History of Association

Chapter Five

BURIAL BENEFITS AND THE ADVISORY COMMITTEE

For many years the officers of the State Association had been interested in providing burial or death benefits for firefighters. It was not until 1922 that the legislature authorized the State Association to divert a portion of the two percent (2%) tax from the Local Relief Associations for that purpose. (#1) This legislation authorized the Executive Committee to establish a General Relief Fund and set up an Advisory Committee. (#2) The Executive Committee was directed to establish Rules and Regulations, with the assistance of the Advisory Committee, and in accordance therewith, the Advisory Committee was charged with evaluating burial or death claims and making payment on behalf of qualified firefighters. (#3)

The Advisory Committee is appointed by the President of the State Association after the Annual Convention. (#4) The Advisory Committee, by law, must be composed of three (3) firefighters who are members of the Executive Committee. The State Treasurer and the Field Examiner are statutory members and the State Treasurer is designated as Secretary-Treasurer for the Committee. The Committee meets twice a month and reviews claims submitted by the Local Relief Association on behalf of a deceased member. Burial claims are carefully reviewed, the firefighter’s records scrutinized, and if properly qualified, the burial claim is paid to the decedent’s appropriate representative in accordance with the rules. (#5) A qualified member is one who has been admitted to membership in the State Association and has completed sixty percent (60%) attendance at all fires and drills for the fire company of which he or she is a member. (#6)

Historically the death benefit was approved at the Forty-Fifth (45th) Annual Convention in 1922. The Convention approved of the Advisory Committee and the plan setting forth the Rules and Regulations as recommended by the Executive Committee. (#7) The Advisory Committee was directed to follow the Convention guidelines and in accordance therewith establish a plan and the rules for payment of the burial claims. (#8) The Executive Committee then incorporated the Rules and Regulations for the Advisory Committee in the 1930 Compendium. (#9)

To insure fairness and proper burial benefits each fire company under municipal control affiliated with the State Association is required to keep and maintain attendance records for each firefighter’s attendance at fires and drills. After completion of seven (7) years’ duty the firefighter becomes qualified and receives a Qualifying Certificate and this fact is properly noted on the State Records. It may also be recorded in the respective County Clerk’s office.

When the original Rules and Regulations were adopted it was obvious to the State Officers and the Executive Committee that a financial limit existed and all firefighters could not all be paid the burial benefit at the time it was approved. The benefit was three hundred dollars ($300.00) and there were at least thirty thousand (30,000) firemen. Therefore a study and analysis was made concerning the members, the fire companies and the municipalities, and it was decided a limit on eligibility must be established. The Executive Committee therefore established a quota system. It allocated a certain number of firefighters eligible to qualify each year based upon the population of the municipality in which the fire company or fire companies were operating . The formula was as follows,

The first burial claims were made from the General Relief Fund during 1922 and 1923. They were reported at the Forty-Sixth (46th) Annual Convention in 1923. The Treasurer reported the actuarial calculation as follows;

To initiate the burial fund an assessment was authorized to be made upon each local association. This assessment, however, was to be collected only if there were insufficient monies in the hands of the Commissioner of Banking and Insurance to pay the requisition needed by the Advisory Committee to pay the burial claims for the first year. (#12) Thereafter the Commissioner allocated the two percent (2%) tax received by him for municipalities without a relief association (999 account), first to the Firemen’s Home and the balance thereof to the General Relief Fund. Many municipalities still did not have fire departments or relief associations so the monies forwarded to the General Relief Fund by the Commissioner grew year after year. At present the General Relief Fund is in excess of forty-two million dollars ($42,000,000.00) and the maximum burial benefit is now eight thousand, seven hundred dollars ($8,700.00). (#13) If the firefighter was killed in the line of duty or was a federal, State or local police officer killed during an act of terrorism, then the firefighter is entitled to triple the maximum benefit. (#14)

The procedural process and the record keeping is imposed upon the Chief or fireperson in charge of the municipal fire company affiliated with the State Association. The ranking officer must maintain the log (green sheets) of all fires and drills and the firefighters attending each. These records are then forwarded to the State Association office which maintains the same from the time the firefighter joins the association until his death. When a firefighter completes the required sixty percent (60%) duty over seven (7) years, eighty-four (84) months he is then certified. When certified he or she is entitled to the maximum burial benefit and is no longer required to perform the duty requirements. (#15)

Notice of death and the claim for burial benefits are imposed upon the Secretary of the particular Local Relief Association. Within ninety (90) days of the date of death the Secretary shall forward the claim to the Secretary of the Advisory Committee. Upon receipt of the claim the Advisory Board reviews the same and if everything is in proper order makes payment to the respective survivor. (#16) If any claim is denied an appeal procedure is provided to the Executive Committee, but the decision of the Executive Committee is final. (#17)

The eligibility and quota requirements remained in effect for many years, but during the 1970’s and early 1980’s the demographics of the state started to change dramatically. The residents of the counties and municipalities became more urbanized and transient. Also many families included two wage earners. As a result there were fewer people available or willing to devote their time to the fire service, or for that matter any community service. Thus membership in many fire companies started to decline and the companies could not fill their memberships without difficulty, and in some cases could not do so at all. The quota was outdated and unnecessary. Also new state and federal laws impacted the fire service, including the various discrimination laws, labor laws and the like. The Executive Committee faced with these issues and possible civil rights requirements and/or violations did not enforce the quota system. (#18) Shortly thereafter a disability discrimination suit was initiated in the Superior Court of Bergen County by a firefighter blinded in one eye. In the case, Szabo v. N.J.S.F.A., the firefighter invoked the disability laws and also challenged the constitutional validity of the State legislation establishing the New Jersey State Firemen’s Association. (#19) The Court entertained the case for approximately three (3) years, conducting extensive discovery, numerous interlocutory hearings, requiring the appearance of the State Attorney General, and numerous briefs. The Court entered its decision on June 28, 1989 and directed that Szabo be admitted forthwith. The Court ruled that the State Statute mandated all firefighters, regardless of disability, be admitted upon approval of the membership by the local municipality. (#20) The Court found the statute constitutional, but directed that the “Compendium”, Constitution, By-Laws and Regulations be redrafted in accordance with the Court Order entered with the decision. The decision rested upon the language of the membership section.

N.J.S.A. 43: 17-9. It provided:

“The membership of such corporation shall consist, without any formal election thereto, of the officers and members of such fire . . . Companies . . . as shall be under the supervision or control of the governing . . . body of the Municipality . . .” (#21)

The Court also reviewed the quota system at length, its history and applicability and also ruled the same illegal. (#22) The Courts decision to allow all firefighters approved by a municipality with a relief association to immediately join the State Association caused major concern. Firefighters regardless of age, disability or other impediment were now immediately eligible for admission. The Court directed the State Association to address other Rules and Regulations along with the quota rules. The officers and the Executive Committee immediately revised the “Compendium” and submitted the new “Compendium” with the revised Constitution, Rules and Regulations to the Court for approval. (#23) This, however, did not address the statutory problem concerning the provision for membership and changes in the State Statute were necessary to protect the limited funds in the General Relief Fund. Coincidentally, at this time the Fund was under stress because of misappropriation of substantial monies by the Treasurer and office coordinator. (#24) In fact the burial payments were reduced, an assessment imposed upon the local associations, and the officers salaries and expenses were frozen. (#25) Immediate action was necessary and the officers were successful in obtaining legislative action amending the statute. (#26) These amendments set age and health requirements in accordance with the Rules and Regulations set by the Executive Committee.

During the time from the Courts decision, June 28, 1988 until the passage of the statutory amendment on June 29, 1989, open enrollment occurred and membership increased. The new amendment brought the membership back under control; however, litigation interpreting the same ensued and financial problems were still a concern. (#27)

Bad news abounded during this general period, and the revenues derived from the two percent (2%) tax received by the Commissioner of Banking and Insurance from foreign insurance companies showed significant reductions. The Commissioner conducted studies and determined that foreign insurance companies were establishing wholly-owned subsidiaries incorporated in New Jersey to avoid payment of the tax. Since this scheme included some of the larger international companies a limit on the tax avoidance was imposed and the loophole and damage to the General Relief Fund was limited by this new legislation. (#28)

During the following years the problems subsided and the revenue outlook improved. The freeze on benefits, salaries and expenses was removed and the real estate boom of the l990’s and early 2000’s increased the General Relief Fund and also the funds of the Local Relief Associations. This did not go unnoticed by either the legislators, Bergen Record, and other newspapers. Legislative hearings resulted. These hearings and the press reports, although painful, did not result in any damage to the State Association. New legislation, generally beneficial, resulted and passed in 1996. (#29)

As previously stated the current death benefit is eight thousand, seven hundred dollars ($8,700.00). This was set by the Executive Committee at the meeting in Wildwood, New Jersey in May 2006. The death benefits payable on behalf of deceased, qualified firefighters is not taxable under the New Jersey Inheritance Tax Law. (#30)

Chapter Six

LOCAL RELIEF ASSOCIATIONS

Each fire department established by law within a municipality or governmental entity in this state is authorized to form a Local Relief Association. (#1) Such association is then considered under “the supervision and control” of that municipality and is entitled to incorporate, affiliate with the New Jersey State Firemen’s Association, and receive the two percent (2%) tax derived from the tax on foreign insurers writing fire and fire related policies within that municipality. Normally “under municipal control” means the municipality adopted an ordinance, resolution or other binding legal procedure. (#2)

The Local Association is solely the creature of the state statutes which authority was established by law on May 2, 1885.(#3) Prior to this date many cities and municipalities had benevolent, eleemosynary, relief or disability associations which may or may not have been incorporated or under governmental control. The Act of 1885 required this governmental control in order to get the two percent (2%) tax so most municipal fire departments organized a Local and affiliated with the State Association. Affiliation with the State Association was not required.

The membership of the Local Association consists of all firefighters approved by the governing body as part of the fire department. The firefighter must be between the ages of eighteen (18) and forty-five (45) years. (#4) All new members, at present, are required to undertake and pass appropriate fire training programs before being admitted. Usually such programs are conducted by the various County Fire Schools or Colleges. They must also furnish evidence of good health. (#5) Upon admission the firefighter becomes eligible for relief benefits as a member of the Local Association and after seven (7) years, eighty-four (84) months of attendance at fires and drills he becomes qualified and entitled to the maximum death benefit provided by the State Association. (#6)

The Local Associations are governed by a Board of Representatives. The representatives are chosen each year and there can be no more than three (3) from each fire company and not more than three (3) from the Exempt Firemen’s Association, if any in the municipality. Also the Chief, or the next highest ranking officer of the department, and the President of such fire association or department are members of the board. (#7) The representatives than elect, by ballot from among their own number or out of the whole membership, a President, a Vice President, a Treasurer, and a Secretary, who shall be the board of officers, and not more than five (5) members of a board of trustees. The trustees shall elect annually a Chairperson and Secretary. If the Local Association is comprised of more than one fire company or Association the Local may provide for three (3) representatives from each fire company to the board of representatives. (#8) The trustees can be no less than three (3) nor more than fifteen (15) initially, divided into classes of five (5), but after that only five (5) per year. (#9) No person however, can serve on both the board of representatives and the board of trustees at the same time. (#10) All officers of the Local Association are required to be covered by a fidelity bond. (#11)

All revenues and collections of the two percent (2%) tax on foreign insurers or other sources must be maintained, secured, invested and dispensed within the guidelines set by statute and within the rules and regulations of the Executive Committee. The management of the business of the Local and all the financial affairs, custody of the property and disposal thereof, including relief benefits, is entrusted to the board of representatives. (#12)

Applications for relief shall be requested on the forms approved by the Executive Committee and shall be based upon and judged upon need. (#13) The processing of the application is handled by the Secretary of the board of trustees. The trustees than investigate the need and make a report and recommendation to the board of representatives. Relief can then be issued in accordance with the Relief Assistance Scale of allowable payments. (#14) Temporary relief, supplemental relief and special relief may be available to qualified firefighters or their families upon application and approval of the State Office.

The funds of the Local are required to be invested in accordance with the statute and rules and regulations previously set forth above. All locals are required to file financial reports with the Field Examiner and these reports are filed annually with the Secretary of State for New Jersey. (#15) Each Local also is registered as a not-for-profit corporation within the State and the State Association files the annual report and fee for each. (#16) Also some may file tax returns with the United States Internal Revenue Service, and all have an EIN number referring to the State Association.

Annual membership reports listing all active members and their percentage of service toward qualification are also filed with the State Office. (#17) Officers who fail to adhere to these rules and regulations and /or the State statutes may find themselves or their Locals in jeopardy, subject to penalties, or disciplinary proceedings, including not being seated at the Convention. (#18) Improper or fraudulent conduct including theft may require the State Officers and the Executive Committee to declare the Local out of accord and to seize the assets and assume control of the Local. (#19) Conduct which appears criminal in nature is referred to the appropriate law enforcement agency.

Under state statute the Local Association is entitled to the two percent (2%) tax collected by the State Association and the tax is required to be remitted to it. The State Association, however, is permitted to assess the Locals for the expenses of operating the state affairs and deducts that amount necessary from the distribution delivered annually to the Local. Prior to 1997 the insurance companies paid the same directly to the Local. The State Association operates the state Convention, operates the State Office, and provides the burial fund. The Local provides relief, may pay delegates and life member Convention expenses and its officers administrative expenses all within the limits of the Rules and Regulations of the Executive Committee. (#20)

Each Local provides the membership for the State Association. They elect the delegates to the Convention. (#21) Those delegates who attend the required number of Conventions then become life members of the State Association. The Local Associations have no provision for life members. All delegates and life members are entitled to vote at the Annual Convention. The state Convention is required annually by law. (#22)