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A municipality's affordable housing obligation is a complex matter with numerous rules, calculations and elements required for compliance. The complexity of Millburn Township's settlement negotiations were exacerbated because there were no compliance mechanisms in place from any prior round obligations. The Township and its elected officials started from scratch in April of 2018. It is not uncommon for negotiations to take 3-5 years, even for those municipalities that had prior round compliance or started in 2015 for their third (3rd) round obligations. Disruption due to the COVID-19 pandemic have also had an impact on the timing of negotiations.
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It is an opportunity for households with low and moderate income, defined as 50% or less of median gross household income based on household size, or between 50% and 80% of median gross household income based on household size, respectively. In more general terms, to be eligible for an affordable unit, applicants must earn a limited amount of income and have limited assets to be qualified as either a low or moderate income household. Low or moderate income housing in the State of New Jersey is typically not “subsidized” housing. These figures are identified by region. Millburn's regional income limits for moderate, low and very low income can be found here.
Rental and sales prices are determined by methodologies which are approved by court order and are below-market rents or prices. The rent or sale price is based upon a percentage of the designated income limits that can reasonably be allocated to housing costs within a particular household size. Affordable units are individually owned or rented and managed by private companies. Regulations establish a specific bedroom mix for the affordable units consisting of 1, 2, and 3-bedroom units.
2021 New Jersey Affordable Housing Regional Income Limits
The Fair Share Housing Center (FSHC) is a recognized affordable housing advocacy group that has been heavily involved in monitoring the efforts of NJ municipalities to comply with their affordable housing obligations. They have been granted "interested party" status in virtually all affordable housing litigation. In Millburn's case, the Township is negotiating directly with FSHC in an attempt to reach settlement of our affordable housing obligation and a status of compliance and repose from the courts.
Yes. All New Jersey municipalities are required to plan, zone and provide a “realistic opportunity” through their land use ordinances for the development of affordable housing. Failing to meet these requirements, set forth under the Southern Burlington County NAACP v. Mt. Laurel Twp. (Mount Laurel) decision, can subject the Township to builder’s remedy lawsuits.
The Township has also been repeatedly told by Judge Gardner and the court appointed Special Master that all settlement negotiations are confidential. Despite repeated requests by Township elected officials, appointed professionals and the public, the court has not waivered from its stance on the confidentiality of the Township's settlement negotiations with Fair Share Housing .
Further, a litigation matter, the Township Committee discusses these issues in closed session meetings in accordance with the requirements of the Open Public Meetings Act. Those closed session discussions help preserve the Committee’s ability to discuss litigation strategy and any pending settlement negotiations without compromising its position in the litigation or in settlement negotiations. The Township understands the public’s desire to learn about all aspects of this important issue as it is nearing conclusion, but since the matter involves litigation, the Township is constrained to discuss the matter only in closed session meetings.
At the appropriate time and once the Township has permission of the court to do so, full disclosure and explanation of the settlement terms will take place.
Millburn is pursuing a Declaratory Judgment action before Judge Gardner of the Superior Court in Essex County with the expectation that the court will grant it a Judgment of Compliance/Repose if all parties involved in mediation have agreed to a settlement. Once a Fairness Hearing is completed and the Township granted compliance and repose from the courts, the Township will prepare a housing plan consistent with the FSHC settlement agreement. Also, Millburn has obtained temporary immunity from the court from future builder remedy lawsuits.
The Township's immunity has been the subject of numerous case management conferences as the Township negotiated with the Fair Share Housing Center on a settlement agreement. The settlement must be agreed upon by The Township of Millburn, Fair Share Housing, the Court's Special Master and any parties that have been granted intervener or interested party status in the case.
Link to plan: https://www.twp.millburn.nj.us/DocumentCenter/View/3397/Master-Plan-Amendment-2018-PDF?bidId
The Council on Affordable Housing (COAH) has failed to establish legally valid rules and numeric obligations for affordable housing since the second round of regulations expired in 1999. There have been numerous court battles between affordable housing advocates, the real estate developers' lobby, municipalities and COAH itself over how the rules should be formulated and the methodology by which local obligations should be established.
In March of 2015, the Supreme Court, after numerous attempts by COAH to establish legally acceptable rules and the methodology to calculate each municipality’s affordable housing obligation, took back jurisdiction over all affordable housing issues. The Supreme Court returned to the county trial courts the responsibility of determining methodology, affordable housing obligations and compliance with the constitutional obligations to provide this housing through land use ordinances, overlay zones and available inclusionary development opportunities. This order stripped COAH of its administrative powers and forced participating towns into a situation where they must attempt to determine their own obligations. This process is ongoing and will likely continue through trial and appeals courts for years to come.
No. Courts will not consider the economic impact to a municipality, whether the impact is on schools or other infrastructure, services, traffic, etc. Although the Township of Millburn and the Millburn Board of Education have concerns with respect to the adverse impact development will have on our schools and traffic, the State of New Jersey and trial courts do not allow us to consider these factors when calculating our affordable housing obligation. Infrastructure such as water and sewer capacity can be considered by the court.
We invite you to view the Affordable Housing Forum conducted on November 7th, 2017, where the Township Attorney, Planner, and Attorney for the Planning Board elaborate on these issues: https://youtu.be/-r0EQ7s6qGU
More recently at its August 18 Township Committee meeting, the Township approved the settlement agreement with FSHC. A presentation was made at this meeting, outlining the settlement agreement. https://www.youtube.com/watch?v=mS1SrG7iQAk&t=8127s
The most common option include:
Developers who file a motion to intervene are asking the Court to be granted special status in the context of a Declaratory Judgment Action. The Court considers whether that potential intervenor can further advance the interests of low and moderate income households to obtain affordable housing, within the context of the Township’s Housing Element and Fair Share Plan. In Millburn’s case, temporary immunity has been granted to the municipality from builder’s remedy lawsuits while the Township pursues approval of its plan.
This has not prevented the Court from allowing two developers to be "interested parties" regarding the Township's settlement negotiations with Fair Share Housing. Both Woodmont Properties and the potential developers of 297 Millburn Avenue (Annie Sez) have been allowed to participate in case management conferences only as "interested parties". While they do not have intervener status they are still seen by the court as potential parties that could advance the Township's obligation to provide for affordable housing.
A builder’s remedy lawsuit allows a developer to file suit to have a specific piece of property chosen by the builder rezoned to allow for the opportunity to construct housing at higher densities than a municipality would otherwise allow, provided that the developer provides a set aside of affordable units that are designated for low and moderate income. A developer is entitled to a builder's remedy if (1) it succeeds in Mount Laurel litigation; (2) it proposes a project with a substantial amount of affordable housing, and (3) the site is suitable, i.e. the municipality fails to meet its burden of proving that the site is environmentally constrained or construction of the project would represent bad planning. Southern Burlington County NAACP v. Mt. Laurel Twp., 92 N.J. 158, 279–80 (1983).
A successful developer in a builder's remedy suit is entitled to a court ordered zoning designation, including all aspects of zoning such as density, setbacks, building heights, lot coverage, etc. to accommodate its proposed inclusionary project. Municipalities in builder's remedy lawsuits may be held liable for the fees of a special master appointed by the court to assist in developing the zoning scheme on the affected property.
A municipality can be protected from builder's remedy lawsuits by receiving a Judgment of Compliance/Repose which generally provides a ten-year period during which the Township would be protected from any future builder's remedy lawsuits so long as Millburn complies with the court approved HEFSP and/or settlement agreement. Southern Burlington County NAACP v. Mt. Laurel Twp., 92 N.J. 158, 291-92 (1983). Because housing obligations have been developed for a discrete period (most recently, 1999-2015), the courts are taking the view that there is a uniform ten-year period during which Judgments of Compliance/Repose are effective, (effective to July 1, 2025, irrespective of when that Judgment is obtained.)
Once a court determines that a municipality has not satisfied its constitutional obligations concerning the development of affordable housing, it is nearly impossible to “win” a subsequent builder’s remedy lawsuit. The municipality loses the presumption of validity of its zoning ordinances and the case proceeds with the underlying premise that the municipality is improperly preventing the development of affordable housing.
As a result, when a builder’s remedy is granted, courts grant the developer the right to construct multi-family housing on its proposed site and relax the municipality’s density, height, bulk and setback standards as necessary to facilitate that development. In addition, that development will contain an affordable housing set-aside, typically between 15% and 20%. These decisions will be made by a judge upon the recommendation of a court-appointed master - not by Township officials.
There was public notice and a public hearing when the Planning Board adopted the HEFSP. Furthermore, the Court will conduct a Fairness Hearing on any settlement agreement that is approved by the Township in its declaratory judgement action. Comments may also be provided directly to the Court as part of the Fairness and/or Compliance hearing. The dates and times of the court hearings are publicly noticed. Any ordinances that are adopted by the Township in order to implement any settlement agreement will be subject to a public hearing at their second reading before the Township Committee.
Information on the action taken by 85 Woodland Road, LLC., et al. v. Township of Millburn, et al. may be found in our Affordable Housing Timeline/Summary (PDF). Ordinance related to the action may be found here:
If settlement had not been reached, the Township would be forced to litigate its affordable housing obligation and how it would meet that obligation. The Township would have lost its immunity against builder's remedy lawsuit. Ultimately the court would have decided Millburn's obligation and how it would be met. Millburn Township settled with FSHC on August 18, 2021.
The settlement agreement with Fair Share Housing. stipulates the following number of units as a set aside within these market rate developments: Canoe Brook (30), Silverman Group (12), Wells Fargo (11), Annie Sez (30), and Woodmont (39). Additionally, 75 units will be built in a 100% affordable development on a portion of the existing DPW site, now referred to as the 11 Main Street development. This results in a total of 197 affordable units. The settlement agreement also requires future developments multi-family developments t0 set aside 20% of the units for affordable housing.
The Township must only ensure development of the 100% affordable housing development. The other developments may proceed in accordance with the developer’s schedule.
The Township is in the process of selecting a developer for the 11 Main St. project. A conceptual plan, which was presented on 11/9 to the Township Committee, has been agreed upon by the governing body to be submitted to Fair Share Housing Center. Fair Share Housing Center must review and approve the concept in accordance with the Township’s settlement agreement by 12/31/21.
This is not just the choice of the Township, but also a choice of those that currently own apartment units. Current owners must be willing to convert current market rate units to affordable units with a [substantial] municipal subsidy. These units would then be deed restricted for at least 30 years and must be leased at current regional rates for moderate, low and very low income level.
Affordable units are required to be deed restricted for at least thirty (30) years.
Though these obligations are court-ordered, the Township will make every effort, as it does when developments are approved at the Planning and Zoning Boards, to ensure these issues are addressed.
The current round obligation will lapse in 2025. At that point, the Township will have to go through another process to determine what its new obligation is when it comes to affordable housing.
Once the settlement is codified by the court the Township, like all other municipalities that completed this process, will maintain its immunity until the current round ends in 2025.