In the wake of Hurricane Sandy, New Jersey has a lot of rebuilding to do. However, the storm has also brought people together. In fact, many New Jersey municipalities have been overwhelmed by charitable contributions intended for storm victims.
To ensure funds are properly distributed, the New Jersey Department of Community Affairs, Division of Local Government Services, has issued guidelines for managing charitable contributions. It encourages local government to direct donations intended for third parties, such as storm victims, to non-profit organizations rather than assuming the responsibility for re-distributing donations.
However, it also acknowledges that many municipalities are still receiving Sandy-related contributions or gifts. In these cases, local governments may appropriate funds and spend them for the purpose for which they are donated in accordance with N.J.S.A. 40A:5-29 (Acceptance of Gifts).
The Division of Local Government highlights the following requirements under the law:
- The governing body must approve a Dedication by Rider resolution. The title of the appropriation dedication should include a reference to “Hurricane Sandy 2012” or “Superstorm Sandy 2012.”
- The Rider resolution must include a plan of disposition for any funds collected, including who will receive the funds (i.e., the specific group of persons or organizations), how they will be allocated, and the process for making allocation decisions (if funds will be disbursed to more than one person or organization).
- There should be public disclosure at the time of contribution specifying the purpose for which the money will be spent.
- Budgeted appropriations not offset by contributions are not authorized or permitted.
- State law does not allow property tax or utility fee based contributions for these purposes.
- Local units must adopt a formal policy outlining how donations to local residents or organizations affected by the disaster will be made.
- Individuals and organizations should be appropriately screened to ensure donations are disbursed to those who are qualified.
For detailed legal advice regarding Hurricane Sandy charitable contributions, we encourage you to contact a member of Scarinci Hollenbeck’s Public Law Group.