In 1894, the state permitted boroughs to be formed by petition, without requiring a special act of the legislature, as had been required before and since. This process was widely used, particularly in Bergen County, "that being the year the county went crazy on boroughs. Today, 56 of the 70 municipalities in Bergen County are boroughs.
Communities often were motivated by financial issues; Chatham broke loose of the township over the financing of gas lighting in the town. The town wanted them and the township government refused to finance them. First the community reorganized as a village, but, when the borough form was introduced through legislation prompted by such discontents, immediately voted to adopt that new form of government.
This wave of municipal reformations was fomented by legislation that allowed a borough to be created by a referendum with no further legislative approval required. In 1875, only 17 boroughs existed, but the prevalence of boroughs exploded, so that they are now the most common type of municipal government in New Jersey, accounting for over 200 of the 566 current municipal governments statewide.
Early in 1894, the New Jersey Legislature passed a school act which had each township constitute a separate school district. Taxpayers were required to pay off any existing debts of the old districts and all future school-related debts of the new districts. Exempted from this provision were "boroughs, towns, villages, and cities". An amendment to the Borough Act, passed on May 9, 1894, allowed for the creation of a borough from parts of two or more townships, and allowed these boroughs created from multiple municipalities to have their own representative on the County Board of Chosen Freeholders.
The citizens responded to the legislation in 1894, and the shift to boroughs was in full force, as scores of new boroughs were carved from townships. The borough-formation pace slowed down when new legislation was passed mandating that boroughs could have their own school districts only if they had 400 children within their boundaries.
The formation of new boroughs continued after 1894. The borough remained the most popular form of government for new municipalities, and most governments formed into the early 20th century used the borough form.
Legislation was drafted to effectively repeal the Borough Acts of 1882, 1890, 1891 and all of their supplements. Under the Incorporation by State Act of March 26, 1896, "No borough or village shall hereafter be incorporated in this state except by special act of the legislature, and every borough or village so incorporated shall be governed by the general laws of this state relating to boroughs or villages respectively." With the formation of new municipalities now firmly returned to the hands of the New Jersey Legislature, the wave of changes met its end, by the beginning of the Great Depression..