On Monday, April 21, New Jersey Department of Community Affairs (DCA) Commissioner Jacquelyn Suarez testified before the Assembly Budget Committee on the FY2026 budget. 

Commissioner Suarez started her testimony outlining the uncertainty of federal funding cuts and the impact on DCA’s budget but was confident that the department is taking proactive steps to prepare for any potential funding decline. Additionally, the Commissioner indicated that over the past year, DCA has actively engaged with municipal, county and community stakeholders to gather data that would allow the department to craft policy with more up to date facts and information, which will play a role in decision-making moving forward.  

MUNICIPAL AID  

While the Commissioner did not mention municipal aid in her remarks, the proposed State FY 2026 Budget recommends a $649.3m appropriation for Consolidated Municipal Property Tax Relief Aid (CMPTRA) and $805.6m for Energy Tax Receipts Property Tax Relief Aid totaling $1.45b. The proposed CMPTRA appropriation is flat as in past years and would be transferred to Energy Tax Receipts Property Tax Relief Aid (ETR). As a result, the statutory CMPTRA formula would remain underfunded, and no municipality would receive CMPTRA in FY 2026. The budget does not include any funding for the Municipal Relief Fund.  

AFFORDABLE HOUSING 

In respect to affordable housing, Commissioner Suarez indicated that P.L. 2024, c.2, which eliminated the Council on Affordable Housing (COAH) and codified the methodology used to determine municipal fair share obligations, also directed DCA to develop calculations for each municipality. In October 2024, DCA released non-binding calculations to assist municipalities in planning for affordable housing development for the next decade. Commissioner Suarez stated that the calculations provided were “well-founded guidance for municipalities to use as they work to create housing” and indicated that that many municipalities have adopted DCA’s calculations. 

The Commissioner continued by indicating that DCA has awarded $129 million from the Affordable Housing Trust Fund (AHTF) since the start of the Murphy Administration, which created 983 affordable rental and homeownership units. She noted that smaller rental units and homeownership housing projects (25 or fewer units) have received most of the funding and include projects that are developed by community-based organizations with strong connections to housing equity issues.  

Additionally, Commissioner Suarez reported that the New Jersey Housing Mortgage and Finance Agency (NJHMFA) has allocated about $397 million through the Affordable Housing Production Fund and Affordable Housing Production Fund Set Aside programs which helped build 4,522 new units.  

The Office of Legislative Services (OLS) reports that expenditures from the AHTF are expected to be $114.5m in SFY26.  

SHARED SERVICES 

Commissioner Suarez reported that over the last six years, the Local Assistance Bureau (LAB), reported over 4,000 shared service agreements and estimated a cost savings of more than $280m. LAB provides professional and technical assistance to municipalities looking to develop shared service agreements.  

The Commissioner also mentioned the Local Efficiency Achievement Program (LEAP) grants to help offset costs to implement shared services. She reported that since SFY2020 120 LEAP grants have been awarded in the amount of $18m.  

The Senate Budget and Appropriations Committee will hear DCA testify on April 29, and the League will provide updates as needed.  

Contacts: Lori Buckelew, Deputy Executive Director, lbuckelew@njlm.org, 609-695-3481, x112, and Erin Knoedler, Legislative Analyst, eknoedler@njlm.org, x116.