NorthJersey.com

Panels OK Bill To Change Print Legal Ads Rule Despite Outcry

The Record (NorthJersey.com) — December 16, 2016

Nicholas Pugliese, State House Bureau

Undeterred by a combined 2 1/2 hours of unanimous testimony against a bill that would allow governments to forgo publishing legal notices in newspapers and instead post them exclusively online, committees in both the Senate and Assembly voted to advance the measure on Thursday.

Publishers, union representatives, environmental activists, residents and others lined up to rail against a bill that they said could result in the loss of as many as 300 jobs, force some publications to shut down and hand governments a lever with which to strong-arm local newspapers.

"It's been characterized as a thumb in the eye of the dailies," said Stephen Parker, co-publisher and general manager of New Jersey Hills Media Group, which publishes newspapers in four counties. "It's a shotgun blast to the weeklies."

Lawmakers in favor of the bill argued that it would be a money-saver for municipalities and their taxpayers despite the fact that it was introduced and voted on with such haste that the non-partisan Office of Legislative Services has not had time to conduct a cost analysis.

Assemblyman John Burzichelli, D-Gloucester, who voted in favor of the measure, also questioned the usefulness of printed legal notices in an increasingly digitized media environment and an era of declining print circulation.

"There are some things that are simply inevitable and that is the electronic world is not going away," he said. "The serving of public notice is critical to democracy, but we are not serving public notice if there's no circulation."

The Senate State Government, Wagering, Tourism and Historic Preservation Committee was the first panel to vote on the measure Thursday morning. After 90 minutes of critical testimony, they voted 2-1 to release it to the full Senate, albeit without the customary recommendation that it be approved there.

Asked after the hearing why he wouldn't recommend a bill of which he is the primary sponsor, Jim Whelan, D-Atlantic, responded, "I think the bill was important enough that it should go to the full floor."

The Assembly Appropriations Committee then took up the measure in the afternoon and, following roughly an hour of unfavorable testimony, approved it 7-0 with two abstentions.

Representatives of the New Jersey Bankers, New Jersey Association of Counties, New Jersey League of Municipalities, New Jersey School Boards Association and New Jersey Conference of Mayors submitted forms Thursday indicating that they were in favor of the legislation but did not testify at either hearing.

The bill was introduced on Monday as part of a package that included a measure to allow Governor Christie to earn income from a book deal while in office in exchange for raises for lawmakers' staffs, judges, county prosecutors and other officials. That bill, too, moved through Senate and Assembly committees on Thursday.

The legal notices measure would give governments the option to publish such public records as budgets, bids for services and meeting announcements online as opposed to in print. Under current law, governments and some private entities are required to publish such notices in locally circulated newspapers. The rates for legal notices are set by statute and have not risen since 1983.

Thomas Cafferty, chief counsel for the New Jersey Press Association, testified Thursday that the current arrangement is "designed to prevent municipalities from using legal advertisements to either curry favor with a publication whose writings might be favorable ... or to punish newspapers whose writings may be contrary to what the administration thinks the views of it should be."

Allowing local officials to choose where to publish legal notices — a provision of the bill touted by supporters as creating flexibility for governments — would actually arm them with the ability to hurt newspapers financially, he said.

Richard Vezza, publisher of the Star-Ledger, called the measure "a bill of unintended consequences" that could put as many as 300 people in the newspaper industry out of work.

"The road to hell is paved with good intentions," he admonished lawmakers. "Do not put 300 employees on the road to hell because you haven't done your homework."

Parker, the co-publisher of New Jersey Hills Media Group, said his company operates with a profit margin of about 5 percent and would take a 15 percent revenue hit without the income from legal notices.

"This bill will be the straw that breaks the camel's back," he said. "It will certainly result in big layoffs, dropped coverage in many of the communities that we serve and very likely the closure of many of our newspapers."

Representatives of the New Jersey Press Association have offered to cut its government rates for legal notices by 50 percent, but that offer has thus far been rebuffed by lawmakers.

Despite the many votes in favor of the bill Thursday, the savings that would result from the measure, if any, have not yet been determined.

Christie's office released figures this week based on an "internal tally" of daily newspapers that claimed the bill would results in savings of more than $80 million for governments — a figure that was sharply disputed by the New Jersey Press Association. When a similar version of the bill was floated briefly in 2010, the non-partisan Office of Legislative Services said it could not estimate savings for taxpayers.

The press association at the time said taxpayers spend $8 million a year on legal notices and businesses $12 million, and a more recent survey by the New Jersey League of Municipalities found that 146 towns, or 26 percent of the state's 565 municipalities, spent $1.05 million on legal notices in 2015.

"If the main point of this bill is to save money, we don't understand how you could possibly put it forth without understanding what the cost would be," Beverly Brown Ruggia, a representative of New Jersey Citizen Action, told lawmakers on Thursday.

The bill now heads to the full Senate and Assembly, which are expected to vote on the measure next Monday. If successful, the bill would go to Christie for his signature and take effect immediately.

"This is a rush job," David Pringle, a campaign director with Clean Water Action, told the Senate panel Thursday. "If you wonder why people are losing faith in government, it's because of legislation like this."

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