It loomed as a rare moment of reform in Trenton.

The dominant Democrats, controlled for generations by party bosses and county chairmen, suddenly approved legislation in March requiring the shadowy "dark money" organizations to reveal their donors and how they spend their funds.

But after Gov. Phil Murphy's conditional veto Monday, the measure — perhaps the most significant finance reform measure in a decade — became a casualty of his bitter, deepening feud with Senate President Stephen Sweeney, D-Gloucester.

Instead of a long-overdue leveling of the campaign finance rules, the derailed bill now stands as an omen of the dysfunction to come. The Murphy-Sweeney squabble threatens to upend the push for property tax relief, the upcoming budget negotiations, the umpteenth attempt to pass a tax increase on millionaires, and an ambitious "Path to Progress" overhaul of public employee benefits.

NJ legal weed on hold

And the dream to legalize marijuana appears all but dead for now, another real-world victim of this insider fight.

It's impossible for party leaders to pull the levers of power to govern when they have taken up arms against each other.

First Citizens United, then dark money swamp

For the moment, the dark money push stands as a lost opportunity — and one that is not likely to come around again anytime soon.

The concern about the corrosive influence of special interest money on campaigns has been on the rise since the 2010 Citizens United Supreme Court decision, which opened the floodgates of unregulated campaign spending.

The dark money tide has swamped New Jersey campaigns. In the 2009 governor's race — which included 80 seats in the Assembly on the ballot — spending by unregulated "independent" groups topped $14.1 million, according to the state Election Law Enforcement Commission. In the 2017 governor's race, when all 120 seats in the Legislature were up for grabs, spending soared to $47.5 million, a 237 percent increase.

But despite the rising tide of unregulated money, Trenton has largely given the issue lip service, perhaps because officeholders have benefited from the outside largess.

Yet, in a twist of irony, the Murphy-Sweeney fight created the conditions that buoyed the prospects of dark money reform.

The roots of the latest effort date back to late 2017, when a group linked to Murphy, New Direction New Jersey, was created weeks after his victory. One of its leaders, Brendan Gill, Murphy's campaign manager, vowed that it would be a model of transparency and would reveal its donors by the year's end.

The group's goal was to promote the new governor's agenda, largely through positive ads with an upbeat Murphy striding through New Jersey, promising a progressive future.

Yet Sweeney and his allies saw New Direction as a political weapon, a way for Murphy to ratchet up public pressure on lawmakers to back his first budget in June 2018 by running campaign-style television ads during the homestretch of bitter negotiations with Sweeney and Assembly Speaker Craig Coughlin, D-Middlesex.

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The ad that eventually ran turned out to be a fairly benign moment of Murphy self-promotion, but the flap only intensified the brewing animosity.

New politics, old rules

Six months later, New Direction officials rescinded a promise to disclose its donors, citing the "toxic political environment" — a reference to the growing divide between Murphy and Sweeney.

But the decision was widely criticized as a hypocritical retreat. Here was a group closely allied with the progressive-change agent Murphy now choosing secrecy over transparency. The champion of the new politics was playing by the old rules.

Sweeney, sensing an opening, pounced, and he fast-tracked dark money reform legislation that had been languishing for years.

The bill required disclosure of donors for groups like New Direction New Jersey that have been formed under chapter 501(c)(4) of the Internal Revenue Service code. But added to the bill was a provision setting disclosure retroactive to Jan. 1, 2018, a provision that took clear aim at the recently formed New Direction.

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Murphy supporters also complained that the Jan. 1 start time gave a pass to General Growth Fund, a similar political group linked to Sweeney's political benefactor, South Jersey Democratic leader George Norcross.

The retroactive provision was eventually stripped from the bill as it made its way through the committee process, but another remained that also took aim at Murphy's allies. It called for banning office holders from creating or running independent expenditure groups, like New Direction. Many interpreted that as taking direct aim at Gill, who is also an Essex County freeholder.

The bill passed the Senate 33-0 and the Assembly 66-2 in March.

In an interview Monday, Sweeney denied that he was deliberately targeting Gill. He said he was reacting to reports of a school board candidate in Union County, who created an independent political action group for his reelection. Sweeney said the provision was needed to make sure lawmakers at all levels operated under the same rules.

"If I'm restricted from doing it, then all elected officials should restricted from doing it,'' he said.

But on Monday, Murphy retaliated with a few political swipes within his conditional veto.

Murphy struck out the provision barring office holders from participating. And then he demanded new language requiring entities that receive more than $25,000 in tax credit subsidies from the state to disclose their donations.

NJ tax breaks join the fight

That appeared to be a shot at Norcross, who has come under intense scrutiny by a special panel created by Murphy to investigate how tax incentives have been doled out for New Jersey to attract and retain corporations.

The investigation is focusing on a 2013 law, signed by then-Gov. Chris Christie and shepherded through the Senate by Sweeney, that tilted the flow of incentives to Camden, Norcross' base of power.

A WNYC radio and Pro Publica report earlier this month said that of nearly $1.6 billion in tax breaks for companies that agreed to make a capital investment in Camden, at least $1.1 billion went to Norcross’ own insurance brokerage, his business partnerships and charitable affiliations, and clients of the law and lobbying firms of his brother Philip.

Norcross defended the incentives, arguing that they helped correct an imbalance of tax subsidies that flowed mostly to North Jersey companies. He said the investment has also been central to a rebirth of the crime-plagued city, across the Delaware River from Philadelphia.

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Murphy's conditional veto leaves the reform in limbo.

Sweeney could try to override Murphy's veto — the original measure passed with veto-proof majorities in both houses. But will lawmakers want to reopen a campaign finance reform debate and put themselves in the crossfire of a heated feud? Probably not.

And Murphy is demanding a dismantling and rewriting of the soon-to-expire tax incentives. Sweeney largely supports the current law as it is. That fight also threatens to dominate the agenda.

Campaign finance reform will probably have to wait — as it always has.