For Immediate Release:
October 7, 2011
Christie Administration announces TRANSITIONAL AID AWARDS for municipalities On fiscal year budgets
Awards Contingent on Legislature Enacting Governor’s Proposal to Restore
Transitional Aid Funding with Oversight Provision
TRENTON, NJ – The Christie Administration today announced the Transitional Aid awards for 5 municipalities operating on a fiscal year budget: Camden City, Lawnside Borough, Paterson City, Trenton City, and Union City. Bridgeton applied, but was not awarded aid because of its improved financial condition. The awards are contingent on the New Jersey Legislature advancing Governor Christie’s proposal to restore Transitional Aid funding and making permanent strict State oversight and reporting requirements.
In keeping with the temporary nature of the program, only half as many municipalities are participating in the program this year compared to last year.
“We’ve shown that our approach of holding towns and cities accountable for the transitional aid they receive and requiring them to implement fiscal and management reforms is working, as evidenced by the fact that fewer municipalities need assistance this year than last year,” said Governor Christie. “I encourage the Legislature to quickly approval my proposal to restore funding for transitional aid with state oversight so we can continue to assist these municipalities with responsible spending and budgeting practices.”
The Transitional Aid awards are conditioned on recipients signing a Memorandum of Understanding (MOU) agreeing to State oversight, reporting requirements and fiscal and management reforms in order to receive the state aid dollars. The Department of Community Affairs (DCA) will allocate 75 percent of a municipality’s awarded funds upon signing the MOU. The balance will be payable later in the fiscal year, provided the requirements of the MOU are complied with and implemented.
“State oversight is viewed positively by key New Jersey stakeholders – especially the taxpayers – because the Christie Administration has demonstrated it can help communities reduce costs, improve operations and keep everyone accountable,” said DCA Commissioner Lori Grifa. “My Department’s professional staff has experience in all areas related to local government and we stand ready to make this expertise available to the cities receiving Transitional Aid.”
The MOU requires aid recipients to obtain Division of Local Government Services approval before hiring personnel or outside consultants; to freeze non-contractual salaries and promotions; to restrict travel expenditures; and to adopt a strong pay-to-play ordinance. Aid recipients are also required to meet with Division staff at least four times a year to review their budget and fiscal progress.
A list of the fiscal year recipients, their requested amounts, and aid awards can be viewed at http://www.nj.gov/dca/lgs/muniaid/11_aid/11tran_aid/2011trans_aid.shtm on the DCA website. For comparison, a list of last year’s fiscal year recipients can be viewed at http://www.nj.gov/dca/lgs/muniaid/10_aid/cy2010_transitional_aid_to_localities.htm.
The program required applicants to reduce their labor costs, modify the services they provide, document efforts to maximize revenues, and eliminate all non-essential spending as a precondition to receiving aid. Applicants also had to prove that despite meaningful cost reductions and services changes, they needed Transitional Aid to avoid a significant increase in their property tax rate.
The Transitional Aid program is implemented through the Division of Local Government Services, which works with local governments throughout the state to ensure their fiscal integrity and to support their efforts to comply with state laws and regulations.
Transitional Aid Awards for Fiscal Year Budget Municipalities