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Shared Services

Posted on: January 5, 2024

Shared Services Filing Requirements Bill Advances

Yesterday, the Senate Community and Urban Affairs Committee favorably reported S-4264 which concerns filing requirements for shared services agreements. This legislation would require local units entering into a shared service agreement to file the agreement and an estimate of the anticipated cost savings with the Division of Local Government Services (DLGS). 

The League opposes this legislation as redundant and already publicly available in multiple forms.  

N.J.A.C. 5:30-3.8(d)(20) requires each municipal user-friendly budget to include a listing of each shared service provided or received, what entity or entities are providing or receiving the service, the beginning and end date of the agreement as applicable, and the amount either received or paid for the service. Compliance with this law is also asked annually on the DLGS Best Practices Inventory Questions under the Core Competencies category and Transparency topic. 

Further, when entering into a shared service agreement, municipalities are required to estimate the cost savings anticipated and adopt a resolution containing this information under the Uniform Shared Service and Consolidation Act N.J.S.A. 40A:65-1 et seq. 

Additional regulatory guidance from the Department of Community Affairs’ Uniform Shared Services and Consolidation Act Personnel Guidelines for Shared Services, Joint Meetings, Regional Service Agencies & Municipal Consolidation Commonly Shared Municipal Services Sub-article B, (3) b. states that: 

any agreement entered into pursuant to this section shall be filed, for informational purposes, with the Division of Local Government Services in the Department of Community Affairs, together with an estimate of the cost savings anticipated to be achieved by the local units that are the parties to the agreement in the case of an agreement between pilot municipalities, pursuant to rules and regulations promulgated by the director.” 

Lastly, the DLGS User-Friendly Budget form UFB-11 requires a listing of all shared services and the amount to be spent or saved.  

A-4183, the Assembly companion to this legislation passed the Assembly last June. S-4264 is scheduled to be considered by the full Senate on Monday.  

Contact: Paul Penna, Senior Legislative Analyst, ppenna@njlm.org, 609-695-3481, x110.


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