New Jersey marks on a curve when it comes to grading how its towns govern

Within the next two weeks, in an annual good government exercise, New Jersey will ask its 565 municipalities how well they’re following state laws and how their work measures up to best practices. Depending on their answers, the state could withhold some funding.

That’s how the Best Practices Inventory has worked since former Gov. Chris Christie’s administration started it in 2010 as a tool for local officials to tell how they’re performing. In 2017, the state withheld roughly $315,000 in municipal property tax relief money from 17 municipalities based on their answers.

Last year, local officials filled out the checklist with the same understanding, that a score below a certain threshold would mean fewer funds. But in the first year of the inventory under Gov. Phil Murphy, the state lowered the threshold for success and withheld exactly $0. State officials said the few municipalities that scored below the minimum hadn’t taken credit for some of the work they were doing.

Based on some persistent concerns from local government groups, the state is tweaking the inventory this year to make it easier to complete and less punitive.

“Our goal is to have this be a holistic review of the state of our municipalities in New Jersey,” Melanie Walter, director of the state’s Division of Local Government Services, which administers the inventory, said Tuesday.

The state plans to use the results to identify what training local officials need, support the state can provide, and projects to keep in mind for grants. About 80 questions will ask how local governments budget, manage their websites, protect themselves against cyber threats, and follow anti-discrimination and financial disclosure laws, as well as a host of other questions about governing.

The threshold for success is higher this year because of changes to the format. Questions classified as measuring “core competency,” basic functions every municipality needs to be doing, are worth more than “best practice” questions — a kind of extra credit, or the “aspirational things we’d like to see communities striving to accomplish” or at least think about, Walter said.

The state added questions last year meant to survey municipalities to determine areas where it could help them operate more efficiently. But those questions were valued the same as others that measured compliance with laws and best practices. This year, the state is changing the inventory so that answers to informational, survey-type questions will not affect a government’s score.

“That’s big,” said Jon Moran, a senior legislative analyst for the New Jersey State League of Municipalities, which opposes the inventory. “If [the state] wants to look for areas to help municipalities, that’s fine. We appreciate the fact they’re not going to be penalized” based on those answers.

The league had asked for changes to the types of questions included and how they are scored. Moran is among the representatives from various local government groups who has met with state officials.

“The whole process, from our perspective, is intrusive and unnecessary,” Moran said. “As long as we have to do it, let’s make it a constructive exercise. Let’s not make it more burdensome than it needs to be. And I think the administration is moving in that direction.”

This year, the state also is updating the inventory to make it easier to fill out. Instead of writing answers in an Excel spreadsheet, municipal officials will submit their answers through an online portal.

Local officials have until the end of October to complete the inventory.