NJ S275

State departments must prepare a cost analysis before entering contracts over $100,000 with private businesses for work typically performed by State employees, examining labor costs, fringe benefits, equipment, transition costs, administration, and potential unemployment compensation for displaced workers.

Contracts reducing State employee workloads cannot proceed unless the analysis shows substantial cost savings and demonstrates privatization does not outweigh the public interest in direct State performance of the function.

Departments are prohibited from contracting with businesses whose principals or management worked for that department within the preceding two years in any capacity affecting the contracted work.

Cost analyses must be filed with the Office of Management and Budget and shared with legislative committees and affected bargaining units, with unions given 20 business days to respond before contracts can be finalized.

Departments may proceed with contracts despite higher costs if State employees lack necessary expertise, skills, or technology, but must wait 30 business days to allow the Legislature opportunity to address those constraints.