SENATE, No. 700

STATE OF NEW JERSEY

INTRODUCED FEBRUARY 15, 1996

By Senators CAFIERO and MATHEUSSEN

An Act concerning in lieu of tax payments to municipalities and amending P.L.1977, c.272.

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

    1. Section 5 of P.L.1977, c.272 (C.54:4-2.2e) is amended to read as follows:

    5. After completion of the review of the assessments of State property, the director shall compute the State's liability for in lieu tax payments in each municipality affected. For the purposes of this act, the effective local purpose tax rate shall be calculated by dividing the local municipal purposes tax levy, including all fire district budget expenditures for each municipality, by the net valuation on which county taxes are apportioned for each municipality. The in lieu payment shall be calculated by applying the effective local purpose tax rate of the municipality for the tax year 1977 and thereafter to the aggregate amount of State property, as defined in section 1, in the municipality and the sum of such calculations shall constitute the State's liability; provided, however, the State shall have no liability to any one municipality when the sum of its liability is less than $1,000.00, and no municipality shall receive an in lieu payment from the State greater than an amount equal to 35% of the local purpose tax levy, which for the purposes of this act shall include revenues which are used for municipal purposes and derived from tax abated properties, for the year for which the calculations are made; provided, however, that in any calendar year no municipality which receives or is entitled to receive any extraordinary payment for municipal services and in lieu of taxes under P.L.1977, c.137 shall receive less under this act than the amount that it received under said P.L.1977, c.137.

(cf: P.L.1983, c.256, s.1)

    2. This act shall take effect on the thirtieth day following enactment.

STATEMENT

    This bill amends the law governing in lieu of tax payments by the State to municipalities. The bill requires that the effective local purpose tax rate used to calculate the in lieu of tax payment by the State to a municipality be calculated by dividing the local municipal purposes tax levy, including all fire district budget expenditures for each municipality, by the net valuation on which county taxes are apportioned for each municipality.

    This amendment permits municipalities which have fire districts responsible for providing fire service to State institutions, including State prisons, to recoup the expense of providing the fire service to the State institutions.

Includes fire district budget expenditures in calculation of in lieu of tax payments.