The Division of Local Government Services recently issued Local Finance Notice 2025-15 providing guidance on the 2026 fire district budget process, including the budget submission process and other key updates. All fire districts are required to submit their 2026 budgets through the Financial Automation Submission & Tracking (FAST) System by entering their budget data into the Division’s standardized Excel budget template and uploading the workbook along with a certified document and all supported documentation as well as other related and annually transmitted forms to the FAST portal budget record. Other supporting documentation required to be submitted to the FAST portal include contracts, shared services agreements, special meeting documentation, and grant agreements.
Completed workbooks must be returned to the designated official(s) for uploading and submission through FAST. The DLGS notes that only designated fire district officials may obtain FAST login credentials to upload and submit the introduced and adopted fire district budgets in FAST. Designated officials include the Secretary to the Board of Fire Commissioners, Treasurer of the Board of Fire Commissioners, and an administrative officer who is an employee of the fire district and responsible for day-to-day operations, including completion and execution of the budget. Contracted preparers that have been designated as officials may also access the fire district budget workbook on behalf of the fire district. Designated officials with existing FAST accounts may use these credentials to access the 2026 budget record for their fire district. New designated officials can register for a FAST account and request access to their fire district at the DCA’s website.
If a fire district pays incentives to volunteers (excluding LOSAP), the district’s total appropriation for all costs associated with such incentives should be inserted on the “Volunteer Incentive Program” line of the 2026 budget.
After February 21, 2026, election results for Fire Districts with February elections, or any fire district with capital, levy cap, or restricted fund balance referendums taking place on that that date, must be reported through the FAST system using the “Elections” tab within the adopted fire district budget module.
Further instructions regarding completion of the fire district budget workbook can be found on the Division’s FAST webpage. Previous posts about the FAST program can be found on the NJLM website.
In addition, the Local Finance Notice provides guidance on the following topics:
Municipal Approval of Elected Commissioner Compensation: The 2026 Fire District budget contains a question verifying Fire District compliance with elected commissioner compensation requirements pursuant to N.J.S.A. 40a:14-88, which requires the municipal governing body to review and approve such compensation before the Fire District can submit its annual budget to the voters, or, in case of Fire Districts whose Board of Fire Commissioners elections coincides with the November General election before the district can adopts its annual budget. The Fire District must seek annual approval of elected commissioner compensation from the municipal governing body regardless of whether the Board is modifying the amount of compensation as ruled in Oughton v. Board of Fire Comrs., etc., 178 N.J. Super. 565, 570-571 (App. Div. 1981). For a Fire District to authorize its elected commissioners to receive compensation, the Board of Fire Commissioners must adopt a resolution establishing the level of compensation.
Emergency Appropriations: The 2026 Fire District budget also contains a question verifying Fire District compliance with the emergency appropriations statutory requirements found at N.J.S.A. 40A:14-78.11 through 40A:14-78.15. Fire Districts may make emergency appropriations post-budget adoptions in the event of a pressing need for public expenditure to protect or promote the public health, safety, morals, or welfare, for purposes unforeseen at the time of budget adoption, or for which adequate provision was not made. However, a Fire District’s total emergency appropriations for one year shall not exceed 3% of the total of current operating appropriations in that year’s adopted budget. No less than 2/3 of a Board of Fire Commissioners’ full membership must adopt a resolution declaring that an emergency exists requiring a supplemental emergency appropriation and the resolution shall be in the form and content prescribed by the municipal governing body and shall set out the nature of the emergency in full. A copy of the resolution must be filed immediately with the municipal governing body and will take effect upon a 2/3 vote of approval. The total amount of all emergency appropriations shall be provided in full by the fire district as a deferred charge in the budget of the next succeeding fiscal year. N.J.S.A. 40A:4-45.45.b authorizes an exclusion to the fire district tax levy cap for “extraordinary costs” related to a declared emergency and only for that portion of costs exceeding the cost of providing services under non-emergency conditions. Pursuant to N.J.A.C. 5:31-2.10, such funds can be treated as one-time (non-permanent) property tax levy cap exclusions upon submission and review of certifications describing the expenditures to the Director of the Division of Local Government Services and may be subject to adjustment to account for the receipt of any State or Federal reimbursements.
2010 Levy Cap Compliance, Capital Appropriations: Pursuant to the 2010 levy cap law (N.J.S.A. 40A:4-45.45), a Fire District’s introduced budget must be balanced and be at or under the levy cap established by the statute. The budget message on Page N-1 must indicate if the district plans to put a levy cap increase question before the voters. An introduced budget requiring referendum questions must include separate line-item appropriations that the referendum proposes to fund by the tax levy increase. Cancelled or unexpended referendum line items (if a levy cap referendum was successful in the prior budget year), and unexpended line items relating to levy cap exclusions, will be deducted from the adjusted levy based on the audit report or as noted in the budget message. Any referendum line-item funds left unexpended at the end of the fiscal year must be cancelled at year end unless the Division approves retaining reserves. If unauthorized balances are found during review of the following year’s budget, the Division will order cancellation of those balances, and the levy cap will be adjusted accordingly.
Grants: For grants awarded prior to budget introduction, the budget should include the anticipated grant revenue along with the corresponding grant appropriations. Grants awarded after budget introduction will be processed as a budget amendment either at the public hearing or at any time after final adoption as permitted by N.J.S.A. 40A:14-78.5(e).
Transmittal of Budget to Director: Budget Adoption: Due to the volume of Fire District budgets submitted concurrently, the Division strongly recommends that Fire Districts submit their introduced budgets as early as possible. Budgets must be submitted only electronically via the Division’s FAST System. The Board of Fire Commission Chairperson is required to prepare a synopsis of the audit and publish it at least once in a newspaper circulating in the Fire District. The district must also file a copy of the synopsis (and proof of publication) with the Division within 10 days after publication. Pursuant to N.J.A.C. 5:31-7.6(g), the synopsis must include a comparative balance sheet, a comparative statement of revenue, expenses/expenditures and changes in retained earnings/fund balance, a summary of recommendations; and single Audit findings. Within 45 days of receiving the annual audit, the Board of Fire Commissioners must certify by resolution that each member has personally reviewed the audit report, and, by a majority vote of the Board’s full membership, sign an affidavit accepting the audit. If the Audit report includes findings, a corrective action plan is also required. The resolution, group affidavit, and any corrective action plan must be submitted to the Division within 45 days after receipt of the audit. Any fire districts that have not complied with the statutory obligation to submit their 2024 annual audit to the Division must submit all documents related to the audit prior to submission of the 2026 Introduced Budget.
Post-Adoption Budget Amendments-Special Items of Revenue: N.J.S.A. 40A:14-78.5, as implemented by N.J.A.C. 5:31-2.17, establishes a process for Fire Districts to seek Director approval to amend an adopted budget. While the new revenue item may have been made available by any private or public funding source, the amount of the corresponding appropriation cannot exceed the amount of the revenue received.
Accounting for Use of Municipal Appropriations to Fire District: N.J.S.A. 40A:14-34 requires the Director to adjust the annual cap on funds a municipality may appropriate for use by its volunteer fire companies or Boards of Fire Commissioners for inflation every two years in accordance with the Cost-of-Living Adjustment (COLA) (N.J.S.A. 40A:4-45.1a). A COLA adjustment of 2.5% has been applied for CY 2025/SFY2026 and CY2026/SFY2027 municipal budgets. This 2.5% adjustment yields a maximum annual contribution of $165,564. In any municipality with more than three such companies or boards, the governing body may annually appropriate an additional $50,000 for each additional volunteer fire company or Fire District. N.J.S.A. 40A:14-34 requires a Fire District receiving municipal appropriations to provide the municipal governing body an annual accounting of the use of all funds appropriated.
Fire District Website/Webpage Requirement: N.J.S.A. 40A:14-70.2 requires all Fire Districts to maintain a website or a webpage on their municipality’s website that contains certain information set forth in the statute. N.J.A.C. 5:31-2.4(u) requires an authorized officer of the fire district to certify on the budget document that the Fire District’s website or webpage complies with the minimum statutory requirements of N.J.S.A. 40A:14-70.2. No Fire District budget will be approved without a completed website certification.
GovConnect: N.J.A.C. 5:30-16.5(c)(7) requires all Fire Districts to register at least one official in GovConnect network to receive Division and other State government information via email. This network uses the State’s “myNewJersey” portal. District leadership is responsible for ensuring that an appropriate individual is enrolled. Fire Districts may enroll in GovConnect by reaching out via email at EGG@dca.nj.gov.
We suggest you review this Local Finance Notice with your municipal professionals.