On appeal from the Superior Court of New Jersey, Law Division, Gloucester County.
Crane, Milmed and King. The opinion of the court was delivered by King, J.A.D.
This is a taxpayer's suit brought to challenge the action of the township committee in placing the following question on the ballot for the next general election:
( ) YES ( ) NO With the understanding that only the users of the water and sewer systems provided by the Mantua Township Municipal Utilities Authority would pay for the assets of those systems, shall the Mantua Township Municipal Utilities Authority purchase the assets of the Mantua Water Company, the Sewell Water Company, the Edenwood Water Company, the Edenwood Sewerage Company, and the Buckingham Utilities Company, Inc. for a total cost of $2,270,000.00, and finance said acquisition by a loan from the Farmers Home Administration, payable over 40 years at interest of 5% per annum, and as well construct a million gallon storage tank and install a distribution system to effectively connect the lines of Sewell and Mantua Water Companies and Edenwood Water Company, and finance the new construction by a combination of a grant and loan from the Farmers Home Administration in the approximate amount of $2,730,000 to be comprised of the maximum amount of grant monies procurable, and the balance being loan monies repayable over 40 years at interest at 5% per annum?
N.J.S.A. 19:37-1 permits a governing body which "desires to ascertain the sentiment of the legal voters . . . upon any question or policy pertaining to the government or internal affairs" of the municipality to adopt a resolution placing a pertinent referendum question on the ballot. The result of the referendum is in no sense binding on the governing body. It is not to be "taken or construed as other than an expression of sentiment by the voters to be followed or disregarded by the governing body in its discretion." N.J.S.A. 19:37-4.
Plaintiff contended successfully in the trial court that because the Township Committee had no power to act with respect to
the proposed acquisition of the five private water companies and the sewer construction contemplated by the question, it had no right to place the question on the ballot. Concededly, power to perform the activities contemplated by the question resides principally with the Mantua Township Municipal Utilities Authority (MUA), a body created pursuant to the Municipal and County Utilities Authority Law, N.J.S.A. 40:14B-1 et seq. For the specific powers of an MUA, see N.J.S.A. 40:14B-20. But as demonstrated below, the MUA's power to act is not exclusive.
Prior expressions of this court on the power of a governing body to place a question on the ballot pursuant to N.J.S.A. 19:37-1 are found in Santoro v. South Plainfield , 57 N.J. Super. 498 (App.Div.1959), and Botkin v. Westwood , 52 N.J. Super. 416 (App.Div.1958), app.dism. 28 N.J. 218 (1958). In Botkin plaintiff successfully attacked the placement of a question on the ballot by a local governing body concerning deconsolidation of school districts. This court there observed that New Jersey boards of education are essentially independent governmental units "separate, distinct and free from the control of municipal governing bod[ies]." Id. at 425. Board members are elected in special elections; school taxes are separately levied. This court ruled in Botkin that this referendum question on school district deconsolidation "constitute[d] a prohibited intrusion . . . in school district affairs by a body which has no business intermeddling with them in the slightest degree except as the legislature has permitted." Id. at 431. We concluded there that the voters' sentiment could only be sought in matters concerning which the inquiring body "has the power to act." Id. at 433.
In Santoro the local governing body had created a sewer authority under the applicable statute. N.J.S.A. 40:14A-1 et seq. The governing body requested the county clerk to place a referendum question on the ballot inquiring whether (1) the sewer authority or (2) the mayor and council of the borough should proceed with and undertake the "planning, financing and installation of sanitary sewers." This court concluded that the
borough had "no authority to do anything" related to the questions, stating: "[i]f the municipality has no power to act it has no right to seek the voter's advice whether to do so." Santoro , above at 502.
The Mantua Township MUA is a separate body created by resolution of the township committee which appoints the MUA's members for fixed terms. N.J.S.A. 40:14B-4(a). However, because of the provisions of N.J.S.A. 40:14B-24(a) and (b) we perceive a significant distinction between the situation ...