5. The director shall select among the municipalities that have applied for extraordinary aid pursuant to section 4 of P.L.1991, c.63 (C. 52:27D-118.35) and shall forward to the board the list of selected municipalities along with the amount of financial assistance to be paid to each municipality. The director in selecting among those eligible municipalities for payment of extraordinary aid shall use criteria which shall include:

a. whether a municipality is experiencing fiscal distress, whether the cost of providing municipal services is extraordinarily high, and whether the tax base is inadequate to meet property tax demands;

b. whether a municipality will use the extraordinary aid for costs associated with activities that improve operations and provide short-term and long-term property tax savings, including but not limited to shared and regionalized services, enhanced tax and revenue collection efforts and other activity that can be demonstrated to meet those requirements; or

c. whether a municipality has incurred other unusual or atypical expenses.

L.1991,c.63,s.5; amended 1999, c.156, s.7.