[HISTORY: Adopted by the Mayor and Council
of the Borough of Emerson 9-1-2009 by Ord. No. 1383.[1] Amendments noted where applicable.]
[1]
Editor's Note: This ordinance also superseded former Ch. 138,
Development Fees, adopted 3-20-2001 by Ord. No. 1170, as amended.
A.
In Holmdel Builder's 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 (the Act), 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.
B.
Pursuant to P.L. 2008, c. 46, Section 8 (N.J.S.A. 52:27D-329.2),
and the Statewide Nonresidential Development Fee Act (N.J.S.A. 40:55D-8.1
through 40:55D-8.7), COAH is authorized to adopt and promulgate regulations
necessary for the establishment, implementation, review, monitoring
and enforcement of municipal affordable housing trust funds and corresponding
spending plans. Municipalities that are under the jurisdiction of
the Council or court of competent jurisdiction and have a COAH-approved
spending plan may retain fees collected from nonresidential development.
C.
This chapter establishes standards for the collection, maintenance
and expenditure of development fees pursuant to COAH's regulations
and in accordance with P.L. 2008, c. 46, Sections 8 and 32 through
38, N.J.S.A. 52:27D-329.2 and N.J.S.A. 40:55D-8.1 through 40:55D-8.7,
respectively. Fees collected pursuant to this chapter shall be used
for the sole purpose of providing low- and moderate-income housing.
This chapter shall be interpreted within the framework of COAH's rules
on development fees.
[Amended at time of adoption of Code (see Ch. 1, General
Provisions, Art. I)]
[Amended 12-18-2018 by Ord. No. 1571-18]
The following terms, as used in this chapter, 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 100% affordable development.
The New Jersey Council on Affordable Housing, established
under the Fair Housing Act.[1]
[Amended 12-18-2018 by Ord. No. 1571-18]
Any act or process that renders more than 50% of a structure
or building unsafe for human occupancy or use shall be considered
demolished for the purposes of this chapter.
The legal or beneficial owner or owners of a lot or of any
land proposed to be included in a proposed development, including
the holder of an option or contract to purchase, or other person having
an enforceable proprietary interest in such land.
Funds paid by any person for the improvement of property
as authorized by Holmdel Builder’s Association v. Holmdel Township,
121 N.J. 550 (1990) and the Fair Housing Act of 1985, N.J.S.A. 52:27D-301
et seq., and regulated by applicable COAH rules.
[Amended 12-18-2018 by Ord. No. 1571-18]
The assessed value of a property divided by the current average
ratio of assessed to true value for the municipality in which the
property is situated, as determined in accordance with Sections 1,
5 and 6 of P.L. 1973, c. 123 (N.J.S.A. 54:1-35a through 54:1-35c).
Those strategies that minimize the impact of development
on the environment and enhance the health, safety and well-being of
residents by producing durable, low-maintenance, resource-efficient
housing while making optimum use of existing infrastructure and community
services.
All internal areas of a dwelling with a floor-to-ceiling
height of greater than six feet, exclusive of garages which are not
to be considered as living space.
A catastrophic event, such as a hurricane, flood, earthquake,
volcanic eruption, landslide, blizzard or other natural phenomena
that causes extensive human casualties or property damage, or both.
[1]
Editor's Note: See N.J.S.A. 52:27D-301 et seq.
A.
Imposed fees.
(1)
For all residential developments, residential developers shall pay
a fee of 1.5% 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. However, if the zoning
on a site has changed during the two-year period preceding the filing
of such a variance application, the base density for the purposes
of calculating the bonus development fee shall be the highest density
permitted by right during the two-year period preceding the filing
of the variance application. Example: If an approval allows four units
to be constructed on a site that was zoned for two units, the fees
could equal 1.5% of the equalized assessed value on the first two
units; and the specified higher percentage up to 6% of the equalized
assessed value for the two additional units, provided zoning on the
site has not changed during the two-year period preceding the filing
of such a variance application.
B.
Eligible exactions, ineligible exactions and exemptions for residential
development.
(1)
Affordable housing developments and developments where the developer
has made a payment in lieu of on-site construction of affordable units
shall be exempt from development fees.
(2)
Developments that have received preliminary or final site plan approval
prior to the adoption of a municipal development fee ordinance shall
be exempt from development fees, unless the developer seeks a substantial
change in the approval. Where a site plan approval does not apply,
a zoning and/or building permit shall be synonymous with preliminary
or final site plan approval for this purpose. The fee percentage shall
be vested on the date that the building permit is issued.
(3)
Development fees shall be imposed and collected when an existing
structure undergoes a change to a more intense use, is demolished
and replaced or is expanded, except that expansion of an existing
residential structure which increases the living space by less than
20% and/or the volume of the existing structure by less than 20% shall
be exempt from paying a development fee. The development fee shall
be calculated on the increase in the equalized assessed value of the
improved structure.
(4)
A dwelling that is constructed as a replacement for a dwelling that
was demolished as a result of a natural disaster shall be exempt from
paying a development fee. The dwelling that is constructed as a replacement
dwelling must be constructed on the same site as the dwelling that
was demolished as a result of a natural disaster.
A.
Imposed fees.
(1)
Within all zoning districts, nonresidential developers, except for
developers of the types of development specifically exempted, shall
pay a fee equal to 2.5% of the equalized assessed value of the land
and improvements, for all new nonresidential construction on an unimproved
lot or lots.
(2)
Nonresidential developers, except for developers of the types of
development specifically exempted, shall also pay a fee equal to 2.5%
of the increase in equalized assessed value resulting from any additions
to existing structures to be used for nonresidential purposes.
(3)
Development fees shall be imposed and collected when an existing
structure is demolished and replaced. The development fee of 2.5%
shall be calculated on the difference between the equalized assessed
value of the preexisting land and improvement and the equalized assessed
value of the newly improved structure, i.e., land and improvement,
at the time final certificate of occupancy is issued. If the calculation
required under this section results in a negative number, the nonresidential
development fee shall be zero.
B.
Eligible exactions, ineligible exactions and exemptions for nonresidential
development.
(1)
The nonresidential portion of a mixed-use inclusionary or market
rate development shall be subject to the development fee of 2.5%,
unless otherwise exempted below.
(2)
The fee of 2.5% shall not apply to an increase in equalized assessed
value resulting from alterations, change in use within existing footprint,
reconstruction, renovations and repairs.
(3)
Nonresidential developments shall be exempt from the payment of nonresidential
development fees in accordance with the exemptions required pursuant
to P.L. 2008, c. 46, as specified in the form N-RDF, State of New
Jersey nonresidential development certification/exemption form. Any
exemption claimed by a developer shall be substantiated by that developer.
(4)
A developer of a nonresidential development exempted from the nonresidential
development fee pursuant to P.L. 2008, c. 46, shall be subject to
it at such time the basis for the exemption no longer applies and
shall make the payment of the nonresidential development fee, in that
event, within three years after that event or after the issuance of
the final certificate of occupancy of the nonresidential development,
whichever is later.
(5)
If a property which was exempted from the collection of a nonresidential
development fee thereafter ceases to be exempt from property taxation,
the owner of the property shall remit the fees required pursuant to
this section within 45 days of the termination of the property tax
exemption. Unpaid nonresidential development fees under these circumstances
may be enforceable by the Borough as a lien against the real property
of the owner.
A.
Upon the granting of a preliminary, final or other applicable approval
for a development, the applicable approving authority shall direct
its staff to notify the Construction Code Official responsible for
the issuance of a building permit.
B.
For nonresidential developments only, the developer shall also be
provided with a copy of form N-RDF, State of New Jersey nonresidential
development certification/exemption, to be completed as per the instructions
provided. The developer of a nonresidential development shall complete
form N-RDF as per the instructions provided. The Construction Code
Official shall verify the information submitted by the nonresidential
developer as per the instructions provided in form N-RDF. The tax
assessor shall verify exemptions and prepare estimated and final assessments
as per the instructions provided in form N-RDF.
[Amended at time of adoption of Code (see Ch. 1, General
Provisions, Art. I)]
C.
The Construction Code Official responsible for the issuance of a
building permit shall notify the local tax assessor of the issuance
of the first building permit for a development which is subject to
a development fee.
D.
Within 90 days of receipt of that notice, the municipal tax assessor,
based on the plans filed, shall provide an estimate of the equalized
assessed value of the development.
E.
The Construction Code Official responsible for the issuance of a
final certificate of occupancy notifies the local assessor of any
and all requests for the scheduling of a final inspection on property
which is subject to a development fee.
F.
Within 10 business days of a request for the scheduling of a final
inspection, the municipal assessor shall confirm or modify the previously
estimated equalized assessed value of the improvements of the development;
calculate the development fee; and thereafter notify the developer
of the amount of the fee.
G.
Should the Borough fail to determine or notify the developer of the
amount of the development fee within 10 business days of the request
for final inspection, the developer may estimate the amount due and
pay that estimated amount consistent with the dispute process set
forth in Subsection b of Section 37 of P.L. 2008, c. 46 (N.J.S.A.
40:55D-8.6).
H.
Fifty percent of the development fee shall be collected at the time
of issuance of the building permit. The remaining portion shall be
collected at the issuance of the certificate of occupancy. The developer
shall be responsible for paying the difference between the fee calculated
at building permit and that determined at issuance of certificate
of occupancy.
I.
Appeal of development fees.
(1)
A developer may challenge residential development fees imposed by
filing a challenge with the County Board of Taxation. Pending a review
and determination by the Board, collected fees shall be placed in
an interest-bearing escrow account by the Borough. Appeals from a
determination of the Board may be made to the Tax Court in accordance
with the provisions of the State Tax Uniform Procedure Law, N.J.S.A.
54:48-1 et seq., within 90 days after the date of such determination.
Interest earned on amounts escrowed shall be credited to the prevailing
party.
(2)
A developer may challenge nonresidential development fees imposed
by filing a challenge with the Director of the Division of Taxation.
Pending a review and determination by the Director, which shall be
made within 45 days of receipt of the challenge, collected fees shall
be placed in an interest-bearing escrow account by the Borough. Appeals
from a determination of the Director may be made to the Tax Court
in accordance with the provisions of the State Tax Uniform Procedure
Law, N.J.S.A. 54:48-1 et seq., within 90 days after the date of such
determination. Interest earned on amounts escrowed shall be credited
to the prevailing party.
A.
There is hereby created a separate, interest-bearing housing trust
fund to be maintained by the Chief Financial Officer for the purpose
of depositing development fees collected from residential and nonresidential
developers and proceeds from the sale of units with extinguished controls.
B.
The following additional funds shall be deposited in the Affordable
Housing Trust Fund and shall at all times be identifiable by source
and amount:
(1)
Payments in lieu of on-site construction of affordable units;
(2)
Developer-contributed funds to make 10% of the adaptable entrances
in a townhouse or other multistory attached development accessible;
(3)
Rental income from municipally operated units;
(4)
Repayments from affordable housing program loans;
(5)
Recapture funds;
(6)
Proceeds from the sale of affordable units; and
(7)
Any other funds collected in connection with the Borough's affordable
housing program.
C.
In the event of a failure by the Borough of Emerson to comply with
trust fund monitoring and reporting requirements or to submit accurate
monitoring reports; or a failure to comply with the conditions of
the judgment of compliance or a revocation of compliance; or a failure
to implement the approved spending plan and to expend funds within
the applicable required time period as set forth in In RE: Tp. Of
Monroe. 442 N.J. Super. 565 (Law Div. 2015) (aff’d 442 N.J.
Super, 563); or the expenditure of funds on activities not approved
by the Court; or for other good cause demonstrating the unapproved
use(s) of funds, the court may authorize the State of New Jersey,
Department of Community Affairs, Division of Local Government Services
(LGS), to direct the manner in which the funds in the Affordable Housing
Trust Fund shall be expended, provided that all such funds shall,
to the extent practicable, be utilized for affordable housing programs
within the Borough of Emerson, or, if not practicable, then within
the county or housing region. Any party may bring a motion before
the Superior Court presenting evidence of such condition(s), and the
court may, after considering the evidence and providing the municipality
a reasonable opportunity to respond and/or remedy the noncompliant
condition(s), and upon a finding of continuing and deliberate noncompliance,
determine to authorize LGS to direct the expenditure of funds in the
trust fund. The court may also impose such other remedies as may be
reasonable and appropriate to the circumstances.
[Amended 12-18-2018 by Ord. No. 1571-18]
D.
All interest accrued in the Housing Trust Fund shall only be used
on eligible affordable housing activities approved by the court.
[Amended 12-18-2018 by Ord. No. 1571-18]
A.
The expenditure of all funds shall conform to a spending plan approved
by the court. Funds deposited in the Housing Trust Fund may be used
for any activity approved by the court to address the Borough’s
fair share obligation and may be set up as a grant or revolving loan
program. Such activities include, but are not limited to: preservation
or purchase of housing for the purpose of maintaining or implementing
affordability controls, rehabilitation, new construction of affordable
housing units and related costs, accessory apartment, market-to-affordable
or regional housing partnership programs, conversion of existing nonresidential
buildings to create new affordable units, green building strategies
designed to be cost saving and in accordance with accepted national
or state standards, purchase of land for affordable housing, improvement
of land to be used for affordable housing, extensions or improvements
of roads and infrastructure to affordable housing sites, financial
assistance designed to increase affordability, administration necessary
for implementation of the Housing Element and Fair Share Plan, and/or
any other activity as permitted by the court and specified in the
approved spending plan.
[Amended 12-18-2018 by Ord. No. 1571-18]
B.
Funds shall not be expended to reimburse the Borough for past housing
activities.
C.
At least 30% of all development fees collected and interest earned
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, rental assistance,
assistance with homeowners' association or condominium fees and special
assessments, and assistance with emergency repairs.
(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 municipal Fair Share Plan to make them affordable to
households earning 30% or less of median income.
[Amended at time of adoption of Code (see Ch. 1, General
Provisions, Art. I)]
(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 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.
[Amended at time of adoption of Code (see Ch. 1, General
Provisions, Art. I)]
E.
No more than 20% of all revenues collected from development fees
may 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. Legal or other fees
related to litigation opposing affordable housing sites or objecting
to the Council's regulations and/or action are not eligible uses of
the Affordable Housing Trust Fund.
[Amended 12-18-2018 by Ord. No. 1571-18]
The Borough shall provide annual reporting of Affordable Housing
Trust Fund activity to the New Jersey Department of Community Affairs,
or any other entity designated by the State of New Jersey, with a
copy provided to Fair Share Housing Center and posted on the municipal
website, using forms developed for this purpose by the New Jersey
Department of Community Affairs. The reporting shall include an accounting
of all Affordable Housing Trust Fund activity, including the sources
and amounts of funds collected and the amounts and purposes for which
any funds have been expended.
[Amended 12-18-2018 by Ord. No. 1571-18]
A.
The ability
for the Borough to impose, collect and expend development fees shall
be permitted through the expiration of the repose period covered by
its judgment of compliance and shall continue thereafter so long as
the Borough has filed an adopted Housing Element and Fair Share Plan
with the court or with a designated state administrative agency, has
petitioned for a judgment of compliance from the court or for substantive
certification or its equivalent from a state administrative agency
authorized to approve and administer municipal affordable housing
compliance and has received approval of its development fee ordinance
from the entity that will be reviewing and approving the Housing Element
and Fair Share Plan.
B.
If the
Borough fails to pursue its authorization to impose and collect development
fees after the expiration of its judgment of compliance it may be
subject to forfeiture of any or all funds remaining within its municipal
trust fund. Any funds so forfeited shall be deposited into the New
Jersey Affordable Housing Trust Fund, established pursuant to Section
20 of P.L. 1985, c. 222 (N.J.S.A. 52:27D-320).
C.
After
the expiration of the judgment of compliance, if the Borough does
not pursue or obtain continued authorization, the Borough shall not
impose a residential development fee on a development that receives
preliminary or final site plan approval, nor shall the Borough retroactively
impose a development fee on such a development. The Borough will not
expend development fees after the expiration of its substantive certification.
