Fair Share Projections
In January 2017 the New Jersey Supreme Court issued its decision on the gap issue. Reference In Re Declaratory Judgement Actions filed by Various Municipalities, County of Ocean, Pursuant to the Supreme Court’s Decision in Re Adoption of N.J.A.C. 5:96, 221 N.J. 1 (2015), Docket No. 077565 (2017). The Court affirmed, in part, and reversed, in part, the decision of the Appellate Division and may have expanded the Mount Laurel doctrine to include, with some important exceptions, low and moderate-income (LMI) households created during the 16 year gap period.
By way of background, during the summer prior to this decision, the Appellate Division held that municipalities were not responsible to zone for a “separate and discrete” amount of LMI households created during a 16-year gap, during which COAH did not promulgate substantive third round regulations. Rather, the only portion of those households that would be zoned for would be “present need,” i.e. LMI households living in crowded or substandard housing. In doing so, the Appellate Division focused on a clear reading of the Fair Housing Act and applicable regulations.
With its January 2017 decision, the Court may have expanded the Mount Laurel doctrine, beyond the plain language of the FHA and applicable regulations, to redefine “present need” to include, in addition to substandard or crowded units, a “component that addresses the affordable housing need of presently existing New Jersey [LMI households], which formed during the gap period.” >opinion at 31. However the courts also put limits on calculating this component, by directing that, “the trial courts must take care to ensure that the present need is not calculated in a way that includes persons who are deceased, who are income-ineligible or other are no longer eligible for affordable housing, or whose households may be already captured through the historic practice of surveying for deficient housing units within the municipality.” Id.
League statement on Supreme Court “gap” Ruling
Published on NJLM's The Town Crier, Legislative Backgrounder blog, January 18, 2017.
Today the New Jersey Supreme Court in a unanimous but nuanced ruling affirmed but modified the Appellate Division’s July 11 decision, which reversed a lower court’s misinterpretation of the Fair Housing Act by assigning a new and unrealistic affordable housing obligation on municipalities.
This is a complicated decision, which will be discussed and debated for months to come. But there are some readily made observations:
- The Supreme Court affirmed but modified the Appellate Division ruling. In doing so, the Court further expanded the Mount Laurel doctrine to include a new obligation on municipalities, which will be folded into present need. The Court wrote:
…the trial courts must employ an expanded definition of present need. The present-need analysis must include, in addition to a calculation of overcrowded and deficient housing units, an analytic component that addresses the affordable housing need of presently existing New Jersey low-and-moderate income households, which formed during the gap period and are entitled to their delayed opportunity to seek affordable housing.” (Page 31 of decision.)
- At the same time, the Court rejected the arguments of certain housing advocates and developers to further expand the “gap” obligation and double count certain households. The Court wrote,
The trial court must take care to ensure that the present need is not calculated in a way that includes persons who are deceased, who are income-ineligible or otherwise are no longer eligible for affordable housing, or whose households may be already captured through the historic practice of surveying for deficient housing units within the municipality.” (Page 31 of decision.)
- The Court ruling, however, has added to a very complicated, process, which will require the expenditure of further resources at the local level. The Court in this decision once again invited the Legislature to revisit the issue and provide necessary reforms.
The so-called “gap” period does not result from any failures of local government. This “gap issue” arises out of Council on Affordable Housing’s inability to promulgate third round regulations from 1999 to the present or make any final determination as to state and regional housing need, as well as constant litigation by certain groups The Fair Housing Act defines a municipal obligation to include present and prospective need, and when it has developed a plan to address both those needs, a town should be deemed compliant and allowed to proceed.
Then League Executive Director Michael J. Darcy, CAE offered the following comment:
While the Supreme Court attempts to forge a middle ground, this decision is vague as to how to determine this additional present need obligation.Thus, the ruling provides little guidance and will likely result in additional property tax resources being expended. We again call upon the Administration and Legislature to craft long-overdue reforms and promulgate a reasonable, rational state housing policy.