An Act providing for the use of prepaid debit cards as the standardized form of disbursement for certain State and local government payments, supplementing Title 52 of the Revised Statutes and Title 40A of the New Jersey Statutes.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. a. Standardizeable State payments to individuals or business entities shall be made in the form of prepaid debit cards.

b. The implementation of this section shall be subject to the following conditions:

The scope and timing of the implementation of this section shall be subject to an ongoing determination of financial feasibility by the State Treasurer, provided that implementation shall comply with the terms of subsection c. of this section and the public disclosure requirements imposed by this subsection;

No later than the first business day of the fourth month of each calendar year that commences at least six months after the date of enactment of this section, the State Treasurer shall make publicly available, via the Department of the Treasury's website, the following information concerning the status of the implementation of this section: the scope of current standardizeable State payments in compliance with this section, plans for continued implementation of the standardizeable State payment prepaid debit card requirement, and explanations as to any determinations of financial infeasibility;

In implementing this section the State Treasurer shall consider carrying out the standardization of prepaid debit card payments in two stages: the first stage applies to State Fiscal Years ¹[2015] 2016¹ and ¹[2016] 2017¹, wherein recipients are allowed to elect a series of alternatives to the prepaid debit card payment default for standardizeable State payments, which alternatives shall include, but are not limited to a conventional check or electronic fund transfer for direct deposit into a recipient's account held by a financial institution; and the second stage applies to State Fiscal Year ¹[2017] 2018¹ and State Fiscal Years thereafter, wherein recipients are allowed to elect an alternative to the prepaid debit card payment default for standardizeable State payments, which alternative shall be electronic fund transfer for direct deposit into a recipient's account held by a financial institution;

This section shall apply to standardizeable State payments authorized by law to be made on or after July 1, ¹[2014] 2015¹; and

This section shall not be construed to authorize or preclude the provision of prepaid debit cards to State officers, employees, and agents as compensation for services.

c. As used in this section:

"Automated teller machine" means an electronic information processing device located in the State of New Jersey that is operated by a financial institution which accepts or dispenses cash in connection with credit or deposit accounts.

"Prepaid debit card" means an open loop card, which may be reloadable or nonreloadable, that enables the cardholder to: (i) transfer funds assigned to the card to a merchant through a point-of-sale terminal in exchange for products, services or a combination thereof; and (ii) withdraw cash against the balance assigned to the card via a qualified financial institution's automated teller machine or a qualified financial institution's manual teller terminal.

"Qualified financial institution" means a State or federally chartered bank, savings bank, savings and loan association, credit union, or other entity approved by the State Treasurer, which owns or operates automated teller machines or manual teller terminals in New Jersey.

"Standardizeable State payment" means a payment authorized by law to be made by a State entity to an individual or a business entity, other than: (i) a payment made pursuant to the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq.; and (ii) payments provided as compensation for services to State officers, employees, and agents.

"State entity" means an entity operating in the form of a State department, agency, board, commission, corporation, authority, university or college, or an entity created by the State that the State Treasurer deems to be a State entity.

2. a. The governing body of a local government entity may adopt a resolution to require that standardizeable local government payments to individuals or business entities shall be made in the form of prepaid debit cards.

b. If a local government entity adopts a resolution pursuant to this section, the implementation of prepaid debit card payment standardization for standardizeable local government payments shall be subject to the following conditions:

The scope and timing of the prepaid debit card payment standardization for standardizeable local government payments shall be subject to an ongoing determination of financial feasibility by the governing body of the local government entity;

The implementation of prepaid debit card payment standardization for standardizeable local government payments

shall comply with the terms of subsection c. of this section and the public disclosure requirements imposed by this subsection;

No later than the first business day of the fourth month of each
calendar year that commences at least six months after the date of enactment of this section, the governing body of the local government entity shall make publicly available, via the local government entity's website, the following information concerning the status of the implementation of prepaid debit card payment standardization for standardizeable local government payments: the scope of current prepaid debit card payment standardization undertaken pursuant to this section for standardizeable local government payments, plans for continued implementation of prepaid debit card payment standardization for standardizeable local government payments, and explanations as to any determinations of financial infeasibility;

In implementing this section the governing body of the local government entity shall consider carrying out the implementation of prepaid debit card payment standardization for standardizeable local government payments in two stages: the first stage applies to State Fiscal Years ¹[2015] 2016¹ and ¹[2016] 2017¹, wherein recipients are allowed to elect a series of alternatives to the standardized prepaid debit card payment for standardizeable local government payments, which alternatives shall include, but are not limited to a conventional check or electronic fund transfer for direct deposit into a recipient's account held by a financial institution; and the second stage applies to State Fiscal Year ¹[2017] 2018¹ and State Fiscal Years thereafter, wherein recipients are allowed to elect an alternative to the standardized prepaid debit card payment for standardizeable local government payments, which alternative shall be electronic fund transfer for direct deposit into a recipient's account held by a financial institution;

This section shall apply to standardizeable local government payments authorized by law to be made on or after July 1, ¹[2014] 2015¹; and

This section shall not be construed to authorize or preclude the provision of prepaid debit cards to local government officers, employees, and agents as compensation for services.

c. As used in this section:

"Governing body" means the board, body, or administrator, by whatever name it may be known by, having charge of the finances of the local government entity;

"Local government entity" means a borough, city, county, county college, county special services district, county vocational school, jointure commission, environmental education center, educational information and resource center, educational research and demonstration center, educational services commission, local or regional school district established pursuant to chapter 8 or chapter 13 of Title 18A of the New Jersey Statutes, municipality, town, township, and village.

"Qualified financial institution" means a State or federally chartered bank, savings bank, savings and loan association, credit union, or other entity approved by the State Treasurer pursuant to section 1 of P.L. , c. (C. ) (pending before the Legislature as this bill), which owns or operates automated teller machines or manual teller terminals in New Jersey.

"Standardizeable local government payment" means a payment authorized by law to be made by a local government entity to an individual or a business entity, other than payments provided as compensation for services to local government officers, employees, and agents.

3. This act shall take effect immediately.