Published in September 2010 Issue of Builder/Architect Magazine, Greater New Jersey Edition
By: Thomas F. Carroll, III, Esq.
The Council on Affordable Housing (COAH), facing proposed legislation designed to abolish it, continues to process municipal petitions seeking substantive certification (approval) of the fair share plans that have been submitted pursuant to the “third round” COAH regulations that are under appeal. At its meeting of September 8, 2010, COAH rendered some decisions of significant interest to builders and others who seek enforcement of the obligation of New Jersey municipalities, imposed by the Mt. Laurel decisions, to eliminate exclusionary zoning.
As of this writing, the legislation proposing to abolish COAH, thus far known as “S1,” has not been enacted, but this may change shortly. On December 1, 2009, the Appellate Division heard oral argument on the 24 appeals brought against the third round (post-2000) regulations of COAH. As of this writing, a decision on that appeal has not yet been issued, but that could change shortly as well.
Matters are clearly in flux, but this article summarizes where things now stand in “the COAH world.”
COAH Ejects Municipality from its Jurisdiction
COAH has rarely ejected a town from its jurisdiction. However, on September 8 it granted the motions of those who asked COAH to dismiss Marlboro Township from its jurisdiction. COAH essentially concluded that Marlboro had abused the COAH process for many years, submitting one defective fair share plan after another, thereby justifying a conclusion that Marlboro had acted in bad faith.
The central benefit of being within COAH’s jurisdiction is protection from builder’s remedy lawsuits. Thus, upon being dismissed from COAH’s jurisdiction, Marlboro became subject to such suits. Although COAH has not yet seen fit to eject other municipalities that are also acting in bad faith before COAH, the ejection of Marlboro is certainly welcome news to those who wish to see effective implementation of Mt. Laurel obligations.
COAH Enjoins Towns from Removing Inclusionary Zoning
In two other matters decided by COAH on September 8, municipalities have been told by COAH that they may not remove or modify inclusionary zoning (zoning allowing for high density market rate and lower income housing) applicable to the sites of developers. In one of those decisions, COAH issued an injunction preventing Montvale Borough from adopting a rezoning ordinance that would remove the inclusionary zoning that presently applies to a site located in that town. Similarly, COAH denied a motion filed by the Township of Little Falls requesting COAH’s permission to modify inclusionary zoning so as to eliminate townhouses as a permitted use.
This, again, is welcome news from COAH. The essence of the COAH rulings is that, where towns have adopted inclusionary zoning in the past to obtain substantive certification and, hence, protection from builder’s remedy lawsuits, they may not remove or modify such zoning willy-nilly. While there are limits to the reach of COAH’s decisions in this regard, builders and other property owners facing such threatened rezonings may find these new COAH decisions to be most useful.
The Status of COAH-Related Legislation
A bill designed to abolish COAH, designated as “S1,” was the first bill introduced in this legislative session. Since January, it has been debated both in the Senate and the Assembly. It stalled in the Assembly in late June, and legislative discussions concerning S1, and/or another COAH-related bill, continue.
The Senate adopted S1, and the Governor’s office has expressed support for it. However, few legal analysts believe that it would pass constitutional muster. The net effect of the Senate-adopted version of S1 would be to define many exclusionary municipalities as inclusionary, and to foist off the financial burden of providing lower income housing on homebuilders without providing any density benefits in return. It is almost certainly unconstitutional as written, and this reason, among others, led to the inability of the proponents of the bill to acquire Assembly approval of S1.
It is hoped that continued discussions will result in a new law that effectively removes the barriers created by exclusionary zoning.
The Appeals Contesting COAH’s Regulations
Some 24 separate appeals contesting COAH’s current regulations have been pending for nearly two years now. No opinion has yet been issued. The appeals raise some very weighty constitutional issues concerning the requirements of the Mt. Laurel obligation, and release of the court’s opinion should provide all interested parties with much-needed guidance concerning satisfaction of Mt. Laurel obligations.
What’s Next?
Efforts to enforce the Mt. Laurel obligation have been in an uncertain state for nearly a decade. Now more than ever, the elimination of exclusionary zoning, and the provision of lower income housing and reasonably priced market rate housing, would provide a boost to the depressed real estate economy. Advocates of the elimination of exclusionary zoning anxiously await the Appellate Division’s decision on the pending appeals, and the Legislature’s action on Mt. Laurel-related legislation. While the September 8 COAH decisions described above provide some welcome news, only resolution of the judicial and legislative matters can truly bring some clarity to what is now an uncertain picture.
NOTE: It is possible that there will be some significant developments from the Legislature or the Appellate Division in the near future. If so, readers are invited to visit this Blog for updates on any such breaking news.