New Jersey Statutes Title 40A. Municipalities and Counties 40A § 3-11

a. Qualified bonds may be issued pursuant to the provisions hereof for the purpose of funding ordinances which have been adopted in the absence of compliance by the municipality with the provisions as to approval for qualification set forth herein, even if notes have been sold or other obligations incurred pursuant to said ordinance, provided that prior to the issuance of such bonds the municipality shall have complied with such provisions. In addition, outstanding bonds of a local unit may be refunded by the issuance of qualified refunding bonds whether or not in advance of the maturity or redemption date of the outstanding bonds in any amount determined to be necessary by the governing body of the municipality to effect the refunding. A bond ordinance authorizing qualified refunding bonds shall become effective and qualified refunding bonds shall be sold and issued in the manner provided in N.J.S. 40A:2-52 to 40A:2-60, both inclusive, and the provisions of said sections shall be applicable thereto and to such refunding bonds and such refunding bonds shall recite that they are issued pursuant to said provisions and this act.

b. The Local Finance Board shall in undertaking the investigation required by subsection b of section 3 of P.L.1976, c. 38 (C. 40A:3-4), take into consideration the probable capacity of the municipality to pay at maturity the qualified refunding bonds proposed to be issued and all other obligations thereof then outstanding, taking into consideration the assessed and true valuation of taxable property in the municipality, the equitable distribution of the burden of interest and debt redemption charges in connection with such qualified refunding bonds and the obligations theretofore outstanding or which may necessarily thereafter be incurred.