Let me first address the term "upgrade". That term does not exist in rehab.
To correctly address this issue, a service "replacement" is defined as a renovation. A service "upgrade" is defined as an alteration.
Attached is a link to how the rehab matrix is intended to be followed.
b_98_1.pdf (nj.gov)
You will note that both a renovation and an alteration both must comply with 6.8 Materials and Methods. When you propose to undertake either a renovation or alteration on an electrical service, ALL components are subject to these requirements.
Rehab code permits a "relaxation" of working clearances for existing work, but that is far as it goes. We cannot simply apply this same leniency to all facets of the permitted work. The argument can be made, as you are attempting, that pre-existing work shall be permitted to remain "as is". That is a gross distortion of how the rehab code works. The intent of the rehab code is to encourage building upgrades to current codes within a degree of reason (thus the allowances afforded to working clearances). To allow a non-compliant issue to remain, just because "it was there when I started" does not follow the intent of the rehab code.
The closest the code comes to that is
5:23-6.2 (f) Pre-Existing Buildings: Buildings or structures legally in existence at the time of the adoption or subsequent amendment of this subchapter may continue in use and nothing herein shall be interpreted as requiring the repair, renovation, alteration or reconstruction of such building, except as provided at N.J.A.C. 5:23-2.32, Unsafe Structures.
Please note that the bold highlighted text is saying that nothing
requires that you take out a permit to fix work that, at the time of installation was compliant, but that is no longer compliant with currently adopted codes. Now I understand that at one time there was no such requirement for MWBC's to have handle ties for single pole breakers, but as I mentioned before, when work is done on the service (renovation or alteration) the circuit breakers are part of that permitted work. At this point ALL permitted work must comply with 6.8, which does not delete the requirements of article 210.4.
As a footnote, as of 02/22 upgrading the grounding electrode system to current code will now be enforceable.
In a nutshell, when doing a service "renovation" or a service "alteration", the service will have to comply with current NEC, as adopted in 3.16, with the exceptions of the requirements of 110.26.
Scott Borsos
Construction Official
NJDCA Division of Codes and Standards
101 South Broad
Trenton NJ