[Amended 6-15-1992 by Ord. No. 92-15; 10-4-1993 by Ord. No. 93-25; 10-7-1996 by Ord. No. 96-13; 12-2-1996 by Ord. No. 96-15; 11-21-2005 by Ord. No. 2005-23; 6-5-2006 by Ord. No. 2006-11; 7-5-2006 by Ord. No. 2006-12; 12-15-2008 by Ord. No. 2008-20; 8-15-2016 by Ord. No.
2016-19; 11-7-2016 by Ord. No. 2016-27]
In accordance with In the Matter of the Adoption of N.J.A.C.
5:96 & 5:97 by the New Jersey Council on Affordable Housing, 221
N.J. 1 (2015) ("Mount Laurel IV"), the Borough of Metuchen filed an
action for declaratory judgment requesting that the Court declare
that Metuchen has complied with its constitutional obligation to provide
a realistic opportunity for the development of housing that is affordable
to low- and moderate-income families and individuals.
In order to carry out such constitutional obligation, the Code
of the Borough of Metuchen is to be amended to include provisions
addressing Metuchen's constitutional obligation to provide for its
fair share of low- and moderate-income housing, as directed by the
Superior Court and consistent with N.J.A.C. 5:93-1, et seq., as amended
and supplemented, N.J.A.C. 5:80-26.1, et seq., as amended and supplemented,
and the New Jersey Fair Housing Act of 1985.
This chapter is intended to provide assurances that low- and
moderate-income units ("affordable units") are created with controls
on affordability over time and that low- and moderate-income households
shall occupy those units.
This Ordinance shall apply except where inconsistent with applicable
law.
The Metuchen Borough Planning Board has adopted a Housing Element
and Fair Share Plan pursuant to the Municipal Land Use Law at N.J.S.A.
40:55D-1, et seq.
The Housing Element and Fair Share Plan have been endorsed by
the governing body.
This chapter implements and incorporates the adopted and endorsed
Housing Element and Fair Share Plan and addresses the requirements
of N.J.A.C. 5:93-1, et seq., as amended and supplemented, N.J.A.C.
5:80-26.1, et seq. as amended and supplemented, and the New Jersey
Fair Housing Act of 1985.
Therefore, is ordained by the Mayor and Council of the Borough
of Metuchen as follows.
The Borough of Metuchen shall file such annual monitoring reports
as may be directed by the Court regarding the status of the implementation
of its Court-approved Housing Element and Fair Share Plan. The report
shall be filed with the Middlesex County Superior Court and shall
be available to the public at the Metuchen Municipal Building, Borough
Clerk's Office, 500 Main Street, Metuchen, NJ 08840.
The following terms when used in this article shall have the
meanings given in this section:
The Fair Housing Act of 1985, P.L. 1985, c. 222 (N.J.S.A.
52:27D-301 et seq.).
Constructed in compliance with the technical design standards
of the Barrier Free Subcode, N.J.A.C. 5:23-7.
The entity designated by the Borough to administer affordable
units in accordance with this article, N.J.A.C. 5:93, and UHAC (N.J.A.C.
5:80-26).
A regional marketing strategy designed to attract buyers
and/or renters of affordable units pursuant to N.J.A.C. 5:80-26.15.
The average percentage of median income at which new restricted
units in an affordable housing development are affordable to low-
and moderate-income households.
A sales price or rent level that is within the means of a
low- or moderate-income household as defined within N.J.A.C. 5:93-7.4,
and, in the case of an ownership unit, that the sales price for the
unit conforms to the standards set forth in N.J.A.C. 5:80-26.6, as
may be amended and supplemented, and, in the case of a rental unit,
that the rent for the unit conforms to the standards set forth in
N.J.A.C. 5:80-26.12, as may be amended and supplemented.
A development included in or approved pursuant to the Housing
Element and Fair Share Plan or otherwise intended to address the Borough's
fair share obligation, and includes, but is not limited to, an inclusionary
development, a municipal construction project or a 100 percent affordable
housing development.
Any mechanism in a municipal Fair Share Plan prepared or
implemented to address a municipality's fair share obligation.
A housing unit proposed or created pursuant to the Act and
approved for crediting by the Court and/or funded through an affordable
housing trust fund.
The New Jersey Housing and Mortgage Finance Agency established
by P.L. 1983, c. 530 (N.J.S.A. 55:14K-1, et seq.).
A housing unit designed to meet the needs of, and exclusively
for, the residents of an age-restricted segment of the population
such that: 1) all the residents of the development wherein the unit
is situated are 62 years of age or older; or 2) at least 80 percent
of the units are occupied by one person who is 55 years of age or
older; or 3) the development has been designated by the Secretary
of the U.S. Department of Housing and Urban Development as "housing
for older persons" as defined in Section 807(b)(2) of the Fair Housing
Act, 42 U.S.C. § 3607.
A structure in which households live in distinct bedrooms,
yet share kitchen and plumbing facilities, central heat and common
areas. Alternative living arrangements include, but are not limited
to: transitional facilities for the homeless; Class A, B, C, D and
E boarding homes as regulated by the State of New Jersey Department
of Community Affairs; residential health care facilities as regulated
by the New Jersey Department of Health; group homes for the developmentally
disabled and mentally ill as licensed and/or regulated by the New
Jersey Department of Human Services; and congregate living arrangements.
A facility that is licensed by the New Jersey Department
of Health and Senior Services to provide apartment-style housing and
congregate dining and to assure that assisted living services are
available when needed for four or more adult persons unrelated to
the proprietor and that offers units containing, at a minimum, one
unfurnished room, a private bathroom, a kitchenette and a lockable
door on the unit entrance.
A household that has been certified by an Administrative
Agent as a low-income household or moderate-income household.
The Council on Affordable Housing, as established by the
New Jersey Fair Housing Act (N.J.S.A. 52:27D-301, et seq.).
The State of New Jersey Department of Community Affairs.
A housing unit with health and safety code violations that
requires the repair or replacement of a major system. A major system
includes weatherization, roofing, plumbing (including wells), heating,
electricity, sanitary plumbing (including septic systems), lead paint
abatement and/or load bearing structural systems.
Any person, partnership, association, company or corporation
that is the legal or beneficial owner or owners of a lot or any land
included in a proposed development including the holder of an option
to contract to purchase, or other person having an enforceable proprietary
interest in such land.
The division of a parcel of land into two or more parcels,
the construction, reconstruction, conversion, structural alteration,
relocation, or enlargement of any use or change in the use of any
building or other structure, or of any mining, excavation or landfill,
and any use or change in the use of any building or other structure,
or land or extension of use of land, for which permission may be required
pursuant to N.J.S.A. 40:55D-1, et seq.
A development containing both affordable units and market
rate units. This term includes, but is not limited to: new construction,
the conversion of a nonresidential structure to residential use and
the creation of new affordable units through the gut rehabilitation
or reconstruction of a vacant residential structure.
A household with a total gross annual household income equal
to 50 percent or less of the median household income.
A restricted unit that is affordable to a low-income household.
The primary structural, mechanical, plumbing, electrical,
fire protection, or occupant service components of a building which
include but are not limited to, weatherization, roofing, plumbing
(including wells), heating, electricity, sanitary plumbing (including
septic systems), lead paint abatement and load bearing structural
systems.
Housing not restricted to low- and moderate-income households
that may sell or rent at any price.
The median income by household size for the applicable housing
region, as adopted annually by COAH or a successor entity approved
by the Court.
A household with a total gross annual household income in
excess of 50 percent but less than 80 percent of the median household
income.
A restricted unit that is affordable to a moderate-income
household.
Any sale or transfer of ownership other than the transfer
of ownership between husband and wife; the transfer of ownership between
former spouses ordered as a result of a judicial decree of divorce
or judicial separation, but not including sales to third parties;
the transfer of ownership between family members as a result of inheritance;
the transfer of ownership through an executor's deed to a class A
beneficiary and the transfer of ownership by court order.
A process by which currently income-eligible households are
selected for placement in affordable housing units such that no preference
is given to one applicant over another except for purposes of matching
household income and size with an appropriately priced and sized affordable
unit (e.g., by lottery).
The maximum housing value in each housing region affordable
to a four-person household with an income at 80 percent of the regional
median as defined by duly adopted Regional Income Limits published
annually by COAH or a successor entity.
The repair, renovation, alteration or reconstruction of any
building or structure, pursuant to the Rehabilitation Subcode, N.J.A.C.
5:23-6.
The gross monthly cost of a rental unit to the tenant, including
the rent paid to the landlord, as well as an allowance for tenant-paid
utilities computed in accordance with allowances published by DCA
for its Section 8 program. In assisted living residences, rent does
not include charges for food and services.
A dwelling unit, whether a rental unit or an ownership unit,
that is subject to the affordability controls of N.J.A.C. 5:80-26.1,
as amended and supplemented, but does not include a market-rate unit
financed under UHORP or MONI.
The Uniform Housing Affordability Controls set forth in N.J.A.C.
5:80-26, et seq.
A household with a total gross annual household income equal
to 30 percent or less of the median household income for the applicable
housing region.
A restricted unit that is affordable to a very low-income
household.
Building insulation (for attic, exterior walls and crawl
space), siding to improve energy efficiency, replacement storm windows,
replacement storm doors, replacement windows and replacement doors,
and is considered a major system for purposes of a rehabilitation
program.
The provisions of this article shall apply to all affordable
housing developments and affordable housing units that currently exist
and that are proposed to be created within the Borough of Metuchen
pursuant to the Borough's most recently adopted Housing Element and
Fair Share Plan.
A.
The administration of an alternative living arrangement shall be
in compliance with N.J.A.C. 5:93-5.8 and UHAC, with the following
exceptions:
B.
With the exception of units established with capital funding through
a 20-year operating contract with the Department of Human Services,
Division of Developmental Disabilities, alternative living arrangements
shall have at least 30 year controls on affordability in accordance
with UHAC, unless an alternative commitment is approved by the Court.
C.
The service provider for the alternative living arrangement shall
act as the Administrative Agent for the purposes of administering
the affirmative marketing and affordability requirements for the alternative
living arrangement.
In inclusionary developments the following schedule shall be
followed:
|
Maximum Percentage of Market-Rate
Units Completed
|
Minimum Percentage of Low- and
Moderate-Income Units Completed
|
|---|---|
|
25
|
0
|
|
25+1
|
10
|
|
50
|
50
|
|
75
|
75
|
|
90
|
100
|
A.
Low/moderate split and bedroom distribution of affordable housing
units.
(1)
The fair share obligation shall be divided equally between low-
and moderate-income units, except that where there is an odd number
of affordable housing units, the extra unit shall be a low-income
unit. At least 13 percent of all restricted rental units shall be
very low-income units (affordable to a household earning 30 percent
or less of median income) except for those units that have been approved
and vested prior to 2008. The very low-income units shall be counted
as part of the required number of low-income units within the development.
At least 25 percent of the obligation shall be met through rental
units, including at least half in rental units available to families.
A maximum of 25 percent may be age restricted. At least half of the
units in total shall be available to families.
(2)
In each affordable development, at least 50 percent of the restricted
units within each bedroom distribution shall be low-income units.
(3)
Affordable developments that are not age-restricted shall be
structured in conjunction with realistic market demands such that:
(a)
The combined number of efficiency and one-bedroom units shall
be no greater than 20 percent of the total low- and moderate-income
units;
(b)
At least 30 percent of all low- and moderate-income units shall
be two bedroom units;
(c)
At least 20 percent of all low- and moderate-income units shall
be three bedroom units; and
(d)
The remaining units may be allocated among two- and three-bedroom
units at the discretion of the developer.
(4)
Affordable developments that are age-restricted shall be structured
such that the number of bedrooms shall equal the number of age-restricted
low- and moderate-income units within the inclusionary development.
This standard may be met by having all one-bedroom units or by having
a two-bedroom unit for each efficiency unit.
B.
Accessibility requirements.
(1)
The first floor of all restricted townhouse dwelling units and
all restricted units in all other multistory buildings shall be subject
to the technical design standards of the Barrier Free SubCode, N.J.A.C.
5:23-7 and the following:
(2)
All restricted townhouse dwelling units and all restricted units
in other multistory buildings in which a restricted dwelling unit
is attached to at least one other dwelling unit shall have the following
features:
(a)
An adaptable toilet and bathing facility on the first floor;
and
(b)
An adaptable kitchen on the first floor; and
(c)
An interior accessible route of travel on the first floor; and
(d)
An adaptable room that can be used as a bedroom, with a door
or the casing for the installation of a door, on the first floor;
and
(e)
If not all of the foregoing requirements in Subsection B(2)(a) through (2)(d) can be satisfied, then an interior accessible route of travel must be provided between stories within an individual unit, but if all of the terms of Subsection B(2)(a) through (2)(d) above have been satisfied, then an interior accessible route of travel shall not be required between stories within an individual unit; and
(f)
An accessible entranceway as set forth at P.L. 2005, c. 350
(N.J.S.A. 52:27D-311a, et seq.) and the Barrier Free SubCode, N.J.A.C.
5:23-7, or evidence that Metuchen has collected funds from the developer
sufficient to make 10 percent of the adaptable entrances in the development
accessible:
[1]
Where a unit has been constructed with an adaptable
entrance, upon the request of a disabled person who is purchasing
or will reside in the dwelling unit, an accessible entrance shall
be installed.
[2]
To this end, the builder of restricted units shall
deposit funds within the Borough of Metuchen's Affordable Housing
Trust Fund sufficient to install accessible entrances in 10 percent
of the affordable units that have been constructed with adaptable
entrances.
[3]
The funds deposited under Subsection B(2)(f)[2] above shall be used by the Borough of Metuchen for the sole purpose of making the adaptable entrance of an affordable unit accessible when requested to do so by a person with a disability who occupies or intends to occupy the unit and requires an accessible entrance.
[4]
The developer of the restricted units shall submit
a design plan and cost estimate to the Construction Official of the
Borough of Metuchen for the conversion of adaptable to accessible
entrances.
[5]
Once the Construction Official has determined that
the design plan to convert the unit entrances from adaptable to accessible
meet the requirements of the Barrier Free SubCode, N.J.A.C. 5:23-7,
and that the cost estimate of such conversion is reasonable, payment
shall be made to the Borough's Affordable Housing Trust Fund in care
of the Borough Chief Financial Officer who shall ensure that the funds
are deposited into the Affordable Housing Trust Fund and appropriately
earmarked.
[6]
Full compliance with the foregoing provisions shall
not be required where an entity can demonstrate that it is "site impracticable"
to meet the requirements. Determinations of site impracticability
shall be in compliance with the Barrier Free SubCode, N.J.A.C. 5:23-7.
D.
Maximum rents and sales prices.
(1)
In establishing rents and sales prices of affordable housing
units, the Administrative Agent shall follow the procedures set forth
in UHAC, utilizing the regional income limits established by COAH
or a successor entity.
(2)
The maximum rent for restricted rental units within each affordable
development shall be affordable to households earning no more than
60 percent of median income, and the average rent for restricted rental
units shall be affordable to households earning no more than 52 percent
of median income.
(3)
The developers and/or municipal sponsors of restricted rental
units shall establish at least one rent for each bedroom type for
both low-income and moderate-income units, provided that at least
13 percent of all low- and moderate-income rental units shall be affordable
to very low-income households, earning 30 percent or less of the regional
median household income.
(4)
The maximum sales price of restricted ownership units within
each affordable development shall be affordable to households earning
no more than 70 percent of median income, and each affordable development
must achieve an affordability average of 55 percent for restricted
ownership units; in achieving this affordability average, moderate-income
ownership units must be available for at least three different sales
prices for each bedroom type, and low-income ownership units must
be available for at least two different sales prices for each bedroom
type.
(5)
In determining the initial sales prices and rent levels for
compliance with the affordability average requirements for restricted
units other than assisted living facilities and age-restricted developments,
the following standards shall be used:
(a)
A studio shall be affordable to a one-person household;
(b)
A one-bedroom unit shall be affordable to a one and one-half
person household;
(c)
A two-bedroom unit shall be affordable to a three-person household;
(d)
A three-bedroom unit shall be affordable to a four and one-half
person household; and
(e)
A four-bedroom unit shall be affordable to a six-person household.
(6)
In determining the initial sales prices and rents for compliance
with the affordability average requirements for restricted units in
assisted living facilities and age-restricted developments, the following
standards shall be used:
(7)
The initial purchase price for all restricted ownership units
shall be calculated so that the monthly carrying cost of the unit,
including principal and interest (based on a mortgage loan equal to
95 percent of the purchase price and the Federal Reserve H.15 rate
of interest), taxes, homeowner and private mortgage insurance and
condominium or homeowner association fees do not exceed 28 percent
of the eligible monthly income of the appropriate size household as
determined under N.J.A.C. 5:80-26.4, as may be amended and supplemented;
provided, however, that the price shall be subject to the affordability
average requirement of N.J.A.C. 5:80-26.3, as may be amended and supplemented.
(8)
The initial rent for a restricted rental unit shall be calculated
so as not to exceed 30 percent of the eligible monthly income of the
appropriate size household, including an allowance for tenant paid
utilities, as determined under N.J.A.C. 5:80-26.4, as may be amended
and supplemented; provided, however, that the rent shall be subject
to the affordability average requirement of N.J.A.C. 5:80-26.3, as
may be amended and supplemented.
(9)
The price of owner-occupied low- and moderate-income units may
increase annually based on the percentage increase in the regional
median income limit for each housing region. In no event shall the
maximum resale price established by the Administrative Agent be lower
than the last recorded purchase price.
(10)
The rent of low- and moderate-income units may be increased
annually based on the permitted percentage increase in the Housing
Consumer Price Index for the United States. This increase shall not
exceed nine percent in any one year. Rents for units constructed pursuant
to low- income housing tax credit regulations shall be indexed pursuant
to the regulations governing low- income housing tax credits.
E.
Multifamily zones.
(1)
Any property in the Borough of Metuchen that is currently zoned
for nonresidential uses and that is subsequently rezoned for residential
purposes or receives a zoning change or a use variance to permit residential
development, or receives a zoning change or a density variance to
permit higher density residential development, and provided such residential
development provides a sufficient compensatory benefit in terms of
the density of development permitted, shall provide an affordable
housing set-aside of 15 percent if the affordable units will be for
rent and 20 percent if the affordable units will be for sale. The
determination of a "sufficient compensatory benefit" shall be made
by the reviewing authority based upon prevailing legislation and/or
case law.
(2)
Any townhouse, garden apartment or other multiple-family residential
development, including PURDS, containing five or more dwelling units
shall comply with the following:
[Amended 5-11-2020 by Ord. No. 2020-09]
(a)
A minimum of 15 percent of the total number of units in a rental
development shall be set-aside as affordable housing units with half
being affordable to low-income households and 13 percent shall be
affordable to very low-income households. If the calculation of the
total number of such affordable units yields a fractional unit of
less than 0.5 percent then a payment in lieu shall be provided or
one additional unit. If the calculation of the total number of such
affordable units yields a fractional unit of 0.5 or greater, it shall
count as one additional unit.
(b)
A minimum of 20 percent of the total number of units in a for-sale
development shall be set-aside as affordable housing units. If the
calculation of the total number of such affordable units yields a
fractional unit of less than 0.5, then a payment in lieu shall be
provided or one additional unit. If the calculation of the total number
of such affordable units yields a fractional unit of 0.5 or greater,
it shall count as one additional unit.
F.
No subdivision. The subdivision of properties proposed for inclusionary
residential developments or mixed use developments that will include
affordable housing is prohibited as a means to circumvent the 50 year
control period.
A.
Affordable units shall utilize the same type of heating source as
market units within an inclusionary development.
B.
Tenant-paid utilities included in the utility allowance shall be
set forth in the lease and shall be consistent with the utility allowance
approved by DCA for its Section 8 program.
In referring certified households to specific restricted units,
the Administrative Agent shall, to the extent feasible and without
causing an undue delay in the occupancy of a unit, strive to:
A.
Control periods for restricted ownership units shall be in accordance
with N.J.A.C. 5:80-26.5, as may be amended and supplemented, and each
restricted ownership unit shall remain subject to the requirements
of this article for a period of at least 30 years, until Metuchen
takes action to release the unit from such requirements. Prior to
such action, a restricted ownership unit must remain subject to the
requirements of N.J.A.C. 5:80-26.1, as may be amended and supplemented,
provided that for any development of five units or more for which
an application for development was not filed as of August 18, 2016,
the initial control period shall be 50 years.
[Amended 8-15-2016 by Ord. No. 2016-19; 11-7-2016 by Ord. No. 2016-27]
B.
The affordability control period for a restricted ownership unit
shall commence on the date the initial certified household takes title
to the unit.
C.
Prior to the issuance of the initial certificate of occupancy for
a restricted ownership unit and upon each successive sale during the
period of restricted ownership, the Administrative Agent shall determine
the restricted price for the unit and shall also determine the non-restricted,
fair market value of the unit based on either an appraisal or the
unit's equalized assessed value without the restrictions in place.
D.
At the time of the initial sale of the unit, the initial purchaser
shall execute and deliver to the Administrative Agent a recapture
note obligating the purchaser (as well as the purchaser's heirs, successors
and assigns) to repay, upon the first non-exempt sale after the unit's
release from the restrictions set forth in this article, an amount
equal to the difference between the unit's non-restricted fair market
value and its restricted price, and the recapture note shall be secured
by a recapture lien evidenced by a duly recorded mortgage on the unit.
E.
The affordability controls set forth in this article shall remain
in effect despite the entry and enforcement of any judgment of foreclosure
with respect to restricted ownership units.
F.
A restricted ownership unit shall be required to obtain a continuing
certificate of occupancy or a certified statement from the Construction
Official stating that the unit meets all Code standards upon the first
transfer of title following the removal of the restrictions provided
under N.J.A.C. 5:80-26.5(a), as may be amended and supplemented.
Price restrictions for restricted ownership units shall be in
accordance with N.J.A.C. 5:80-26.1, as may be amended and supplemented,
including:
A.
The initial purchase price for a restricted ownership unit shall
be approved by the Administrative Agent.
B.
The Administrative Agent shall approve all resale prices, in writing
and in advance of the resale, to assure compliance with the foregoing
standards.
C.
The master deeds of inclusionary developments shall provide no distinction
between the condominium or homeowner association fees and special
assessments paid by low- and moderate-income purchasers and those
paid by market purchasers.
D.
The owners of restricted ownership units may apply to the Administrative Agent to increase the maximum sales price for the unit on the basis of anticipated capital improvements. Eligible capital improvements shall be those that render the unit suitable for a larger household or the addition of a bathroom. See Section 110-95.13.
A.
Buyer income eligibility for restricted ownership units shall be
in accordance with N.J.A.C. 5:80-26.1, as may be amended and supplemented,
such that low-income ownership units shall be reserved for households
with a gross household income less than or equal to 50 percent of
median income and moderate-income ownership units shall be reserved
for households with a gross household income less than 80 percent
of median income.
B.
Notwithstanding the foregoing, however, the Administrative Agent
may, upon approval by the Borough Council, and subject to the Court's
approval, permit moderate-income purchasers to buy low-income units
in housing markets if the Administrative Agent determines that there
is an insufficient number of eligible low-income purchasers to permit
prompt occupancy of the units. All such low-income units to be sold
to moderate-income households shall retain the required pricing and
pricing restrictions for low-income units.
C.
A certified household that purchases a restricted ownership unit
must occupy it as the certified household's principal residence and
shall not lease the unit; provided, however, that the Administrative
Agent may permit the owner of a restricted ownership unit, upon application
and a showing of hardship, to lease the restricted unit to another
certified household for a period not to exceed one year.
D.
The Administrative Agent shall certify a household as eligible for
a restricted ownership unit when the household is a low-income household
or a moderate-income household, as applicable to the unit, and the
estimated monthly housing cost for the particular unit (including
principal, interest, taxes, homeowner and private mortgage insurance
and condominium or homeowner association fees, as applicable) does
not exceed 33 percent of the household's eligible monthly income.
A.
Prior to incurring any indebtedness to be secured by a restricted
ownership unit, the owner shall apply to the Administrative Agent
for a determination in writing that the proposed indebtedness complies
with the provisions of this section, and the Administrative Agent
shall issue such determination prior to the owner incurring such indebtedness.
B.
With the exception of First Purchase Money Mortgages, neither an
owner nor a lender shall at any time cause or permit the total indebtedness
secured by a restricted ownership unit to exceed 95 percent of the
maximum allowable resale price of the unit, as such price is determined
by the Administrative Agent in accordance with N.J.A.C. 5:80-26.6(b).
A.
The owners of restricted ownership units may apply to the Administrative
Agent to increase the maximum sales price for the unit on the basis
of capital improvements made since the purchase of the unit. Eligible
capital improvements shall be those that render the unit suitable
for a larger household or that adds an additional bathroom. In no
event shall the maximum sales price of an improved housing unit exceed
the limits of affordability for the larger household.
B.
Upon the resale of a restricted ownership unit, all items of property
that are permanently affixed to the unit or were included when the
unit was initially restricted (for example, refrigerator, range, washer,
dryer, dishwasher, wall-to-wall carpeting) shall be included in the
maximum allowable resale price. Other items may be sold to the purchaser
at a reasonable price that has been approved by the Administrative
Agent at the time of the signing of the agreement to purchase. The
purchase of central air conditioning installed subsequent to the initial
sale of the unit and not included in the base price may be made a
condition of the unit resale provided the price, which shall be subject
to 10-year, straight-line depreciation, has been approved by the Administrative
Agent. Unless otherwise approved by the Administrative Agent, the
purchase of any property other than central air conditioning shall
not be made a condition of the unit resale. The owner and the purchaser
must personally certify at the time of closing that no unapproved
transfer of funds for the purpose of selling and receiving property
has taken place at the time of or as a condition of resale.
A.
Control periods for restricted rental units shall be in accordance
with N.J.A.C. 5:80-26.11, as may be amended and supplemented, and
each restricted rental unit shall remain subject to the requirements
of this article for a period of at least 30 years, until Metuchen
takes action to release the unit from such requirements. Prior to
such action, a restricted rental unit must remain subject to the requirements
of N.J.A.C. 5:80-26.1, as may be amended and supplemented, except
that for any development of five units or more for which an application
for development was not filed as of August 18, 2016, the initial control
period shall be 50 years.
[Amended 8-15-2016 by Ord. No. 2016-19; 11-7-2016 by Ord. No. 2016-27]
B.
Deeds of all real property that include restricted rental units shall
contain deed restriction language. The deed restriction shall have
priority over all mortgages on the property, and the deed restriction
shall be filed by the developer or seller with the records office
of the County of Middlesex. A copy of the filed document shall be
provided to the Administrative Agent within 30 days of the receipt
of a certificate of occupancy.
C.
A restricted rental unit shall remain subject to the affordability
controls of this article despite the occurrence of any of the following
events:
A.
A written lease shall be required for all restricted rental units
and tenants shall be responsible for security deposits and the full
amount of the rent as stated on the lease. A copy of the current lease
for each restricted rental unit shall be provided to the Administrative
Agent.
B.
No additional fees or charges shall be added to the approved rent
(except, in the case of units in an assisted living residence, to
cover the customary charges for food and services) without the express
written approval of the Administrative Agent.
C.
Application fees (including the charge for any credit check) shall
not exceed five percent of the monthly rent of the applicable restricted
unit and shall be payable to the Administrative Agent to be applied
to the costs of administering the controls applicable to the unit
as set forth in this article.
D.
No rent control ordinance or other pricing restriction shall be applicable
to either the market units or the affordable units in any development
in which at least 15 percent of the total number of dwelling units
are restricted rental units in compliance with this article.
A.
Tenant income eligibility shall be in accordance with N.J.A.C. 5:80-26.13,
as may be amended and supplemented, and shall be determined as follows:
(1)
Very low-income rental units shall be reserved for households
with a gross household income less than or equal to 30 percent of
median income.
(2)
Low-income rental units shall be reserved for households with
a gross household income less than or equal to 50 percent of median
income.
(3)
Moderate-income rental units shall be reserved for households
with a gross household income less than 80 percent of median income.
B.
The Administrative Agent shall certify a household as eligible for
a restricted rental unit when the household is a very low-income household,
low-income household or a moderate-income household, as applicable
to the unit, and the rent proposed for the unit does not exceed 35
percent (40 percent for age-restricted units) of the household's eligible
monthly income as determined pursuant to N.J.A.C. 5:80-26.16, as may
be amended and supplemented; provided, however, that this limit may
be exceeded if one or more of the following circumstances exists:
(1)
The household currently pays more than 35 percent (40 percent
for households eligible for age-restricted units) of its gross household
income for rent, and the proposed rent will reduce its housing costs;
(2)
The household has consistently paid more than 35 percent (40
percent for households eligible for age-restricted units) of eligible
monthly income for rent in the past and has proven its ability to
pay;
(3)
The household is currently in substandard or overcrowded living
conditions;
(4)
The household documents the existence of assets with which the
household proposes to supplement the rent payments; or
(5)
The household documents reliable anticipated third-party assistance
from an outside source such as a family member in a form acceptable
to the Administrative Agent and the owner of the unit.
A.
The Borough of Metuchen shall appoint a specific municipal employee
to serve as a Municipal Housing Liaison responsible for administering
the affordable housing program, including affordability controls,
the Affirmative Marketing Plan, monitoring and reporting, and, where
applicable, supervising any contracted Administrative Agent. Metuchen
shall adopt an ordinance creating the position of Municipal Housing
Liaison. Metuchen shall adopt a resolution appointing a Municipal
Housing Liaison. The Municipal Housing Liaison shall be appointed
by the governing body and may be a full or part time municipal employee.
The Municipal Housing Liaison shall be approved by the Court and shall
be duly qualified through a training program sponsored by Affordable
Housing Professionals of New Jersey before assuming the duties of
Municipal Housing Liaison.
B.
The Municipal Housing Liaison shall be responsible for oversight
and administration of the affordable housing program for Metuchen,
including the following responsibilities which may not be contracted
out to the Administrative Agent:
(1)
Serving as Metuchen's primary point of contact for all inquiries
from the State, affordable housing providers, Administrative Agents
and interested households;
(2)
Monitoring the status of all restricted units in Metuchen's
Fair Share Plan;
(3)
Compiling, verifying and submitting annual monitoring reports
as may be required by the Court;
(4)
Coordinating meetings with affordable housing providers and
Administrative Agents, as needed; and
(5)
Attending continuing education opportunities on affordability
controls, compliance monitoring and affirmative marketing at least
annually and more often as needed.
C.
Subject to the approval of the Court, the Borough of Metuchen shall
designate one or more Administrative Agent(s) to administer newly
constructed affordable units in accordance with UHAC. An Operating
Manual for each affordable housing program shall be provided by the
Administrative Agent(s) to be adopted by resolution of the governing
body and subject to approval of the Court. The Operating Manual(s)
shall be available for public inspection in the office of the Borough
Clerk, in the office of the Municipal Housing Liaison, and in the
office(s) of the Administrative Agent(s). The Municipal Housing Liaison
shall supervise the contracting Administrative Agent(s).
The Administrative Agent shall be an independent entity serving
under contract to and reporting to the municipality. The fees of the
Administrative Agent shall be paid by the owners of the affordable
units for which the services of the Administrative Agent are required.
The Administrative Agent shall perform the duties and responsibilities
of an Administrative Agent as set forth in UHAC, including those set
forth in Sections 5:80-26.14, 16 and 18 thereof, which includes:
A.
Affirmative marketing.
(1)
Conducting an outreach process to affirmatively market affordable
housing units in accordance with the Affirmative Marketing Plan of
the Borough of Metuchen and the provisions of N.J.A.C. 5:80-26.15;
and
(2)
Providing counseling or contracting to provide counseling services
to low- and moderate-income applicants on subjects such as budgeting,
credit issues, mortgage qualification, rental lease requirements,
and landlord/tenant law.
B.
Household certification.
(1)
Soliciting, scheduling, conducting and following up on interviews
with interested households;
(2)
Conducting interviews and obtaining sufficient documentation
of gross income and assets upon which to base a determination of income
eligibility for a low- or moderate-income unit;
(3)
Providing written notification to each applicant as to the determination
of eligibility or non-eligibility;
(4)
Requiring that all certified applicants for restricted units
execute a certificate substantially in the form, as applicable, of
either the ownership or rental certificates set forth in Appendices
J and K of N.J.A.C. 5:80-26.1 et seq.;
(5)
Creating and maintaining a referral list of eligible applicant
households living in the housing region and eligible applicant households
with members working in the housing region where the units are located;
and
(6)
Employing a random selection process as provided in the Affirmative
Marketing Plan of the Borough of Metuchen when referring households
for certification to affordable units.
C.
Affordability controls.
(1)
Furnishing to attorneys or closing agents forms of deed restrictions
and mortgages for recording at the time of conveyance of title of
each restricted unit;
(2)
Creating and maintaining a file on each restricted unit for
its control period, including the recorded deed with restrictions,
recorded mortgage and note, as appropriate;
(3)
Ensuring that the removal of the deed restrictions and cancellation
of the mortgage note are effectuated and properly filed with the Middlesex
County Register of Deeds or County Clerk's office after the termination
of the affordability controls for each restricted unit;
(4)
Communicating with lenders regarding foreclosures; and
(5)
Ensuring the issuance of continuing certificates of occupancy
or certifications pursuant to N.J.A.C. 5:80-26.10.
D.
Resales and rerentals.
(1)
Instituting and maintaining an effective means of communicating
information between owners and the Administrative Agent regarding
the availability of restricted units for resale or rerental; and
(2)
Instituting and maintaining an effective means of communicating
information to low- and moderate-income households regarding the availability
of restricted units for resale or re-rental.
E.
Processing requests from unit owners.
(1)
Reviewing and approving requests for determination from owners
of restricted units who wish to take out home equity loans or refinance
during the term of their ownership that the amount of indebtedness
to be incurred will not violate the terms of this article;
(2)
Reviewing and approving requests to increase sales prices from
owners of restricted units who wish to make capital improvements to
the units that would affect the selling price, such authorizations
to be limited to those improvements resulting in additional bedrooms
or bathrooms and the depreciated cost of central air-conditioning
systems;
(3)
Notifying the municipality of an owner's intent to sell a restricted
unit; and
(4)
Making determinations on requests by owners of restricted units
for hardship waivers.
F.
Enforcement.
(1)
Securing annually from the municipality a list of all affordable
housing units for which tax bills are mailed to absentee owners, and
notifying all such owners that they must either move back to their
unit or sell it;
(2)
Securing from all developers and sponsors of restricted units,
at the earliest point of contact in the processing of the project
or development, written acknowledgement of the requirement that no
restricted unit can be offered, or in any other way committed, to
any person, other than a household duly certified to the unit by the
Administrative Agent;
(3)
The posting annually in all rental properties, including two-family
homes, of a notice as to the maximum permitted rent together with
the telephone number of the Administrative Agent where complaints
of excess rent or other charges can be made;
(4)
Sending annual mailings to all owners of affordable dwelling
units, reminding them of the notices and requirements outlined in
N.J.A.C. 5:80-26.18(d)4;
(5)
Establishing a program for diverting unlawful rent payments
to the municipality's Affordable Housing Trust Fund; and
(6)
Creating and publishing a written operating manual for each
affordable housing program administered by the Administrative Agent,
to be approved by the Borough Council and the Court, setting forth
procedures for administering the affordability controls.
G.
Additional responsibilities.
(1)
The Administrative Agent shall have the authority to take all
actions necessary and appropriate to carry out its responsibilities
hereunder.
(2)
The Administrative Agent shall prepare monitoring reports for
submission to the Municipal Housing Liaison in time to meet any monitoring
requirements and deadlines imposed by the Court.
(3)
The Administrative Agent shall attend continuing education sessions
on affordability controls, compliance monitoring, and affirmative
marketing at least annually and more often as needed.
A.
The Borough of Metuchen shall adopt by resolution an Affirmative
Marketing Plan, subject to approval of the Court, that is compliant
with N.J.A.C. 5:80-26.15, as may be amended and supplemented.
B.
The Affirmative Marketing Plan is a regional marketing strategy designed
to attract buyers and/or renters of all majority and minority groups,
regardless of race, creed, color, national origin, ancestry, marital
or familial status, gender, affectional or sexual orientation, disability,
age or number of children to housing units which are being marketed
by a developer, sponsor or owner of affordable housing. The Affirmative
Marketing Plan is intended to target those potentially eligible persons
who are least likely to apply for affordable units in that region.
It is a continuing program that directs marketing activities toward
Housing Region 3 and is required to be followed throughout the period
of restriction. At the request of Fair Share Housing Center, the following
five organizations have been added to be the Affirmative Marketing
Plan: Fair Share Housing Center, New Brunswick NAACP, Plainfield NAACP,
Metuchen NAACP and Latino Action Network.
[Amended 8-15-2016 by Ord. No. 2016-19; 11-7-2016 by Ord. No. 2016-27]
C.
The Affirmative Marketing Plan shall provide a regional preference
for all households that live and/or work in Housing Region 3, comprised
of Middlesex, Hunterdon and Somerset Counties.
D.
The municipality has the ultimate responsibility for adopting the
Affirmative Marketing Plan and for the proper administration of the
Affirmative Marketing Program, including initial sales and rentals
and resales and rerentals. The Administrative Agent designated by
the Borough of Metuchen shall implement the Affirmative Marketing
Plan to assure the affirmative marketing of all affordable units.
E.
In implementing the Affirmative Marketing Plan, the Administrative
Agent shall provide a list of counseling services to low- and moderate-income
applicants on subjects such as budgeting, credit issues, mortgage
qualification, rental lease requirements, and landlord/tenant law.
F.
The Affirmative Marketing Plan shall describe the media to be used
in advertising and publicizing the availability of housing. In implementing
the Affirmative Marketing Plan, the Administrative Agent shall consider
the use of language translations where appropriate.
G.
The affirmative marketing process for available affordable units
shall begin at least four months (120 days) prior to the expected
date of occupancy.
H.
Applications for affordable housing shall be available in several
locations, including, at a minimum, the County Administration Building
and/or the County Library for each county within the housing region;
the municipal administration building and the municipal library in
the municipality in which the units are located; and the developer's
rental office. Applications shall be mailed to prospective applicants
upon request.
I.
The costs of advertising and affirmative marketing of the affordable
units shall be the responsibility of the developer, sponsor or owner.
A.
Upon the occurrence of a breach of any of the regulations governing
the affordable unit by an owner, developer or tenant, the municipality
shall have all remedies provided at law or equity, including but not
limited to foreclosure, tenant eviction, a requirement for household
recertification, acceleration of all sums due under a mortgage, recuperation
of any funds from a sale in violation of the regulations, injunctive
relief to prevent further violation of the regulations, entry on the
premises, and specific performance.
B.
After providing written notice of a violation to an owner, developer
or tenant of a low- or moderate-income unit and advising the owner,
developer or tenant of the penalties for such violations, the municipality
may take the following action(s) against the owner, developer or tenant
for any violation that remains uncured for a period of 60 days after
service of the written notice:
(1)
The municipality may file a Court action pursuant to N.J.S.A.
2A:58-11 alleging a violation or violations of the regulations governing
the affordable housing unit. If the owner, developer or tenant is
adjudged by the Court to have violated any provision of the regulations
governing affordable housing units the owner, developer or tenant
shall be subject to one or more of the following penalties, at the
discretion of the Court:
(a)
A fine of not more than $500 per day or imprisonment for a period
not to exceed 90 days, or both, provided that each and every day that
the violation continues or exists shall be considered a separate and
specific violation of these provisions and not a continuation of the
initial offense;
(b)
In the case of an owner who has rented a low- or moderate-income
unit in violation of the regulations governing affordable housing
units, payment into the Borough of Metuchen Affordable Housing Trust
Fund of the gross amount of rent illegally collected;
(c)
In the case of an owner who has rented a low- or moderate-income
unit in violation of the regulations governing affordable housing
units, payment of an innocent tenant's reasonable relocation costs,
as determined by the Court.
(2)
The municipality may file a court action in the Superior Court
seeking a judgment that would result in the termination of the owner's
equity or other interest in the unit, in the nature of a mortgage
foreclosure. Any such judgment shall be enforceable as if the same
were a judgment of default of the First Purchase Money Mortgage and
shall constitute a lien against the low- or moderate-income unit.
(a)
The judgment shall be enforceable, at the option of the municipality,
by means of an execution sale by the Sheriff, at which time the low-
and moderate-income unit of the violating owner shall be sold at a
sale price which is not less than the amount necessary to fully satisfy
and pay off any First Purchase Money Mortgage and prior liens and
the costs of the enforcement proceedings incurred by the municipality,
including attorney's fees. The violating owner shall have his right
to possession terminated as well as his title conveyed pursuant to
the Sheriff's sale.
(b)
The proceeds of the Sheriff's sale shall first be applied to
satisfy the First Purchase Money Mortgage lien and any prior liens
upon the low- and moderate-income unit. The excess, if any, shall
be applied to reimburse the municipality for any and all costs and
expenses incurred in connection with either the Court action resulting
in the judgment of violation or the Sheriff's sale. In the event that
the proceeds from the Sheriff's sale are insufficient to reimburse
the municipality in full as aforesaid, the violating owner shall be
personally responsible for the full extent of such deficiency, in
addition to any and all costs incurred by the municipality in connection
with collecting such deficiency. In the event that a surplus remains
after satisfying all of the above, such surplus, if any, shall be
placed in escrow by the municipality for the owner and shall be held
in such escrow for a maximum period of two years or until such earlier
time as the owner shall make a claim with the municipality for such.
Failure of the owner to claim such balance within the two-year period
shall automatically result in a forfeiture of such balance to the
municipality. Any interest accrued or earned on such balance while
being held in escrow shall belong to and shall be paid to the municipality,
whether such balance shall be paid to the owner or forfeited to the
municipality.
(c)
Foreclosure by the municipality due to violation of the regulations
governing affordable housing units shall not extinguish the restrictions
of the regulations governing affordable housing units as the same
apply to the low- and moderate-income unit. Title shall be conveyed
to the purchaser at the Sheriff's sale, subject to the restrictions
and provisions of the regulations governing the affordable housing
unit. The owner determined to be in violation of the provisions of
this Plan and from whom title and possession were taken by means of
the Sheriff's sale shall not be entitled to any right of redemption.
(d)
If there are no bidders at the Sheriff's sale, or if insufficient
amounts are bid to satisfy the First Purchase Money Mortgage and any
prior liens, the municipality may acquire title to the low- and moderate-income
unit by satisfying the First Purchase Money Mortgage and any prior
liens and crediting the violating owner with an amount equal to the
difference between the First Purchase Money Mortgage and any prior
liens and costs of the enforcement proceedings, including legal fees
and the maximum resale price for which the low- and moderate-income
unit could have been sold under the terms of the regulations governing
affordable housing units. This excess shall be treated in the same
manner as the excess which would have been realized from an actual
sale as previously described.
(e)
Failure of the low- and moderate-income unit to be either sold
at the Sheriff's sale or acquired by the municipality shall obligate
the owner to accept an offer to purchase from any qualified purchaser
which may be referred to the owner by the municipality, with such
offer to purchase being equal to the maximum resale price of the low-
and moderate-income unit as permitted by the regulations governing
affordable housing units.
(f)
The owner shall remain fully obligated, responsible and liable
for complying with the terms and restrictions of governing affordable
housing units until such time as title is conveyed from the owner.
Appeals from all decisions of an Administrative Agent appointed
pursuant to this article shall be filed in writing with the Court.
(Reserved by Ord. No. 2016-19)
