[Added 12-7-1998 by Ord. No. O-13-98; amended 3-22-2004 by Ord. No. O-6-04; 4-23-2007 by Ord. No. O-4-07]
In Holmdel Builders Association v Holmdel Township,
121 N.J. 550 (1990), the New Jersey Supreme Court determined that
mandatory development fees are authorized by the Fair Housing Act
of 1985, N.J.S.A. 52:27d-301 et seq., and the State Constitution,
subject to the Council on Affordable Housing's (COAH's) adoption of
rules. This article establishes standards for the collection, maintenance,
and expenditure of development fees pursuant to COAH's rules. Fees
collected pursuant to this article shall be used for the sole purpose
of providing low- and moderate-income housing. This article shall
be interpreted within the framework of COAH's rules on development
fees.
The Borough of Wharton shall not spend development
fees until COAH has approved a plan for spending such fees and the
Borough has received third round substantive certification from COAH
or a judgment of compliance.
The following terms, as used in this article,
shall have the following meanings:
A development included in the housing element and fair share
plan and includes, but is not limited to, an inclusionary development,
a municipal construction project or a one-hundred-percent affordable
development.
The New Jersey Council on Affordable Housing.
Funds paid by an individual, person, partnership, association,
company or corporation for the improvement of property as permitted
in COAH's rules.
The value of a property determined by the Municipal Tax Assessor
through a process designed to ensure that all property in the municipality
is assessed at the same assessment ratio or ratios required by law.
Estimates at the time of issuance of a building permit may be obtained
utilizing estimates for construction cost. Final equalized assessed
value will be determined at project completion by the Municipal Tax
Assessor.
A.
Collection of fees. Fifty percent of the development
fee will be collected at the time of issuance of the building permit.
The remaining portion will be collected at the issuance of the certificate
of occupancy. The developer shall be responsible for paying the difference
between the fee calculated at the issuance of the building permit
and that determined at issuance of certificate of occupancy.
B.
Residential development fees:
(1)
Within the R-40, R-15, R-10, R-75, RM-75, A,
ALR, and OAL Zoning Districts, residential developers shall pay a
fee of 1% of the equalized assessed value for residential development,
provided no increased density is permitted.
(2)
When an increase in residential density pursuant
to N.J.S.A. 40:55D-70d(5) (known as a "d" variance) has been permitted,
developers may be required to pay a development fee of 6% of the equalized
assessed value for each additional unit that may be realized.
C.
Nonresidential development fees.
(1)
Within the MB, B-1, B-2, I-1, I-2 and I-3 Zoning
Districts, nonresidential developers shall pay a fee of 2% of the
equalized assessed value for nonresidential development.
(2)
If an increase in floor area ratio is approved
pursuant to N.J.S.A. 40:55D-70d(4), then the additional floor area
realized (above what is permitted by right under the existing zoning)
will incur a bonus development fee of 6% of the equalized assessed
value for nonresident development.
A.
Affordable housing developments shall be exempt from
development fees. All other forms of new construction shall be subject
to development fees unless exempted below.
B.
Development fees shall be imposed and collected when
an existing structure is expanded or undergoes a change to a more
intense use. The development fee shall be calculated on the increase
in the equalized assessed value of the improved structure.
C.
Within the CBD, SH, AH-1 and AH-2 Zoning Districts,
developers shall be exempt from paying a development fee.
A.
There is hereby created a separate interest-bearing
housing trust fund for the purpose of depositing development fees
collected from residential and nonresidential developers and proceeds
from the sale of units with extinguished controls. All development
fees paid by developers pursuant to this chapter shall be deposited
into this fund.
B.
Within seven days from the opening of the trust account,
the Borough of Wharton shall provide COAH with written authorization,
in the form of a three-party escrow agreement between the municipality,
the bank and COAH, to permit COAH to direct the disbursement of the
funds as provided for in N.J.A.C. 5:94-6.16(b).
C.
No funds shall be expended from the affordable housing
trust fund unless the expenditure conforms to a spending plan approved
by COAH. All interest accrued in the housing trust fund shall only
be used on eligible affordable housing activities approved by COAH.
A.
Funds deposited in the housing trust fund may be used
for any activity approved by COAH to address the municipal fair share.
Such activities include, but are not limited to, rehabilitation, new
construction, RCAs subject to the provisions of N.J.A.C. 5:94-4.4(d),
ECHO housing, purchase of land for affordable housing, improvement
of land to be used for affordable housing, purchase of housing, extensions
or improvements of roads and infrastructure to affordable housing
sites, financial assistance designed to increase affordability, or
administration necessary for implementation of the housing element
and fair share plan. The expenditure of all funds shall conform to
a spending plan approved by COAH.
B.
Funds shall not be expended to reimburse Wharton for
past housing activities.
C.
After subtracting development fees collected to finance
an RCA, a rehabilitation program or a new construction project that
are necessary to address the Borough of Wharton's affordable housing
obligation, at least 30% of the balance remaining shall be used to
provide affordability assistance to low- and moderate-income households
in affordable units included in the municipal fair share plan. One-third
of the affordability assistance portion of development fees collected
shall be used to provide affordability assistance to those households
earning 30% or less of median income by region.
(1)
Affordability assistance programs may include
down payment assistance, security deposit assistance, low-interest
loans and rental assistance.
(2)
Affordability assistance to households earning
30% or less of median income may include buying down the cost of low-
or moderate-income units in the third round municipal fair share plan
to make them affordable to households earning 30% or less of median
income. The use of development fees in this manner shall entitle the
Borough of Wharton to bonus credits pursuant to N.J.A.C. 5:94-4.22.
(3)
Payments in lieu of constructing affordable
units on site and funds from the sale of units with extinguished controls
shall be exempt from the affordability assistance requirement.
D.
The Borough of Wharton may contract with a private
or public entity to administer any part of its housing element and
fair share plan, including the requirement for affordability assistance,
in accordance with N.J.A.C. 5:94-7.
E.
No more than 20% of the revenues collected from development
fees each year, exclusive of the fees used to fund an RCA, shall be
expended on administration, including, but not limited to, salaries
and benefits for municipal employees or consultant fees necessary
to develop or implement a new construction program, a housing element
and fair share plan, and/or an affirmative marketing program. In the
case of a rehabilitation program, no more than 20% of the revenues
collected from development fees shall be expended for such administrative
expenses. Administrative funds may be used for income-qualification
of households, monitoring the turnover of sale and rental units and
compliance with COAH's monitoring requirements. Development fee administrative
costs are calculated and may be expended at the end of each year or
upon receipt of the fees.
Imposed and collected development fees that
are challenged shall be placed in an interest-bearing escrow account
by the Borough of Wharton. If all or a portion of the contested fees
are returned to the developer, the accrued interest on the returned
amount shall also be returned.
A.
The Borough of Wharton shall complete and return to
COAH all monitoring forms included in the annual monitoring report
related to the collection of development fees from residential and
nonresidential developers, payments in lieu of constructing affordable
units on site and funds from the sale of units with extinguished controls,
and the expenditure of revenues and implementation of the plan certified
by COAH. All monitoring reports shall be completed on forms designed
by COAH.
B.
The ability for the Borough of Wharton to impose,
collect and expend development fees shall expire with its substantive
certification unless the Borough has filed an adopted housing element
and fair share plan with COAH, has petitioned for substantive certification,
and has received COAH's approval of its development fee ordinance.
If Wharton fails to renew its ability to impose and collect development
fees prior to the expiration of certification, it may resume the imposition
and collection of development fees only by complying with the requirements
of N.J.A.C. 5:94-6. Wharton shall not impose a development fee on
a development that receives preliminary or final approval after the
expiration of its substantive certification, nor will Wharton retroactively
impose a development fee on such a development. The Borough of Wharton
will not expend development fees after the expiration of its substantive
certification.
