After months of NJ21st trying to get a clear answer on the legality of the CMS lease agreement, Berkeley Heights Town officials have now taken the position that what they actually approved was a Shared Services Agreement.

Township attorney Scott Salmon told NJ21st (in an 08/11 email) that, while the arrangement started out “stylized as a lease,” it’s “for all intents and purposes” a shared service under N.J.S.A. 40A:65-5 and that the N.J.S.A. 40A:12-5 requirement for leases to be approved by ordinance was “really intended” for cases where the Township is renting its land to non-governmental, for-profit entities.

There are parts of the law that do make exceptions for certain leases. N.J.S.A. 40A:12-14(c), as an example, lets a town lease property to a nonprofit org for a public purpose by resolution – courts have affirmed this.

But that exception applies when the municipality is the landlord, not the tenant — and when the other party is a nonprofit corporation.

In this case, the BOE owns the field and is leasing it to the Town. The BOE is a public entity, not a nonprofit, so it’s not clear whether that exception would really apply here.

Before it was called a “shared service,” the Township Council had already approved the arrangement several times as a lease. In fact, that’s what the public voted on last year.

On Aug. 12, Mr. Salmon acknowledged that the shared services agreement is tied to and related to the lease agreement. However, he said that “just because we’re referring to it as a lease agreement doesn’t mean that it falls under the statute”. He reaffirmed his position that the arrangement is still a shared service, and stated that if it were ever challenged, the Council could “cure” the issue by ratifying it with a Shared Services Resolution.

NJ21st responded that the lease agreement itself — as referenced in the shared services agreement — was passed by resolution at the two March meetings, and that addressing the question now could be a wiser course given the public interest and controversy surrounding the deal.

In other words, there would be no shared services agreement without the lease and that the Council should just follow the proper process.

Also on Aug. 12, Board of Education member Natasha Joly weighed in, saying she was “a bit confused” as to whether the March agreement was an actual lease or something merely “stylized” as one. She recalled that the Township had previously argued a 25-year lease — an actual lease, not a rebranded arrangement — was needed in lieu of ownership to qualify for certain grants.

The Mayor, Council and Recreation Department did in fact represent that a lease was necessary in order to apply for grants MULTIPLE times leading up to the final BOE Vote.

There was no comment at all from the Mayor or Council on this issue beyond Mr. Couto’s last email that we reported on expressing his intention to follow up with the Township Attorney and the Mayor’s response that referred back to the Attorney’s guidance.

Here’s the timeline in pictures….

The November 5, 2024 ballot presented to voters clearly the issue as a long-term lease of Lower Columbia Field. In fact, it had a $1.00 price tag without a single mention of a “shared services agreement.”

In it’s tax-funded press release encouraging voters to approve the agreement the Berkeley Heights Recreation Department stated:

“There are state and federal grants that are only available to the Township and not available to the Board of Education. In such cases, there are requirements for the Township to have a minimum of a 25-year lease agreement to be considered for a project on Board of Education property.”

On March 4, 2025, the Council passed a resolution authorizing the Mayor to sign a Lease Agreement for Lower Columbia Field.

On March 25, 2025, it approved a revised lease at a special meeting.

On May 20, 2025, the Council adopted a Shared Services Agreement for maintenance — a document that still cites and depends on the lease. The BOE approved the lease on March 18, 2025.

The May 20 Shared Services document matches its term to the length of the lease, includes the same contingencies, and spells out obligations “consistent with the terms of the Lease Agreement.”

And this is why we fact check every single word coming out of the Municipal Building.

Legal Context: New Jersey’s Local Lands and Buildings Law generally says municipal leases must be approved by ordinance — which requires public notice, multiple readings, and a public hearing. There’s an exception for leases to nonprofits serving a public purpose, which can be approved by resolution, but that doesn’t clearly apply here. In this case, the Township is the tenant, the Board of Education is the landlord, and neither is a nonprofit. Whether calling it a shared service or citing its public purpose is enough to avoid the ordinance process isn’t clearly settled in the law.

Full Email Chain

As a non-commercial and ad-free, free platform, we rely on you to help us grow. If you value independent coverage of local government, please consider helping us out.

Read More About the CMS Lease Agreement

Subscribe to NJ21st For Free

Our Commitment to Ethical Journalism