ASSEMBLY, No. 1695

STATE OF NEW JERSEY

INTRODUCED MARCH 4, 1996

By Assemblymen ROBERTS and MALONE

An Act concerning interlocal service agreements and amending P.L.1973, c.208.

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

    1. Section 1 of P.L.1973, c.289 (C.40:8B-1) is amended to read as follows:

    1. This act shall be known and may be cited as the "[Interlocal] Joint Services Incentive Aid Act."

(cf: P.L.1973, c.289, s.1)

    2. Section 5 of P.L.1973, c.289 (C.40:8B-5) is amended to read as follows:

    5. Applications for joint service program grants may be made covering any or all [of the following] areas of governmental service, including, but not limited to, the following areas:

    a. joint assessment and collection of taxes;

    b. joint maintenance of municipal records and statistics and electronic data processing;

    c. joint building, housing and plumbing code inspection and enforcement;

    d. joint solid waste collection and disposal or recycling;

    e. joint air pollution control inspection and enforcement;

    f. joint welfare and social service programs;

    g. joint maintenance and administration of parks and recreational and cultural facilities;

    h. joint maintenance of roads, public works and beaches;

    i. joint fire departments (Any intermunicipal volunteer department or company shall be eligible to apply pursuant to section 4 of this act, except that any intermunicipal volunteer fire program shall provide for the consolidation of all companies within the municipalities served. Such consolidation shall in no way be deemed to affect municipal aid to fire companies under N.J.S.40A:14-34. For purposes of such aid, the consolidated company shall be eligible for the full amount of aid which its constituent companies might have received from any municipality had they remained separate entities);

    j. consolidation of municipal police forces or departments;

    k. joint municipal courts;

    l. joint risk management services;

    m. joint energy conservation services, including, but not limited to, the costs incurred by local government units in purchasing or renting equipment, materials and supplies, or in employing personnel, for the purposes of reducing energy consumption in buildings and properties owned by such local government units, or in providing advisory and other services in the area of energy conservation to the citizens, businesses and industries of such units.

(cf: P.L.1981, c.529, s.1)

    3. Section 6 of P.L.1973, c.289 (C.40:8B-6) is amended to read as follows:

    6. a. No grant under this act shall be made to any joint program which has not submitted an approved plan of operations based on a feasibility study of the project conducted pursuant to this section. A 2-year grant may, however, be extended to any consolidated municipality filing an application pursuant to section 42 of the "Municipal Consolidation Act" (P.L.1977, c.435; C.40:43-66.35 et seq.). Such feasibility study shall be conducted by or under the supervision of the Department of Community Affairs, either (1) by the Department of Community Affairs or by an agency or agencies of the State of New Jersey approved by the Commissioner of Community Affairs, or (2) by a qualified third party approved by the Department of Community Affairs and by the principal executive officer of any principal executive department of State Government whose approval of such feasibility study is required by subsection b. of this section and by a majority of 2/3 or more of the applicant local units, or (3) in the case of joint energy conservation services, by the [Department of Energy] Board of Public Utilities or, in the case of joint solid waste collection, disposal or recycling, by the Department of Environmental Protection. Such plan of operations shall constitute the final element of the feasibility study when approved by the Commissioner of Community Affairs and by any and every principal executive officer of a principal executive department of State Government which exercises jurisdiction over the performance of the services to be provided jointly under the proposed program.

    b. Any local units eligible for aid as defined in sections 3 and 4 of [this act] P.L.1973, c.289 shall be eligible to apply for funds to conduct a feasibility study under the auspices of the Department of Community Affairs. Application for such shall include: the names of the proposed participants; certified copies of a resolution or substantially similar resolutions passed by the governing bodies of the participating units authorizing such application; the services for which joint programs are contemplated, and the expected benefits of such a joint program. The application shall be in such form and shall also contain such other information as may be required by the Commissioner of Community Affairs.

    All grants for feasibility studies shall require the joint approval of the Commissioner of Community Affairs and the principal executive officer of any and every principal executive department of State Government which exercises jurisdiction over the performance of the services to be provided jointly under the proposed program.

    c. The feasibility study shall include such detailed surveys of present service standards in the area to be served by the joint program as may be required to establish substantial evidence that a joint program would either enable provision of a needed service which could not otherwise be provided, or remedy existing levels of service provision, or otherwise produce better services at relatively lower unit costs or with more efficient administration, and that such joint programs would not adversely affect neighboring local units, and that no neighboring local unit which might benefit is being excluded from the program; provided that any such local unit claiming exclusion had expressed a desire to be included in the feasibility study by giving written notice of such desire to the Commissioner of Community Affairs within 30 days from the date on which the commissioner made public announcement of the feasibility study grant.

    d. Within 1 month of the completion of the feasibility study, the Department of Community Affairs shall hold a public hearing in each local unit to be included in the proposed joint program. After such hearings and upon submission and approval of a plan based thereon as provided in subsection a. of this section, the joint program shall be eligible for aid under this act. No joint program shall receive aid unless the governing bodies of all participating local units have passed identically worded resolutions ratifying the grant contract between the State and the participating local units.

    If the feasibility study shall contain recommendations for establishing a joint service program, within 6 months from the date of the last public hearing on the feasibility study, the governing body of each local unit which participated in the study shall communicate in writing to the Commissioner of Community Affairs stating their intentions of implementing or their specific and detailed objections to implementing each recommendation made in the feasibility study for establishing a joint service plan.

    e. The Commissioner of Community Affairs shall, upon formal request by the governing body or chief executive officer of any local unit, cause to be made a preliminary survey as to the eligibility of such local unit and any other local units for State aid under this act with respect to any joint arrangements for provision of services specified or suggested in such request. Such preliminary survey shall be of sufficient scope and detail to enable the commissioner to advise all local units concerned in the projected joint arrangement whether the circumstances warrant detailed feasibility study pursuant to subsections a., b., c. and d. of this section; and the commissioner shall transmit formal notice of the findings and conclusions of such preliminary survey to all the said local units concerned.

(cf: P.L.1981, c.529, s.2)

    4. Section 7 of P.L.1973, c.289 (C.40:8B-7) is amended to read as follows:

    7. a. Local units in joint programs qualifying for aid for the implementation of joint programs under this act shall receive the following aid for 4 years:

    (1) if the service provided under the joint agreement is one which the local unit has previously provided, an amount to cover all extraordinary administrative and operating costs incurred by the local unit as a result of implementation of the joint program;

    (2) if the service provided under the joint agreement is one which the local unit has not previously provided, an amount equal to 10% of the total costs incurred by the local unit as a result of implementation of the joint program.

    b. (1) In those areas in which the approved feasibility study indicates that previous service provided in any participating local unit was at such a low level that minimum adequacy can be obtained only by substantial upgrading, the Commissioner of Community Affairs is hereby authorized to provide for aid on behalf of that unit in accordance with paragraph (2) of subsection a. of this section rather than paragraph (1).

    (2) In the event that a local unit currently providing a service at or above minimum levels as determined by the approved feasibility study enters into a joint agreement with a unit or units eligible for aid under paragraph (2) of subsection a. of this section or under paragraph (1) of this subsection, aid to joint program on behalf of each local unit participating may be given as if all local units had qualified for aid under paragraph (2) of subsection a. of this section or under paragraph (1) of this subsection.

    c. Aid payable under this act shall be subject to availability of State appropriations and to a budget estimate approved in advance by the Commissioner of Community Affairs. The local units shall receive such payment for a period not to exceed 4 years from the date of inception of the joint program.

    d. (1) For the purposes of this act, "extraordinary operating and administrative costs" shall be deemed to be those operating and administrative costs incurred by a local unit for a service provided through a joint agreement which exceed the operating and administrative costs which it would have incurred for the provision of such service had such joint agreement not been implemented.

    (2) For the purposes of this act, "operating and administrative costs" shall [not] include costs which are considered capital costs as set forth in section 40A:2-22 of the "Local Bond Law" (N.J.S.40A:2-22)[; except that the Commissioner of Community Affairs may declare as eligible for aid under this act such costs as in his judgment could reasonably be included within an operating budget notwithstanding the fact that they may be bondable].

    (3) The amounts expended for extraordinary operating and administrative costs by each local unit receiving aid pursuant to paragraph (1) of subsection a. of this section, and the amounts expended for total operating and administrative costs by each other local unit receiving aid under this act, as the case may be, shall be certified each year by each local unit participating in a joint program, and approved by the Commissioner of Community Affairs subject to a performance audit performed by or under the auspices of the Department of Community Affairs.

(cf: P.L.1973, c.289, s.7)

    5. This act shall take effect immediately.

STATEMENT

    This bill revises the "Interlocal Services Aid Act" by permitting applications for joint service program grants covering any or all areas of government service, and also by providing that capital costs associated with an interlocal service agreement will be covered by a grant made pursuant to the act through an amendment to the definition of "operating and administrative costs." The bill also makes technical corrections to existing law and changes the title of the "Interlocal Services Aid Act" to the "Joint Services Incentive Aid Act."

    It is the intent of the sponsor that these changes will foster innovative partnerships between local governments and reduce the property tax burden on local property taxpayers.

Revises and renames "Interlocal Services Aid Act."