Bill > S4708

Introduced Session

This bill would create greater flexibility in the municipal consolidation process, set forth in sections 25 through 28 of P.L.2007, c.63 (C.40A:65-25 through C.40A:65-28), in the following ways: ? non-contiguous municipalities would be permitted to consolidate if located within a reasonable distance of one another; ? applicants for consolidation would be allowed to develop their own process for the equalization of property assessments in the new municipality, subject to the approval of the Director of the Division of Taxation in the Department of the Treasury; ? districts based on old or newly established boundaries with unique planning mechanisms, services, and ordinances would be permitted in the new municipality; ? existing debt, or debt newly created by any financial arrangement between any or all of the former municipalities in furtherance of any aspect of a consolidation plan, may be apportioned among the taxpayers of the consolidating municipalities as debt within special taxing districts in any manner that the parties mutually agree upon in the consolidation plan; ? consolidating municipalities would be permitted to enter into any financial or other agreement to adjust benefits between the municipalities, provide indemnification from legal actions stemming from a consolidation, or provide incentives or other acts to facilitate municipal consolidation; and ? a joint public hearing on applications for consideration of a consolidation plan or to create a Municipal Consolidation Study Commission would no longer be required. The bill provides greater clarity with respect to the municipal consolidation process in the following ways: ? clarification of the petition process for the creation of a Municipal Consolidation Study Commission, by providing specifics as to the form of the petition, its filing, and its verification, consistent with requirements for a petition proposing the formation of a joint municipal consolidation study commission under the "Municipal Consolidation Act," P.L.1977, c.435 (C.40:43-66.35 et al.); ? provision of specific requirements with regard to the composition, meetings, and responsibilities of a Municipal Consolidation Study Commission; ? clarification that a consolidation must be implemented in accordance with the consolidation plan under the oversight of the Local Finance Board; ? clarification that a Municipal Consolidation Study Commission report must address the implementation issues set forth in subsection a. of section 26 of P.L.2007, c. 63 (C.40A:65-26); ? the Director of the Division of Taxation would be expressly permitted to waive any law, rule, or regulation concerning the assessment of property that may not have anticipated a phase-in or consolidation of services if a waiver is found reasonable to further the process of consolidation, as may already be pursued through a referral to the agency pursuant to provisions of existing law; ? the Local Finance Board would be expressly permitted to, in making decisions concerning consolidation, pursue a waiver of a law, rule, or regulation that may not have anticipated a phase-in or consolidation of services through referral of the matter to the appropriate agency pursuant to provisions of existing law; and ? the Local Finance Board would be expressly authorized to make decisions and issue orders regarding consolidation. The bill permits the designation of an administrative support entity to handle the administrative affairs of the Municipal Consolidation Study Commission so that the commission can focus on its work in creating a consolidation plan. An administrative support entity would be subject to the provisions of P.L.1963, c.73 (C.47:1A-1 et seq.), more commonly known as the "Open Public Records Act." The bill requires a referendum in a new municipality on whether to have a municipal open space tax, and the amount or rate of such tax, if one or more of the consolidating municipalities has an annual open space tax levy, even if all the consolidating municipalities have an open space tax at the same rate. The bill requires that an application to create a Municipal Consolidation Study Commission include the proposed means of funding the study. The bill requires that a consolidation plan and a Municipal Consolidation Study Commission report address the projected property tax impact resulting from consolidation. The bill provides certain seniority, tenure, pension, and other protections for law enforcement officers and chiefs of police and for firefighters and fire chiefs in a consolidation, consistent with the protections for law enforcement officers and police chiefs current law provides in the case of shared services and joint contracts. The bill requires that, whenever one or more of the participating municipalities is subject to Civil Service, terminal leave payments be made to employees who were terminated for reasons of economy and efficiency as a result of a consolidation, consistent with the existing terminal leave requirement for shared services and joint contracts. The bill requires the voters of each participating municipality to approve of a proposed consolidation in order for it to be implemented, regardless of whether it is proposed by the governing bodies of the municipalities or a petition-created Municipal Consolidation Study Commission. Current law only requires approval of a consolidation by voter referendum if a consolidation is pursued by a Municipal Consolidation Study Commission created by applications of the governing bodies of the municipalities. Lastly, the bill also revises the procedures for the consolidation of a sparsely populated municipality pursuant to P.L.1995, c.376 (C.40:43-66.78 et seq.). These revisions include changing the definition of a "sparsely populated municipality" to include a municipality with a population of less than 1,000. Current law defines such municipality as one with a population of less than 500. The revisions also include requiring voter approval for a sparsely populated municipality with a population of less than 100. Current law allows such municipality to consolidate by ordinances adopted by the governing bodies of the participating municipalities. The revisions also require the formulation of a plan to consolidate a sparsely populated municipality with an absorbing municipality.

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Jim Beach (D)*, 

Introduced in the Senate, Referred to Senate Community and Urban Affairs Committee (on 10/20/2025)

Official Document