Local Public Contracts Law N.J.S.A. 40A:11-1 et seq.
April, 2014 Page 36
such contracts shall be entered into only subject to and in accordance with guidelines
promulgated by the Board of Public Utilities establishing a methodology for computing energy
cost savings and energy generation costs.
Any contract for services other than professional services, the statutory length of which contract is
for three years or less, may include provisions for no more than one two-year, or two one-year,
extensions, subject to the following limitations: a. The contract shall be awarded by resolution of
the governing body upon a finding by the governing body that the services are being performed in
an effective and efficient manner; b. No such contract shall be extended so that it runs for more than
a total of five consecutive years; c. Any price change included as part of an extension shall be based
upon the price of the original contract as cumulatively adjusted pursuant to any previous
adjustment or extension and shall not exceed the change in the index rate for the 12 months
preceding the most recent quarterly calculation available at the time the contract is renewed; and
d. The terms and conditions of the contract remain substantially the same.
All multiyear leases and contracts entered into pursuant to this section, including any two-year or
one-year extensions, except contracts involving the supplying of electricity for the purpose of
lighting public streets and contracts for thermal energy authorized pursuant to subsection (1)
above, construction contracts authorized pursuant to subsection (9) above, contracts for the
provision or performance of goods or services or the supplying of equipment to promote energy
conservation through the production of class I renewable energy or class II renewable energy
authorized pursuant to subsection (45) above, contracts for water supply services or for a water
supply facility, or any component part or parts thereof authorized pursuant to subsection (16),
(30), (31), (34), (35), (37) or (43) above, contracts for resource recovery services or a resource
recovery facility authorized pursuant to subsection (17) above, contracts for the sale of energy
produced by a resource recovery facility authorized pursuant to subsection (18) above, contracts
for wastewater treatment services or for a wastewater treatment system or any component part or
parts thereof authorized pursuant to subsection (19), (36), (37) or (43) above, and contracts for the
purchase of electricity or administrative or dispatching services related to the transmission of such
electricity authorized pursuant to subsection (24) above and contracts for the purchase of
electricity generated from a power production facility that is fueled by methane gas authorized
pursuant to subsection (44) above, shall contain a clause making them subject to the availability
and appropriation annually of sufficient funds as may be required to meet the extended obligation,
or contain an annual cancellation clause.
The Division of Local Government Services in the Department of Community Affairs shall adopt and
promulgate rules and regulations concerning the methods of accounting for all contracts that do not
coincide with the fiscal year.
All contracts shall cease to have effect at the end of the contracted period and shall not be extended
by any mechanism or provision, unless in conformance with the "Local Public Contracts Law,"
P.L.1971, c.198 (C.40A:11-1 et seq.), except that a contract may be extended by mutual agreement
of the parties to the contract when a contracting unit has commenced rebidding prior to the time
the contract expires or when the awarding of a contract is pending at the time the contract expires.
L.1971, c. 198, s. 15; amended 1975, c. 326, s. 33; 1975, c. 353, s. 11; 1977, c. 53, s. 7; 1978, c. 154; 1981, c. 2, s.
1; 1981, c. 551, s. 1; 1982, c. 67, s.1; 1983, c. 176; 1983, c. 195; 1983, c. 398; 1983, c. 426; 1985, c. 37, s. 19;
1985, c. 38, s. 37; 1985, c. 72, s. 19; 1985, c. 452, s. 2; 1986, c. 47; 1986, c. 177; 1987, c. 102, s. 31; 1989, c. 159,
s. 2; 1991, c. 142, s. 2; 1991, c. 143, s. 5; 1991, c. 312; 1991, c. 356; 1991, c. 381, s. 49; 1991, c. 407; 1991, c.
451; 1992, c. 63; 1992, c. 98, s. 2; 1993, c. 381, s. 5; 1994, c. 71; 1995, c. 3; 1995, c. 41, s. 2; 1995, c.1 01, s. 13;
1995, c. 216, s. 12; 1995, c. 371; 1996, c. 113, s. 19; 1997, c. 288; 1999, c. 23, s. 64; 1999, c. 440, s. 23; 2002, c.
47, s. 9; 2003, c. 150, s. 3; 2005, c. 296, s. 2; 2008, c. 83, s. 3; 2009, c. 4, s. 8.