We’ve already given you the COAH in 90 Seconds, a short primer on affordable housing (or as the author called it: “Affordabullshit”) so feel free to read that first.
On Tuesday night Hopewell Township served up, in a joint committee meeting round-table, its own overview of the history of affordable housing in New Jersey, the obligations that arose from civil litigation, actions Hopewell Township has taken to meet those obligations, speculation about the future of affordable housing, and also implications of failing to comply.
It was three hours of presentating and commenting. I’m boiling it down for you but it is still long.
History of Affordable Housing in New Jersey
The history of affordable housing in New Jersey is long and technical. Unless you’re a nerd or a lawyer, what you really need to know is that addressing affordable housing issues started with a series of court cases, starting in 1975, collectively known as the “Mount Laurel” cases through which the court established several major rules including a burden on municipalities to plan for, provide and/or not exclude affordable housing.
Steve Goodell, Hopewell Township attorney, explained that through the 1983 Mount Laurel decision (Mount Laurel II), the court expressed that in the absence of legislative action, the court would continue to regulate and solve the affordable housing problems and it further established the notion of a “builder’s remedy” which is the method of enforcing the affordable housing obligation.
“It’s the hammer that the court wielded against the towns that have exclusionary housing,” said Goodell.
From this litigation was born the “Fair Housing Act” which is a statute adopted by the state legislature that tried to give guidance and clarity to municipalities about their fair share of the affordable housing obligations. The Fair Housing Act created the Council on Affordable Housing (“COAH”), which is the administrative agency intended to identify municipal fair share numbers and compliance mechanisms which are revisited every six years.
The 6 year periods are known as “rounds.” Round 1 occurred between 1987-1993 during which time COAH determined each region’s required number of affordable housing units and how to comply. If a municipality had a plan, the municipality submitted its COAH plan for certification to be immunized from developer’s lawsuits (we’ll be talking about the penalty = “builder’s remedy” later in this article). Round 2 was between 1993-1999 and COAH issued new numbers. You’d expect Round 3 to start in 1999 or even 2000. It did not.
The Current State of Obligations
Round 3 (1999-now) was supposed to mean new numbers but it did not quite happen immediately. Towns were very concerned with the forced growth they were being required to undergo to provide for affordable housing units. COAH considered an approach called “growth share” which means that if a town grows, then the burden of fulfilling an affordable housing obligation increases with development. Affordable housing advocates opposed this “growth share” approach, and litigation continued with several challenges that continued until this year. Ultimately, the court told COAH that “growth share” was not a constitutional approach and the prior Round 2 “fair share” methodology need to be applied again. A tight timeframe was also established by the court for COAH to issue new numbers and compliance regulations, which preliminarily COAH has done. Currently, the regulations are in the “public comment” phase which means that it is having public hearings and also accepting written comments on the rules.
“Fair share” consists of 3 elements: 1) present need / rehabilitation share, 2) unanswered obligation which are from Round 2; and 3) prospective need which are the obligations going forward from now until 2024.
Frank Banisch, Hopewell Township’s urban planner, explained that prior to Round 3 change, 20% of all newly built housing projects (greater than 2 units) had be affordable but now the obligation is 10% which means that more development must be built to reach that set-aside. Also the affordable housing must be inclusionary along with an economic feasibility study for the inclusionary zoning, which is a cost placed on the municipality.
What if a municipality doesn’t comply
The consequence for non-compliance is something called a “builder’s remedy” which is when a potential developer brings suit against the municipality seeking to remedy the municipality’s exclusionary zoning. The potential result is that the land can then be zoned for something else to permit affordable housing. “If you have failed in your obligation to find one of those ways that fit in rationally with your plan, then the court will allow a developer to come in and in effect rewrite your development plan,” said Goodell.
“Either you choose your fate, or it gets chosen for you,” stated Banisch.
So far, not many builder’s remedy lawsuits have been filed because the economic climate did not support booming development but at this time “it is a threat that has to be considered,” said Ronald Morgan, Hopewell Township’s Planning Board attorney.
Hopewell Township’s Fair Share Obligations and Efforts Taken To Meet the Existing Obligation
The new fair share obligation (that’s all 3 elements) for the entire state is cumulatively 115,818 units. Under the now invalidated “growth share” model, Hopewell Township thought it had an obligation of 419 units (albeit for a shorter “round” than the current rules that would apply for the periods through 2034) said Edwin Schmierer, Hopewell Township’s Affordable Housing attorney. However… under the new “fair share” approach
For Hopewell Township, under the new proposed rules, the total remaining affordable housing obligation for the period of 1987-2024 is 1,477 (with 982 due by 2024 and the balance of 495 due by 2034).
Schmierer stated that Hopewell Township has been working toward this goal early on in the recommendation process through a variety of projects. The Township has provided some “scattered site housing” which are units scattered throughout an existing community and also established relationships with non-profits including Community Options and Project Freedom to build housing primarily for the developmentally disabled. Hopewell Gardens is also a 1- and 2- bedroom rental community that has also helped to alleviate some of the affordable housing obligations.
The new “third round” rules are far from final. In the next few months, here’s how they will unfold across the state:
- April 30: Draft rules released
- June 2: Formal proposal published as potential rules
- July 2: COAH public hearing
- August 1: deadline for public written comments on rules
- October 2: COAH expected to adopt rules (with or without changes to the current proposal)
- November 17: effective date of rules (assuming no court intervention)
- May 15, 2015: municipalities propose new plans for certification
The future of COAH is unclear but according to Schmierer, “The only answer is to do what you’ve been doing. This whole COAH thing was up in the air yet the town stayed the course and continued the plan… If the Supreme Court changes the ground rules, [the Township is] in a much better position to show that has been doing it and is continuing to do so.”
MercerMe will continue to cover issues regarding affordable housing as they develop over the coming months, especially as they shape how our communities are trying to balance need for preservation, open space, decline in tax ratables and education.