New Jersey Zoning Watch

I don’t know why this merited a second article in a week’s time because it doesn’t seem to say anything new, other than this:

“This is expensive litigation,” said Jeffrey Surenian, a lawyer specializing in affordable housing who is representing the borough. 

Nevertheless, today the Star Ledger provided an update on the Mt. Laurel suit between Avalon Bay Communities and the Borough.  For the full article, click here.

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As developers contemplate a slowing housing market, NIMBY-ism continues to trump sound, constitutionally-mandated land use policy and New Jersey refocuses on its lack of affordable housing, will Mt. Laurel suits be on the rise?  While the Appellate Division in In the Matter of the Adoption of N.J.A.C. 5:94 and 5:95 by the New Jersey Council on Affordable Housing, provided for a stay on builder’s remedy lawsuits against municipalities “whose application for substantive certification is affected by the decision,” the stay apparently does not apply to municipalities who did not have substantive certification of a second round plan and who failed to file an application for substantive certification under the invalidated third round regulations.  

Thus, given that many municipalities failed to obtain substantive certification of a second round plan or file an application for the third round, it is a question worth pondering given the dynamics of an economic slowdown coupled with newly-introduced regulations from the Council on Affordable Housing (”COAH”) designed to implement the “third round” obligations of municipalities to provide constitutionally-mandated affordable housing which impose onerous requirements such as one affordable unit for every four newly-constructed market rate units.

The proposed regulations require a substantially greater contribution toward affordable housing by municipalities, particularly growing suburban and rural communities around the state, in contrast to the prior version of the third round rules.  Municipalities were informed of the key provisions of the new regulations and encouraged to adopt inclusionary zoning ordinances in a letter from COAH on December 24, 2007.

Two recent media reports involving municipalities in Union County, Roselle Park and Cranford - both communities which did not receive substantive certification of fair share affordable housing plans from COAH, which allows developers to proceed directly to litigation in Superior Court following good faith negotiations with the municipality rather than through an administrative proceeding before COAH - demonstrate that developers may be less willing to negotiate over an extended period of time in an uncertain market and will not be shy about using litigation to implement development plans which include an affordable housing component but which are alleged to be improperly denied or interminably delayed in the municipal review process.

While both cases involve similar claims by the plaintiff-developers that the municipalities have not complied with the mandate under the New Jersey Constitution to provide affordable housing and both involve designated redevelopment areas with adopted redevelopment plans, the cases appear to be about the form and density of the affordable housing provided as opposed to examples of deliberate exclusion.  Based upon media reports, the issue in the Roselle Park litigation seems to be over a disagreement with the type of housing.  The Borough’s plan contemplates for sale condominiums and retail uses for a former industrial site while the developer wants to built “luxury” apartments. 

In Cranford, the developer apparently worked with the municipality to develop a redevelopment plan and originally agreed upon a number of units which included a density bonus for “green” construction, but has attempted to renegotiate the terms of the plan based upon economic and market conditions.

While the Roselle Park case has proceeded past the initial motion phase and the court had referred the case to mediation, it appears that, based upon media reports, the municipality is firmly committed to fighting for its development plan.

In Cranford, undoubtedly, the first round of motions will deal with whether good faith negotiations ensued before the developer filed suit.  If the court finds that such negotiations took place, the Township may be in for a long and costly battle, given the fact that, following the promulgation of the third-round rules in 2004, the governing body never applied for substantive certification of a third round plan or enacted an approved growth share ordinance.

In an an environment where elected officials must balance their obligations to comply with the Fair Housing Act and the Mount Laurel I and Mount Laurel II mandates with the pressures of overzealous NIMBYs who use tactics like anonymous flyers or blog entries that warn their neighbors of “Section 8 housing” and rail against “our community” losing its “small town charm” and turning into “Elizabeth, Newark or Camden” while adding to the burden on schools, traffic, flooding and what ever other parade of horribles they can use to stoke the fears of suburban homeowners, it is no wonder that communities may now have to brace themselves for an uptick in Mt. Laurel litigation, brought on by a perfect storm of a slumping real estate market and a pattern of either indifference to or willful avoidance of constitutional mandates combined with political pandering to vocal anti-development groups.

For more information on Mt. Laurel litigation, the newly-proposed third-round COAH regulations or affordable housing issues in general, feel free to contact us at pmorin@saul.com

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The “Transit-Friendly Development” newsletter, a joint effort of NJ Transit and the Bloustein School’s Alan M. Voorhees Transportation Center at Rutgers University, “aims to enrich the transit-oriented development (TOD) conversation in New Jersey’s diverse communities by highlighting what is happening in the state and around the country: best practices, model programs, legislation and local problem-solving experiences.”

This newsletter is a fountain of information regarding new development opportunities and the January 2008 issue highlights two transit-oriented redevelopment plans:  one for the City of Berkely in Burlington County and the other for the Borough of Somerville in Somerset County.  The City of Berkely, along with the neighboring community of Edgewater Park are working together to take advantage of new light rail service to their communities.  It is expected that Edgewater Park will be preparing its own redevelopment plan to work in concert with Berkley. 

Somerville’s redevelopment plan has been in the public arena since the summer and the deadline for submitting responses to the Borough’s request for proposals is approaching.  The deadline is March 14, 2008.  The link to the landfill redevelopment plan also provides information on other redevelopment areas in Somerville.

For more information on Berkely’s or Somerville’s redevelopment plans, please contact us at pmorin@saul.com.

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In a long-awaited ruling, a Superior Court Judge in Somerset County has held that Readington Township may proceed with condemnation of hundreds of acres of land at the Solberg Airport which the Township intends to preserve as open space.

According to an article in the October 17, 2008 Express Times, Solberg Aviation Co., a family-owned airport, fought the township, arguing the condemnation masked Readington’s desire to prevent the facility from expanding.

Readington moved to condemn 624 acres of the 726-acre airport property for use as open space and obtain the development rights to the remaining 102-acre airport.  The Court, relying upon the Appellate Division’s decision in Mt. Laurel Twp. v. Mipro Homes LLC, 379 N.J. Super. 358 (App. Div. 2005), aff’d, 188 N.J. 531 (2006), found that a municipality has clear statutory authority to condemn land for open space purposes and that the condemnation of land for open space is a “public use,” even though no “active use” is contemplated.   Id. at 373.

From the Express Times article: 

In court, Solberg Airport argued the land was being condemned not for reasons of open space but to prevent the airport from expanding and possibly allowing larger airplanes to fly in and out. The local airport is used by an average of 50 to 60 pilots a day, and it is host to an annual hot air balloon festival.

Arguments were heard in court in late 2006, but [the Hon. Yolanda] Ciccone gave Solberg until March to provide additional evidence.  She wrote Solberg had presented “little to nothing new since the Nov. 3, 2006, hearing” and the evidence did not “meet the strong and convincing burden” needed to stop the condemnation.  “Solberg bears a heavy burden to demonstrate that the township’s motives rise to the level of fraud or bad faith,” the ruling said.

For the purchase, the township raised $21.7 million through a bond ordinance approved by voters.

If you are interested in receiving a copy of Judge Ciccone’s January 16, 2008 letter opinion, e-mail us at pmorin@saul.com

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In Pond Run Watershed Association v. Township of Hamilton Zoning Bd. of Adj., (A-1022-06T1) (App. Div. Jan. 10, 2008) (approved for publication), a notice involving multiple use variances sought for a proposed development, which included a 5,000-square-foot, 168-seat restaurant with a potential liquor license – but which notice failed to specifically reference the restaurant – was inadequate under N.J.S.A. 40:55D-11 and Perlmart of Lacey v. Lacey Twp. Planning Bd.

The court found that since the notice only mentioned age-restricted housing and “retail/office units” but did not mention the anticipated restaurant, it failed to adequately advise interested parties of the extent of the development, particularly where restaurants were only permitted as of right in the particular zone on developments of 100 acres or more.

Furthermore, the court enjoined further construction of the restaurant and held that variances needed to be considered again at a public hearing because the variance conditions had included an “illegal exaction” — a $476,000 negotiated payment by the developer toward the cost of a proposed off-site municipal amphitheater. 

Although the trial court correctly held that the payment was improper, the Appellate Division found that the court should have remanded the matter to the Zoning Board, rather than only eliminating that significant contribution as it may have had a major impact on the Board’s consideration of the overall project since the residential component failed to include any significant recreational space.  Rather than send the case directly to the Zoning Board, however, the Appellate Division remanded the case back to the Law Division for further clarification of the issues below, particularly in light of the fact that construction had commenced on several aspects of the project.

For a copy of the official opinion from the NJ Judiciary website, click here.

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The Appellate Division has granted an extension of the deadline for the Council on Affordable Housing to promulgate new affordable housing rules to June 2.  Housing advocates are awaiting a ruling on their request for the appointment of a special master to oversee the rule-making process.  This extends the original December 31, 2007 deadline by more than five months. 

Public hearings on the proposed regulations are scheduled for:

Thursday, January 24, at Rutgers University in Camden; 

Monday, January 28, at the Lincoln Park Administration Building in Jersey City; 

Wednesday January 30, at the Wayne Public Library, Wayne Township;

Tuesday, February 5, Hunterdon County Route 12 Complex, Flemington Borough; and

Wednesday, February 6, at Monmouth County Library in Manalapan Township. 

The new rules require one affordable unit for every four new units built in a community.  For more information, see the Star Ledger’s January 10 story here.

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On January 4, 2008, the Star Ledger reported that New Jersey municipalities will need to create 115,000 new houses and apartments for moderate and low income households by 2018.   This does not include an additional 51,000 homes and apartments that need major rehabilitiation, according to the Council on Affordable Housing. 

Report: N.J. Needs to Step Up Efforts on Affordable Housing 

By Tom Hester

. . . .The figures show New Jersey’s need for affordable housing is far greater than state officials had previously projected, outstripping Gov. Jon Corzine’s goal to provide 100,000 new or refurbished affordable housing units over the next 10 years.

. . . .

The report, prepared by the Philadelphia-based Econsult Corp., determined that more affordable housing would be needed based on projections of how many new jobs will be created — and how many total houses and apartments will be generated — over the next decade.

Using this yardstick, it predicts the greatest growth — and need for affordable housing — will occur in Gloucester, Sussex, Ocean, Hunterdon, Warren and Burlington counties. The report suggests, for example, that Parsippany-Troy Hills would have to create 1,783 units of affordable housing, and South Brunswick would have to come up with 1,223.

COAH Director Lucy Voorhoeve stressed yesterday the numbers for some towns will drop if they cooperated in providing affordable housing in the past or can show they do not have the land to build on.

Since 1987, 308 of New Jersey’s 566 towns have willingly participated in the affordable housing effort, while more than 60 others have been taken to court to act. The nearly 200 remaining towns have either failed to participate or did not have to.

. . . .

One matter that remains unsettled is how the Corzine administration and Legislature would fund the affordable housing effort, a cost some estimate could reach $18 billion.

State Community Affairs Commissioner Joseph V. Doria confirmed yesterday one proposal under serious consideration would call for a state fee on all commercial construction to help towns pay for affordable housing. Walsh said the Corzine administration is considering a 2 percent fee, but Doria maintained a percentage has not been settled.

“We have talked to various organization representing the builders, developers,” Doria said. “It is one of many ideas.”

Mike Cerra, an analyst for the New Jersey State League of Municipalities, said local officials are concerned the latest housing need figure of more than 115,000 “is so high.”

“I think like everyone else we are reviewing the numbers and the methodology,” Cerra said. “Our first reaction is to underscore our concern regarding funding. It is clear it will have a negative impact on property taxes.”

Voorhoeve said the state Department of Environmental Protection has told COAH there are 1 million acres open to housing or commercial construction, more than triple the amount of space needed for the projected new affordable units.

“Towns can use these numbers as a target when preparing their affordable housing plans,” Voorhoeve said.

The Econsult report became available as COAH went before an appeals court panel in Trenton yesterday to request an extension until June to complete the new court-ordered housing regulations. The extension is supported by the League of Municipalities but opposed by affordable housing activists who want the court to appoint a special master to oversee the settlement of housing regulations. The judges made no decision yesterday.

For the potential affordable housing obligation for each municipality on a county-by-county basis, go to: http://www.nj.com/news/bythenumbers/

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On Wednesday, January 9, 2008, Philip J. Morin III, Special Counsel in the Firm’s Real Estate Department, resident in our Newark office, will be on the faculty for this one-day Lorman Educational Services Seminar that will discuss land use law, environmental issues and the development approval process in New Jersey.   Panelists will address the newly-proposed affordable housing regulations, the state of redevelopment after Gallenthin v. Paulsboro, and look ahead to potential legislative action regarding Regional Contribution Agreements and other land use issues in 2008.

 Mr. Morin will present several lectures throughout the day, including “Overview of Development and Land Use Law,” “Land Use Procedures and the Public Hearing,” “Ethical Considerations” and “Recent Trends and Municipal Government Perspectives.”  Also on the faculty are Stephen A. Santola, Esq., Executive Vice President and General Counsel of Woodmont Properties; Brian McMorrow, P.E. of Bohler Engineering, PC and Paul Grygiel, AICP, P.P., of Phillips Preiss Shapiro Associates, Inc.

The seminar will take place in the Sheraton Atlantic City Convention Center Hotel from 9:00 a.m. to 4:30 p.m.  NY and PA CLE credit is available.

For for information and to register for this event, please click here.

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