Office of Legislative Services
State House Annex
P.O. Box 068
Trenton, New Jersey 08625
Legislative Budget and Finance Office
Phone (609) 847-3105
Fax (609) 777-2442
www.njleg.state.nj.us
LEGISLATIVE FISCAL ESTIMATE
SENATE, No. 3969
STATE OF NEW JERSEY
221st LEGISLATURE
DATED: DECEMBER 26, 2024
SUMMARY
Synopsis: Extends economic recovery term under "Municipal Rehabilitation and
Economic Recovery Act."
Type of Impact: Potential five-year increase in State expenditures; five-year impact on
municipal expenditures.
Agencies Affected: Department of Community Affairs; New Jersey Economic
Development Authority; City of Camden.
Office of Legislative Services Estimate
Fiscal Impact January 2025 to January 2030
Potential State Expenditure Increase Indeterminate
Municipal Finance Impact Indeterminate
The Office of Legislative Services (OLS) concludes that the bill may potentially increase State
administrative expenditures over a five-year period, from January 2025 to January 2030,
associated with the continued oversight of the City of Camden.
The extended applicability of certain fiscal authorizations would have an indeterminate annual
impact on the City of Camden. Most notably, the municipality would be permitted to increase
its property tax levy by three percent, rather than two percent, per year and would be required
to receive funding priorities from State agencies.
BILL DESCRIPTION
This bill would extend the economic recovery term under the Municipal Rehabilitation and
Economic Recovery Act (MRERA), applicable to the City of Camden, by five years, from January
2025 to January 2030. This would extend the special governing procedures, economic benefits,
and additional oversight measures provided for a qualified municipality under the MRERA. FE to S3969
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FISCAL ANALYSIS
EXECUTIVE BRANCH
None received.
OFFICE OF LEGISLATIVE SERVICES
The OLS concludes that the five-year extension of the economic recovery-related provisions
of the MRERA would have an indeterminate annual impact on the finances of the City of Camden
and potentially increase State expenditures over a period of five years, from January 2025 to
January 2030.
Impact on City of Camden:
The MRERA authorizes the City of Camden to increase its property tax levy regularly by no
more than three percent per year, rather than the two-percent limit applicable to non-MRERA
municipalities. Consequently, the bill allows the City of Camden to increase its property tax levy
by a greater amount during the five-year extension period.
The act also provides the mayor of the City of Camden with certain additional powers. The
mayor may veto the minutes of any independent board or authority of the municipality, such as
the housing authority, parking authority, planning board, and zoning board of adjustment. The
five-year extension of these additional powers could therefore affect municipal finances to the
extent that this mayoral veto power results in the modification of certain spending initiatives.
The MRERA also requires every State agency to grant the highest priority to any application
from the City of Camden for the award or approval of any financial assistance or infrastructure
project that would benefit the municipality. By extending the MRERA timetable, the bill may
allow the City of Camden to receive increased funding from existing State aid programs.
Impact on State Expenditures:
The bill may increase State expenditures for the continued oversight of the City of Camden by
the Department of Community Affairs. Notably, the department is to (1) conduct an annual
compliance audit of the activities of the City of Camden; and (2) ensure that the annual municipal
budget includes sufficient appropriations for the improvement of internal audit mechanisms and
controls. The department may veto any resolution or ordinance adopted by the governing body of
the municipality, subject to override by the municipality. As a result, the department may incur
additional administrative expenditures in exercising these additional powers and responsibilities.
In addition, the MRERA sets forth a comprehensive economic development strategy to
revitalize the City of Camden. Most notably, the law authorized the Economic Development
Authority to issue not more than $175 million in bonds to support various types of development
activities in the municipality. To direct the disbursement of these funds, the MRERA established
the Economic Recovery Board, a subsidiary corporation of the authority.
The OLS notes that authority’s 2022 Annual Report states that the State Economic Recovery
Board of Camden is currently inactive, and that MRERA funds are fully committed and not
available for disbursement. As of April 2017, the most recent authority publication on the Camden
Economic Recovery Initiative indicates that the State disbursed approximately $164.1 million of
the $175 million bond issuance. The board is required to operate during the period in which the
municipality is operating under the MRERA or until its funds have been disbursed, whichever
occurs first. Assuming the information concerning the commitment and disbursement of MRERA FE to S3969
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funds is still correct, the bill would not increase State expenditures by continuing the board’s
operations during the five-year period following enactment of the bill.
Section: Local Government
Analyst: Abigail Stoyer
Associate Fiscal Analyst
Approved: Thomas Koenig
Legislative Budget and Finance Officer
This legislative fiscal estimate has been produced by the Office of Legislative Services due to the
failure of the Executive Branch to respond to our request for a fiscal note.
This fiscal estimate has been prepared pursuant to P.L.1980, c.67 (C.52:13B-6 et seq.).