I. State Issues
a. Governor Signs Land Banking Legislation
On Wednesday, Governor Murphy signed into law S-1214, which would authorize a municipality to enter into an agreement with a non-profit or a redevelopment entity to serve as the municipality's land banking entity. The League supported this permissive legislation, which expands upon a critical tool for redevelopment.
Under the new law, a municipality may convey municipally-owned property and assign municipally-owned liens to the land bank entity. In addition, the bill permits the land bank to acquire property by gift or purchase, and to serve as the municipality’s agent for the purposes of purchasing tax liens, foreclosing on liens, and foreclosing on abandoned property.
The enabling ordinance authorized by the new law may permit the new land bank to:
acquire property on behalf of the municipality;
demolish and otherwise clear buildings and conduct other site improvements;
maintain and secure property, and
lease or convey property.
Contact: Michael F. Cerra, Assistant Executive Director, mcerra@njlm.org, 609-695-3481 x120.
b. Governor Freezes Most Transition Aid
Upon signing the FY 2020 State budget, Governor Murphy issued Executive Order 73, which impounds up to $235 million in spending, and is not subject to a potential override. Specifically, EO 73 directs the Department of Treasury, Office of Management and Budget (OMB) to reserve $235 million in discretionary spending. The OMB will monitor and release this funding if sufficient resources and when anticipated savings are realized. A full list of frozen spending is available.
Among the $235 million is almost $105 million in transitional aid. The Governor’s proposed budget included this nearly $105 million, which was then increased by $10 million by the Legislature.
For background, Governor Christie took similar action in 2016 following his signing of the State FY 2017 budget. Governor Christie Executive Order 209 held state funds in reserve, including Transition Aid and some transportation funding, and called for agreement on State Health Benefits to be achieved by the “Plan Design Committee.” In that circumstance, the Plan Design Committee took the appropriate action and the funding was eventually released.
Also for background, Transitional Aid is, according to the Office of Legislative Services, (OLS), “…the State’s only discretionary municipal financial assistance program. Transitional aid is awarded to help municipalities in serious fiscal distress meet immediate budgetary needs.” (Emphasis added.)
According to the “Individual Certifications of Municipal State Aid,” which are available on the DCA’s website, the following municipalities received Transitional Aid in Calendar Year 2018/Fiscal Year 2019:
Atlantic City, $3.9 million;
Camden, $22.3 million;
Nutley, $4.1 million;
Paterson, $33 million;
Penns Grove, $0.45 million;
Salem, $1.4 million;
Seaside Heights, $1.19 million;
Trenton, $6 million; and
Union City, $20 million.
These awards total $92.34 million. The current list of municipalities seeking transition aid is not available as this time as the State is in the middle of the application process.
The League has been in contact with the Administration objecting to this maneuver and seeking guidance. In particular, we are concerned with the impacted municipalities which operate on a calendar year budget, as the budget was likely certified assuming these revenues and we are now just over halfway through the budget year.
We will advise you of developments.
Contact: Michael F. Cerra, Assistant Executive Director, mcerra@njlm.org, 609-695-3481 x120.
c. Recap of the July PFRS Board Meeting
At the July 8 Police and Fire Retirement System (PFRS) board meeting the Board unanimously hired Robert Garrison as in-house legal counsel and appointed existing Division of Pensions staff to various positions needed to run the day-to-day operations of the system. The Board is in the process of reviewing the nine resumes received for the Executive Director position and will begin the interview process shortly. The Board also authorized the solicitation of quotes from firms offering to conduct the search for the Chief Investment Officer.
Corey Amon, Director of Division of Investments, and Susan Sarnowski, Compliance Officer and Director of Operations, provided an update on the transition to the Board. The Division of Investments is in the process of opening separate accounts and subaccounts to facilitate the transition. Their goal is to have all trading funds open when the Board’s regulations are enacted.
The next meeting of the Board is August 12.
Contact: Lori Buckelew, Senior Legislative Analyst, lbuckelew@njlm.org, 609-695-3481 x112.
d. Spotted Lanternfly Information
The State Department of Agriculture sent out this advisory this morning. We forward it to you as an FYI.
The Spotted lanternfly, initially found in Berks County Pennsylvania in 2014, was discovered in the New Jersey environment in July 2018 in Warren County. Following this discovery, it was also found in Mercer and Hunterdon counties. A Quarantine was initiated to slow the movement and control the further spread of this insect throughout the state. The Department and USDA field crews are out conducting surveys, assessing properties and conducting treatments against this invasive exotic insect in the Quarantine zone. As a result of surveys conducted by state and federal crews the Department is proposing to expand the Quarantine to include Burlington, Camden, Gloucester, Salem and Somerset Counties beginning in August of 2019. Even though entire counties are identified in the Quarantine, the insect does not infest the entire county. This insect does not pose a direct threat to humans or animals but feeds on over 70 trees and plants and can cause significant damage to all sectors of the state’s agricultural industry and the forested environment as well.
Further information about this insect can be found on the Departments web page.