By: Henry T. Chou, Esq.
Lawmakers have reacted swifty to the Appellate Division’s recent decision that affordable housing must be accorded “inherently beneficial” status when proposed in use variance applications, even if a town has already otherwise met all affordable housing obligations assigned by the Council on Affordable Housing (COAH).
On September 18, two Republican Senators, Phillip Haines of Burlington County and Christopher Bateman of Somerset County, stated that they would introduce a bill to override Homes for Hope, Inc. v. Eastampton Land Use Planning Board, A-5551-07, a case in which the Appellate Division held that a land use board must consider affordable housing proposed in a use variance application as an “inherently use” irrespective of the town’s COAH status.
To obtain a use variance, i.e., approval for a use not specifically permitted under the zoning ordinance, an applicant needs to demonstrate that its proposed project meets both the “positive” and “negative” criteria required by the Municipal Land Use Law. Typically, to satisfy the positive criteria, an applicant must show that the site is specially suited for the proposed use. The negative criteria requires the applicant to demonstrate that the proposed use will not pose a substantial detriment to the public good and will not substantially impair the purpose of the master plan and zoning ordinance.
An affordable housing development included in a town’s COAH-approved compliance plan is considered an “inherently beneficial use” in the same vein as hospitals and schools, with such status presumptively satisfying the positive criteria without the need to show that the site is specially suited for affordable housing. The Appellate Division’s decision in Homes of Hope extended the “inherently beneficial use” status to affordable housing developments that are not part of a town’s COAH compliance plan, i.e., proposed affordable housing that is in excess of the required number of affordable housing units assigned to a town by COAH. The Appellate Division based its holding on the rationale that additional affordable housing is no less beneficial to society just because a town has already satisfied the minimum numerical requirement imposed by COAH.
Based on reports, the bill proposed by the two Republican lawmakers would allow a land use board to deny use variance applications proposing affordable housing if COAH has already granted substantive certification to that town.
By: Henry T. Chou, Esq.
On August 24, 2009, the Appellate Division issued a decision in Homes of Hope v. Eastampton Land Use Planning Board that makes it harder for municipal land use boards to deny use variance applications by developers seeking to build affordable housing. At issue in the lawsuit was whether a 100% affordable housing project proposed by a non-profit developer should have been considered an “inherently beneficial use” by the Eastampton Land Use Board when evaluating the developer’s use variance application.
To obtain a use variance, i.e., approval for a use not specifically permitted under the zoning ordinance, an applicant needs to demonstrate that its proposed project meets both the “positive” and “negative” criteria required by the Municipal Land Use Law. To satisfy the positive criteria, an applicant must show that the site is specially suited for the proposed use. The negative criteria requires the applicant to demonstrate that the proposed use will not pose a substantial detriment to the public good and will not substantially impair the purpose of the master plan and zoning ordinance.
Typically, an affordable housing development included in a town’s COAH-approved compliance plan is considered an “inherently beneficial use” in the same vein as hospitals and schools, with such status presumptively satisfying the positive criteria without the need to show that the site is specially suited for affordable housing. The Appellate Division’s decision in Homes of Hope extends the “inherently beneficial use” status to affordable housing developments that are not part of a town’s COAH compliance plan, i.e., proposed affordable housing that is in excess of the required number of affordable housing units assigned to a town by COAH. The Appellate Division based its holding on the rationale that additional affordable housing is no less beneficial to society just because a town has already satisfied the minimum numerical requirement imposed by COAH.
However, it unclear whether the court’s holding applies the “inherently beneficial use” status only to 100% affordable housing projects (developments that consist entirely of affordable units) or whether it also applies to “inclusionary developments” (developments that contain both market-rate units and affordable units). If the holding applies to inclusionary developments, it could motivate private developers to seek use variances for inclusionary developments on a more widespread basis, and lead to the creation of more affordable housing in the State.
The Appellate Division has remanded the matter back to the Eastampton Land Use Board for further consideration of the use variance application based on the “inherently beneficial use” status of the proposed affordable housing. It seems certain that the Board will petition the Supreme Court for certification of the Appellate Division’s decision. In the meantime, municipal officials across the State are convinced that Appellate Division’s ruling – if left untouched or upheld by the Supreme Court – will make it easier for developers to obtain use variances to build affordable housing, which they fear will generate children and overburden existing schools.
On July 27, 2009 Governor Jon S. Corzine signed into law the New Jersey Economic Stimulus Act of 2009. Sections 37 through 39 of the New Jersey Economic Stimulus Act of 2009 suspend the Non-Residential Development Fee Act which was signed into law on July 17, 2008. As a result, proof of payment of a non-residential development fee or proof of an exemption is no longer required for a final certificate of occupancy to be issued.
All developers involved in the construction of non-residential development which is subject to the Non-Residential Development Fee Act must still complete Form NRDF. The Form will be modified to reflect the amendments to the Non-Residential Development Fee Act by the Economic Stimulus Act of 2009 and the additional exempt status of certain projects which receive preliminary or final site plan approval prior to July 1, 2010.
In addition, developers that have paid a non-residential development fee since July 17, 2008, may claim a refund of “the difference between the moneys committed prior to July 17, 2008 and the monies paid.” Continue reading →
AIA-NJ supports the proposed 18 month moratorium on COAH fees to promote economic activity in the state. We have formed a special task force which will research issues and make recommendations for COAH going forward. AIA-NJ has also been invited by State Senator Lesniak to participate in the COAH discussion over the next 18 months.
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