Affordable housing overhaul gets Senate panel’s OK

Following hours of testimony Thursday, a Senate panel advanced a bill overhauling New Jersey’s affordable housing system alongside a raft of related bills.

The five-member Senate Community and Urban Affairs Committee approved the larger overhaul, which saw some new amendments Thursday, in a party-line vote, with the committee’s two Republicans in opposition. Most of the other bills won unanimous approval.

One of the changes to the larger bill would shift the deadline for state officials to issue calculations that towns use to determine their affordable housing obligations. The amendment caused concern among some officials, who warned the timeline would leave towns little time to draft plans.

“If you have a municipality that just had an election cycle and ends up now swearing in new members in January, has a change of control, doesn’t have continuity, a change in professionals, the whole nine yards — having the timeline to be immediately thereafter, in and of itself, may not be plausible,” said Sen. Holly Schepisi (R-Bergen).

Under the bill, local officials must submit their affordable housing plans to the state by the end of January 2025 or risk exposure to builder’s remedy lawsuits, which are lodged by developers to force construction without approval from local governments.

The new deadline could leave some towns with just one month to draft a 10-year affordable housing plan, and there’s no guarantee that recently elected local officials would have the knowledge to work out a plan so quickly, said Chatham Borough Council President Jocelyn Mathiasen.

“If you have people who are new, there is so much to learn, and a lot of us are small communities,” Mathiasen said. “Some of us have administrators who are really with it and great attorneys. Some of us don’t. Some of us have attorneys who switch with political parties.”

Despite the changes, support for the bill fell among familiar lines: Housing advocates, construction laborers, and developers generally supported it, while some local officials cautioned about the effect it might have on smaller communities they claimed would face outsized development under its provisions.

The New Jersey League of Municipalities and the New Jersey Conference of Mayors, two of the largest groups representing the state’s local elected officials, did not pick a side, though they had some suggestions.

East Windsor Mayor Janice Mironov, speaking for the League, asked the committee to add additional legal protections for towns that have calculated their affordable housing obligations using the figures issued by the state Department of Community Affairs, warning the bill as written would allow challenges against well-meaning municipalities.

“If a municipality were to accept a number by DCA and it’s challenged by a developer who calculates their own number and a higher number, there’s no legal status accorded to the DCA number, the municipal number from being challenged in that respect and in fact being increased,” said Mironov.

While the bill would immunize towns that meet program deadlines from builder’s remedy lawsuits, they could still face other exclusionary zoning suits and challenges within a dispute resolution program the bill would create.

Mironov added the bill should require the Department of Community Affairs to make the data sets and other factors used to calculate affordable housing obligations available to stakeholders to ensure a predictable and objective process.

The rest of the package

The panel approved seven other affordable housing bills alongside the broad overhaul Thursday, with most receiving little discussion and even less opposition.

Among those bills is legislation that would allow affordable housing developers to deduct a portion of their construction expenses from their gross income and corporate business tax bills. Separate legislation would exempt builders charged with erecting 100% affordable housing developments from the state’s sales tax.

Another bill would allow affordable housing projects backed by state or local affordable housing trust funds to make payments in lieu of taxes. That bill drew some concern from one of the committee’s members, who said the bill should be amended to send PILOT funds to municipalities and school districts instead of to municipalities and counties.

“Our school districts are receiving no money under these PILOTs, and as we continue to build and have more of these family units coming in, there becomes a greater disparity, particularly in the suburban areas where a supermajority of the property taxes are attributable to schools,” said Schepisi, who abstained. “We need to try to make sure that we don’t have a tipping point where it becomes unmanageable.”

Other legislation approved Thursday would reserve some state rental assistance funds for a voucher program to help homeowners meet mortgage, insurance, and property tax costs, among some others.

The Assembly Housing Committee is set to consider the affordable housing bill package at its Jan. 29 meeting, but it’s unclear when the matter will wind its way to votes by the full Legislature. Because the bill includes an appropriation, it must also move through appropriations committees in both chambers.

Singleton, who made numerous requests for additional information from Thursday’s witnesses, said discussions about changes to the bill package would continue, but he warned the process could not drag on forever.

“I thank everyone for their thoughtful comments here today. As I said, there is continued commitment for further dialogue,” Singleton said. “I will say this, though, and I want to be completely fair and upfront with everyone: The further dialogue does not have an endless date.”