2. a. In each State fiscal year, each municipality shall receive Consolidated Municipal Property Tax Relief Aid equal to the amount of Consolidated Municipal Property Tax Relief Aid received in the prior State fiscal year multiplied by the sum of 1.0 and the index rate or zero, whichever is greater. However, any municipality that did not receive a distribution of Consolidated Municipal Property Tax Relief Aid during fiscal year 1999 shall receive aid equal to the amount of Consolidated Municipal Property Tax Relief Aid received in the prior State fiscal year plus the product of the base year amount and the index rate or zero, whichever is greater. As used in this section, “base year amount” means the sum of aid received by the municipality in fiscal year 1995 under those State aid programs which were consolidated in P.L.1995, c.164, the fiscal year 1996 annual appropriations act, under the Consolidated Municipal Property Tax Relief Aid distribution. As used in this section, “index rate” means the rate of annual percentage increase, rounded to the nearest half-percent, in the Implicit Price Deflator for State and Local Government Purchases of Goods and Services, computed and published quarterly by the United States Department of Commerce, Bureau of Economic Analysis, calculating the annual increase therein at the second calendar quarter which occurred in the next preceding State fiscal year. The Director of the Division of Local Government Services shall promulgate annually the index rate to apply in the next following State fiscal year which shall be the same as the index rate determined pursuant to section 4 of P.L.1983, c.49 (C. 40A:4-45.1a).

Any amount of aid distributed to a municipality in excess of the amount distributed to the municipality for Consolidated Municipal Property Tax Relief Aid during the State fiscal year 1999 shall be used solely and exclusively by each municipality for the purpose of reducing the amount the municipality is required to raise by local property tax levy for municipal purposes. If the amount of the increased distribution exceeds the amount required to be raised by local property tax levy for municipal purposes, the balance of the increased distribution shall be used to reduce the amount the municipality is required to collect for county purposes, notwithstanding the provisions of this or any other law to the contrary. The Director of the Division of Local Government Services in the Department of Community Affairs shall certify annually that each municipality has complied with the requirements set forth herein.

b. The amount appropriated for Consolidated Municipal Property Tax Relief Aid in a State fiscal year shall be sufficient to fully fund the distribution to municipalities as determined pursuant to subsection a. of this section.

L.1999,c.168,s.2.