SENATE BUDGET AND APPROPRIATIONS COMMITTEE

 

STATEMENT TO

 

[Fourth Reprint]

ASSEMBLY, No. 1512

 

STATE OF NEW JERSEY

 

DATED: JANUARY 14, 1997

 

      The Senate Budget and Appropriations Committee reports favorably Assembly Bill No. 1512 (4R) of 1996.

      Assembly Bill No. 1512 (4R) amends the "Stormwater Management and Combined Sewer Overflow Abatement Bond Act of 1989" (P.L.1989, c.181) to permit the Department of Environmental Protection (DEP) and the New Jersey Environmental Infrastructure Trust (Trust) to use the bond moneys to make grants, zero or low interest loans, or loan guarantees to local governments for stormwater management and overflow abatement projects. The 1989 bond act was approved in November, 1989 by the voters of New Jersey. The bill's proposed changes to that act must also be approved by the electorate. The ballot question is to be submitted for approval at the general election to be held in November, 1997.

      The bill provides that the $50,000,000 authorized by P.L.1989, c.181 would be used for the purposes of providing grants or loans to local governments for the costs of stormwater management and combined sewer overflow abatement projects, all as identified pursuant to the stormwater management and combined sewer overflow abatement project priority list to be adopted by the Commissioner of DEP pursuant to section 28 of P.L.1989, c.181, as amended by the bill.

      The bill provides for two separate, nonlapsing revolving funds: the "Stormwater Management and Combined Sewer Overflow Abatement Fund" and the "Stormwater Management and Combined Sewer Overflow Abatement Trust Fund."

      Not less than $45,000,000 is to be deposited in the "Stormwater Management and Combined Sewer Overflow Abatement Fund" and allocated to the DEP for the purposes of providing grants or zero or low interest loans to local governments for the costs of stormwater management and combined sewer overflow abatement projects.

      Up to $5,000,000 is to be deposited into the "Stormwater Management and Combined Sewer Overflow Abatement Trust Fund," with moneys in that fund to be used by the Trust to establish a reserve account for loans made by the Trust, and a guarantee account to secure debt issued by local governments in connection with the financing of a project.

      The bill also: (1) authorizes the Trust to collect annual fees in connection with any loans or other services provided to local governments; (2) delegates to DEP responsibility for administering the "Stormwater Management and Combined Sewer Overflow Abatement Fund;" (3) authorizes the Trust to use income earned on moneys deposited in the "Stormwater Management and Combined Sewer Overflow Abatement Trust Fund" to cover unreimbursed administrative expenses; (4) authorizes temporary cross-use by the DEP and Trust of moneys in the two funds; and (5) requires DEP and the Trust to provide annual accounts of moneys expended from their respective funds.

      The bill also provides that if the "New Jersey Environmental Infrastructure Trust Act" (a companion measure pending in the Legislature) has not been enacted into law by the date of the approval of this act by the voters, the amendments made to the 1989 bond act pertaining to the Trust would remain inoperative.

      The bill prohibits the appropriation of any of the bond monies or loan repayments for indirect administrative costs or for fringe benefit costs of State and cap the direct administrative costs of the State at existing fiscal year 1997 levels, less any administrative costs for indirect or fringe benefit costs, plus an annual three percent escalator.

      As reported, this bill is identical to Senate Bill No. 469 SCS of 1996 (Kyrillos/Ciesla).

 

FISCAL IMPACT

      This bill has not been certified as requiring a fiscal note. The amendments to the bond act made by this bill (if approved by the voters) allow, but do not require, the use of previously authorized bonded indebtedness for financing the cost of stormwater management and combined sewer overflow abatement projects.

      The bill appropriates $5,000 from the General Fund to the Department of State to publish the notice of the bond question.