Gloucester Township MUA Dissolution
The following reasons were given in the proposal to dissolve the GT MUA. (The full proposal is below along with the meting transcript)
THE PROPOSED DISSOLUTION OF THE AUTHORITY
The Township has undertaken an extensive review and anlysis of the proposed dissolution of the
Authority and has developed a comprehensive report (the “Dissolution Report”) in accordinance
with the requirements of Local Authorities Fiscal Control Law, N.J.S.A. 40A:5A-1. A copy of the
Dissolution Report is attached as Exhibit “B”. The primary reasons for dissolution are as follows:
1) conformity with the larger policy of the State of New Jersey (“State”) for reduction in redundancy
in government; 2) greater accountability to the electorate; 3) enhanced operating efficiencies; and 4)
financial considerations.
STATE POLICY: It has been consistent State policy for over thirty (30) years to encourage
the reduction of the number of local government subdivisions. In 1986, the State created
the County and Municipal Government Study Commission charged in part with studying
local government fragmentation into numerous sub-municipal independent agencies. The
Commission expressed the opinion that municipal governing bodies should have direct
policy control of the services offered by independent agencies. In 2007, the State
established the Local Unit Alignment, Reorganization and Consolidation Commission to
promote a reduction in the number of local units of government including independent
authorities. In 2015, the State’s Best Practices Program specifically asked if municipalities
reviewed the possibility of consolidating utility services with municipal operations. After
undertaking a thorough review and analysis in furtherance of this directive, the Township
has determined that the dissolution of the GTMUA meets the policy objectives established
by the State.
ACCOUNTABILITY TO THE ELECTORATE: A fundamental principle of local
government is that elected officials provide the most direct line of accountability to
residents. In accordance with this principal, the dissolution of the Authority will lead to
greater political accountability as evidenced by the overlap of current Authority customers
in comparison to taxpaying residents of the Township. Specifically, the Authority has
21,058 total accounts of which 21,039 (approximately 99.91%) are in the Township.
Dissolving the Authority and creating a Department of Sewer Utility and a Department of
Global Services within the Township will naturally provide for greater accountability to
the electorate of the Township through the direct oversight of sewer utility operations by
the Mayor and Township Council.
EFFICIENCY: Consolidation presents opportunities to create more value for the taxpayers
and ratepayers of the Township through economies of scale and more effective use of
public resources. Certain benefits include the elimination of duplicate professional
services and the cost of the Authority Board, consolidation of financial operations,
improved collection rates and the integration of all infastructure improvements under a
unified capital improvement program. The Township also expects to realize additional
efficiencies over time as the Authority operations are integrated into the Township.
FINANCIAL CONSIDERATIONS: The Authority is financially sound and has
historically operated at a profit with stable and consistent cash inflows. As such, it is
anticipated that there will be no additional financial burden to the Township’s electorate.
Further, it is anticipated that by merging the Authority’s responsibilities into the Township,
greater in-roads can be made in capping customer payment deficiencies, leading to even
greater incoming cash flows in the future.
