Affordable Housing Legislation (Final Update)

On Wednesday, March 20, 2024, Governor Murphy signed A4/S50. This bill lays out guidelines, methodology, and compliance mechanisms for how municipalities will meet their affordable housing obligations and “fair share” in advance of the fourth round, which begins on July 1, 2025.

The New Jersey Chapter of the American Planning Association initially opposed the bill’s passage solely because it was introduced in late December during lame-duck and the speed at which the Legislature wanted to move without giving all stakeholders an opportunity to review the contents of a 70-page bill.

Since then, the Chapter, through its Legislative and Housing Committees, has met with the bill’s sponsors, elected officials, key legislative staff, and allied professionals to propose critical amendments. We have also testified at hearings and produced white papers and data analyses to better inform policymakers about the planning implications.

PROPOSED CHANGES TO CONNECT COMPREHENSIVE PLANNING (ACCEPTED)

The Chapter is pleased to share that various amendments were made to incorporate the critical connection between affordable housing and the State Development and Redevelopment Plan (“State Plan”). Since last Fall, APA New Jersey has been working with the Office of Planning Advocacy on this long-anticipated update. After leading a series of outreach initiatives to solicit stakeholder feedback, the Chapter is now responsible for the draft preliminary plan, which will be available shortly. More information on the process can be found here.

Specific amendments include the following additions which were made to the Bill:

SECTION 1

t. The Legislature, in amending and supplementing the “Fair Housing Act,” P.L.1985, c.222 (C.52:27D-301 et al.), intends to facilitate comprehensive planning in alignment with smart growth principles, and the State Development and Redevelopment Plan.

u. The Legislature declares that the changes made to affordable housing methodologies, obligations, and fair share plans, as determined to be a necessity by the Legislature, through the enactment of P.L. , c. (C. ) (pending before the Legislature as this bill), are made with the intention of furthering consistency with the State Development and Redevelopment Plan.2

SECTION 2

2[x.] z. “State Development and Redevelopment Plan” or “State Plan” means the plan prepared pursuant to sections 1 through 12 of the “State Planning Act,” P.L.1985, c.398 (C.52:18A-196 et al.), designed to represent a balance of development and conservation objectives best suited to meet the needs of the State, and for the purpose of coordinating planning activities and establishing Statewide planning objectives in the areas of land use, housing, economic development, transportation, natural resource conservation, agriculture and farmland retention, recreation, urban and suburban redevelopment, historic preservation, public facilities and services, and intergovernmental coordination pursuant to subsection f. of section 5 of P.L.1985,c.398 (C.52:18A-200

SECTION 22

10. A municipality’s housing element shall be designed to achieve the goal of access to affordable housing to meet present and prospective housing needs, with particular attention to [low and moderate income] low- and moderate-income housing, and shall contain at least: […]

i. An analysis of consistency with the State Development and Redevelopment Plan, including water, wastewater, stormwater, and multi-modal transportation, based on guidance and technical assistance from the State Planning Commission.

We appreciate President Chuck Latini, Executive Director Sheena Collum, and Vice President for Policy Tom Dallessio for this important work.

PROPOSED CHANGES TO THE METHODOLOGY (NOT ACTED UPON)

Unfortunately, the Chapter was unsuccessful in its numerous attempts to update the proposed methodology. We continue to feel it is inequitable, relies on poor data that will produce unintended consequences, and could not be calculated upon the bill’s passage (and will continue to not be available until later in the Summer). Thus, the Legislature passed a bill, and the Governor signed a bill with obligations and allocations for development that no one can produce at this time to inform communities of what is expected and required in the next decade.

Throughout this process, the Chapter advocated for the following changes that were not acted upon:

Replace Qualified Urban Aid “exemptions” with the first 40 communities on the Municipal Revitalization Index. The first leg of the methodology permits an exemption of prospective need obligation to dozens of towns. As an example, Hoboken and Jersey City account for 50% of job growth in Region 1 and yet will be exempt from receiving an obligation, and the remaining towns will need to make up their sizeable fair share. These communities are thriving and developing, and both would not appear in the top tier of the Municipal Revitalization Index but are qualified urban aid municipalities. Similarly, when you travel to Region 2, a wildly desirable Montclair is exempt and yet ranks #417 out of 564 on the Municipal Revitalization Index. The Chapter urged using a timelier and more reliable dataset, by way of the Municipal Revitalization Index, to determine “distress” as an indicator for possible exemptions to affordable housing obligations. In fact, Mayor Steve Fulop of Jersey City concurred and testified that his city should not be exempted from this critical legislation.

The Third Round (Jacobson) Methodology, carried forward to the Fourth Round, produces geographic distributions of the allocation that are inconsistent with the Mount Laurel doctrine or good housing policy.

Equalized nonresidential valuation no longer works as an indicator of growth and will undoubtedly produce unintended consequences and an unequal distribution of prospective need. Negative nonresidential growth is apparent throughout the State and creates drastic fluctuations. The development of warehouses is a great example of where non-residential growth has increased but is certainly not a great indicator of where housing should go. Far superior employment data is readily available, and the end product will display that housing will be located closer to where there is availability of jobs and transportation.

The map above was shared with the Bill sponsors using the language provided in the original bill. The language was amended in the final bill to go all the way back to 1999 to address this change raised by the Chapter. However, similar test runs show there is no better indicator than that of actual employment data.

SECTION 7

For the purposes of this paragraph, the beginning of the round of affordable housing obligations preceding the fourth round shall be the beginning of the gap period in 1999.

Vacant land is no longer a necessary indicator for the methodology. The vast majority of new housing to be planned for post-2025 in Fourth Round compliance plans will not rely on “vacant” land but rather redevelopment. We recommended returning to the use of gross acres in a growth designation (under the State Plan and regional bodies). [Note: This has nothing to do with “Vacant Land Analysis” that occurs as part of the compliance process in determining how much of the allocation can be appropriately located in a municipality in a compliance round.]

We offer our thanks and appreciation to Creigh Rahenkamp, APA New Jersey Housing Committee Chair, and Graham Petto, Housing Committee Member and Principal Planner at Topology, who worked with all the data and produced visuals during our ongoing advocacy.

Concluding Remarks

The Chapter has and will continue to offer its professional expertise to members of the legislature and has offered it services to the New Jersey Department of Community Affairs in the upcoming months in anticipation of the Fourth Round. Various housing sessions will be available at the upcoming 2024 New Jersey Planning and Redevelopment Conference and our Housing Committee is currently exploring professional development opportunities for planners.

Resources