New Jersey Municipal Services Act
If your association maintains its own private roads, New Jersey's Municipal Services Act can require your town to pay for — or reimburse your community for — snow removal, street lighting, and trash and recycling collection. The full statutory text, hosted for reference, with a plain-language guide for homeowners.
Homeowners in many New Jersey common-interest communities pay twice for basic street services: once through municipal property taxes, and again through association dues that cover plowing, street lights, and trash pickup on the community's private roads. The Municipal Services Act (P.L.1989, c.299) was enacted to close that gap.
For a “qualified private community,” the Act says the municipality shall either provide these services directly — the same way it does on public streets — or reimburse the association for providing them itself (§ 40:67-23.3). The three covered services are:
- Snow, ice, and obstruction removal from the community's roads and streets;
- Street lighting — the municipality pays for the electricity, though not the installation or upkeep of the poles, lamps, and wiring; and
- Collection of leaves, recyclables, and solid waste along the roads and streets.
Is your community “qualified”?
Under § 40:67-23.2, a qualified private community is a residential condominium, cooperative, fee-simple community, or horizontal property regime where the cost of maintaining the roads and providing essential services is borne by a not-for-profit entity made up exclusively of the unit owners — and whose residents receive no tax abatement or exemption tied to the community's construction. Rental apartment and garden-apartment complexes owned by a landlord, and proprietary campgrounds, are expressly excluded.
Provide the service, or reimburse — the town's choice
A municipality may hand the work to its own crews or sign a written agreement to reimburse the association each year (§§ 40:67-23.5, 23.6). Reimbursement is capped at what the town would have spent doing the job itself, the association must account for how the money is used, and any unspent balance is refunded to the municipality. A town is not required to send its vehicles onto private roads that have not been accepted for dedication or that fail municipal construction standards — except that a road cannot be refused for being too narrow (§ 40:67-23.3). The community may also be asked to pay for insurance riders so municipal vehicles can operate on its private streets (§ 40:67-23.4).
If your association believes it qualifies but is not receiving service or reimbursement, the statutory text below is the starting point for a conversation with your municipal governing body or attorney. The Act was phased in between 1993 and 1997 and has applied at the full 100% level for many years. For related resources, see the New Jersey HOA laws hub.
1. For the purposes of this act:
a. "Condominium" means the form of real property ownership provided for under the "Condominium Act," P.L.1969, c.257 (C.46:8B-1 et seq.);
b. "Cooperative" means a housing corporation or association wherein the holder of a share or membership interest in the corporation or association is entitled to possess and occupy, for dwelling purposes, a house, apartment, or other unit of housing owned by the corporation or association, or to purchase a unit of housing constructed or erected by the corporation or association;
c. "Fee simple community" means a private community which consists of individually owned lots or units and provides for common or shared elements or interests in real property;
d. "Horizontal property regime" means the form of real property ownership provided for under the "Horizontal Property Act," P.L.1963, c.168 (C.46:8A-1 et seq.);
e. "Qualified private community" means a residential condominium, cooperative, fee simple community, or horizontal property regime, the residents of which do not receive any tax abatement or tax exemption related to its construction, comprised of a community trust or other trust device, condominium association, homeowners' association, or council of coowners, wherein the cost of maintaining roads and streets and providing essential services is paid for by a not-for-profit entity consisting exclusively of unit owners within the community. No apartment building or garden apartment complex owned by an individual or entity that receives monthly rental payments from tenants who occupy the premises shall be considered a qualified private community. No "proprietary campground facility," as defined in section 1 of P.L.1993, c.258 (C.45:22A-49), shall be considered to be a qualified private community.
L.1989,c.299,s.1; amended 1993,c.258,s.10.
2. a. Except as otherwise provided in subsection b. of this section, the governing body of every municipality shall reimburse a qualified private community for the following services as provided in sections 4 and 5 of P.L.1989, c.299 (C.40:67-23.5 and C.40:67-23.6) or provide the following services within a qualified private community in the same fashion as the municipality provides these services on public roads and streets:
(1) Removal of snow, ice and other obstructions from the roads and streets;
(2) Lighting of the roads and streets, to the extent of payment for the electricity required, but not including the installation or maintenance of lamps, standards, wiring or other equipment; and
(3) Collection of leaves and recyclable materials along the roads and streets and the collection or disposal of solid waste along the roads and streets.
b. Nothing in P.L.1989, c.299 (C.40:67-23.2 et seq.) shall require a municipality to operate any municipally owned or leased vehicles or other equipment, or to provide any of the services enumerated in subsection a. of this section, upon, along or in relation to any road or street in a qualified private community which either (1) is not accepted for dedication to public use or (2) does not meet all municipal standards and specifications for such dedication, except for width.
c. The Director of the Division of Local Government Services in the Department of Community Affairs, for the purpose of calculating the allowable operating appropriations before exceptions pursuant to section 2 of P.L.1976, c.68 (C.40A:4-45.2), shall provide a cap base adjustment to the total general appropriations of the local budget year prior to the year in which the services are first provided by the municipality for the full amount appropriated pursuant to P.L.1989, c.299 (C.40:67-23.2 et seq.).
L.1989,c.299,s.2; amended 1993,c.6,s.1.
A qualified private community shall be required to pay the cost of any insurance riders required by the municipality to enable municipal vehicles to operate on private roads and streets within the qualified private community.
L.1989, c.299, s.3.
a. As provided in section 5 of this act and in lieu of providing some or all of the services set forth in section 2 of this act, a municipality shall enter into a written agreement to annually reimburse the qualified private community in an amount not to exceed the cost that would be incurred by the municipality in providing those services directly.
b. The amount to be reimbursed to the qualified private community shall be used by the qualified private community to pay for the service which the municipality chooses not to provide, and that amount shall be the actual cost to the qualified private community of providing that service, but not exceeding the amount which the municipality would have expended on that service if it were provided directly by the municipality to the qualified private community.
c. An agreement entered into pursuant to this section shall provide for an accounting by the qualified private community of the use of the money paid over to it by the municipality, and for the refunding to the municipality of any payments in excess of the amounts actually expended or contractually committed by the qualified private community during the accounting period in order to provide for the services covered by the agreement.
L.1989, c.299, s.4.
5. a. Pursuant to a reimbursement agreement entered into in lieu of providing some or all of the services set forth in section 2 of P.L.1989, c.299 (C.40:67-23.3), the municipality shall reimburse the qualified private community for a portion of the cost of providing services commencing in local budget year 1993 for municipalities operating on a calendar year basis and in local budget year 1994 for municipalities operating on a fiscal year basis in the following manner:
1993 or 1994, as appropriate, ...20% of the total cost of services in 1993 or 1994, as appropriate
1994 or 1995, as appropriate, ...40% of the total cost of services in 1994 or 1995, as appropriate
1995 or 1996, as appropriate, ...60% of the total cost of services in 1995 or 1996, as appropriate
1996 or 1997, as appropriate, ...80% of the total cost of services in 1996 or 1997, as appropriate
The total cost of services in each local budget year shall be determined pursuant to section 4 of P.L.1989, c.299 (C.40:67-23.5). In local budget year 1997 or 1998, as appropriate, and for each local budget year thereafter, the municipality shall either provide the services pursuant to section 2 of P.L.1989, c.299 (C.40:67-23.3) or enter into a written agreement to annually reimburse the qualified private community in full pursuant to section 4 of P.L.1989, c.299 (C.40:67-23.5).
b. Notwithstanding the schedule set forth in subsection a. of this section, any municipality that entered into a reimbursement agreement prior to January 1, 1993, shall be permitted to continue in accordance with the schedule in that reimbursement agreement.
c. Appropriations by a municipality during the phase-in period in conformance with the implementation schedule set forth in subsection a. or b. of this section shall be considered appropriations mandated by State statute for the purposes of subsection cc. of section 3 of P.L.1976, c.68 (C.40A:4-45.3). The Director of the Division of Local Government Services in the Department of Community Affairs, for the purpose of calculating the allowable operating appropriations before exceptions, shall provide a cap base adjustment to the local budget year in which the 100% level is reached for the full amount appropriated pursuant to P.L.1989, c.299 (C.40:67-23.2 et seq.).
L.1989,c.299,s.5; amended 1993,c.6,s.2.
A municipality shall be required to accept for dedication for public use, by a qualified private community, any road or street within the community that conforms to municipal specifications for public roads and streets.
L.1989, c.299,s.6.
Nothing in this act shall prevent a municipality from providing additional services, that primarily serve public purposes, to the residents of a qualified private community. The governing body of any municipality which prior to the operative date of this act has enacted an ordinance providing all the services or reimbursement provided by this act to a qualified private community may repeal the ordinance and implement the provisions of this act. Nothing in this act shall be construed as abrogating or superseding any agreement in effect pursuant to such an ordinance prior to the operative date of this act.
L.1989, c.299, s.7.
General information, not legal advice. Statutory text is reproduced from the official New Jersey source and may not reflect the most recent amendments.