Excludes salaries and wages for emergency response personnel from municipal appropriations cap.

A1009

ASSEMBLY, No. 1009

STATE OF NEW JERSEY

222nd LEGISLATURE

�

PRE-FILED FOR INTRODUCTION IN THE 2026 SESSION

Sponsored by:

Assemblywoman CAROL A. MURPHY

District 7 (Burlington)

SYNOPSIS

���� Excludes salaries and wages for emergency response
personnel from municipal appropriations cap.

CURRENT VERSION OF TEXT

���� Introduced Pending Technical Review by Legislative
Counsel.

��

An Act
concerning emergency personnel salaries and wages in
municipal budgets and amending P.L.1976, c.68.

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

���� 1.� Section 3 of P.L.1976,
c.68 (C.40A:4-45.3) is amended to read as follows:

���� 3.��� In the preparation of
its budget a municipality shall limit any increase in said budget to 2.5% or
the cost-of-living adjustment, whichever is less, over the previous year's
final appropriations subject to the following exceptions:

���� a.��� (Deleted by amendment,
P.L.1990, c.89.)

���� b.��� Capital expenditures,
including appropriations for current capital expenditures, whether in the
capital improvement fund or as a component of a line item elsewhere in the
budget, provided that any such current capital expenditure would be otherwise
bondable under the requirements of N.J.S.40A:2-21 and 40A:2-22;

���� c. (1) An increase based upon
emergency temporary appropriations made pursuant to N.J.S.40A:4-20 to meet an
urgent situation or event which immediately endangers the health, safety or
property of the residents of the municipality, and over which the governing
body had no control and for which it could not plan and emergency
appropriations made pursuant to N.J.S.40A:4-46. Emergency temporary
appropriations and emergency appropriations shall be approved by at least
two-thirds of the governing body and by the Director of the Division of Local
Government Services, and shall not exceed in the aggregate 3% of the previous
year's final current operating appropriations.

���� (2)� (Deleted by amendment,
P.L.1990, c.89.)

���� The approval procedure in this
subsection shall not apply to appropriations adopted for a purpose referred to
in subsection d. or j. below;

���� d.��� All debt service,
including that of a Type I school district;

���� e.��� Upon the approval of the
Local Finance Board in the Division of Local Government Services, amounts
required for funding a preceding year's deficit;

���� f.���� Amounts reserved for
uncollected taxes;

���� g.��� (Deleted by amendment,
P.L.1990, c.89.)

���� h.��� Expenditure of amounts
derived from new or increased construction, housing, health or fire safety
inspection or other service fees imposed by State law, rule or regulation or by
local ordinance;

���� i.���� Any amount approved by
any referendum;

���� j.���� Amounts required to be
paid pursuant to (1) any contract with respect to use, service or provision of
any project, facility or public improvement for water, sewerage, parking,
senior citizen housing or any similar purpose, or payments on account of debt service
therefor, between a municipality and any other municipality, county, school or
other district, agency, authority, commission, instrumentality, public
corporation, body corporate and politic or political subdivision of this State;
(2) the provisions of article 9 of P.L.1968, c.404 (C.13:17-60 through
13:17-76) by a constituent municipality to the intermunicipal account; (3) any
lease of a facility owned by a county improvement authority when the lease
payment represents the proportionate amount necessary to amortize the debt
incurred by the authority in providing the facility which is leased, in whole
or in part; and (4) any repayments under a loan agreement entered into in
accordance with the provisions of section 5 of P.L.1992, c.89;

���� k.��� (Deleted by amendment,
P.L.1987, c.74.)

���� l.���� Appropriations of
federal, county, independent authority or State funds, or by grants from
private parties or nonprofit organizations for a specific purpose, and amounts
received or to be received from such sources in reimbursement for local
expenditures. If a municipality provides matching funds in order to receive the
federal, county, independent authority or State funds, or the grants from
private parties or nonprofit organizations for a specific purpose, the amount
of the match which is required by law or agreement to be provided by the
municipality shall be excepted;

���� m.�� (Deleted by amendment,
P.L.1987, c.74.)

���� n.��� (Deleted by amendment,
P.L.1987, c.74.)

���� o.��� (Deleted by amendment,
P.L.1990, c.89.)

���� p. �� (Deleted by amendment,
P.L.1987, c.74.)

���� q.��� (Deleted by amendment,
P.L.1990, c.89.)

���� r.���� Amounts expended to
fund a free public library established pursuant to the provisions of
R.S.40:54-1 through 40:54-29, inclusive;

���� s.���� (Deleted by amendment,
P.L.1990, c.89.)

���� t.���� Amounts expended in
preparing and implementing a housing element and fair share plan pursuant to
the provisions of P.L.1985, c.222 (C.52:27D-301 et al.) and any amounts
received by a municipality under a regional contribution agreement pursuant to
section 12 of that act;

���� u.��� (Deleted by amendment,
P.L.2004, c.74.)

���� v.��� (Deleted by amendment,
P.L.1990, c.89.)

���� w.�� (Deleted by amendment,
P.L.2004, c.74.)

���� x.��� Amounts expended to aid
privately owned libraries and reading rooms, pursuant to R.S.40:54-35;

���� y.��� (Deleted by amendment,
P.L.1990, c.89.)

���� z.��� (Deleted by amendment,
P.L.1990, c.89.)

���� aa.�� Extraordinary expenses,
approved by the Local Finance Board, required for the implementation of an
interlocal services agreement;

���� bb.� Any expenditure mandated
as a result of a natural disaster, civil disturbance or other emergency that is
specifically authorized pursuant to a declaration of an emergency by the
President of the United States or by the Governor;

���� cc.�� Expenditures for the
cost of services mandated by any order of court, by any federal or State
statute, or by administrative rule, directive, order, or other legally binding
device issued by a State agency which has identified such cost as mandated
expenditures on certification to the Local Finance Board by the State agency;

���� dd.� Expenditures of amounts
actually realized in the local budget year from the sale of municipal assets in
extraordinary cases and with the permission of the Local Finance Board;

���� ee.�� Any local unit which is
determined to be experiencing fiscal distress pursuant to the provisions of
P.L.1987, c.75 (C.52:27D-118.24 et seq.), whether or not a local unit is an
"eligible municipality" as defined in section 3 of P.L.1987, c.75 (C.52:27D-118.26),
and which has available surplus pursuant to the spending limitations imposed by
P.L.1976, c.68 (C.40A:4-45.1 et seq.), may appropriate and expend an amount of
that surplus approved by the director and the Local Finance Board as an exception
to the spending limitation.� Any determination approving the appropriation and
expenditure of surplus as an exception to the spending limitations shall be
based upon:

���� 1)��� the local unit's revenue
needs for the current local budget year and its revenue raising capacity;

���� 2)��� the intended actions of
the governing body of the local unit to meet the local unit's revenue needs;

���� 3)��� the intended actions of
the governing body of the local unit to expand its revenue generating capacity
for subsequent local budget years;

���� 4)��� the local unit's ability
to demonstrate the source and existence of sufficient surplus as would be
prudent to appropriate as an exception to the spending limitations to meet the
operating expenses for the local unit's current budget year; and

���� 5)��� the impact of
utilization of surplus upon succeeding budgets of the local unit;

���� ff.�� Newly authorized
operating appropriations for the municipal court or violation's bureau when
approved by the vicinage Presiding Judge of the Municipal Court after
consultation with the mayor and governing body of the municipality;

���� gg.� (Deleted by amendment,
P.L.2004, c.74.)

���� hh.� (Deleted by amendment,
P.L.2004, c.74.)

���� ii.��� Subject to the approval
of the Local Finance Board, expenditures related to the cost of conducting and
implementing a total property tax levy sale pursuant to section 16 of P.L.1997,
c.99 (C.54:5-113.5);

���� jj.��� Amounts expended for a
length of service award program pursuant to P.L.1997, c.388 (C.40A:14-183 et
al.);

���� kk.� Amounts expended to
provide municipal services or reimbursement amounts to multifamily dwellings
for the collection and disposal of solid waste generated by the residents of
the multifamily dwellings.� This subsection shall cease to be operative at the
end of the first local budget year in which the municipality has fully phased
in its reimbursement amount expenses;

���� ll.��� Amounts expended by a
municipality under an interlocal services agreement entered into pursuant to
the "Interlocal Services Act," P.L.1973, c.208 (C.40:8A-1 et al.)
entered into after the effective date of P.L.2000, c.126 (C.52:13H-21 et al.).�
The governing body of the municipality that will receive the service may choose
to allow the amount of projected annual savings to be added to the amount of
final appropriations upon which its permissible expenditures are calculated
pursuant to section 2 of P.L.1976, c.68 (C.40A:4-45.2);

���� mm. Amounts expended under a
joint contract pursuant to the "Consolidated Municipal Service Act,"
P.L.1952, c.72 (C.40:48B-1 et seq.) entered into after the effective date of
P.L.2000, c.126 (C.52:13H-21 et al.).� The governing body of each participating
municipality may choose to allow the amount of projected annual savings to be
added to the amount of final appropriations upon which its permissible
expenditures are calculated pursuant to section 2 of P.L.1976, c.68
(C.40A:4-45.2);

���� nn.� (Deleted by amendment,
P.L.2004, c.74.)

���� oo.� Amounts appropriated in
the first three years after the effective date of P.L.2003, c.92 (C.18A:7F-5b
et al.) for liability insurance, workers' compensation insurance and employee
group insurance;

���� pp.� Amounts appropriated in
the first three years after the effective date of P.L.2003, c.92 (C.18A:7F-5b
et al.) for costs of domestic security preparedness and responses to incidents
and threats to domestic security;

���� qq.� Amounts required to be
paid by a municipality pursuant to the provisions of section 4 of P.L.2007,
c.311 (C.13:1E-96.5)
;

����
rr.� Amounts appropriated
for salaries and wages for emergency response personnel, including police
officers, fire fighters, paramedics, and members of an ambulance team, rescue
squad, or mobile intensive care unit
.

���� In the first full year when an
existing appropriation or expenditure that is subject to budget limitations is
made an exception to budget limitations, a municipality shall deduct from its
final appropriations upon which its permissible expenditures are calculated
pursuant to section 2 of P.L.1976, c.68 (C.40A:4-45.2), the amount which the
municipality expended for that purpose during the last full budget year, or
portion thereof, in which the purpose so excepted was funded from
appropriations in the municipal budget.

���� In the first full year when an
existing appropriation or expenditure that is not subject to budget limitations
is made subject to budget limitations, a municipality shall add to its final
appropriations upon which its permissible expenditures are calculated pursuant
to section 2 of P.L.1976, c.68 (C.40A:4-45.2), the amount which the
municipality expended for that purpose during the last full budget year, or
portion thereof, in which the purpose so excepted was funded from
appropriations in the municipal budget.

(cf: P.L.2007, c.311, s.17)

���� 2.� This act shall take effect
immediately and shall apply to municipal budgets adopted following the
effective date of this act.�

STATEMENT

���� The bill excludes salaries and
wages for emergency response personnel from the municipal appropriation cap.�
Under the bill, emergency response personnel includes police officers, fire
fighters, paramedics, and members of an ambulance team, rescue squad, or mobile
intensive care unit.

���� N.J.S.A.40A:4-45.3 requires
that a municipality limit appropriation increases to 2.5 percent or the
cost-of-living adjustment, whichever is less, over the previous year's final
appropriations, but provides for certain exceptions.� The bill would add
salaries and wages for emergency response personnel to the existing list of
allowable exceptions.