Bill > S1283

Introduced Session

This bill, known as "Citizens Fund Act," establishes a trust fund for the conveyance of certain assets for the benefit of the public benefit plans. Citizens Fund (fund), is established as an instrumentality of the State to exercise public and essential governmental functions. The purpose of the fund is to lessen the burdens of government by providing a fund through which a public entity may contribute, transfer, or sell its revenue-producing assets to a segregated or commingled account and share the risks and benefits of the performance of those assets, to maximize the performance and long-term value of those assets, and to benefit the public entity. The fund shall retain, appoint, or procure a fund manager to provide overall management of the Citizens Fund and may engage an administrator and other professionals in overseeing the activities of the fund. The assets of the fund will be maintained as a separate account segregated from all other funds of the State and the non-State public employers participating in public benefit plans. The fund will be legally independent and separate, regardless of its treatment for tax, accounting, reporting, securities law, or other purposes. The bill provides that no person is to use or authorize the use of the assets in the fund, or the investment earnings, for any purpose other than for the maximization of the value of the assets in the fund, including meeting or exceeding the level of service required to operate the asset pursuant to State and federal law and regulations for the safety of the public and the environment, for the benefit of members and retirees in the public benefit plans, and for the reasonable costs of administering the fund. The bill provides that Citizens Fund is to have a fund board, the be appointed by the Governor, comprised of five members as follows: a member of the New Jersey Infrastructure Bank; a member of the Division of Investment or their designee, who shall serve ex officio; the chairperson of the fund advisory board; and the largest holder of certificates of trust in the fund that is not represented by, or associated with, a State-administered retirement system. Members are to remain active until their successor is qualified. The member of the New Jersey Infrastructure Bank is to serve as chairperson and the director of the Division of Investment is to serve as treasurer and as vice chairperson of the fund board. The position of secretary is to be elected from among the members of the fund board that are not State office holders. The term for secretary is to be three years. The board will be constituted as an instrumentality of the State exercising public and essential governmental functions, and the exercise by the board of the powers conferred by this bill will be deemed and held to be an essential governmental function of the State. The bill provides that the members of the Citizens Fund board are to serve without compensation, but the fund will reimburse the members for actual and necessary expenses incurred in the performance of their duties The bill establishes a fund advisory board to the fund board. The fund is to form an enterprise advisory board for each asset or group of assets conveyed to the fund by a public entity and an enterprise advisory board is to be comprised of each municipality or county that is an associated public entity. Enterprise advisory board membership is to be based on a pro-rata share of the average annual volume sales of the asset over the past five years and adjusted at least every 10 years that is to be in accordance with the provisions in the transfer agreement. The enterprise advisory board members are to serve for two years. Members of the enterprise advisory board are to be appointed by the secretary of the fund board upon the recommendation from the executive of the associated public entity. The members of the enterprise advisory board or boards are to elect a chairperson and vice-chairperson who will serve on the fund advisory board. All public information that is distributed to fund board members relative to the fund board meetings is to also be provided simultaneously to the enterprise advisory board members. The purpose of the enterprise advisory board is to provide the fund board with advice and information relevant to the local systems of the conveyed asset. Neither the fund advisory board nor the enterprise advisory board is to have any voting or veto authority over the fund board. The enterprise advisory board members are to receive no compensation. The bill provides that a public entity may convey to the fund an asset held by the public entity. The conveyance is to be governed by a transfer agreement, which is to be proposed by the fund board and approved by the public entity. Only that portion of the conveyed asset that is net of financing costs and amounts deposited into the investment account or other distributions made to, or on behalf of the public entity will be evidenced by certificates of trust and credited to the holding account of the Common Pension Fund as provided by this bill. Asset contributions on behalf of the public entity and the fund's asset distributions are to be deposited in the investment account of the Common Pension Fund. The public benefit plans are not to be required or permitted to pay any expenses incurred in connection with the conveyance of an asset pursuant to the bill. The bill provides that an asset proposed for conveyance to the fund is to be valued by an independent valuation agent, as defined in the bill, and is to be revalued periodically. The valuation agent is to issue a report representing its opinion as to the valuation of the asset in accordance with an asset conveyance. An asset conveyance is not to be effectuated until after the report has been issued and both the fund manager, upon approval from the board, and the public entity or non-public entity accept the proposed value. If either rejects the proposed value, the conveyance is not to be effectuated, and any written agreement for the conveyance of an asset will be void. The bill amends the "Water Infrastructure Protection Act" to allow a municipality with a water or wastewater asset under emergent conditions to include conveyance of the asset to the fund as an option under that law.

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Linda Greenstein (D)*, 

Introduced in the Senate, Referred to Senate Budget and Appropriations Committee (on 01/13/2026)

Official Document