How the NJ Condominium Act (Municipal Services Act) Benefits HOAs and Community Associations



As you may recall, winter arrived late in the Mid-Atlantic, with balmy December temperatures dashing dreams of a white Christmas.  But despite the season’s late debut, heavy snowfall and even blizzard conditions affected many parts of this region this winter.  Consequently, many communities had to arrange and pay for snow removal services – which can often be one of the biggest chunks an association’s budget.   

But for managed communities in New Jersey, these costs may be mitigated by the Municipal Services Act, aka the Condominium Services Act.  If you’re a Board member of a managed community located in state, it’s very important that you understand what this legislation is all about – and how it can benefit your community association.

New Jersey’s Municipal Services Act, adopted in 1989 and amended in 1993, was enacted to ensure that municipal services, such as snow and trash removal and street lighting electricity, were provided to all homes within a town’s borders. 

Previously, homes on public streets received municipal services from their township or municipality, with costs paid by their homeowners’ tax dollars.  However, homes that were part of community associations – with private roads maintained by their associations – did not receive these services, but their homeowners paid the same taxes.  At the same time, their association fees were used to contract and pay for private services.

The Municipal Services Act requires that municipalities provide snow and ice removal, leaf, trash and recyclable collection, and street light electricity for qualified private communities “in the same fashion” they provide these services for homes along public streets.  A municipality may also opt to reimburse a managed community for its costs, but in an amount equivalent to what the town would pay to provide these services, which is typically lower.
 
Thanks to the Municipal Services Act, residents of qualified New Jersey managed communities no longer incur double payments for the same municipal services.  But if your community is not currently receiving benefits, how do you get started?

“If a community qualifies to receive a Municipal Reimbursement, its association attorney must contact the township to negotiate the terms of the agreement.  Once it’s in place, the community manager can take over to facilitate and oversee the process each year,” says Eileen Szelewicki, a community manager for FirstService Residential in New Jersey. 

She notes that each township handles the process differently and has its own unique requirements for payment and/or reimbursement, so she makes it a priority to proactively manage the process for all of her communities each year. 

“I stay on top of each township’s requirements and deadlines to ensure that each of my managed communities remains compliant and receives the funds for municipal services it is entitled to each year,” she says.

Most New Jersey homeowner associations (HOAs), condominium associations and cooperative boards qualify for the Municipal Services Act, but if you’re unsure, consult with your association’s attorney or a good community management company.  If you do qualify, a professional community management company can help you navigate and manage the process to ensure your association receives the services or reimbursement it’s entitled to.  For more information on the Municipal Services Act and how your association can qualify and benefit, contact New Jersey community management leader FirstService Residential.