What is the limit on debt for capital projects according to New Jersey statutes?

In New Jersey, the limit on debt for capital projects is set at 3.5% of the average of the last three years' assessed property valuation. This measure is established to ensure that municipalities do not overextend themselves financially by borrowing beyond their means. By basing the debt limit on a consistent average of property valuation, the law aims to promote fiscal responsibility and maintain the economic stability of the municipality.

This limit encourages municipalities to consider their growth and tax base stability over a period of years, rather than relying on fluctuating annual revenues or budgets, which could lead to unsustainable financial practices. The 3.5% cap helps ensure that public funds are managed prudently, allowing for necessary capital projects without jeopardizing the municipality's fiscal health.