Red Tape Review Commission Successes
Modernized LLC Act to Encourage Formation in New Jersey
The Revised Uniform Limited Liability Company Act (RULLCA) was signed by Governor Christie on September 19, 2012. This bill repeals the NJ LLC Act and replaces it with a more modern regulatory scheme for the creation and operation of LLCs, the most popular business organization in NJ.
Notable benefits of RULLCA include enhanced ease and flexibility of formation, with streamlined methods for domestication (an LLC formed in another state becomes an LLC in NJ) and conversion (a corporation becomes an LLC). RULLCA adopts some of the best elements of the Business Corporation Act concerning the indemnity of members and mangers and remedies for deadlock, for example. RULLCA also eliminates pitfalls concerning the perpetual existence of the LLC and the valuation of interests for resigning members.
Since RULLCA is more consistent with the expectations of businesspeople, it should encourage the formation of LLCs in NJ rather than surrounding states.
Moreover, RULLCA signals the efforts NJ is making to improve its reputation as a home for business. This legislation was sponsored by all four legislative members of the Red Tape Review Commission.
As Part of Commitment To Common Sense Regulations, DEP Launches New Permit To Spur Use Of Energy-Efficient Technology
As part of its commitment to a cleaner and more diverse energy future for New Jersey as well as common sense regulations, the Department of Environmental Protection has developed a new general permit to make it faster and easier for a wide range of facilities such as small- to moderate-size manufacturers, office complexes, apartment complexes, hospitals, schools and other institutions to turn energy used for heating into electricity. For more information, visit: http://www.state.nj.us/dep/newsrel/2011/11_0124.htm
Preventing Red Tape Before It Starts
In accordance with Governor Christie’s Common Sense Principles for rulemaking, in June 2011, the Division of Consumer Affairs published a Notice of Pre-Proposal concerning a potential amendment to N.J.A.C. 13:48-11.2, which governs the disclosures non-profit, charitable organizations make to the public in their solicitations. In so doing, the Division sought feedback on a proposal that, among other things, would have required non-profits to include on any written solicitation a means for a donor to designate the program or programs to be funded with the contributions. The Division received feedback on the proposal, including testimony presented to the Red Tape Review Commission, and, ultimately, opted to not go forth with the regulatory amendment. In short, the system worked. Governor Christie’s Common Sense Principle of seeking feedback from interested stakeholders before proposing rules operated as envisioned, and this red tape was stopped before it started.
Uniform Contracting and Licensing Procedures
On September 30, 2011, Governor Christie signed into law A2366/S2331 which requires the Department of Human Services and the Department of Children and Families to, to the extent practicable, collaborate to establish uniform contracting requirements for social service organizations that contract with the departments. Such uniform requirements are to include uniform reporting procedures and audit schedules, and centralized licensing review and licensing issuance. Moreover, where an organization has programs licensed to provide services through both departments, each program shall be issued a license by a single department, to the extent practicable. Such collaboration among departments that share jurisdiction is encouraged, and this collaboration may prove to be a model for similar intra-department collaboration.
Cutting Red Tape and Boosting Water Conservation
Sub-metering of utilities is the monitoring, measuring, and charging of utility costs to tenants based on actual use of utilities consumed by each tenant, as opposed to the antiquated practice of estimating tenant consumption – an inherently problematic practice that both overcharges some tenants, while undercharging others.
The Red Tape Review Group previously noted that New Jersey’s prohibition of utility sub-metering was archaic and anachronistic, noting that New Jersey was the only state to still prohibit sub-metering of utilities in rental housing units. Accordingly, in August 2011, the Board of Public Utilities ("BPU") altered its policy to permit sub-metering of water in newly constructed residential apartment buildings, as well as repurposed existing buildings where all existing pipes, service lines, and other water infrastructure beyond the utility company’s meters are replaced. Motivated by the substantial conservation benefits of water sub-metering and the appropriateness of equitable cost allocation among tenants, BPU concluded that amending its policy was in the public interest. To be sure, the Red Tape Review Group noted that studies found "water savings upward of 15% after sub-meters were installed."
Short-cutting Red Tape at MVC
Operating and maintaining school buses will become a bit easier if proposed rule changes from the Motor Vehicle Commission are adopted. None of these changes published in the New Jersey Register of August 1, 2011 would impact school bus safety, but they would allow school bus operators to run their fleets more efficiently.
In a concession to the 21st Century, one proposal would allow school bus operators to limit their use of paper and maintain records electronically. Required fingerprints also would be submitted electronically, according to the proposed changes. Another common sense change would allow school buses that fail inspection to be driven to be re-inspected as long as there are no passengers. Previously, school buses had to be towed to the re-inspection station. The regulations would also free operators from the State’s micro-managing of the look of school buses. Operators would have more flexibility in regard to the color, size and letters on school buses and bus grilles would be permitted to be black, rather than only chrome, silver or “National School Bus Yellow.”
The inspection of school buses would no longer depend upon mileage, but would be required either every three months or according to the manufacturer’s recommended maintenance schedule – whichever came first. The inspection according to mileage had been a big problem for rural, high-mileage bus routes.
These proposals reinforce the Christie Administration’s drive to eliminate red tape and burdensome regulations. The administration has created an ongoing Red Tape Review Commission to look for smart ways to reduce the state’s regulatory environment. The next meeting will be held on September 21, 2011, at Stockton State College from 2:00 until 5:00.
Board of Public Utilities to issue its orders in written form and to post them on the Internet.
Governor Christie signed legislation to ease the bureaucratic burden for New Jersey businesses. The legislation, (A-2849), which had bipartisan support, requires the state Board of Public Utilities to issue its orders in written form and to post them on the Internet. The BPU, which regulates New Jersey utilities, often issues orders orally at meetings. The stipulation that they now be posted on the Internet is meant to make BPU orders as clear as possible. This is significant, given the complexity of many BPU decisions.
Since assuming office in 2010, the Administration has made cutting red tape a priority and formed an ongoing Red Tape Review Commission, chaired by Lt. Governor Kim Guadagno, to review state rules and regulations with an eye toward making them simpler.
Longer Sunset for Rules and Streamlined Re-adoption
Governor Chris Christie signed another piece of legislation to ease the regulatory burden in New Jersey by cutting red tape. The bill, A-2721/S-2013, says State rules will now have a sunset provision, or expiration date, of seven years rather than five. Moreover, the bill allows for an easier and less cumbersome procedure for re-adopting rules that are not substantially changed.
The bill sponsors include Assemblyman John Burzichelli, Assemblyman Scott Rumana and Senator Steve Oroho, who are all members of the Red Tape Commission. The Red Tape Group recommended this amendment to the Administrative Procedure Act in its report last year.
Governor Christie Signed Two Bills Aimed at Cutting Red Tape
Governor Chris Christie signed two bills aimed at streamlining bureaucracy and cutting red tape, a chief goal of the Christie-Guadagno Administration. The bills were A-2720/S-2014 and A-2853/S-1914, sponsored by two members of the Red Tape Review Group, Assemblyman John Burzichelli and Senator Steve Oroho.
A-2720/S-2014 amends the “Administrative Procedure Act” to allow substantial changes to proposed rules upon adoption, without forcing the State agency to re-propose the entire rule. This should create efficiencies in the rule-making process and help agencies to be more responsive to stakeholder comment.
A-2853/S-1914 mandates a departmental review (in concert with local agencies, where possible) of permits and the permitting process. The legislation should also accelerate economic development projects by creating a central point of contact for each project within the Department of State who will coordinate the permitting process among State and local agencies.
Cutting Red Tape in Atlantic City
Governor Chris Christie recently signed legislation aimed at modernizing how the state regulates Atlantic City casinos.
The bill, S-12, clarifies the roles of the Casino Control Commission and the Division of Gaming Enforcement to avoid duplication. The Casino Control Commission now has full control over licensing and regulatory disputes while the Division of Gaming Enforcement oversees day-to-day casino regulation.
In the past, these agencies had overlapping responsibilities. The bill also eliminates the requirement that Casino Control Commission officials be physically present at all times during casino operation. Today's technology makes such on the scene monitoring unnecessary. In general, the changes are designed to make state regulations less costly and burdensome for casino operators.