Will New Fine Collection Rules Be a Cash Cow For New Jersey Municipalities?

Scarinci HollenbeckNew Jersey municipalities are starting to reap the benefits of a new rule that privatizes the collection of municipal court fines. The rule specifically authorizes municipalities to contract with private collection agencies to collect delinquent fines owed to local courts.

According to a recent article in the New Jersey Law Journal, 30 local governments are in the process of privatizing their collection efforts, while dozens more have requested information about the program from the Administrative Office of the Courts. Municipalities have a lot to gain; uncollected fines across the state of New Jersey amount to more than $252 million, according to AOC spokeswoman Winnie Comfort.

For those who are not yet taking advantage of the new program, below is a brief summary of the procedures governing the private collection of municipal court fines:

  • Private collection is only available after “all judicial enforcement remedies permitted by law or court rule” have been exhausted.
  • A municipality or county must first request authorization from the Administrative Director of the Courts to collect unpaid outstanding monies before entering into a contract with a private collection agency.
  • Prior to implementation of the contract, the municipality or county must send to the Administrative Director of the Courts a copy of the contract with the private collection agency, which sets forth, among other provisions, the amount of the administrative fee to paid by the debtor, and any documents proposed to be used as part of the services performed by the private collection agency.
  • The municipality or county may authorize the assessment of a fee, not to exceed 22% of the amount collected, to be assessed by the private collection agency to pay for the costs of collection.
  • Debtors are instructed to send payments directly to the municipal court, which then forwards any administrative fees collected to the private collection agency.

For additional information about the private collection of municipal court fines, please contact a member of Scarinci Hollenbeck’s Public Law Group.


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