Legislation that would ease the financial burden on New Jersey towns looking to consolidate was approved by the state Senate Thursday.

The bill would authorize a municipality to adopt an ordinance authorizing special emergency appropriations for the payment of non-recurring expenses incurred by that town to implement a consolidation with another town.

"When towns merge, it costs money...for things like repurposing a first aid building into something else, lawyers and consultant fees to get all the pieces in place" said bill sponsor Senator Bob Gordon (D-Bergen/Passaic.)

Under current law, special emergency appropriations are paid for through the issuance of "special emergency notes," which must be paid off in five years. The use of special emergency appropriations, and the issuance of special emergency notes to fund the non-recurring costs and expenses associated with the consolidation process will allow consolidating municipalities to immediately begin to experience the financial savings of municipal consolidation by spreading the effect of the non-recurring costs associated with municipal consolidation over a five-year period.

The bill would also allow towns to be exempt from the two-percent property tax cap when faced with these additional non-recurring expenses.

"What we're looking to do is really eliminate a financial hurdle to the consolidation process, with the expectation that by spending a little money up front, we can save a lot of money for taxpayers in the long run" said Gordon.

He said municipal consolidation is needed if New Jersey ever wants to reduce the size of government.

"Until we do something about 566 municipalities and 618 school districts, the costs are never going to drop and the taxes are never going to become bearable in this state."