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May 14, 2013                                            URGENT ALERT

Re: Appellate Court Issues Injunction Staying Seizure of Affordable Housing Trusts

Dear Mayor:

The Appellate Division issued an injunction late yesterday, which stayed the State’s attempted seizure of potentially up to $164 million dollars in municipal affordable housing trust funds.  

Effectively, the Court blocked the actions of the Council on Affordable Housing (COAH) at their May 1 meeting.   On the date, the Council met for the first time in over two years to authorize the attempted seizure of the municipal affordable housing trust funds.  Please see the League’s May 1 letter for more on that meeting: http://www.njslom.org/letters/2013-0501-COAH.html

The Court’s action comes in response to action brought by the Fair Share Housing Center (FSHC) on Friday.     In that action, FSHC argued that the agency failed to comply with its own existing regulations.  The Court order prohibits the State from moving forward on taking the trusts until the Appellate Panel convenes for oral argument on the matter on June 5 in Newark.  The Administration could appeal the Appellate Division injunction to the New Jersey Supreme Court.  

As you know, the League strongly opposed the State’s attempted seizure of the funds and welcomes and appreciates the Court’s action.   The affordable housing trusts are collected by municipalities to subsidize the construction of affordable housing, assisting municipalities in meeting their state mandated housing obligations and providing a revenue source that is not dependent on the property tax.     If the State were successful in seizing these local trusts, municipalities would be forced to comply with these obligations by depending on other revenues sources, including the property tax. 

As a result of the court injunction, municipal responses and payment to COAH of “uncommitted” funds are now not due by May 22.    However, you may want to continue to prepare and have your responses ready to go if it becomes necessary to submit at some future date.  Please consult with your attorneys and housing specialists as to what approaches are most appropriate for your municipality.

The League will continue to advise you of all developments on this matter.  Questions can be directed to Mike Cerra at mcerra@njslom.com or 609-695-3481 x120.

Very truly yours,

Janice S. Mironov, President
New Jersey State League of Municipalities,
Mayor, East Windsor Township

William G. Dressel, Jr.
Executive Director

 

 

 

 

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