Authorizes fire districts to issue certain bond anticipation notes for up to 10 years following initial note issuance.

S3731

SENATE, No. 3731

STATE OF NEW JERSEY

222nd LEGISLATURE

�

INTRODUCED MARCH 5, 2026

Sponsored by:

Senator� ANTHONY M. BUCCO

District 25 (Morris and Passaic)

SYNOPSIS

���� Authorizes fire districts to issue certain bond
anticipation notes for up to 10 years following initial note issuance.

CURRENT VERSION OF TEXT

���� As introduced.

��

An Act

concerning fire district authority to issue bond
anticipation notes and amending P.L.1981, c.188.

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

���� 1.� Section 1 of P.L.1981,
c.188 (C.40A:14-86.1) is amended to read as follows:

���� The board of commissioners of
a fire district, following the authorization by voters of the issuance of bonds
pursuant to N.J.S.40A:14-86, may by resolution borrow money and issue
negotiable notes in anticipation of the bond issue.� Any note shall be designated
a "bond anticipation note" and shall contain a recital that it is
issued in anticipation of the issuance of bonds.� Such notes may be issued for
a period not to exceed
[
1
]

one

year, and may be renewed from time to time
[
not
to
]

for
additional periods, none of which shall
exceed
[
1
]

one
year; but all such
notes, including renewals, shall mature and be paid not later than the
[
third
anniversary of the date of the original notes
]

first day of the fifth month following the close of the tenth fiscal year
next following the date of the original notes
;� provided, however, that no
notes shall be renewed beyond the first anniversary date of the original notes
unless an amount of such notes, at least equal to the first legally payable
installment of the bonds in anticipation of which the notes are issued
,

is paid and retired on or before
[
the
second anniversary date, and if the notes are renewed beyond the second
anniversary date of the original notes, a like amount is paid or retired� on or
before the third anniversary date from funds other than the proceeds of
obligations;� except that the notes shall mature and be paid not later than
the� first day of the fifth month following the close of the third fiscal year
next� following the date of the original notes, provided that, in addition to
amounts� paid and retired pursuant to this section, an amount of such notes
equal to not� less than the first legally payable installment of the bonds in
anticipation of� which the notes are issued has been paid and retired not later
than the end of� the third fiscal year from funds other than the proceeds of
obligations
]

each subsequent anniversary date beyond which the notes are renewed from
funds other than the proceeds of obligations
.

���� The period of usefulness as
defined in N.J.S.40A:2-22 of any purpose for which bonds are issued shall
include the period during which notes issued in anticipation of such bonds are
outstanding, including all renewals thereof.

���� Funds derived from the
issuance of fire district bonds may be used to redeem notes issued in
anticipation of the bond issue.

(cf: P.L.1981, c.188, s.1)

���� 2. This act shall take effect
immediately.�

STATEMENT

���� This bill authorizes fire
districts to issue a series of one-year bond anticipation notes for up to 10
years to finance capital projects.�

���� Currently, fire districts are
authorized to issue a series of one-year notes for up to three years to finance
capital projects.� When a fire district�s capital project exceeds a period of
three years, the fire district is often forced to issue long term bonds or
enter into a lease purchase agreement with a bank for the remainder of the
capital project.� This bill would allow a fire district to finance capital
projects with bond anticipation notes for the entirety of most projects.�