The Brick Township municipal complex, 2023. (Photo: Daniel Nee)
The owners of businesses and rental homes in Brick Township, under an ordinance introduced this week, will be required to obtain a mercantile license from town hall in order to comply with a new state insurance mandate.
New Jersey adopted a law in late 2022 that requires business owners and rental property owners to maintain various levels of insurance coverage. The controversial measure came amidst urging from the legal lobby, and counted lawmakers who work as personal injury attorneys among its sponsors, generating criticism in some political circles. The bill, however, passed muster with the full legislature and was signed into law by Gov. Phil Murphy.
Enforcement of the state law was left to municipal governments, forcing many towns – including Brick – to create new licensing regimes to comply. The state did not fund enforcement, instead choosing to enable local governments to charge a license fee. In Brick, the township council this week introduced an ordinance requiring business owners and the owners of rental properties to obtain a “mercantile license” from the township, contingent of providing sufficient insurance coverage as mandated by the state statute.
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Under the proposed ordinance, the owners of businesses and multifamily rental units would be required to annually register a certificate of insurance with the municipality. In Brick, officials sought input from the business community through the Chamber of Commerce on how to best tackle the new mandate, with emphasis placed on keeping the fee reasonable and offering some type of benefit beyond simple compliance with the law. Ultimately, officials and business owners decided on a $25 permit fee, and the ability for the township to maintain a more complete and accurate list of business owner contact information that could prove useful in emergencies – a measure that has been discussed in years past.
The mercantile license require would apply to those who have a physical business in the township, as well as the owners of a single or multiple rental properties. Multifamily property owners with four or few units, one of which is owner-occupied, would also be required to obtain a license. The owners of larger rental properties are already subject to more stringent regulations.
Individuals who contract with other businesses – such as a stylist who rents space in a salon – do not have to obtain a mercantile license.
According to the New Jersey Office of Business Innovation, the law requires landlords and business owners to carry $500,000 in liability insurance for deaths or bodily injuries that may occur at their properties. For small, multifamily rental properties that are owner-occupied, the minimum liability insurance is $300,000.
Non-compliance could net a penalty of $100 for each violation. Existing businesses are required to obtain the license by Dec. 31, 2023, and new businesses must apply for a license within 30 days of opening.
The ordinance will be the subject of a public hearing and a second vote by the council before final adoption. That will occur at the March 14 council meeting.
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