SENATE, No. 176

STATE OF NEW JERSEY

Introduced Pending Technical Review by Legislative Counsel

PRE-FILED FOR INTRODUCTION IN THE 1996 SESSION

By Senator RICE

An Act concerning oversight of the Passaic Valley Sewerage Commissioners, and supplementing chapter 14 of Title 58 of the Revised Statutes.

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

    1. The provisions of section 16 of P.L.1953, c.388 (C.58:14-34.25) and any other law, or any rule or regulation adopted pursuant thereto to the contrary notwithstanding, the Department of Community Affairs is hereby authorized to review the operations, policies, procedures, rates and any other assessed charges of the Passaic Valley Sewerage Commissioners, and shall arbitrate in any dispute between the commissioners and a contracting municipality contesting the charges being assessed against it. The review and arbitration authorized by this act shall include the review and arbitration of any matters involving the entity commonly known as the "Passaic Valley Sewerage Commission."

    2. a. The Passaic Valley Sewerage Commissioners shall, within 90 days of the effective date of this act, submit to the Department of Community Affairs and each of their contracting municipalities a report of the basic terms and provisions of the service agreements and contracts between the commissioners and each of their contracting municipalities, an explanation of how the rates and other charges have been derived pursuant to these contract provisions, the current method for calculating the rate for a contracting municipality, and the provisions and procedure, if any, for renegotiating any of these terms or provisions and appealing the rate charge.

    b. The Passaic Valley Sewerage Commissioners shall, within 90 days of the effective date of this act, submit to the Department of Community Affairs and the Department of Environmental Protection the financial records of the Passaic Valley Sewerage Commission for the preceding five fiscal years, or for a longer time period as the departments may require, including the rates calculated for each contracting municipality and how they were calculated, the total effluent, by class, processed by the commission and the total effluent, by class, processed from each contracting municipality, the total operating budget, operating costs, overhead expenses, staffing levels, salaries and debt service of the commission, the total rate charges assessed to each contracting municipality, and any other information concerning the management and operation of the commission that the departments may require.

    c. The Department of Community Affairs, in consultation with the Department of Environmental Protection, shall review the report and records submitted pursuant to subsection a. and b. of this section and shall, within one year of receipt of the report and records, report to the Governor and the Legislature its determination as to whether the rates, fees and charges assessed against municipalities are just, reasonable and fair, its recommendations for any changes in these rates, fees, charges or how they are determined, its recommendations for improvement of the financial management of the commissioners, and its recommendations for the improvement and protection of the contractual and negotiating rights of the contracting municipalities.

    3. a. The provisions of section 16 of P.L.1953, c.388 (C.58:14-34.25) and any other law, or any rule or regulation adopted pursuant thereto to the contrary notwithstanding, all meetings and minutes of the Passaic Valley Sewerage Commissioners shall be open and available to the public as of the effective date of this act. No rate, fee or charge shall be increased except with the commissioners' approval at a meeting of the commissioners, and no rate, fee or charge shall become effective until the minutes of the meeting at which the rate, fee or charge increase was approved have been approved by the contracting member municipalities as provided in subsection c. of this section.

    b. Within 30 days of the effective date of this act, the commissioners shall provide to the Department of Community Affairs records of its total operating costs and the percentages of the costs covered by each contracting member municipality, or information from which these percentages can be estimated. Upon receipt of the records and information, the department shall determine the percentage veto to be assigned to each contracting member municipality based on the percentage of the operating costs of the Passaic Valley Sewerage Commission covered by its service rates, fees and other charges, and shall notify each contracting member municipality of the veto powers assigned to all the contracting member municipalities.

    c. The commissioners shall notify each of its contracting member municipalities of any meeting of the commissioners, in writing, at least 10 days in advance of the meeting. The notice shall contain the time, date and place of the meeting and the agenda for the meeting. Each contracting municipality shall have 30 days following the date of the meeting to veto to any decision made at the meeting and file its veto with the Department of Community Affairs. At the conclusion of the 30-day period, the department shall determine if a majority by percentage veto power, as set pursuant to subection b. of this section, have vetoed the minutes and shall notify in writing the commissioners and each of the contracting member municipalities of the veto action taken on the minutes. If the minutes have been vetoed, the Department of Community Affairs shall enter into arbitration with the commissioners and the vetoing contracting member municipalities to negotiate an agreement concerning the vetoed decisions. If no agreement has been reached in 60 days, the Department of Community Affairs shall set a deadline for final action concerning the dispute and, in consultation with the Department of Environmental Protection, shall make a determination concerning the disputed issues by that date. The Department of Community Affairs' determination shall constitute final action on the minutes and the vetoed decisions contained therein and shall be binding on the commissioners and each contracting member municipality.

    d. No change in rates, fees or charges shall be in effect while final action on the minutes concerning the rate, fee or charge is pending.

    4. This act shall take effect immediately.

STATEMENT

    This bill would subject the Passaic Valley Sewerage Commissioners and the Passaic Valley Sewerage Commission (PVSC) to Department of Community Affairs (DCA) oversight. This bill also authorizes the DCA to arbitrate in any dispute between the PVSC and any municipality that is serviced by the PVSC. The DCA would arbitrate and provide oversight in consultation with the Department of Environmental Protection and Energy (DEPE).

    This bill requires the Passaic Valley Sewerage Commissioners to report to the Department of Community Affairs and their contracting municipalities the contract provisions and methods of calculating rates and charges within 90 days of the effective date of the act. This bill also requires the commissioners to submit the financial records of the PVSC to the DCA and the Department of Environmental Protection. The DCA, in consultation with the DEPE, is required to review the informationa and records and, within one year of the receipt of the information and records, report to the Governor and the Legislature on its determination as to whether the rates, fees and charges assessed against municipalities are just, reasonable and fair, its recommendations for any changes in these rates, fees, charges or how they are determined, its recommendations for improvement of the financial management of the commissioners, and its recommendations for the improvement and protection of the contractual and negotiating rights of the contracting municipalities.

    This bill further requires all meetings and minutes of the commissioners to be open and available to the public, gives the contracting member municipalities veto powers over the minutes and prohibits the increase of any rate, fee or charge except at a public meeting of the commissioners. The DCA is driected to assign veto percentage powers to each municipality based on information provided to the DCA by the commissioners concerning the percentages of operating costs covered by the service rates, fees and other charges assessed on the municipalities. The commissioners must notify each municipality in writing of any meeting at least 10 days in advance of the meeting, and each municipality must notify the DCA of its veto within 30 days of the meeting. At the conclusion of the 30-day period, the DCA determines if the minutes have been vetoed by a majority of percentage vetoes and notifies the municipalities and commissioners of the outcome. If the minutes have been vetoed, the DCA arbitrates between the vetoing municipalities and the commissioners until an agreement is made. If no agreement is reached in 60 days, the DCA, in consultation with the DEPE, is required to make a determination and the determination constitutes final action on the minutes.

Establishes DCA oversight of Passaic Valley Sewerage Commissioners.