New Jersey Division of Local Government Services Local Finance Notice 2025-10
Local Finance Notice 2025-10 Ensuring Swift, Legal Storm Recovery: Budget & Procurement Guidance for NJ Municipalities
Following Governor Murphy’s Executive Order 392 declaring a state of emergency after July 14, 2025 storms, the notice guides municipalities, counties, and school districts on financial and procurement protocols.
Emergency Appropriations (Municipalities & Counties)
• Budget already adopted
An emergency appropriation requires a two-thirds vote by the governing body and a CFO certification that expenditures are storm-related. These resolutions must be filed with DLGS. Amounts exceeding 3% of the budget cap also require state director approval.
• Budgets pending adoption
Local units may use temporary emergency appropriations tied directly to storm response. These expenses are excluded from standard budget and tax levy caps, but must be specifically labeled and certified in the budget.
• Multi-year funding for infrastructure
Municipalities may adopt special emergency ordinances allowing a 3-year funding plan for damaged streets, roads, bridges, etc. Such moves require planning board approval and must be filed with DLGS.
Spreading Emergency Costs
Areas with significant costs can apply to finance them over multiple years—particularly if spreading leads to at least a $50/year tax impact over three years—subject to Local Finance Board review.
Fire Districts
Fire districts can enact emergency appropriations up to 3% of operating budgets with a two-thirds board vote, and must coordinate approval with municipal governing bodies. Costs exceeding normal levels can be treated as one-time levy cap exclusions.
Storm Recovery Reserves
Communities with dedicated reserves may tap into them for storm-related needs like debris removal. If future reimbursements are received (e.g., from FEMA), they must be redeposited into the reserve.
Emergency Procurement Procedures
- Under state Public Contracts Law and School Contracts Law:
- Agencies can bypass standard bidding for urgent contracts.
- Emergency procurements are exempt from Pay-to-Play rules.
- No emergency contract report is needed per a 2016 Treasurer’s directive.
- BRC and PWCR documentation may be submitted after contract award; payment is contingent on submission.
- Vendors must still adhere to wage regulations and certifications (like Russia/Belarus, Iran sanctions).
Why This LFN Matters
- Clarity & Transparency – Provides consistent, legal paths for financing urgent storm-response efforts.
- Financial Stability – Enables structured budgeting—both one-year and multi-year.
- Compliance – Ensures procurement aligns with ethics, wage standards, and anti-corruption laws.
- Efficient Recovery – Facilitates quicker response and restoration via streamlined emergency procurement.
Practical Steps for Local Governments
- Engage Finance Officers Early – Confirm eligibility for emergency funding and certify appropriations.
- Label Budget Items Clearly – Especially for new storm-related line items.
- Plan for Multi-Year Funding – Infrastructure damage often justifies three-year ordinances.
- Document Thoroughly – Record all certifications, bids (or bid waivers), and approvals.
- Use Reserve Wisely – Tap storm reserves, but replenish them when reimbursements arrive.
Local Finance Notice 2025-10
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/2025/2025-10.pdf
Contact Wielkotz & Company, LLC Today
For further information on Local Finance Notice 2025-10 and its implementation feel free to reach out to Steven Wielkotz at (973)-835-7900 ext. 201 or sdw@w-cpa.com.
