November 22, 2017
NJAC is committed to advocating for legislation, regulations, and policy directives that empower county government to operate more effectively and efficiently. As a non-partisan organization that represents the only true regional form of government in the State with a unified and proactive voice, NJAC is dedicated to advancing innovative programs and initiatives that enhance the level of service provided and save valuable taxpayer dollars. With this in mind, NJAC will pursue the following legislative goals for the 2016/17 lame-duck session, the 2018/19 legislative session, and a new Administration in January of 2018.
1. Lame-Duck Goals – January 2018
- Extend the 2.0% cap on binding interest arbitration awards and reinstate the health benefit requirements under Chapter 78.
- Authorize counties to share county tax administrators.
- Equalize the bid, pay-to-play, and prevailing wage thresholds.
A. Caps on Binding Interest Arbitration Awards
NJAC is urging members of the State Legislature to permanently extend the 2% cap on binding interest arbitration awards before the law sunsets on December 31st. County and municipal officials from across the State, and on both sides of the aisle, hail the cap as a critical tool for controlling personnel costs; negotiating reasonable successor contracts; and, avoiding arbitration awards granted by third party administrators who are not accountable to taxpayers.
For nearly a decade, the 2% cap on binding interest arbitration awards has kept public safety employee salaries and wages under control simply because parties have been closer to reaching an agreement from the onset of negotiations. For county governments alone, the cap has effectively managed the growth of over $1.0 billion worth of public safety employee salaries since using interest arbitration as leverage for negotiating more lucrative contracts is no longer a viable option for collective bargaining units. In fact, the data contained in the report recently released by the Governor’s appointees to the Police and Fire Public Interest Arbitration Task Force, demonstrates that the 2% cap has limited the use of interest arbitration, as originally intended under the law, to a procedure of last resort and only for when parties reach an impasse in negotiations.
Moreover, the 2% cap on binding interest arbitration awards has established clear parameters for negotiating reasonable successor contracts that preserves the collective bargaining process and takes into consideration the separate 2% tax levy cap on overall local government spending. In addition to employee salaries, wages, and health benefits that comprise 50% of county operating budgets statewide, county governments face significant regulatory and statutory State mandates, which include implementing Criminal Justice Reform, operating judicial and prosecutorial facilities, providing courthouse security, housing inmates in county jails, delivering health and human service programs, maintaining county roads and bridges, funding county colleges and vocational-technical schools, conducting primary and general elections, and much more. With this in mind, the 2% cap on binding interest arbitration awards has proven to be an effective resource that makes it possible for county governments to live within their limited means.
Failure to permanently extend the 2% cap on binding interest arbitration awards will inequitably alter the collective bargaining process in favor of labor at the expense of taxpayers, and will lead to awards by arbitrators with no fiduciary duty to deliver essential services in a cost effective manner. NJAC recently conducted a comprehensive survey of county employee salaries, wages, and health benefits, which also presented the following question: “Faced with the expiration of Chapter 78 in 2015 and the 2% cap on binding interest arbitration awards, what cost saving measures will your county consider.” In addition to raising taxes by adopting a resolution to exceed the 2% tax levy cap, counties would consider mandating employee furloughs; privatizing certain services; forgoing raises for non-affiliated employees; and, reducing or eliminating non-mandated services such as transportation for the aged and disabled, meals on wheels, mental health and addiction services, and more. Although NJAC commends the police, firefighters, correction officers, and sheriff officers that put their lives on the line every day to protect the communities in which they serve, we also recognize that our State, local governments, and property taxpayers are struggling to make ends meet.
B. Procurement Parity
NJAC supports Senate, No. 728/ Assembly, No. 1118 (Cruz-Perez D-5/Beach D-6) (Oliver D-34/Pintor-Marin D-2), which would equalize the bid, pay-to-play, and prevailing wage thresholds.
NJAC supports this common sense measure as it will promote consistency in the law and provide new opportunities for local and small businesses that struggle with the existing procurement process. Current law requires local governing bodies and businesses to comply with three separate and conflicting public procurement statutes. In general, the Local Public Contracts Law requires counties and municipalities to award a contract through a fair and open competitive bidding process if the anticipated goods and services exceed $40,000.00.
Separately, the Pay-to-Play Law requires counties and municipalities to award a contract through a fair and open competitive bidding process if the contractor awarded said contract makes certain reportable political contributions for as a little as $300.00. Finally, the Prevailing Wage Law requires contractors to register with the State and pay specific wages to its employees if the contract is expected to exceed $2,000.00 for counties and $15,444.00 for municipalities. County governments have long struggled with reconciling these three conflicting laws, while local and small businesses have been impacted by its cumbersome process as they typically lack the necessary resources to comply with its many requirements. S-728 is on Second Reading in the Senate, and A-1118 is currently in the Assembly State and Local Government Committee awaiting consideration.
C. County Tax Administrators
NJAC’s supports Senate, No. 577/Assembly, No. 1644 (Doherty R-23/Sweeney D-3)(Schaer D-36/Mazzeo D-2), which would permit counties to share county tax administrators.
NJAC has long been an advocate for sharing resources and regionalization where feasible as cost effective alternatives for providing necessary and often mandated government services in a more reliable and practical manner. Over the past decade, our counties have led the way on implementing innovative programs and initiatives that have improved the level of service provided and saved valuable taxpayer dollars. Unfortunately however, several antiquated laws remain on the books and have become significant barriers to moving forward with potential cost saving initiatives.
For example, N.J.S.A. 54:3-7(b) requires the county board of taxation in each county to appoint a full time county tax administrator. The Governor appoints all tax board members with the advice and consent of the Senate, and the State Treasurer pays their salaries accordingly. However, counties must pay for the salaries of their county tax administrator at a statewide average of approximately $96,500.00 per year, which does not include pension, health, or other fringe benefits. Counties must also pay for the salaries of all clerical assistants, and for the operation and maintenance of the offices for the entire tax board and administrator. Several counties have expressed interest in sharing their county tax administrator as a meaningful cost saving measure, but have been advised that such an arrangement is prohibited by N.J.S.A. 54:3-7(b) as it again requires counties to employ their tax administrator on a full-time basis. At a time in which all local governments are struggling to make ends meet, this outdated level of bureaucracy imposes an unnecessary barrier to progressively sharing services. S-577 is currently in the Senate State Government, Wagering, Tourism, and Historic Preservation Committee awaiting consideration, and A-1644 is currently in the Assembly State and Local Government Committee.
2. Short-Term Goals – 2018/2019 Legislative Session
- Provide counties with their fair share of fees or surcharges collected from administering 9-1-1 services.
- Permit the use of electronic procurement for goods and services.
- Restrict commercial entities from using the Open Public Records Act for business purposes.
A. 9-1-1 Service Funding
The State of New Jersey collects annually from consumers approximately $120.0 million in telecommunication surcharges as 9-1-1 System and Emergency Response Fees (Fees) and deposits these monies into the 9-1-1 System and Emergency Trust Fund Account (Fund). As has been well documented, the State has collected over $1.2 billion in fees since 2006 with only 11% of Fund monies being spent on eligible expenses as recently reported by the Federal Communications Commission (FCC). Moreover, the State has failed to provide any funding for eligible expenses to local 9-1-1 centers operated by counties and municipalities, and has instead diverted Fund dollars to cover general operating expenses in the Department of Law and Public Safety.
Counties and municipalities across the State handle the vast majority of 9-1-1 service requests through local “Public Safety Answering Points (PSAP)” and have come to inequitably rely on the collection of local property taxpayer dollars to improve, operate, and maintain 911 systems. In fact, NJAC recently collected data from 15 of our 21 counties that reported they’ve spent over $219.0 million in capital improvements over the last five years. Improvements may have included facility upgrades; and, the purchase or lease of hardware and software such as telephone systems, computer aided dispatch, location mapping technology, voice recording technology, data analytics, and NextGen 9-1-1. These 15 counties also spent an estimated $76.0 million in 2016 on operating expenses, which may include administrative costs such as salaries, staff training, ongoing systems maintenance, network security costs, and IT consulting services. On the average, these counties provided some level of 9-1-1 dispatch services for approximately of 73% of the municipalities located within their borders.
With this in mind, NJAC is urging State leaders to comply federal guidelines and restore critical Fund monies to county and municipal 911 centers to operate, maintain, and construct effective, efficient and contemporary 911 systems. NJAC is also making the following recommendations: constitutionally dedicating any new 9-1-1 fees or surcharges imposed by the Legislature and collected by the State to county and municipal 9-1-1 centers; adopting the best practices outlined in the “New Jersey 9-1-1 Consolidation Study” published in 2006, which in part, calls for reducing the number of local 9-1-1 centers to streamline operations and save taxpayer dollars; and amending the Constitution to require the Governor and Legislature to properly allocate State monies pursuant to statutory law.
B. Electronic Procurement
NJAC supports Assembly, No 2220/Senate, No. 1729 (Benson D-14/Webber R-26) (Whelan D-2/Oroho R-24), which would authorize local governing bodies to use electronic procurement technologies under the Local Public Contracts Law.
In summary, the measure would authorize local units, joint purchasing units, or cooperative pricing systems to use electronic procurement practices for the following purposes: to purchase electric generation service, electric related service, gas supply service, or gas related service, for use at its facilities so long as the purchase otherwise complies with the provisions of the “Electric Discount and Energy Competition Act”; for the sale of surplus personal property under certain circumstances; and, for the sale of real property that would otherwise comply with the sale and lease provisions of the “Local Lands and Buildings Law.”
Additionally, contracts awarded for the administration of electronic procurement practices would be subject to the requirements of the “Local Public Contracts Law,” and the “Public School Contracts Law.” The bill would also require the Director of the Division of Local Government Services in the Department of Community Affairs, in consultation with other State government entities, to promulgate rules and regulations to effectuate the provisions of the bill. NJAC supports this legislation as it would modernize the procurement process saving valuable time, money, and resources. A-2220/S-1729 is on Second Reading in both houses.
C. Regulating Commercial Entities from abusing OPRA
The Open Public Records Act at N.J.S.A. 47:1A-1.1 defines a government record as “… any paper, written or printed book, document, drawing, map, plan, photograph, microfilm, data processed or image processed document, information stored or maintained electronically or by sound-recording or in a similar device, or any copy thereof, that has been made, maintained or kept on file or received in the course of official business.” Under OPRA, a government record includes printed records, tape recordings, microfilm, electronically stored records, books, maps, photographs, etc. Additionally, all government records are subject to public access unless specifically exempt under the law.
NJAC is a proponent of transparency and openness in government; and, embraces the tenet that government records must be readily accessible for inspection, copy, or examination by the general public. However, county governments process over 15,000 record requests each year of which the vast majority are for commercial entities seeking to take advantage of the law for business purposes. Not only do these onerous requests circumvent the intent of the law and public’s right to know, they use valuable time, resources, and taxpayer dollars. With this in mind, NJAC is advocating for legislation that would restrict commercial entities from making OPRA requests for business purposes that range from soliciting deed and mortgage information, environmental assessment data, pet records, and much more.
3. Long-Term Goals – New Administration
- Reduce the costs associated with operating and maintaining county court facilities.
- Streamline Civil Service laws, rules, and regulations, which includes an opt-out provision for local governing bodies.
- Establish a dedicated source of grant funding for counties to use as seed monies to regionalize services.
- Modernize the Local Public Contracts Law.
- Provide counties with the option to establish a dedicated source of revenue to promote economic development and tourism.
A. County Court Facility Costs
Under the State Judicial Unification Act, county governments are responsible for operating, maintaining, and making capital improvements to county court facilities across the State. Counties are also responsible for bearing the costs associated with implementing Criminal Justice Reform at a price tag of over $50.0 million and of which has yet to produce any tangible cost savings as predicted by proponents of the reform. Counties are further required to provide enhanced court security pursuant to a 2015 Directive issued by the Administrative Office of the Courts. As county governments also continue to struggle with making ends meet under the two percent property tax cap, where counties must prepare two comprehensive cap calculations and use the more restrictive one, county leaders have been working to identify realistic solutions that will minimize the toll this tremendous responsibility has taken on fiscal operations.
With this in mind, NJAC recommends implementing a policy, procedure, or practice that governs how the Judiciary engages county governing bodies on making capital improvements to court facilities. Currently, limited parameters or controls exist and the judiciary has no fiduciary duty to taxpayers as is the case with county officials who pay for the costly renovations, reconstruction, and construction projects. NJAC also supports legislation that would authorize county sheriffs to appoint Class Two special law enforcement officers, on a part-time basis and without pension or health benefits, to conduct court security under the direction of a county assignment judge. Under current law, only counties with police departments (Bergen, Camden, and Union) and municipalities may appoint Class Two police officers. Finally, NJAC also supports legislation that would establish a “Court Security Enhancement Fund,” and would finance the Fund by increasing certain court fees, assessments, and penalties. In summary, this measure would dedicate monies from the Fund to help counties and municipalities operate and maintain safe and secure court facilities. NJAC supports this initiative as it would dedicate a stable source of revenue to offset the significant and growing costs associated with providing courthouse security and implementing Criminal Justice Reform.
B. Streamlining Civil Services
NJAC recognizes the important protections afforded workers by the State’s civil service system. However, the system has become an outdated and overly burdensome bureaucracy in dire need of the reforms outlined below.
The first would authorize local governments to hire temporary seasonal employees for ten months instead of six months to prevent the county from training two separate workforces for seasonal services. The second reform would extend the Working Test Period (WTP) from three months to six months to provide local governments with a better opportunity to fully assess potential employees. The WTP is the period of time following a regular appointment from a certified list or appointment to a non-competitive title. NJAC also recommends limiting the Commission’s jurisdiction to hear appeals for disciplinary actions that result in an employee being suspended for fifteen working days or more instead of five days as the process uses considerable county resources. An additional reform would eliminate the statutorily imposed employee severance payments required under the Uniform Shared Services and Consolidation Act as the payments have been a disincentive for local governments to regionalize services.
Further, NJAC recommends modifying the Administrative Code to eliminate the perpetuity of special reemployment lists. Once an employee declines a position for which they have title rights, they should then be removed from the list accordingly. NJAC also recommends either eliminating bumping rights or requiring the Commission to fully disclose such rights upon request, so that local governments may properly execute a layoff plan as originally intended. Local governments should also have the ability to transfer employees from one department to another when a department experiences down time and important resources are needed elsewhere. Finally, NJAC recommends providing county and municipal governments with the opportunity to “opt-out” of Civil Service, which is prohibited under current law.
C. Regionalizing Services
As the only true regional form of government in the State that provides services in an effective manner and saves valuable taxpayer dollars simply by economies of scale, county government must play a vital and growing role in relieving residents and businesses of the highest property tax burden in the land.
Moreover, as municipalities continue to struggle with the two percent property tax cap and a seemingly never-ending barrage of unfunded State mandates, towns across New Jersey are looking to county government for leadership and relief. In addition to delivering a broad range of services, county government has evolved over the past decade into providing traditional municipal functions at a significant cost savings while enhancing the level of service provided. Some of these former municipal functions include: cooperative purchasing, 911 dispatch, animal control, public health, tax assessor, electronic waste recycling, public works, wastewater management, vehicle maintenance, EMS, police, and much more.
Although a proven and effective method for saving valuable taxpayer dollars, one of the biggest hurdles to the regionalization of services is the initial investment. Whether these costs come in the form of consultant studies, employee related expenditures, or upfront capital improvement and acquisition outlays, regionalization requires a significant initial investment. Currently, this investment is either borne by local property taxpayers; or, is enough of a deterrent to prevent regionalization. While the State has previously offered grants-in-aid in order to promote regionalization, these funds have been relatively unreliable; and, subject to elimination or diversion through the annual budget process. With this in mind, NJAC is encouraging the new administration to establish a dedicated annual funding stream for the purpose of offsetting the initial costs associated with regionalizing services.
D. Modernizing the Local Public Contracts Law
New Jersey’s Local Public Contract’s Law is voluminous and confusing, and has not undergone a comprehensive revision in over two decades. Despite significant technological advances during this time, the public procurement system remains antiquated. To compound matters, each new legislative session inevitably produces a high volume of bills aimed at updating or modifying very limited or specific applications of the Local Public Contracts Law where contractors or local governments have experienced issues. These quick fixes have left parts of the law out of sync with each other, creating a plethora of case law that has complicated the public procurement process even more.
As the timely and cost-efficient procurement of goods and services is essential to the orderly administration of government, NJAC is advocating for a comprehensive review and modernization of the Local Public Contracts Law; and, looks forward to working with the purchasing community in conducting a substantive analysis of the procurement process that will likely include modifications in the following areas: equalize the Pay-to-Play, Prevailing Wage, and Bid thresholds – also a lame-duck goal; create an independent commission of subject matter experts to review and make recommendations concerning all proposed changes to Local Public Contract laws and regulations; coordinate timeframes related to challenges to bid specifications and issuing addenda; modernize the process for public bid advertisements and legal publications; clarify the addendum process for solid waste collection and disposal services; and, additional matters to be determined.
E. Promoting County Tourism and Economic Development
Tourism is one of the leading economic development drivers in the State that supports over 500,000 jobs and accounts for 9.8% of the State’s total employment. Moreover, the industry generated an impressive $38.2 billion in 2016, which represents 6.5% of the State’s overall economy. As has been well documented, the promotion of tourism generates an exceptionally high Return on Investment (ROI), with an estimated $12 generated for every $1 expended. Despite the significant tangible economic benefits resulting from investments in promoting tourism, the State’s Division of Travel and Tourism awarded just $1,617,000 in grants to the various regional Destination Marketing Organizations (DMOs) in 2017. With 13 DMOs in the State, that amounts to an average of just $124,324 in funding per DMO.
NJAC submits that promoting the State’s tourism industry at the county level is critical for growing the State’s economy. However, counties lack the flexibility under the 2% property tax cap to adequately make up for the limited State funding; and, lack the legislative authority to establish their own source of revenue for this purpose. As such, NJAC supports legislation that would provide counties with the option of establishing a dedicated source of revenue for promoting economic development and tourism. More specifically, NJAC supports legislation that would authorize counties to impose a hotel tax on room occupancy by adopting a resolution or ordinance as necessary. The tax imposed by a county resolution or ordinance would be in addition to any other tax or fee imposed by statute or municipal ordinance or resolution; and, revenue generated by a county hotel tax must be used exclusively by the county for the purpose of promoting tourism and economic development.
Upcoming NJAC Events
If you haven’t done so already, please make sure to register for NJAC’s December 8th Summit on the Opioid Crisis and Resources for Recovery. We’ve put together two terrific panel discussions where law enforcement authorities, and parent advocates will examine the epidemic and present viable strategies for combating this public health crisis. Additionally, addiction and recovery professionals, mental health providers, and other subject matter experts will discuss resources for recovery and recommend new approaches for providing vital support to those in need. Although we’re waiving the registration fee for State, county, and other local officials, you MUST registration for the event by visiting our website at www.njac.org.
State House Trivia: Did you know that Harry Truman was the first U.S. President to pardon a turkey on Thanksgiving and allowed the bird to spend its remaining days at the Frying Pan Park farm in Virginia?
“May your stuffing by tasty. May your turkey be plump. May your mashed potatoes and gravy have nary a lump. May your yams be delicious and your pies take the prize. And, may your Thanksgiving dinner stay off of your thighs.” – Anonymous