2384-13 Chptr 5-Subchapter 33-Shop Local Rewards Prgm.pdf

6 renters, non-resident employees, visitors, or other such individuals authorized to participate and register in the Shop Local Program. d. Reports to Taxpayer Consumers. The Licensee shall make available to all Taxpayer Consumers a written statement of credits or rebates earned by the Taxpayer Consumer. The Licensee may provide this statement via e-mail, or make same accessible via its Web site. 5-33.12 Property Tax Credits Provided Only Upon Receipt of Funds by the Township The Township will only provide credits to a Taxpayer Consumer’s property tax bill after payment is received from a Licensee with respect to the specific property tax account. If the Township does not receive payment relating to a property tax credit, whether or not such rebates were collected by the Licensee, the Taxpayer Consumer will be responsible for the full amount of the property tax liability as if the credits were never provided by the Participating Merchant. 5-33.13 Violations and Penalties In addition to suspension and/or revocation of any license issued hereunder, and in addition to any applicable State penalties, any violation of the provisions of this Ordinance, or any violation of the terms and conditions of the Applicant’s application, shall be punishable as provided in Chapter I, Section 1-5 of the Revised General Ordinances of the Township of West Orange. 5-33.14 Additional Conditions. The Township shall establish the necessary reporting requirement for any payment of taxes made to the Township by the vendor. The Township shall not be responsible for any impact of program participation on mortgage escrow calculations. The Township shall not be responsible for any changes in property ownership. The Applicant shall have the right to surrender its license to the Township at any time, so long as it provides ninety (90) days’ notice to the Township Clerk and Business Administrator, in writing. In such an event, the Applicant agrees to the orderly phasing out of its involvement in the Shop Local Program, including but not limited to remitting the balance of any and all funds due to the Township in connection with property tax credits which may have been retained by the Applicant on behalf of Taxpayer Consumers. AND BE IT FURTHER ORDAINED, that the remainder of Chapter 5 remains unchanged. BE IT FURTHER ORDAINED, that if any section, paragraph, subsection, clause or provision

on behalf of Taxpayer Consumers. AND BE IT FURTHER ORDAINED, that the remainder of Chapter 5 remains unchanged. BE IT FURTHER ORDAINED, that if any section, paragraph, subsection, clause or provision of this Ordinance shall be adjudged by the courts to be invalid, such adjudication shall apply only to the section, paragraph, subsection, clause or provision so adjudicated, and the remainder of the Ordinance shall be deemed valid and effective.

7 BE IT FURTHER ORDAINED, that any ordinances or parts thereof in conflict with the provisions of this Ordinance are repealed to the extent of such conflict. BE IT FURTHER ORDAINED, that this Ordinance shall take effect upon passage and publication in accordance with law. __________________________________ Honorable Susan McCartney Council President ___________________________________ Honorable Robert D. Parisi Mayor Adopted: August _________, 2013 Approved as to form on the basis of the facts provided: _________________________________________ Richard D. Trenk Township Attorney 740139_1

8 LEGISLATIVE HISTORY This Ordinance is intended to provide a legislative scheme which requires that any entity seeking to operate any type of “Shop Local” incentive program must first obtain a license to do so. On May 7, 2013, the Township Council adopted Resolution No. 87-13, formally expressing its support for a “Shop Local” property tax credit program (the “Shop Local Program”). The Shop Local Program proposes to authorize licensed third party administrators (“TPA”) to organize and administer a local economic stimulation plan whereby a Township resident is rewarded with property tax credits when it makes purchases at Participating Merchants. As currently contemplated, the Shop Local Program will require TPAs to register and contract with certain interested merchants, which would offer tax credits, processed through the TPA, to residents who make purchases at their businesses. The TPA will receive a fee from the Participating Merchant for a designated portion of the transaction (in an exact percentage selected by the Participating Merchant), and a portion of that fee would then be provided to the Township to satisfy the resident’s financial or tax obligations to the Township. Other municipalities have adopted or are in the process of adopting and authorizing such programs. These municipalities include Marlboro, Pequannock, Voorhees, Bayonne, Caldwell and Manalapan. The New Jersey Department of Consumer Affairs, Division of Local Government Services, has advised the Township that there is no prohibition on this manner of satisfying a resident’s tax obligations. This proposed Ordinance serves several important functions. First, it creates a clear procedure to govern the application process for those entities seeking to operate any ShopLocal Program. Once a conforming application has been submitted to the Township Clerk and reviewed for completeness, the Township Council has the authority to grant or deny the license by resolution based on its review of several enumerated factors.

9 This legislation also promotes the public safety and welfare, requiring that all applicants for a license to operate a Shop Local Program meet a review by the Township Council about the applicant’s business aptitude and criminal history. This Ordinance also protects the public by requiring the licensee to post a bond, essentially guaranteeing that monies credited to a Taxpayer Consumer for making purchases at local businesses actually be made available to the Township as a credit to the Taxpayer Consumer. The Ordinance also requires the applicant to file proof of liability insurance which names the Township as an Additional Insured, and further requires an indemnification in favor of the Township to ensure that there is limited liability in connection with the Shop Local Program. Also, given the innovative nature of the Shop Local Program, this legislation authorizes the Township Council to establish, by resolution, a form of application to be submitted by the prospective licensee; this application form may also set forth additional terms and conditions which the Council deems necessary and proper to the efficient and effective administration of the Shop Local Program. The Authority for this proposed Ordinance is derived from N.J.S.A. 40:48-1, which authorizes the governing body of every municipality in the State of New Jersey to “make, amend, repeal and enforce . . . ordinances, regulations, rules and by-laws not contrary to the laws of this state or of the United States, as it may deem necessary and proper for the good government, order and protection of persons and property, and for the preservation of the public health, safety and welfare of the municipality and its inhabitants.” 747869_2