Senator Gopal and Assemblyman Egan have introduced legislation (S-3941/A-5240) that makes various changes to local budget law and laws regarding local officials’ certifications to codify existing practices and update the fines. The League supports this legislation.
S-3941/A-5240 changes the statutory budget and audit-related deadlines as follows:
| Current Statutory Date | New Statutory Date |
Mayor/Council Faulkner Act (Executive) budget transmission to governing body | 1/15 | 2/28 |
Submission of the County Annual Financial Statement (AFS) | 1/26 | 3/10 |
Submission of the Municipal Annual Financial Statement (AFS) | 2/10 | 3/10 |
Municipal introduction and approval of budget | 2/10 | 3/31 or the next regularly scheduled meeting of the governing body thereafter |
County introduction and approval of budget | 1/26 | 3/31 or the next regularly scheduled meeting of the governing body thereafter |
Municipal budget adoption | 3/20 | 4/30 or the next regularly scheduled meeting of the governing body thereafter |
County budget adoption | 2/28 | 4/30 or the next regularly scheduled meeting of the governing body thereafter |
Audit Completion for County and Municipality | June 30 | August 31 |
Audit Completion for Authorities | 4th month’s end of fiscal year | 8th month’s end of fiscal year |
For State Fiscal Year budget municipalities, the statutes are revised to update the budget deadline language to add “or the next regularly scheduled meeting of the governing body.”
The temporary budget appropriation amount for calendar year municipalities or counties would be increased from 26.25% to 35%. State Fiscal Year’s temporary budget appropriation would remain at 26.25%.
The bill also requires the local unit to be responsible for any necessary investigations and corrective action on audit findings.
The bill also updates the fines for governing body members and local officials. For governing body members, the fines are increased from $25/day to $100/day for failure or refusal to comply with the audit and corrective action plan and has received an order from the Division of Local Government Services (DLGS) Director. In addition, the bill adds a $100/day fine for the governing body’s failure to appoint a Chief Financial Officer, Municipal Clerk, Tax Collector, or Public Works Manager. As a reminder, the fines cannot be paid by the local government, they must be paid by the individual governing body member.
For local officials (i.e., Chief Financial Officer, Municipal Clerk) the bill increases the fine from $5/day to $100/day for failure file the Annual Financial Statement with the DLGS or failure or refusal to comply with the audit and corrective action plan and has received an order from the DLGS Director.
The bill also requires that within 90 days of vacancy of the Chief Financial Officer, Municipal Clerk, Tax Collector, or Public Works Manager, the governing body must appoint a replacement. The appointment can be satisfied by entering into a shared service agreement or appointing a temporary Chief Financial Officer, Acting Municipal Clerk, or Interim Public Works Manager. The DLGS Director may grant an extension upon request of the governing body.
The bill also gives the DLGS Director the ability to authorize the mailing of estimated tax bills upon good cause being shown and upon terms and conditions deemed reasonable by the Director. The decision of the DLGS Director is final. It only applies for estimated tax bills after June 30 for calendar year municipalities. For state fiscal year municipalities, it is either for bills after December 31 for 1st installment or after June 30 for 3rd installment.
Finally, the bill expands, allowing the DLGS Director to initiate a review of the behavior or practices if the director finds it advisable to do so through the normal exercise of the director’s statutory duties and responsibilities of the Registered Municipal Clerk, Certified Tax Collector, Certified Public Works Manager, and Qualified Purchasing Agent. The language in the bill mirrors the authority already in place for the Certified Municipal Finance Officer.
Contact: Lori Buckelew, Deputy Executive Director, lbuckelew@njlm.org, 609-695-3481, x112.