State Authorizes $10M to Study Shared Services

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By Philip Sean Curran

Assemblywoman Joann Downey
(D-11)

The Murphy administration will provide $10 million to help towns around the state pursue government shared services and school district consolidation studies to lower New Jersey’s property taxes, among the highest in the nation.

An initiative included in the program challenges local governments to compete for grants from a $3.1 million fund for impactful local shared services projects. Each county has been allocated $150,000.

“The goal of this whole thing for the challenge grants is to encourage towns, counties, municipal authorities to develop the best plan for their residents,” said Assemblywoman Joann Downey (D-11). “Even with the 2-percent property tax cap, too many New Jersey residents can’t afford to live here. And that’s the bottom line.”

A larger chunk, $5.8 million, is earmarked for implementation grants to aid in completing or transitioning toward shared services arrangements and for school consolidation studies.

The final piece provides $1.05 million for the 21 counties to hire staff as shared service coordinators, intended for public-sector, career-minded young professionals under a fellowship, according to the Murphy administration. The funding comes out to $50,000 per county.

“As we lead our state towards the stronger and fairer economy that we hope to build together,” Murphy said in a Sept. 25 statement, “it is our administration’s responsibility to provide these communities a platform from which to pursue efficient growth, achieve smart government, and provide relief to local taxpayers.”

Some parts of the state are further ahead than others when it comes to sharing services.

Assemblywoman Serena DiMaso (R-13) said that when she was a Monmouth County freeholder with current director Thomas A. Arnone, the “county was in the forefront of shared services.” She said the county would share services with towns for everything from snow removal to road repair.

“We’ve been doing that for years, so I’m glad the state is catching up,” she said. “The only way we’re going to save taxpayer dollars is if we work together.” The funding from the state does not specifically address supporting towns that want to merge with one another. The last major municipal consolidation in New Jersey took place in 2013, when Princeton Borough and Princeton Township officially became one community. New Jersey has 565 municipalities and more than 600 school districts.

“And we’re concerned, because if you have overlapping, competing school districts and wasting money, that could be going towards children’s education, not towards like more administration costs,” Downey said.

State Senate President Stephen M. Sweeney (D- 3) has proposed merging hundreds of school districts into K-12 regional districts as par t of a series of steps to improve the state’s fiscal health amid concerns about public employee health benefit and pension costs.

“Shared services agreements can’t come from a top-down approach, where the state tells individual towns what to do, where to merge, and when to cut,” said state Sen. Vin Gopal (D-11) in a statement Sept. 25. “With these grants, we can really harness the independent creativity of each town in New Jersey, and use that competition to make sure that this $10 million creates the most possible taxpayer savings for every dollar spent.”

During the administration of former Gov. Chris Christie, the state imposed a 2-percent tax cap that governing bodies and school districts have to live under.

“Whenever there’s an opportunity to create efficiency and some cost savings, I think there’s a willingness,” said Mike Cerra, assistant executive director of the New Jersey State League of Municipalities.

But he said there are “administrative obstacles” to shared services at the local level that the state needs to look at. For example, he cited New Jersey’s Civil Service system.

At the moment, New Jersey has 192 towns where employees are covered under the Civil Service Commission, which is in, but operates independently from any super vision or control by, the Department of Labor and Workforce Development.

The league favors allowing local referendums to give voters a choice to opt their communities out of the system.

“Not everyone is in the system, although most of the larger communities are,” he said.

If a civil service town and a non-civil service town want to share a department, employees from the non-civil service town would gain civil service rights, even after the agreement ended, he said.

“That’s been an obstacle,” he said, “and potential discussions about agreements have almost not gotten started because there’s almost no way to get around that problem.”