January 1, 1900

by Stephen M. Eisdorfer

On December 31, 2008, New Jersey’s implementation of the Mount Laurel mandate to create affordable housing opportunities in our suburban communities entered a new era. By that date, most towns that wished to remain within the protective jurisdiction of the New Jersey Council on Affordable Housing (COAH) were required to file new housing plans with COAH and petition the agency for review of those plans. More than 230 towns filed new plans with COAH. The only class of towns not obligated to file by December 31, 2008 were towns in the Highlands, for whom the deadline was extended until December 2009.

This is a new era because, for the first time since 1999, towns have been assigned specific numerical housing obligations and been required to formulate plans that meet those obligations. It is also the fi rst time since 1999 that municipalities that wish to recruit private sector builders to assist them in meeting their housing obligations have been required to designate sites and to rezone those sites for multi-family housing.

Exclusionary Zoning Litigation

It is also a new era because, for the first time since 1999, it is practical for builders to bring exclusionary zoning suits against municipalities that are not meeting their post-1999 housing obligations. At least 250 towns outside the Highlands area have not filed with COAH and are not otherwise immune from litigation. These towns are potentially vulnerable to exclusionary zoning suits that could result in site-specific builder’s remedies. A chart showing municipal housing obligations under the current COAH rules is posted on the website of Hill Wallack LLP. Click here to view. A list of towns that have filed with COAH is posted on COAH’s website at http://www.state.nj.us/dca/affiliates/coah/reports/newthirdround.xls.

Prior to filing an exclusionary zoning case, a builder must make a good faith effort to induce the town to voluntarily rezone his or her property for inclusionary development and must do so without threatening exclusionary zoning litigation. The town is not permitted to use the builder’s effort to induce voluntary compliance as an opportunity to hastily file with COAH.

COAH’s Administrative Process

For towns that have fi led with COAH, COAH has 45 days to determine whether the filing is complete. If the filing is deemed incomplete, the town has another 45 days to correct any deficiencies. If the town fails to correct the deficiencies, it is automatically deemed dismissed from COAH’s jurisdiction and becomes vulnerable to exclusionary zoning litigation.

Once a town’s petition is deemed complete, the town must give public notice of its filing. That notice opens a 45-day period for property owners, builders, and other interested persons to file written objections to the petition, with those objections to point out deficiencies in the fair share plan and identify sites proposed for favorable rezoning. The new regulations establish detailed requirements for a proper objection. If an objection does not satisfy the requirements, COAH may deem the objection incomplete. If so, objectors will have 14 days to correct any deficiencies. The filing of an objection is a critical step. By filing an objection, the property owner or builder assures that he or she will have the right to be involved in all subsequent stages of the agency proceeding. A property owner or builder who fails to file an objection at this point may or may not be able to intervene in the process later on.

Where objections are filed, the town and the objectors are obligated to participate in mediation over the objections. This is the next real opportunity for a property owner or builder to induce the town to include a proposed project in the town’s housing plan. In principle, mediation is to begin 45 days after the end of the objection period.

Once it starts, mediation is to be completed within 90 days, although this deadline can be extended. Again, however, the end result of the mediation process may be a favorable rezoning for objecting builders, since all towns will have to bring their plans into compliance with the new regulations and satisfy their fair share obligations.

COAH Standards for Inclusionary Zoning

COAH’s new standards for inclusionary zoning set the following presumptive minimum densities that vary depending upon the location of property: 8 units per acre in State Development and Redevelopment Plan Planning Area 1, 6 units per acre in Planning Area 2 and designated “centers,” 4 units per acre in sewered areas outside of Planning Areas 1 and 2, and a 40 percent increase over existing zoning elsewhere. The standards also impose a presumptive maximum set-aside in the “high growth” Planning Areas of 25 percent, i.e, that no more than 25 percent of the total units be set aside for low and moderate income families and children. For projects in which the affordable units will be rented, the minimum presumptive density is 12 units per acre everywhere, with a presumptive maximum 20 percent of the units to be set aside for low and moderate income families and individuals. In addition, for rental projects, 10 percent of the affordable units are to be set aside for very low income households—homes with incomes at or below 30 percent of the regional median income.

Although the promulgation of these standards by COAH in October 2008 represents a great step forward from COAH’s December 2004 regulations and its June 2008 regulations, there is still much in them for builders not to like. The NJBA, represented by Hill Wallack LLP, has brought suit in the Appellate Division of the New Jersey Superior Court challenging the constitutionality of these standards. The suit contends that the standards do not create incentives for builders that are sufficient to create realistic housing opportunities, as mandated by the New Jersey Supreme Court in the Mount Laurel decision. The standards are particularly problematic in places where existing permitted densities may already be higher than the COAH- prescribed densities and in places where NJDEP regulations make the COAH-prescribed densities unattainable. Indeed, even COAH recognizes that these densities and set-asides may not be sufficient in some instances.

Conclusion

COAH regulations offer a variety of possible routes for securing more workable densities and set-asides. None of those routes, however, is automatic. This new era creates new opportunities for builders, but taking advantage of those opportunities will usually require the filing of litigation or maneuvering through COAH’s review and mediation processes. As noted above, filing objections with COAH by the “objections deadline” is optimum, but it should also be stressed that COAH is obligated to accept and consider objections whenever they are filed - filing them late essentially means that an objector cannot formally participate in the COAH review and mediation process, but even late filing of objections can yield favorable rezonings in certain cases.

Identifying opportunities presented by the COAH process and the Mount Laurel doctrine often requires considerable knowledge and sophistication. The Land Use Division attorneys at Hill Wallack LLP would be glad to provide assistance to those seeking to further explore the COAH process. 

Stephen M. Eisdorfer is also a partner of the firm in the Land Use Division. A past-Member of the Board of Directors of the New Jersey State Bar Association’s Land Use Law Section, he concentrates his practice in land use litigation, including Mount Laurel litigation and litigation involving the civil rights statutes.