An Assembly candidate thrown off the June primary ballot because he works for a federally funded agency has won reinstatement.

The Appellate Division on Tuesday reversed a Hudson County judge who found Carmelo Garcia, executive director of the Hoboken Housing Authority, subject to a regulation barring elective office to those employed “in connection with a program financed in whole or in part by federal funds or loans.”

That regulation, last revised in 2008, was only a New Jersey implementation of the federal Hatch Act, and by its terms could not exceed the federal law’s requirements, the panel found.

In 2012, Congress loosened the Hatch Act, so that it now bars only employees of a government entity whose budget consists entirely of federal funds from running for office.

New Jersey is free to enact restrictions that go beyond the revised Hatch Act. “A state regulation based on recently outdated federal law, however, does not demonstrate New Jersey’s intention to impose restrictions beyond those imposed federally on federally-funded employees,” Appellate Division Judges Marie Simonelli and Ellen Koblitz said.

“Accordingly, N.J.A.C. 4A:10-1.2(b) must be read through the lens of the current federal Hatch Act,” the judges said.

Garcia is one of five Democrats running for two open District 33 seats. The suit, Abernathy v. Garcia, A-3861-12, was filed by Democrats who support rival candidates.

Their attorney, Flavio Komuves of Zazzali, Fagella, Nowak, Kleinbaum & Friedman in Newark, says the appeals court overlooked a factual dispute about whether Garcia’s salary was paid entirely with federal dollars. Assignment Judge Peter Bariso Jr., whose ruling was reversed, had made no findings on that issue.

Komuves says the appeals court also overlooked his assertion that the Legislature approved the restrictions on political activity for employees of federally funded agencies in 2008 when it adopted a reorganization of the Department of Personnel.

Komuves filed an emergent motion for a stay of the ruling but Koblitz denied it on Thursday. He says he will petition the Supreme Court for certification.

Angelo Genova, of Genova, Burns, Giantomasi & Webster in Newark, who represented Garcia, says, “The Appellate Division understood this regulation is supposed to track the Hatch Act, so I don’t think it rises to the level of a public policy concern that warrants the Supreme Court’s concern.”