Jersey City Adopts Increasingly Stringent Pay-to-Play Ordinance

December 21, 2012

Since 2008, Jersey City’s pay-to-play Ordinance has remained one of the most stringent in the State of New Jersey. In fact, the Jersey City Ordinance served as a model for the transitional aid pay-to-play ordinances, which many municipalities and cities have been required to adopt in recent years. On December 19, 2012, the Jersey City Council adopted an increasingly restrictive pay-to-play Ordinance.  Adopted by a vote of 5-4, the new provisions of the Ordinance restrict vendors from entering into contracts with the City if, within one calendar year prior to award, the vendor or certain persons and entities associated with the vendor made a contribution in excess of $200 per calendar year to:
  • A candidate  for Jersey City municipal office
  • A candidate for Jersey City Board of Education
  • A candidate for Assembly or Senate whose district encompasses Jersey City (currently District 31) and has contributed any funds to any Jersey City elective municipal office in the twelve months prior to award of the contract
  • Every county political party committee
  • Every state political party committee
  • Every legislative leadership committee
  • Any political committee  or continuing political committee (“CPC”) that is registered with ELEC and has, in the twelve (12) months prior to the award of the contract: (1) contributed in excess of $200 to any candidate committee for Jersey City municipal election; (2) transferred more than 5% of its assets to a candidate committee for a Jersey City municipal election; (3) advertised express support or advocacy for the election of any candidate committee for Jersey City municipal election; (4) engaged in voter identification initiatives within the City of Jersey City; or (5) engaged in voter registration or get-out-the-vote activities within the City of Jersey City.
Although the list of covered recipient committees is very broad and includes “every” state party committee, county party committee and legislative leadership committee, the Ordinance does contain a clarification, which seems to suggest that these recipient committee are covered only where, in the past calendar year, they have provided financial or in-kind support in excess of $200 to certain Jersey City or Hudson County recipients. The Ordinance also contains a $2,500 aggregate annual limit, which covers all contributions by the vendor itself and certain persons and entities associated with the vendor that fall within the Ordinance’s definition of a “business entity”.  For example, the Ordinance covers any person that received compensation or income in excess of $100,000 from the vendor within the past calendar year.  Thus, an employee who does not own an interest in the vendor company, but has an annual salary of more than $100,000, appears to be covered by the Jersey City Ordinance. The Ordinance contains three key deviations from statewide pay-to-play restrictions.  First, it covers subcontractors. Second, it reduces the contribution limit to $200 per calendar year, which is a deviation from the $300 reportable threshold under New Jersey campaign finance law. Third, it subjects joint candidate committees to a single $200 per calendar year limit regardless of how many candidates are participating. Once a contract has been awarded, a vendor is prohibited from making a contribution, in any amount, to a recipient covered by the Jersey City Ordinance. The intricacies of this Ordinance should not be taken lightly.  Whether a recipient committee is covered may depend almost entirely on the activities in which that recipient committee engages. For example, before writing a check greater than $200 to a county political party committee outside of Hudson County, a vendor may need to review that party’s ELEC reports for the past twelve (12) months to determine whether the county party committee engaged in any support of Jersey City recipients. The Ordinance is prospective only. If signed by the Mayor, the Ordinance will take effect twenty (20) days thereafter. Update: On December 28, Mayor Healy vetoed the pay-to-play ordinance passed by the Jersey City Council on December 19 citing legal and constitutional concerns. The Council may override the Mayor’s veto with six votes but the Ordinance only passed with five votes. If the Council does not override the Mayor's veto, the original ordinance, enacted in 2008, will remain in effect.

Tag: New Jersey