This bill aims to limit the diversion of funds from stormwater, water, and sewer utilities to municipal and county budgets by reducing the allowable transfer percentage. Currently, municipalities can transfer up to five percent of the annual operating costs of a utility to other expenditures; this bill reduces that limit to three percent. Similarly, counties and municipalities can appropriate undesignated funds or unreserved retained earnings from authorities up to five percent of the authority's annual operating costs, which will also be reduced to three percent under this bill.

Additionally, the bill mandates that municipalities and counties must provide written notice to the Division of Local Government Services in the Department of Community Affairs whenever they transfer surplus revenue from stormwater, water, or sewer utilities, or appropriate funds from a water or sewer authority. This requirement aims to enhance transparency and accountability in the management of these funds.

Statutes affected:
Introduced: 40A:4-35.1, 40A:5A-12.1