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May 26, 2011

RE:  Affordable Housing and COAH Update

Dear Mayor:

The purpose of this letter is to provide you an update on various developments regarding affordable housing and on-going litigation regarding COAH’s 3rd round regulations.   The letter is divided into three sections: Legal Update, Legislative Update and current status of municipalities.

Legal Update.   In late March, the New Jersey Supreme Court granted all the petitions for certification of the October 8, 2010 Appellate Division decision (see October 8, 2010 Dear Mayor Letter and March 31 Dear Mayor letter) which invalidated COAH’s third round regulations.  The League of Municipalities was one of the parties seeking certification, as were several municipalities.   The League asked the Court to hear all of the petitions so as to get a comprehensive decision that can provide guidance to municipalities. We are obviously pleased with the Court’s decision. 

The October decision struck down the burdensome regulations promulgated by the agency, which were opposed by local governments for the inflated projections of growth and reliance on a faulty vacant land analysis.  However, in doing so, the Court also invalidated the “growth share” methodology as adopted by the agency.    It is important to note that at issue before the Court is not the “Mount Laurel doctrine” itself but rather how the doctrine is best implemented.

Our adversaries in this litigation claim that growth share is an attempt by the League and municipalities to avoid growth and housing obligations, and that makes the approach unconstitutional.      Their assertion is both false and, considering that it was housing advocates who first proposed growth share, highly disingenuous.    These advocates continue to falsely interpret the frustration of local officials with an unwieldy bureaucratic process as entrenched opposition to affordable housing.

The League will urge the Court to settle on a methodology that is reasonable and rational, which provides for affordable housing and does so in a way consistent with the principles of smart growth and the State Plan and does not impose a financial obligation on our property taxpayers.  We await the scheduling of oral argument. 

Legislative Update.    On January 24, Governor Christie conditionally vetoed S-1/A-3447, which would have eliminated the Council of Affordable Housing and made other changes to the State’s housing laws.    After a nearly year-long debate, the legislation that was sent to the Governor was opposed by local governments as well as by the Administration.    Senator Ray Lesniak, the primary sponsor, subsequently withdrew the legislation, but indicated that he was working on new legislation that would combine the best elements of the various proposals.  To date, no new legislation has been introduced and it appears unlikely that a legislative solution will pass before the Legislature recesses in late June. 

Current Status of Municipalities.   Because of the uncertainty of COAH and whether any new units would count towards a future obligation, many municipalities are uncertain as to how to proceed in the current environment.    However, PL 2008, c. 46, commonly known as A-500, put a 4-year window on existing trust fund dollars as well as newly collected funding.     The 4-year window for local trust fund dollars will expire just over a year from now, in July, 2012.   At that time, the State could seize local trust fund dollars in place in 2008 that have not been committed.     If your municipality has uncommitted housing trust fund dollars, we would recommend speaking to your attorney and staff dedicated to housing issues as to how to best proceed.

The Department of Human Service and the Department of Community Affairs, along with the NJ Housing Mortgage Finance Agency, recently announced a joint effort to expedite the process of moving individuals out of institutions off the DHS waiting list.    Presumably, this will offer municipalities an opportunity to commit trust fund dollars for units that will be credited against future obligations, whether the obligation is determined by a State agency such as COAH or defined in statute.   We are seeking clarification from the DCA on this program, and will provide additional information at a future date.   In the meanwhile, additional information can be found at:

For questions on this letter, please contact Mike Cerra at or 609-695-3481 x120.

Very Truly Yours,

William G. Dressel, Jr.
Executive Director



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