Downtown New Jersey Submits Letter Opposing Proposed Financial Disclosure Requirements

Downtown New Jersey Submits Letter Opposing Proposed Financial Disclosure Requirements

On March 16, 2017, Downtown New Jersey President Bob Goldsmith submitted a letter to Department of Community Affairs Commissioner Charles Richman detailing the organization’s opposition to a proposed rule that would require volunteer directors and members of a BID or SID to file financial disclosures. (Read the full letter.)

The proposed rule (N.J.A.C. 5:35-2.1) would include volunteer directors and members in the definition of “managerial executive employees,” thus triggering the financial disclosure requirement. Downtown New Jersey’s letter argues that BIDs and SIDs are, in the words of one court decision, a “quasi-public solution” to issues facing distressed downtowns. Because they are organized and financed voluntarily by the member property and business owners, the letter says, they should not be viewed as governmental entities subject to strict disclosure requirements. To do otherwise would ignore both legislative intent and previous court decisions that have found them not to be public entities, and to require public financial disclosure would potentially present a significant barrier to individual members’ willingness to serve their BIDs or SIDs in a leadership or management capacity. The predictable effect of this, said Mr. Goldsmith in the letter, would be that BIDs’ and SIDs’ well documented success at downtown revitalization would decline. He also noted that other volunteer organizations that would be covered by the proposed rule would suffer similarly.

No action has been taken yet on the proposed rule. Downtown New Jersey will continue to follow up and keep members informed.