Land Use Preemption

There are several land use preemption bills that may be considered during the Lame Duck period, which is between now and the seating of the new legislature in January. Some of these bills that had not been previously considered or have stalled during the past two years.

Land Use Preemption Bills

S-1408/A-2757 Stranded Assets

  • Sponsor(s): Senators Singleton & Wimberly; Assembly Representatives Greenwald, Calabrese, and McCoy 
  • Status: 2nd Reading in the Senate; Assembly Commerce, Economic Development & Agriculture Committee 

An amended, version of S-1408 authorizes the conversion of certain office parks and retail centers to mixed-use developments w. The amendments to S-1408 do not address the concerns raised by local officials and removes the two-year sunset, making the bill even more objectionable.  

As amended, the SCS for S-1408 would require a municipal planning board to permit the conversion of eligible properties, so-called “stranded assets” into mixed-use developments, effectively bypassing the existing variance procedure and preempting local zoning. The bill defines an eligible property as an office park that is at least 50,000 square feet or a retail center of at least 15,000 square feet; and has a vacancy rate of at least 25% rate for at least 18 months immediately preceding the application; or has suffered an economic downturn over the immediately preceding 3 years, demonstrated by evidence of a quantifiable loss in revenue such that the developer’s expenses for the premises have exceeded revenues by at least 30% or more each year.  

The 2-year sunset in the original bill, meaning that this would be a permanent preemption of local planning, has been removed.

A mixed-use development, which may include the demolition of existing structures, that is subject to a preemptive conversion shall be considered a permitted use and not require a variance, subject to several criteria including the development otherwise complies with zoning requirements in the municipality’s mixed-use zone; the application proposes at least two types of uses, one of which shall be residential, and no use shall be industrial; and at least 20% of the residential units to be constructed shall be reserved as very-low-income housing, low-income housing, or moderate-income housing.

The bill goes on to establish the criteria to follow if there are multiple mixed-use zones and legislates mixed-use zones if the municipality does not have a mixed-use zone. This is likely to result in costly litigation.   

In addition, the bill’s legislative findings declare that “one significant impediment to converting stranded retail centers and office parks into dynamic mixed-use communities is the application of outdated, rigid municipal zoning regulations that often separate residential and commercial uses from each other.” Then states that in order to encourage the development of vibrant and desirable mixed-use communities, further to the public good, it is appropriate for the Legislature to set standards to modernize local land use regulations that stand in the way of the repurposing and redevelopment of stranded retail centers and office parks.

The League testified in strong opposition to the legislation based on the unnecessary and unwarranted preemption of local master planning. In our statement, we noted that any such application can be made through the variance process or redevelopment process. Further, we noted that the criteria in the bill are ripe for litigation and expressed concern that this could turn into a backdoor means to challenge a town’s approved affordable housing plan and expose the municipality to litigation.

S-4451/A-5667 Land Use Element to be Included as Part of Master Plan

  • Sponsor(s): Senators Singleton & Wimberly; Assembly Representatives Lopez and Karabinchak 
  • Status: Passed Senate 23-14; Assembly Housing Committee  

S-4451 modifies requirements for land use plan element and housing plan element of municipal master plan. 

The League raised several concerns with the sponsor, principally because the legislation makes the housing element a mandatory element, and the bill is effective immediately. The implication is that every current master plan could be deemed non-compliant with the statute, forcing the immediate revision of hundreds of master plans.  

The new legislation will seemingly require municipalities to completely reassess and revamp their master plans to accommodate the new housing requirements. It will require the expenditure of significant resources to have the appropriate professionals go out into the municipalities to assess the current plans and changes that will need to be made, as well as to create further plans regarding, for example, transportation and access.

S-2974/A-3043 Reduction in the Required Number of Parking Spaces in Statewide Site Improvement Standards at Residential Developments  

  • Sponsor(s): Senators Sarlo and Singleton Assembly Representatives Calabrese, Greenwald and Karabinchak 
  • Status: 2nd Reading in the Senate; Assembly State and Local Government Committee  

S-2974 would restrict a municipality’s ability to make land use decisions that best suit its community and that are reflected in its Master Plan. By mandating specific zoning obligations without local input, it would undermine local officials’ ability to properly manage land use in their municipality. Without local review, planning, and decision-making authority, local officials cannot be as effective to their respective communities.  

S-2974 assumes that reduced parking is appropriate for all projects based on their proximity to public transportation. While this may be true in some instances, it may not be true in others. Decisions on minimum parking for projects are best made on a case-by-case basis and should be made by local officials with an understanding of the specific needs of the community. Under current law, a developer can obtain relief from minimum parking standards.  

Eliminating minimum parking requirements may be suitable for some areas, but in others could cause congestion and parking shortages. Limited parking availability increases “cruising” or the amount of time drivers spend looking for parking.   

Under current law, a developer can obtain relief from the standards from a reviewing board on a case-by-case basis, but such relief is subject to the scrutiny of local officials. This relief done at a local level allows for individual projects to be reviewed and relief to be granted when appropriate. This type of review maintains the original legislative intent and function of the site improvement standards.

S-4048/A-5241 Warehouse Prohibition Near Historic District  

  • Sponsor(s): Senators Gopal and Singleton ; Assembly Representatives Murphy, Peterpaul, and Miller 
  • Status: 2nd Reading in the Senate; Assembly State and Local Government Committee  

This amended legislation narrowly defines a historic district and grants waiver authority to the Planning Board where the historic district is located. Under this narrow definition of historic district, this legislation applies to about eight locations throughout the state. However, in one instance, the historic district is in a neighboring municipality from the proposed development and grants land use authority to the neighboring municipality where there is no responsibility or accountability to the residents of the developing municipality.  

The League opposes S-4048 because it violates the long-held tenet of home rule where municipalities make decisions for their communities and stand accountable to their residents.