New Jersey Division of Local Government Services Local Finance Notice 2024-04
Local Finance Notice 2024-04 New Russia-Belarus Law Developments & Implementation Required by Contracting Units
On August 4, 2023, a company obtained a temporary restraining order (TRO) from the United States District Court for the District of New Jersey, which enjoins the State from enforcing the “Prohibited Activities in Russia or Belarus” law against that company on the ground that the statute is likely inconsistent with federal law. At that time, due to the ongoing litigation, the New Jersey Department of the Treasury (Treasury) removed the Russia Belarus list from its website, and the State (along with its agencies and instrumentalities) voluntarily suspended further implementation of the Russia-Belarus law until further order of the Court.
On December 22, 2023, the company then obtained a permanent injunction from the United States District Court, which prohibits the State from enforcing N.J.S.A. 52:32-60.1 against the company on the grounds that such enforcement would conflict with the existing federal sanctions regime and thus violate the U.S. Constitution’s Supremacy Clause.
New List and Vendor Certification
· The Local Public Contracts Law, Public School Contracts Law, and the County College Contracts Law, generally require contracting units under those laws to implement and comply with the
provisions of P.L. 2022, c.3 applicable to State agencies. See N.J.S.A. 40A:11-2.2; 18A:18A-49.5;18A:64A-25.44. Thus, when a contract for goods or services is awarded, renewed, amended, or
extended, a contracting unit shall now
1) require a vendor or contractor to certify, using the Treasury vendor certification as a template, that the vendor or contractor is not identified on the OFAC list due to activity related to Russia and/or Belarus
2) type the vendor’s or contractor’s name and address into the OFAC list search to determine whether they appear on the list due to activity related to Russia and/or Belarus. When searching the OFAC list, the vendor or contractor is considered to be engaging in activity related to Russia and/or Belarus if the term Russia or Belarus comes up next to their name under the “Program(s)” column.
Threshold for Requiring Vendor/Contractor Russia-Belarus Certification
· A vendor or contractor is not required to provide a Russia-Belarus certification prior to the award of a State contract for goods or services that is beneath the State agency quote threshold of $1,000.
· Given the threshold for vendor/contractor certification applied to State goods or services contracts, combined with the practical considerations of local purchasing, a contracting unit should rely on the advice of legal counsel in determining whether to apply its own local quote threshold to the Russia-Belarus certification; the Division will defer to contracting units on this point.
H2 Local Finance Notice 2024-04
Please follow the link below to read more about these items and guidance on how your local unit can implement them: https://www.nj.gov/dca/dlgs/lfns/2024/2024-04.pdf
Contact Wielkotz & Company, LLC Today
For further information on Local Finance Notice 2024-03 and its implementation feel free to reach out to Steven Wielkotz at (973)-835-7900 ext. 201 or sdw@w-cpa.com.
