By Joshua Burd
New Jersey towns and cities must account for more than 15 years of unmet need in determining their affordable housing obligations, the state Supreme Court has ruled, paving the way for the development of tens of thousands of low- and moderate-income units statewide.
In a unanimous decision issued Wednesday, the court said towns are constitutionally obligated to include a so-called gap period, a stretch starting in 1999 in which state officials failed to produce valid guidelines for calculating affordable housing needs. The judges ruled that local officials must address the needs of low- and moderate-income households that have come into existence since then, finding that those obligations are part of the “present need” for affordable housing.
In doing so, the judges have sided with housing advocates and developers who have fought to have those years counted since the Supreme Court assumed oversight of the process in 2015.
“We hold that, in determining municipal fair share obligations for the Third Round, the trial courts must employ an expanded definition of present need,” Justice Jaynee LaVecchia wrote on behalf of the court. “The present-need analysis must include, in addition to a calculation of overcrowded and deficient housing units, an analytic component that addresses the affordable housing need of presently existing New Jersey low- and moderate-income households, which formed during the gap period and are entitled to their delayed opportunity to seek affordable housing.”
Exactly how much that will add to the overall statewide obligation was not clear from Wednesday’s ruling. But published reports have said accounting for the gap years could raise the obligation from 100,000 to 200,000 units across New Jersey.
The case stemmed from an appeal last year by 13 municipalities in Ocean County, which were among some 300 declaratory judgment actions that were initiated by towns and cities after the Supreme Court’s 2015 decision. At issue was the latest set of rules crafted by the Council on Affordable Housing — the agency born from the 1985 Fair Housing Act — that municipalities used to calculate their affordable housing obligations.
COAH’s second housing cycle rules had expired in 1999. In the subsequent years, the agency failed to come up with guidelines for a third round that weren’t challenged in court, leading to years of controversy and uncertainty for local governments and developers around the state.
The Ocean County towns and the New Jersey State League of Municipalities argued against counting the gap years in their obligations, believing it would overwhelm their local governments with new requirements. The Fair Share Housing Center, the New Jersey Builders Association and private developers argued that that gap years must be captured.
After a trial court ruled in favor of housing advocates early last year, the municipalities appealed. That decision was reversed by the Appellate Division, causing Fair Share Housing to appeal to the Supreme Court.
In Wednesday’s opinion, the justices said they had affirmed the Appellate Division opinion, but in a modified form.
“The Appellate Division as well as the trial court (plus the other trial courts that have considered the matter) incorporated, in their own ways, the recognition that the need that arose during the gap period was a responsibility of the municipalities,” the opinion read. “Indeed, both decisions below inherently recognized that there could be no hiatus in the constitutional obligation. We agree and, therefore, affirm that important aspect to the Appellate Division judgment.
“What separated the trial court and Appellate Division panel in this matter is how to account for need arising during the gap period.”
This is a developing story. Check back to RE-NJ.com and tomorrow’s edition of The Briefing for more reaction and analysis. Click here to sign up for The Briefing.
