SENATE, No. 1156

 

STATE OF NEW JERSEY

 

INTRODUCED MAY 16, 1996

 

 

By Senator ADLER

 

 

An Act concerning penalties for ethics violations by local officials and amending and supplementing P.L.1991, c.29.

 

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

 

    1. Section 3 of P.L.1991, c.29 (C.40A:9-22.3) is amended to read as follows:

    3. As used in this act:

    a. "Board" means the Local Finance Board in the Division of Local Government Services in the Department of Community Affairs;

    b. "Business organization" means any corporation, partnership, firm, enterprise, franchise, association, trust, sole proprietorship, union or other legal entity;

    c. "Governing body" means, in the case of a municipality, the commission, council, board or body, by whatever name it may be known, having charge of the finances of the municipality, and, in the case of a county, the board of chosen freeholders, or, in the case of a county having adopted the provisions of the "Optional County Charter Law," P.L.1972, c.154 (C.40:41A-1 et seq.), as defined in the form of government adopted by the county under that act;

    d. "Interest" means the ownership or control of more than 10% of the profits, assets or stock of a business organization but shall not include the control of assets in a nonprofit entity or labor union;

    e. "Local government agency" means any agency, board, governing body, including the chief executive officer, bureau, division, office, commission or other instrumentality within a county or municipality, and any independent local authority, including any entity created by more than one county or municipality, which performs functions other than of a purely advisory nature, but shall not include a school board;                f. "Local government employee" means any person, whether compensated or not, whether part-time or full-time, employed by or serving on a local government agency who is not a local government officer, but shall not mean any employee of a school district. The term also includes uncompensated special assistants and advisors to local government officers, whether titled or not;

    g. "Local government officer" means any person whether compensated or not, whether part-time or full-time: (1) elected to any office of a local government agency; (2) serving on a local government agency which has the authority to enact ordinances, approve development applications or grant zoning variances; (3) who is a member of an independent municipal, county or regional authority; or (4) who is a managerial executive or confidential employee of a local government agency, as defined in section 3 of the "New Jersey Employer-Employee Relations Act," P.L.1941, c.100 (C.34:13A-3), but shall not mean any employee of a school district or member of a school board;

    h. "Local government officer or employee" means a local government officer or a local government employee;

    i. "Member of immediate family" means the spouse or dependent child of a local government officer or employee residing in the same household.

(cf: P.L.1991, c.29, s.3)

 

    2. Section 6 of P.L.1991, c.29 (C.40A:9-22.6) is amended to read as follows:

    6. a. Local government officers shall annually file a financial disclosure statement. All financial disclosure statements filed pursuant to this act shall include the following information which shall specify, where applicable, the name and address of each source and the local government officer's job title:

    (1) Each source of income, earned or unearned, exceeding [$2,000] $1,000 received by the local government officer or a member of his immediate family during the preceding calendar year. Individual client fees, customer receipts or commissions on transactions received through a business organization need not be separately reported as sources of income. If a publicly traded security is the source of income, the security need not be reported unless the local government officer or member of his immediate family has an interest in the business organization;

    (2) Each source of fees and honorariums having an aggregate amount exceeding $250 from any single source for personal appearances, speeches or writings received by the local government officer or a member of his immediate family during the preceding calendar year;

    (3) Each source of gifts, reimbursements or prepaid expenses having an aggregate value exceeding [$400] $250 from any single source, excluding relatives, received by the local government officer or a member of his immediate family during the preceding calendar year;

    (4) The name and address of all business organizations in which the local government officer or a member of his immediate family had an interest during the preceding calendar year; and

    (5) The address and brief description of all real property in the State in which the local government officer or a member of his immediate family held an interest during the preceding calendar year.     b. The Local Finance Board shall prescribe a financial disclosure statement form for filing purposes; however, any local ethics board may develop its own form, subject to approval by the Local Finance Board. For counties and municipalities which have not established ethics boards, the board shall transmit sufficient copies of the forms to the municipal clerk in each municipality and the county clerk in each county for filing in accordance with this act. The municipal clerk shall make the forms available to the local government officers serving the municipality. The county clerk shall make the forms available to the local government officers serving the county.

    For counties and municipalities which have established ethics boards, the Local Finance Board shall transmit sufficient copies of the forms to the ethics boards for filing in accordance with this act if the local ethics board has not promulgated its own approved form. The ethics boards shall make the forms available to the local government officers within their jurisdiction.

    For local government officers serving the municipality, the original statement shall be filed with the municipal clerk in the municipality in which the local government officer serves. For local government officers serving the county, the original statement shall be filed with the county clerk in the county in which the local government officer serves. A copy of the statement shall be filed with the board. In counties or municipalities which have established ethics boards a copy of the statement shall also be filed with the ethics board having jurisdiction over the local government officer. Local government officers shall file the initial financial disclosure statement within 90 days following the effective date of this act. Thereafter, statements shall be filed on or before April 30th each year.

    c. All financial disclosure statements filed shall be public records. (cf: P.L.1991, c.29, s.6)

 

    3. Section 10 of P.L.1991, c.29 (C.40A:9-22.10) is amended to read as follows:

    10. a. An appointed local government officer or employee found guilty by the Local Finance Board or a county or municipal ethics board of the violation of any provision of this act or of any code of ethics in effect pursuant to this act, shall be fined not less than $100.00 nor more than [$500.00] $1500.00 for each separate offense, which penalty may be collected in a summary proceeding pursuant to "the penalty enforcement law" (N.J.S.2A:58-1 et seq.). The board or a county or municipal ethics board shall report its findings to the office or agency having the power of removal or discipline of the appointed local government officer or employee and may recommend that further disciplinary action be taken, including removal of that officer or employee.

    b. An elected local government officer or employee found guilty by the Local Finance Board or a county or municipal ethics board of the violation of any provision of this act or of any code of ethics in effect pursuant to this act, shall be fined not less than $100.00 nor more than [$500.00] $1500.00 for each separate offense, which penalty may be collected in a summary proceeding pursuant to "the penalty enforcement law" (N.J.S.2A:58-1 et seq.).

    c. In addition to a fine imposed pursuant to subsection b. of this section the Local Finance Board may make a public recommendation to the prosecutor of the county in which an elected local government officer holds office and to the officer or agency having the power of removal, for the prosecution and removal of that officer. appointed local official or employee. Such recommendation from the Local Finance Board shall be considered sufficient cause for removal pursuant to section 11 of P.L.1991, c.29 (C.40A:9-22.11).

(cf: P.L.1991, c.29, s.10)

 

    4. Section 11 of P.L.1991, c.29 (C.40A:9-22.11) is amended to read as follows:

    11. The finding by the Local Finance Board or a county or municipal ethics board that an appointed local government officer or employee is guilty of the violation of the provisions of this act, including failure to timely file the annual financial disclosure form required pursuant to section 6 of P.L.1991, c.29 (C.40A:9-22.6), or of any code of ethics in effect pursuant to this act, shall be sufficient cause for his removal, suspension, demotion or other disciplinary action by the officer or agency having the power of removal or discipline. When a person who is in the career service is charged with violating the provisions of this act or any code of ethics in effect pursuant to this act, the procedure leading to removal, suspension, demotion or other disciplinary action shall be governed by any applicable procedures of Title 11A of the New Jersey Statutes and the rules promulgated pursuant thereto.

(cf: P.L.1991, c.29, s.11)

 

    5. (New section) The Local Finance Board shall issue an annual compliance and enforcement report to the Governor and Legislature listing, by municipality, the number of:

    employees required to file financial disclosure forms;

    employees who actually filed the required financial disclosure forms;

    ethics complaints initiated by the Local Finance Board after an investigation by a State department or agency;

    ethics complaints received by the Local Finance Board;

    ethics complaints decided;

    ethics violations found;

    fines imposed; and

    advisory opinions issued.

 

    6. This act shall take effect immediately.

 

 

STATEMENT

 

    The purpose of this bill is to increase the penalties for violations of the "Local Government Ethics Law," P.L.1991, c.29 (C.40A:9-22.1 et seq.) and to require the annual reporting of statistics related to that law. The Department of Community Affairs has released information indicating that a significant number of local officials and employees fail to comply with the financial disclosure requirements of the ethics law. The Department of Community Affairs has also indicated that it believes that enhanced penalties, including the power of the Local Finance Board to recommend the removal of an appointed local officer or employee who fails to timely file the financial disclosure form, will encourage better compliance with the law on the part of local officials. The bill also expands the definition of "local government employee" to include uncompensated special assistants and advisors to elected local officials, whether titled or not, and decreases the threshold amounts for income and gifts that trigger reporting requirements.

 

 

                             

Increases penalties under and scope of "Local Government Ethics Law."