs. [To the extent possible, the] The commission may request specific resources from the department.  The department shall provide the commission with all resources requested by the commission that the department determines are reasonable and necessary for the commission to operate and satisfy its statutory duties including, but not limited to, the provision of offices, equipment, materials, and administrative, technical, and legal personnel.  The department shall have the burden of showing that a request for resources is unreasonable.

     (2)   The commission may also request, and shall be entitled to, the assistance and services of the employees of any State department, board, bureau, commission, or agency, as it may require and as may be available to it for its purposes.

     b.    The commission may request, and shall be entitled to, the cooperation of the officials and employees of every county and municipality, as it may require.

     c.     The commission may incur traveling and other miscellaneous expenses necessary to perform its duties, within the limits of funds available to it for its purposes.

     d.    The commission may contract for the services of professional, technical, and operational personnel and consultants as it may determine are necessary to perform its duties, within the limits of funds available to it for its purposes.

(cf: P.L.2007, c.54, s.6)

 

      10.    Section 7 of P.L.2007, c.54 (C.52:27D-507) is amended to read as follows:

      7.   a. The ["Local Unit Alignment, Reorganization, and Consolidation Commission"] commission shall annually, by January 31st, submit to the Governor and the Legislature a report summarizing the commission's activities over the course of the previous calendar year.

     b.    In the event that the commission proposes consolidation of local units [or a shared services agreement], the commission shall submit a copy of the consolidation [or shared services] proposal to the Governor and the Legislature [no later than May 1st of the year in which the proposed consolidation is to be put before the voters pursuant to subsection a. of section 8 of P.L.2007, c.54 (C.52:27D-508).  A municipal consolidation proposal shall include, but not be limited to, a description of the form of government, the election of officers, the apportionment of debts, and other issues between pairs or groups of municipalities which the commission proposes should consolidate or share services] together with its annual report.

     c.     [A consolidation or shared services proposal shall take effect at the end of a period of 30 calendar days after the date on which the proposal is transmitted to the Senate and General Assembly, on a day on which both thereof shall be meeting in the course of a regular or special session, unless, between the date of transmittal and the end of the 30-day period, the Legislature passes a concurrent resolution stating in substance that the Legislature does not favor the consolidation proposal.] (Deleted by amendment, P.L.    , c.    )

(cf: P.L.2007, c.54, s.7)

 

      11.    Section 8 of P.L.2007, c.54 (C.52:27D-508) is amended to read as follows:

      8.   a.  [Upon] If a local unit receives a recommendation for the sharing of services from the commission together with the [taking effect of a consolidation or shared services proposal] State Treasurer's certification of the recommendation, pursuant to [subsection b. of] section [7] 5 of P.L.2007, c.54 [(C.52:27D-507)] (C.52:27D-505), [each recommendation included therein shall be put before the affected voters at the next general election and shall become effective only upon its] the local unit shall approve the recommendation within 14 months of the date of the notice or be subject to a reduction of State aid in accordance with subsection f. of this section.  A local unit may approve a recommendation for the sharing of services by adoption of an ordinance, or by adoption by a majority of the voters of [each affected municipality] the local unit.

     Nothing in this subsection shall prohibit the governing body of a local unit from approving a recommendation for the sharing of services by adoption of a resolution or ordinance and placing that proposal before the affected voters at the next general election.

     b.    [In order to effectuate the provisions of subsection a. of this section, the Secretary of State] If the governing body of a local unit chooses to place the question of approval of a recommendation for the sharing of services before the voters, the clerk or other appropriate administrative officer of the local unit shall forward to the clerk of [each] the county in which the [affected] local [units are] unit is located a public question to be included on the ballots at the next general election for the election districts encompassing those affected local units.

     [(1) The question with respect to consolidation shall read as follows:

     "Shall (insert the names of the participating local units) be consolidated into a single local unit to be known as (insert the name proposed for the consolidated local unit)?"

     (2)] The question with respect to a shared services proposal shall read as follows:

     "Shall (insert the services to be shared) be jointly undertaken between (insert the  names of the entities between which sharing is to occur)?  The State proposes this “sharing of services” and estimates that it can save $ (insert estimate of savings included in the proposal pursuant to subsection c. of section 5 of P.L.2007, c.54 (C.52:27D-505)).  This proposed sharing of service will (insert "reduce," "increase," "not change," or "slow the rate of growth of") the level of service currently provided by (insert the name of the entity) according to the State's recommendation.  This estimated savings will result, on average, of a savings of $ (insert savings per property taxpayer based on averaged assessed property) per property tax bill of the averaged assessed property of $ (insert the averaged assessed property).  The (insert name of entity) (insert "supports" or "opposes") this proposed shared service for the following reason(s) (insert the one or more reasons).  If a majority of the voters vote "No", the State shall reduce “State Aid” to your municipality by that amount each year."  The reduction of State aid may result in an increase in the property tax levy.

     c.     [The consolidation of pairs or groups of local units recommended for consolidation under subsection a. of this section shall be accomplished within 14] Local units that are the subject of a recommendation for the sharing of services shall implement the recommendation within 28 months following the [voter approval] date of the [consolidation recommendation] notice of the commission recommendation.

     d.    (1) No question with respect to a consolidation recommended or proposed by the commission shall be submitted to the voters of a local unit.

     (2)   The adoption of a form of government, the election of officers, the apportionment of debts, and other issues between pairs or groups of municipalities [required] that choose to consolidate pursuant to [an approved] a consolidation [recommendation under subsection c. of this section] proposal shall be determined by the commission, as far as practicable, in accordance with the procedures set forth in the "Municipal Consolidation Act," P.L.1977, c.435 (C.40:43-66.35 et al.) or any other statute governing municipal consolidation.  A consolidation shall be approved by ordinance after two public hearings have been held one after the first reading of the ordinance, and one after the second reading of the ordinance.

     e.     For a period of 10 years [from the] following implementation of an approved consolidation [of a pair or group of municipalities pursuant to a consolidation recommendation approved under subsection c. of this section] proposal, and notwithstanding any law to the contrary, the residents of [those municipalities] the consolidated municipality, or portions thereof, shall not have the right to secede to form a new municipality, or to consolidate with, or annex themselves to, any other municipality.

     f.     (1) If a municipality does not approve a recommendation for the sharing of services within 14 months of the date of notice of the commission's recommendation, or if that municipality does not make a good faith attempt to enter into and implement the recommended joint contract or shared service agreement within 28 months following the date of notice of the commission's recommendation, then the State shall annually reduce the total amount of State aid allocated to that municipality under the Consolidated Municipal Property Tax Relief Aid (CMPTRA) program, the Energy Tax Receipts Property Tax Relief Fund (ETR) program, or both, by the total net savings estimated in the proposal pursuant to subsection c. of section 5 of P.L.2007, c.54 (C.52:27D-505).

     (2)   No municipality shall be subject to a reduction in its CMPTRA or ETR allocation, or both, for its refusal to comply with a consolidation recommendation or proposal by the commission.

     (3)   No municipality shall be subject to a reduction in its CMPTRA or ETR allocation, or both, if it approved a recommendation for the sharing of services and the failure to implement the recommendation was due to the action or inaction of the governing body or voters of another local unit.

(cf: P.L.2007, c.54, s.8)

 

      12.    (New section)  There is appropriated from the General Fund to the Department of Community Affairs such sums as may be necessary for the operating expenses of the Local Unit Alignment, Reorganization, and Consolidation Commission, or any other entity created, or designated, on or after the effective date of PL.    , c.     (C.         ) (pending before the Legislature as this bill) by an act of the Legislature to perform the duties required pursuant to P.L.2007, c.54 (C.52:27D-501 et seq.), subject to the approval of the Director of the Division of Budget and Accounting in the Department of the Treasury.

 

      13.    (New section)  There is appropriated from the Property Tax Relief Fund to the Department of Community Affairs such sums for non-recurring costs that the Local Unit Alignment, Reorganization, and Consolidation Commission, or any other entity created, or designated, on or after the effective date of PL.    , c.     (C.         ) (pending before the Legislature as this bill) by an act of the Legislature to perform the duties required pursuant to P.L.2007, c.54 (C.52:27D-501 et seq.), determines are necessary to fund extraordinary expenses of local units to implement consolidation plans and shared service agreements, subject to the approval of the Director of the Division of Budget and Accounting in the Department of the Treasury.

 

      14.    (New section)  The following sections are repealed:

      Section 8 of P.L.2007, c.63 (C.40A:65-8);

      Section 17 of P.L.2007, c.63 (C.40A:65-17);

      Section 19 of P.L.2007, c.63 (C.40A:65-19);

      Sections 16 through 18 of P.L.1975, c.329 (C.26:3A2-16 through C.26:3A2-18).

 

      15.    This act shall take effect immediately and shall only apply to shared service agreements, joint contracts, or municipal consolidations entered into on or after the effective date of this act.