People for Open Government
2007 Public Contracting Reform Ordinance
Shall the "pay-to-play" reform ordinance, duly submitted by initiative petition to the City of Hoboken, which includes, among other provisions, (a) limitations on contributions to Hoboken and Hudson County candidates and political parties from business entities (including individuals, family members, firms of all types and affiliates) prior to receiving professional services contracts (additionally including banking, insurance, and other consultant contracts) or extraordinary unspecified services (additionally including media, public relations, lobbying, parking garage management or other consulting and/or management services) with the City of Hoboken, where the amount of such limitations shall be $300 each per year to local candidates or local political parties, $500 each per year to any local joint candidates committee or county political party, and $2,500 per year in aggregate from a firm and its affiliates and (b) prohibitions on such political contributions by business entities performing professional services contracts or extraordinary unspecified services contracts during the negotiation and performance of such contracts, be approved?
We the undersigned registered voters of Hoboken, New Jersey, petition that the City of Hoboken adopt the following ordinance:
PUBLIC CONTRACTING REFORM ORDINANCE
Be It Enacted by the City of Hoboken:
WHEREAS, large political contributions from those seeking or performing contracts with a municipality, raise reasonable concerns on the part of taxpayers and residents as to their trust in government and its business practices;
WHEREAS, pursuant to N.J.S.A. 40:48-2, a municipality is authorized to adopt such ordinances, regulations, rules and by-laws as necessary and proper for good government, as well as the public health, safety and welfare; and
WHEREAS, pursuant to P.L.2005, c.271 (codified at N.J.S.A. 40A:11-51) a municipality is authorized to adopt by ordinance, measures limiting the awarding of public contracts to business entities that have made political contributions, and limiting the contributions that the recipient of such a contract can make during the term of a contract; and
WHEREAS, in the interest of good government, the people and the government of the City of Hoboken desire to establish a policy that will avoid the perception of improper influence in public contracting and local elections;
NOW, THEREFORE, BE IT RESOLVED, it shall be the policy of the City of Hoboken to create such a regulation which states that a business entity which makes political contributions to municipal candidates and municipal and county political parties in excess of certain thresholds shall be limited in its ability to receive public contracts from the City of Hoboken; and
BE IT ORDAINED by the City of Hoboken, in the County of Hudson, and State of New Jersey, as follows:
SECTION 1 PROHIBITION ON AWARDING PUBLIC CONTRACTS TO CERTAIN CONTRIBUTORS
(a)To the extent that it is not inconsistent with state or federal law, the City of Hoboken and any of its departments, instrumentalities or purchasing agents shall not enter into any agreement or otherwise contract to procure "professional services" as such term is defined at N.J.S.A. 40A:11-2(6) and used at N.J.S.A. 40A:11-5(1)(a)(i) and/or banking, insurance or other consulting service (hereinafter "professional services"), nor "extraordinary unspecified services" as such term is defined at N.J.S.A. 40A:11-2(7) and used at N.J.S.A. 40A:11-5(1)(a)(ii) and/or media, public relations, lobbying, parking garage management or other consulting and/or management service (hereinafter "extraordinary unspecified services") from any business entity if such business entity has solicited or made any "contribution" (as such term is defined at N.J.A.C. 19:25-1.7, which definition includes loans, pledges and in-kind contributions) (hereinafter "contribution"), to (i) a candidate, candidate committee or joint candidates committee of any candidate for elective municipal office in Hoboken or a holder of public office having ultimate responsibility for the award of a contract, or (ii) to any Hoboken or Hudson County political committee or political party committee, or (iii) to any continuing political committee or political action committee that regularly engages in the support of Hoboken municipal or Hudson County elections and/or Hoboken municipal or Hudson County candidates, candidate committees, joint candidate committees, political committees, political parties, political party committees, (hereinafter "PAC"), in excess of the thresholds specified in subsection (d) within one calendar year immediately preceding the date of the contract or agreement.
(b)No business entity who submits a proposal for, enters into negotiations for, or agrees to any contract or agreement with the City of Hoboken or any of its departments or instrumentalities, for the rendition of "professional services" or "extraordinary unspecified services" shall knowingly solicit or make any contribution, to (i) a candidate, candidate committee or joint candidates committee of any candidate for elective municipal office in Hoboken, or a holder of public office having ultimate responsibility for the award of a contract, or (ii) to any Hoboken or Hudson County political committee or political party committee, or (iii) any "PAC" between the time of first communication between that business entity and the municipality regarding a specific agreement for "professional services" or "extraordinary unspecified services", and the later of the termination of negotiations or rejection of any proposal, or the completion of the performance or specified time period of that contract or agreement.
(c)For purposes of this Ordinance, a business entity whose contributions are regulated by this ordinance means: (i) an individual including the individual's spouse, and any child/children; (ii) a firm; corporation; professional corporation; partnership; limited liability company; organization; association; and any other manner and kind of business entity; (iii) any person who owns 10% or more of the equity or ownership or income interests in a person or entity as defined in sections (i) and (ii) above and their spouses and child/children; (iv) all partners or officers of such an entity, in the aggregate, and their spouses and child/children; and (v) all persons who are an "affiliate" of a person as defined in sections (i) and (ii) above, as such term is used in 11 U.S.C. 101(2).
(d)The monetary thresholds of this Ordinance are: (i) a maximum of $300 each for any purpose to any candidate or candidate committee for mayor or governing body, or $500 to any joint candidates committee for mayor or governing body, or $300 to a political committee or political party committee of the City of Hoboken; (ii) $500 to a Hudson County political committee or political party committee; (iii) $500 to any "PAC". However, any group of persons meeting the definition provided in section (c) above of business entity may not annually contribute for any purpose in excess of $2,500 to all City of Hoboken candidates, candidate committees, joint candidate committees, and holders of public office having ultimate responsibility for the award of a contract, and all City of Hoboken or Hudson County political committees and political party committees, and all "PAC"s, combined, without violating subsection (a) of this section.
(e)For purposes of this section, the office that is considered to have ultimate responsibility for the award of the contract shall be (i) the City of Hoboken Mayor or Governing body, if the contract requires approval or appropriation from the Mayor or Governing body, or (ii) the Mayor of the City of Hoboken, if the contract requires approval of the Mayor, or if a public officer who is responsible for the award of a contract is appointed by the Mayor.
SECTION 2 CONTRIBUTIONS MADE PRIOR TO THE EFFECTIVE DATE
No contribution or solicitation of contributions made prior to the effective date of this Ordinance shall be deemed to give rise to a violation of this Ordinance.
SECTION 3 - CONTRIBUTION STATEMENT BY PROFESSIONAL BUSINESS ENTITY
(a)Prior to awarding any contract or agreement to procure "professional services" or "extraordinary unspecified services" from any business entity, the City of Hoboken or its purchasing agents and departments, as the case may be, shall receive a sworn statement from the intended recipient of said contract that he/she/it has not made a contribution in violation of Section 1 of this Ordinance. The City of Hoboken, its purchasing agents and departments shall be responsible for informing the City Council that the aforementioned sworn statement has been received and that the business entity is not in violation of this ordinance, prior to awarding the contract or agreement.
(b)The recipient of said contract or agreement shall have a continuing duty to report any violations of this Ordinance that may occur during the negotiation, proposal process or the completion of the performance or specified time period of that contract or agreement . The certification required under this subsection shall be made prior to entry into the contract or agreement with the City of Hoboken, or prior to the provision of services or goods, as the case may be, and shall be in addition to any other certifications that may be required by any other provision of law.
SECTION 4 RETURN OF EXCESS CONTRIBUTIONS
A recipient of a contract for "professional services" or "extraordinary unspecified services" may cure a violation of Section 1 of this Ordinance, if, within 30 days after the general election which follows the date of the contribution, the contract recipient notifies the municipality in writing and seeks and receives reimbursement of the contribution from the recipient of such excess contribution.
SECTION 5 EXEMPTIONS
The contribution limitations prior to entering into a contract in Section 1(a) do not apply to contracts which (i) are awarded to the lowest responsible bidder after public advertising for bids and bidding therefor within the meaning of N.J.S.A. 40A:11-4, or (ii) are awarded in the case of emergency under N.J.S.A. 40A:11-6. There is no exemption for contracts awarded pursuant to a "Fair and Open Process" under N.J.S.A. 19:44A-20 et seq.
SECTION 6 PENALTY
(a)It shall be a material breach of the terms of a City of Hoboken agreement or contract for "professional services" or "extraordinary unspecified services" when a recipient of such agreement or contract has: (i) made or solicited a contribution in violation of this Ordinance; (ii) knowingly concealed or misrepresented a contribution given or received; (iii) made or solicited contributions through intermediaries for the purpose of concealing or misrepresenting the source of the contribution; (iv) made or solicited any contribution on the condition or with the agreement that it will be re-contributed to a candidate, candidate committee or joint candidates committee of any candidate for elective municipal office in Hoboken, or a holder of public office having ultimate responsibility for the award of a contract, or any Hoboken or Hudson County political committee or political party committee, or any "PAC"; (v) engaged or employed a lobbyist or consultant with the intent or understanding that such lobbyist or consultant would make or solicit any contribution, which if made or solicited by the professional business entity itself, would subject that entity to the restrictions of this Ordinance; (vi) funded contributions made by third parties, including consultants, attorneys, family members, and employees; (vii) engaged in any exchange of contributions to circumvent the intent of this Ordinance; or (viii) directly or indirectly, through or by any other person or means, done any act which if done directly would subject that entity to the restrictions of this Ordinance.
(b)(b) Furthermore, any business entity that violates Section 6 (a) ii-viii shall be disqualified from eligibility for future City of Hoboken contracts for a period of four (4) calendar years from the date of the violation.
SECTION 7 CITIZENS PRIVATE RIGHT OF ACTION
Notwithstanding any other common right of law, any Hoboken citizen or citizens group shall have the right to sue any or all entities in violation of this ordinance, including the business entity awarded a contract or agreement to provide "professional services" or "extraordinary unspecified services", the candidate or committee as specified in subsection 1(a) above, and/or the City Hoboken, in order to compel those entities to comply with this ordinance.
SECTION 8 SEVERABILITY
If any provision of this Ordinance, or the application of any such provision to any person or circumstances, shall be held invalid, the remainder of this Ordinance to the extent it can be given effect, or the application of such provision to persons or circumstances other than those to which it is held invalid shall not be affected thereby, and to this extent the provisions of this Ordinance are severable. The drafters of this Ordinance, the persons signing the petition in support of this Ordinance, and the persons who cast votes in favor of the Ordinance, declare that they would have supported the Ordinance and each section, subsection, sentence, clause, phrase, or provision or application thereof, irrespective of the fact that any one or more other sections, subsections, sentences, clauses, phrases, or provisions or applications thereof may be held invalid.
SECTION 9 REPEALER
All ordinances or parts of ordinances which are inconsistent with any provisions of this Ordinance are hereby repealed as to the extent of such inconsistencies.
SECTION 10 EFFECTIVE DATE
This Ordinance shall become effective twenty (20) days following the earlier of (a) final adoption thereof by the Municipal Council of the City of Hoboken or (b) the date on which the passage of this Ordinance as a public question is certified pursuant to N.J.S.A. 19:20-9 or other applicable law, and shall be published as required by law.
COMMITTEE OF PETITIONERS pursuant to N.J.S.A. 40:69A-186
James A. Castiglione, 300 Washington Street 2, Hoboken, NJ07030
James R. Hine, 258 Newark Street, Hoboken, NJ07030
Eric S. Kurta, 214 Garden Street 4, Hoboken, NJ07030
Edward J. Mecka, 2 Marineview Plaza 20E, Hoboken, NJ07030
James D. Vance, 107 Monroe Street, Hoboken, NJ07030