[Amended 4-4-2018 by Ord.
No. 2018-02]
A.
In accordance with N.J.A.C. 5:97, all units assisted under this chapter
shall be subject to resale and rent affordability control for the
periods outlined herein. Should the terms as authorized by N.J.A.C.
5:97 be amended as provided by law, then this chapter may be amended
and the Township Committee may at its discretion take such steps as
necessary to amend any loan agreement or deed restriction, with the
consent of the owner.
B.
At the time an application for a unit(s) is approved by the Township Committee, each household in occupancy must be income eligible as set forth in Article III whether an owner-applicant or a renter-applicant. Owners of vacant units must agree to rent or sell the unit to an income eligible low- or moderate-income household when the rehabilitation or accessory apartment is completed or when the market-to-affordable unit is funded. In approving the rehabilitation of vacant units, the Township Committee shall attempt to assure that at least 50% of such vacant units are reserved for low-income households.
C.
The owner shall provide a certification verifying that the proposed
rent level complies with this chapter and COAH rules.
A.
Owner-occupied rehabilitated units. Units which are owner-occupied
shall be subject to affordability controls for a term of 10 years.
At that time, the administrative agent shall advise the Township Attorney
to file the lien effectuating the rehabilitation loan agreement as
hereinafter set forth.
B.
Renter-occupied rehabilitated units. Units which are occupied by
renter households shall be subject to affordability controls for a
period of 10 years from the date a completion report is filed by the
Construction Code Official with the administrative agent. At that
time, the administrative agent shall advise the Township Attorney
to file the deed restriction effectuating the rehabilitation loan
agreement as hereinafter set forth. If a unit is renter-occupied,
upon completion of the rehabilitation, the maximum rate of rent shall
be the lesser of the current rent or the maximum permitted rent pursuant
to N.J.A.C. 5:97-9 and UHAC.
C.
Vacant rehabilitated units.
(1)
At the time a vacant unit is approved for funding by the Township
Committee, the owner shall elect either to sell or to rent the unit
when rehabilitation is completed. If the unit is to be sold, it shall
be sold to an income eligible low- or moderate-income household based
on the following standards:
(a)
Sales units shall be priced so that the sales price is affordable
to households based on a factor of no more than 28% of gross income
being paid for principal, interest, taxes, and insurance with a 10%
down payment and a mortgage at prevailing interest rates at the time
the application is approved. Controls shall be in effect for six years.
(b)
Rental units shall be rented to income eligible household based
on no more than 30% of gross income paid for rent, including utilities.
Controls shall be in effect for 10 years.
(2)
At the time a vacant unit has been rehabilitated and a completion report issued, the Attorney shall file the loan agreement in the manner provided in § 199-23 below. The agreement and deed restriction shall contain provisions requiring that, as a condition of sale or rent of the vacant unit, the owner shall provide the administrative agent with documentation and the administrative agent shall verify that the proposed purchaser or renter household meets the income criteria established in this chapter, i.e., that the household is either low-income or moderate-income and that the sales price or rent level is affordable as low- or moderate-income housing, all in accordance with the occupancy designation of the unit as set forth in § 199-16. The administrative agent shall provide the owner with approval or disapproval based upon the criteria in this chapter for making such determinations. Until a satisfactory determination is reached, any certificate of occupancy shall be considered conditional in regard to substantiation of compliance with this chapter. Once the administrative agent certifies approval, a copy shall be forwarded to the Construction Code Official, who shall issue the full certificate of occupancy, provided all work-related items have been completed satisfactorily.
At such time as the Township Committee approves an application
for assistance (funding) under this chapter for a rehabilitation or
accessory apartment, it shall be with the condition that the amount
of funding for capital costs or soft costs paid to the applicant shall
be the subject of a rehabilitation loan agreement, whereby the owner
agrees to be bound by this chapter and the following terms:
A.
General terms. The rehabilitation or accessory apartment loan shall be for the full amount of funds borrowed by the applicant to cover the cost of the repairs to each eligible unit, whether from Township funds or other funding sources as may be available through this program. The loan shall stipulate that interest shall only accrue on the principal according to the terms outlined in Subsection D. Payments on principal shall only be due upon sale or refinancing of the unit(s), except as outlined below in Subsections C, D and E.
B.
Terms for owner-occupied rehabilitated units. Owners of owner-occupied units shall generally continue to reside in the unit for 10 years. If the unit is sold during the ten-year period, the loan shall be assumable only if the purchaser is an income eligible low- or moderate-income household. If, during the ten-year term, the unit is sold to a non-income eligible household, the loan and all accrued interest determined as specified in Subsection E shall be repaid in full as a condition of the sale. The Township will then offer the same assistance to another unit within the Township. At the end of the ten-year period, the loan principal shall be repaid in full, except that if the owner remains an income eligible household and continues to live in the unit, the payment may be deferred. In said event, a new agreement shall be executed stipulating these conditions.
C.
Terms for renter-occupied rehabilitated units. Owners of renter-occupied
units shall agree to rent the unit to an income eligible household
for the full ten-year term. Any future owner of such units shall be
bound by this restriction, and the loan shall be assumable. At the
end of the ten-year period, the loan principal shall be repaid in
full, except that if the owner agrees to continue renting to income
eligible households, the payment may be deferred. In said event, a
new agreement shall be executed stipulating these conditions.
D.
Terms for accessory apartments. Owners of renter-occupied accessory
apartments shall agree to rent the unit to an income eligible household
for the full ten-year term. For units with a ten-year loan agreement,
the loan shall be repaid in full at the end of the ten-year period,
together with accrued interest, except that if the owner agrees to
continue renting to income eligible households, the payment may be
deferred. In said event, a new agreement shall be executed stipulating
these conditions. The loan may not be prepaid during the initial ten-year
period.
E.
Premature termination. In cases where the rehabilitation or accessory
apartment loan agreement must be terminated prematurely due to court
action, bankruptcy or good cause as may be established by rules and
regulations of an appropriate federal or state agency, before the
expiration of the time period in the agreement required by this chapter
or COAH regulations as revised, the amount of the loan principal is
to be paid in full together with accrued interest determined as follows:
(1)
For a ten-year loan terminated in its first year, simple interest
at a rate per annum equal to the prime rate at Citibank of New York
plus 2%. For a ten-year loan terminated thereafter, the rate per annum
for the entire period will be the first year's rate reduced by
10% for each full year that the loan has been outstanding until after
nine full years when the rate shall be 1%.
An owner who decides to rent a rehabilitated unit which was owner-occupied at the time the application was approved shall only be permitted to rent the unit to an income eligible household in accordance with the standards contained in § 199-17C(1)(b) above. The controls shall be extended and the loan agreement modified so as to extend the term thereof to 10 years from the date of the filing of the completion report, in accordance with § 199-18C above.
Exceptions to these controls shall be the same
as the Resale and Rental Affordability Control Regulations promulgated
by the New Jersey Housing and Mortgage Finance Agency as required
by the Fair Housing Act.
Notwithstanding the above, nothing herein shall
require the relocation or eviction of a household lawfully occupying
a unit due to a rise in income above the restricted income limits.
The income limits which shall govern this chapter shall be those
promulgated by COAH or a court of competent jurisdiction.
At such time as the application for funding is approved, the Township Attorney shall, within 14 days, prepare and arrange the execution of the deferred loan agreement. A copy shall be given to the owner, Construction Code Official, and Township Clerk. Upon receipt of a copy of the agreement, the Construction Code Official shall authorize the work. The original shall be held by the Attorney in escrow, pending the filing of the completion report, at which time same shall be recorded with the Register of Deeds. A copy of the recorded agreement shall be sent to the above listed parties and shall contain the date of expiration of the controls in accordance with the above provisions contained in § 199-17.
[Added 1-19-2005 by Ord. No. 2005-01]
A.
For the violation of any part of Article V by an owner of a low- and/or moderate-income unit, the Township shall provide written notice of such violation to the owner and advise the owner of the penalties for such violation. For any and every such violation that remains uncured within 60 calendar days from the date of service of such written notice, the Township may pursue any of the courses of action permitted in this chapter.
B.
The Township shall have the right to file a court
action pursuant to N.J.S.A. 2A:58-11 alleging that a violation or
violations of this chapter and/or other provisions of the Township
Code exists. If the owner is found by the court to have violated any
provision of this chapter and/or other provisions of the Township
Code, the owner shall be subject to one or more of the following penalties,
at the discretion of the court:
(1)
A fine of not more than $1,250 or imprisonment
for a period not to exceed 90 days, or both. Each and every day that
the violation continues or exists shall be considered a separate and
specific violation of these provisions, subject to individual penalties,
and not as continuing offense;
(2)
In the case of an owner who has resold his or
her low- or moderate-income unit in violation of this chapter and/or
other provisions of the Township Code, payment is to be made into
the Township's Housing Trust Fund of the difference between the unauthorized
resale price and maximum resale price allowed by this chapter; plus
the sum of $1,000 for administrative costs;
(3)
In the case of an owner who has rented his or
her low- or moderate-income unit in violation of this chapter and/or
other provisions of the Township Code, payment is to be made into
the Township's Housing Trust Fund, of the difference between the total
unauthorized rental charge and the total maximum rental charge allowed
by this chapter, plus the sum of $1,000 for administrative costs;
and/or
(4)
In the case of an owner who has rented his or
her low- or moderate-income unit in violation of this chapter and/or
the Township Code, the owner will be responsible for payment of an
innocent tenant's actual relocation costs, as determined by the court.
C.
For any offense after the first offense by an owner
of a low- or moderate-income unit, or with respect to such a unit
in which the owner has any interest whatsoever (for example, without
limitation, the owner's interest in a company that is the record owner
of such unit), the Township may file an action in Superior Court seeking
a judgment, which would result in the termination of the record owner's
equity or other interest in the unit, in the nature of a mortgage
foreclosure. Any 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- and moderate-income unit, as follows:
(1)
Such judgment shall be enforceable, at the option
of the Township, 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 Township, 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.
(2)
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 Township for any and all costs
and expenses incurred in connection with either the court action resulting
in the judgment of violations or the Sheriff's sale or both. In the
event that the proceeds from the Sheriff's sale are insufficient to
reimburse the Township in full as aforesaid, the violating owner shall
be personally responsible for and to the extent of such deficiency,
in addition to any and all costs incurred by the Township 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 Township 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 Township 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 Township.
Any interest accrued or earned on such balance while being held in
escrow shall belong to and shall be paid to the owner or forfeited
to the Township.
(3)
Foreclosure by the Township due to violation
of this chapter and/or any other provision of the Township Code shall
not extinguish as to that unit the restrictions of this chapter and/or
other provisions of the Township Code as the same apply to low- and
moderate-income units. Title shall be conveyed to the purchaser at
the Sheriff's sale, subject to the restrictions and provisions of
this chapter and the Township Code. 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.
(4)
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 Township 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 this
chapter and the Township Code. This excess shall be treated in the
same manner as the excess which would have been realized from an actual
sale as previously described.
(5)
Failure of the low- and moderate-income unit
to be either sold at the Sheriff's sale or acquired by the Township
shall obligate the owner to accept an offer to purchase from any qualified
purchaser which may be referred to the owner by the Township or any
subdivision thereof, with such offer to purchase being equal to the
maximum resale price of the low- and moderate-income unit as permitted
by the terms and provisions of this chapter and the Township Code.
(6)
The owner shall remain fully obligated, responsible
and liable for complying with the terms and restriction of this chapter
and the Township Code until such time as title is conveyed from the
owner.
