[7-19-2018 by Ord. No.
18-1587]
This chapter of the Code of the Township of Montgomery shall
be known as the "Affordable Housing Ordinance of the Township of Montgomery."
[7-19-2018 by Ord. No.
18-1587]
a. This chapter of the Township Code sets forth regulations regarding
the very-low-, low-, and moderate-income housing units in the Township
consistent with the provisions known as the "Substantive Rules of
the New Jersey Council on Affordable Housing," N.J.A.C. 5:93 et seq., and the Uniform Housing Affordability Controls ("UHAC"),
N.J.A.C. 5:80-26.1 et seq., except where modified by the requirements
for very-low-income housing as established in P.L. 2008, c. 46 (the
"Roberts Bill," codified at N.J.S.A. 52:27D-329.1) as reflected in
the terms of a settlement agreement between the Township and the Fair
Share Housing Center ("FSHC") such that the statutory requirement
to provide very-low-income units equal to 13% of affordable units
approved and constructed after July 17, 2008, to be affordable households
at 30% of the regional median income, overrides the UHAC requirement
that 10% of all low- and moderate-income units must be affordable
at 35% of the regional median income, and the Township's constitutional
obligation to provide a fair share of affordable housing for very-low-,
low-, and moderate-income households.
b. This chapter is intended to assure that very-low-, low- and moderate-income
units ("affordable units") are created with controls on affordability
over time and that very-low-, low- and moderate-income households
shall occupy these units. This chapter shall apply to all inclusionary
developments and 100% affordable developments (including those funded
with low-income housing tax credit financing) except where inconsistent
with applicable law.
c. This chapter implements and incorporates the Fair Share Plan and
addresses the requirements of N.J.A.C. 5:93, as may be amended and
supplemented.
[7-19-2018 by Ord. No.
18-1587]
a. The Township of Montgomery shall comply with the following monitoring
and reporting requirements regarding the status of the implementation
of its court-approved Housing Element and Fair Share Plan:
1. Beginning on December 8, 2018, and on every anniversary of that date
through December 8, 2025, the Township agrees to provide annual reporting
of its Affordable Housing Trust Fund activity to the New Jersey Department
of Community Affairs ("NJDCA"), Council on Affordable Housing ("COAH"),
or Local Government Services ("NJLGS"), or other entity designated
by the State of New Jersey, with a copy provided to FSHC and posted
on the municipal website, using forms developed for this purpose by
the NJDCA, COAH, or NJLGS. The reporting shall include an accounting
of all Affordable Housing Trust Fund activity, including the source
and amount of funds collected and the amount and purpose for which
any funds have been expended.
2. Beginning on December 8, 2018, and on every anniversary of that date
through December 8, 2025, the Township agrees to provide annual reporting
of the status of all affordable housing activity within the municipality
through posting on the municipal website, with a copy of such posting
provided to FSHC, using forms previously developed for this purpose
by COAH or any other forms endorsed by the Special Master and FSHC.
3. By July 1, 2020, as required pursuant to N.J.S.A. 52:27D-313, the
Township will post on its municipal website, with a copy provided
to FSHC, a status report as to its implementation of its plan and
an analysis of whether any unbuilt sites or unfulfilled mechanisms
continue to present a realistic opportunity. Such posting shall invite
any interested party to submit comments to the municipality, with
a copy to FSHC, regarding whether any sites no longer present a realistic
opportunity. Any interested party may, by motion, request a hearing
before the court regarding these issues.
4. By December 8, 2020, and every third year thereafter, as required
by N.J.S.A. 52:27D-329.1, the Township will post on its municipal
website, with a copy provided to FSHC, a status report as to its satisfaction
of its very-low-income requirements, including its family very-low-income
requirements. Such posting shall invite any interested party to submit
comments to the municipality and FSHC on the issue of whether the
municipality has complied with its very-low-income and family very-low-income
housing obligations.
[7-19-2018 by Ord. No.
18-1587]
The following terms, when used in this chapter, shall have the
meanings given in this section:
ACT
The Fair Housing Act of 1985, P.L. 1985, c. 222 (N.J.S.A.
52:27D-301 et seq.).
ADAPTABLE
Constructed in compliance with the technical design standards
of the Barrier Free Subcode, N.J.A.C. 5:23-7.
ADMINISTRATIVE AGENT
The entity designated by the Township to administer affordable
units in accordance with this chapter, N.J.A.C. 5:93, and UHAC (N.J.A.C. 5:80-26.1).
AFFIRMATIVE MARKETING
A regional marketing strategy designed to attract buyers
and/or renters of affordable units pursuant to N.J.A.C. 5:80-26.15.
AFFORDABILITY AVERAGE
The average percentage of median income at which new restricted
units in an affordable housing development are affordable to low-
and moderate-income households.
AFFORDABLE
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.
AFFORDABLE HOUSING DEVELOPMENT
A development included in or approved pursuant to the Housing
Element and Fair Share Plan or otherwise intended to address the Township's
fair share obligation, and includes, but is not limited to, an inclusionary
development, a municipal construction project or a 100% affordable
housing development.
AFFORDABLE HOUSING PROGRAM(S)
Any mechanism in a municipal fair share plan prepared or
implemented to address a municipality's fair share obligation.
AFFORDABLE UNIT
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.
AGE-RESTRICTED UNIT
A housing unit designed to meet the needs of, and exclusively
for, the residents of an age-restricted segment of the population
such that:
a.
All the residents of the development wherein the unit is situated
are 62 years of age or older; or
b.
At least 80% of the units are occupied by one person who is
55 years of age or older; or
c.
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.
AGENCY
The New Jersey Housing and Mortgage Finance Agency established
by P.L. 1983, c. 530 (N.J.S.A. 55:14K-1 et seq.).
ALTERNATIVE LIVING ARRANGEMENT
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.
ASSISTED LIVING RESIDENCE
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.
CERTIFIED HOUSEHOLD
A household that has been certified by an administrative
agent as a very-low-income household, low-income household or moderate-income
household.
COAH or the COUNCIL
The New Jersey Council on Affordable Housing, as established
by the New Jersey Fair Housing Act (N.J.S.A. 52:27D-301 et seq.),
which has primary jurisdiction for the administration of housing obligations
in accordance with sound regional planning consideration in the state.
DCA
The State of New Jersey Department of Community Affairs.
DEFICIENT HOUSING UNIT
A housing unit with health and safety code violations that
require 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.
DEVELOPER
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
or contract to purchase, or other person having an enforceable proprietary
interest in such land.
DEVELOPMENT
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.
DEVELOPMENT FEE
Money paid by a developer for the improvement of property
as permitted in N.J.A.C. 5:93-8.8.
EQUALIZED ASSESSED VALUE
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).
GREEN BUILDING STRATEGIES
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.
INCLUSIONARY DEVELOPMENT
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.
LOW-INCOME HOUSEHOLD
A household with a total gross annual household income equal
to 50% or less of the regional median household income by household
size.
LOW-INCOME UNIT
A restricted unit that is affordable to a low-income household.
MAJOR SYSTEM
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.
MARKET-RATE UNITS
Housing not restricted to low- and moderate-income households
that may sell or rent at any price.
MEDIAN INCOME
The median income by household size for the applicable housing
region, as adopted annually by the Township pursuant to this chapter,
by COAH or by a successor entity approved by the court.
MODERATE-INCOME HOUSEHOLD
A household with a total gross annual household income in
excess of 50% but less than 80% of the regional median household income
by household size.
NONEXEMPT SALE
Any sale or transfer of ownership other than the transfer
of ownership between spouses; 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.
RANDOM SELECTION PROCESS
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).
REGIONAL ASSET LIMIT
The maximum housing value in each housing region affordable
to a four-person household with an income at 80% of the regional median
as defined by duly adopted regional income limits published annually
by COAH or a successor entity.
REHABILITATION
The repair, renovation, alteration or reconstruction of any
building or structure, pursuant to the Rehabilitation Subcode, N.J.A.C.
5:23-6.
RENT
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.
RESTRICTED UNIT
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.
UHAC
The Uniform Housing Affordability Controls set forth in N.J.A.C.
5:80-26.1 et seq.
VERY-LOW-INCOME HOUSEHOLD
A household with a total gross annual household income equal
to 30% or less of the regional median household income by household
size.
WEATHERIZATION
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 it is considered a major system for purposes of a rehabilitation
program.
[7-19-2018 by Ord. No.
18-1587]
a. The provisions of this chapter shall apply to all affordable housing
developments and affordable housing units that currently exist and
that are proposed to be created within the Township of Montgomery
pursuant to the Township's most recently adopted Housing Element
and Fair Share Plan.
b. Moreover, this chapter shall apply to all developments that contain
very-low-, low- and moderate-income housing units, including any currently
unanticipated future developments that will provide very-low-, low-
and moderate-income housing units.
c. Projects receiving federal low-income housing tax credit financing
shall comply with the income and bedroom distribution requirements
of UHAC at N.J.A.C. 5:80-26.3 (with the exception that the UHAC requirement
for 10% of the affordable units in rental projects being required
to be at 35% of median income be modified as required by the statutory
requirement, N.J.S.A. 52:27D-329.1, to 13% of affordable units in
such projects shall be required to be at 30% of median income) and
the length of the affordability controls applicable to such projects
shall be not less than a thirty-year compliance period plus a fifteen-year
extended use period.
[7-19-2018 by Ord. No.
18-1587]
a. A multifamily development providing a minimum of five new housing
units created through a municipal rezoning; Zoning Board use or density
variance; or redevelopment plan or rehabilitation plan that provides
for densities at or above six units per acre is required to include
an affordable housing set-aside of 20% if the affordable units will
be for sale and 15% if the affordable units will be for rent.
b. At least 50% of the affordable units in each development shall be
affordable to low-income housing. At least 13% of all affordable units
in rental developments shall be affordable to very-low-income households.
c. All such affordable units, including bedroom distribution, shall
be governed by the controls on affordability and affirmatively marketed
in conformance with UHAC, N.J.A.C. 5:80-26.1 et seq., or any successor
regulation, and all other applicable law.
d. No subdivision shall be permitted or approved for the purpose of
avoiding compliance with this requirement. Developers cannot, for
example, subdivide a project into two lots and then make each of them
a number of units just below the threshold.
e. This requirement does not give any developer the right to any such
rezoning, variance or other relief or establish any obligation on
the part of the Township of Montgomery to grant such rezoning, variance
or other relief.
f. This Township-wide mandatory set-aside requirement does not apply
to any sites or specific zones otherwise identified in the Township's
settlement agreement with FSHC or Fair Share Plan, for which density
and set-aside requirements shall be governed by the specific standards
as set forth therein. The Township shall maintain this mandatory set-aside
provision through at least July 7, 2025, at which time the Township
may determine to extend the applicability of the provision.
[7-19-2018 by Ord. No.
18-1587]
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:
1. Affirmative marketing (N.J.A.C. 5:80-26.15); provided, however, that
the units or bedrooms may be affirmatively marketed by the provider
in accordance with an alternative plan approved by the court;
2. Affordability average and bedroom distribution (N.J.A.C. 5:80-26.3).
b. With the exception of units established with capital funding through
a twenty-year operating contract with the Department of Human Services,
Division of Developmental Disabilities, alternative living arrangements
shall have at least thirty-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.
[7-19-2018 by Ord. No.
18-1587]
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%
|
[7-19-2018 by Ord. No.
18-1587]
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% of all restricted rental units shall be very-low-income
units (affordable to a household earning 30% or less of regional median
income by household size). The very-low-income units shall be counted
as part of the required number of low-income units within the development.
2. In each affordable development, at least 50% of the restricted units
within each bedroom distribution shall be very-low- or 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% of the total low- and moderate-income units;
(b) At least 30% of all low- and moderate-income units shall be two-bedroom
units;
(c) At least 20% 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
b2(a) through
(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
b2(a) through
(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 Montgomery Township has collected funds
from the developer sufficient to make 10% 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 Township of Montgomery's Affordable Housing Trust
Fund sufficient to install accessible entrances in 10% of the affordable
units that have been constructed with adaptable entrances.
(3)
The funds deposited under Subsection
b2(f)(2) above shall be used by the Township of Montgomery 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 Township
of Montgomery 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 meets
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 Township's Affordable Housing Trust
Fund in care of the Township Treasurer, who shall ensure that the
funds are deposited into the Affordable Housing Trust Fund and appropriately
earmarked.
3. 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.
c. Design:
1. In inclusionary developments, to the extent possible, low- and moderate-income
units shall be integrated with the market units.
2. In inclusionary developments, low- and moderate-income units shall
have access to all of the same common elements and facilities as the
market units.
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 most recently published regional weighted average
of the uncapped Section 8 income limits published by HUD and the calculation
procedures as approved by the court and detailed herein.
"Regional income units shall be established for the region that
the Township is located within (i.e., Region 3) based on the median
income by household size, which shall be established by a regional
weighted average of the uncapped Section 8 income limits published
by HUD. To compute this regional income limit, the HUD determination
of median county income for a family of four is multiplied by the
estimated households within the county according to the most recent
decennial Census. The resulting product for each county within the
housing region is summed. The sum is divided by the estimated total
households from the most recent decennial Census in the Township's
housing region. This quotient represents the regional weighted average
of median income for a household of four. The income limit for a moderate-income
unit for a household of four shall be 80% of the regional weighted
average median income for a family of four. The income limit for a
low-income unit for a household of four shall be 50% of the HUD determination
of the regional weighted average median income for a family of four.
The income limit for a very-low-income unit for a household of four
shall be 30% of the regional weighted average median income for a
family of four. These income limits shall be adjusted by household
size based on multipliers used by HUD to adjust median income by household
size. In no event shall the income limits be less than those for the
previous year."
2. The maximum rent for restricted rental units within each affordable
development shall be affordable to households earning no more than
60% of median income, and the average rent for restricted rental units
shall be affordable to households earning no more than 52% 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% of all low-
and moderate-income rental units shall be affordable to very-low-income
households, which very-low-income units shall be part of the low-income
requirement.
4. The maximum sales price of restricted ownership units within each
affordable development shall be affordable to households earning no
more than 70% of median income, and each affordable development must
achieve an affordability average of 55% 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:
(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; and
(c) A two-bedroom unit shall be affordable to a two-person household
or to two one-person households.
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% of the
purchase price and the Federal Reserve H.15 rate of interest), taxes,
homeowners' and private mortgage insurance and condominium or
homeowners' association fees, does not exceed 28% 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% 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 rents of very-low-, low- and moderate-income units may be increased
annually based on the permitted percentage increase in the Housing
Consumer Price Index for the Northeast Urban Area. This increase shall
not exceed 9% in any one year. Rent increases for units constructed
pursuant to low-income housing tax credit regulations shall be indexed
pursuant to the regulations governing low-income housing tax credits.
[7-19-2018 by Ord. No.
18-1587]
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 HUD for the Section 8 program.
[7-19-2018 by Ord. No.
18-1587]
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. Provide an occupant for each bedroom;
b. Provide children of different sexes with separate bedrooms;
c. Provide separate bedrooms for parents and children; and
d. Prevent more than two persons from occupying a single bedroom.
[7-19-2018 by Ord. No.
18-1587]
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 chapter for a period of at least 30 years, until Montgomery
Township 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.
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 nonrestricted,
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 nonexempt sale after
the unit's release from the restrictions set forth in this chapter,
an amount equal to the difference between the unit's nonrestricted
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 chapter 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.
[7-19-2018 by Ord. No.
18-1587]
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 homeowners' 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 13.
[7-19-2018 by Ord. No.
18-1587]
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% of median
income and moderate-income ownership units shall be reserved for households
with a gross household income less than 80% of median income.
b. Notwithstanding the foregoing, the administrative agent may, upon
approval by the Township Committee, and subject to the court's
approval, permit a moderate-income purchaser to buy a low-income unit
if and only if the administrative agent can demonstrate that there
is an insufficient number of eligible low-income purchasers in the
housing region to permit prompt occupancy of the unit and all other
reasonable efforts to attract a low-income purchaser, including pricing
and financing incentives, have failed. Any such low-income unit that
is sold to a moderate-income household shall retain the required pricing
and pricing restrictions for a low-income unit.
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's and private mortgage
insurance and condominium or homeowner's association fees, as
applicable) does not exceed 33% of the household's eligible monthly
income.
[7-19-2018 by Ord. No.
18-1587]
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% 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).
[7-19-2018 by Ord. No.
18-1587]
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 add 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 ten-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.
[7-19-2018 by Ord. No.
18-1587]
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 chapter for a period of at least 30 years, until Montgomery
Township 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.
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 Somerset. 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 chapter despite the occurrence of any of the following
events:
1. Sublease or assignment of the lease of the unit;
2. Sale or other voluntary transfer of the ownership of the unit; or
3. The entry and enforcement of any judgment of foreclosure on the property
containing the unit.
[7-19-2018 by Ord. No.
18-1587]
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 5% 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 chapter.
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% of the total number of dwelling units are restricted
rental units in compliance with this chapter.
[7-19-2018 by Ord. No.
18-1587]
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% of the regional
median household income by household size.
2. Low-income rental units shall be reserved for households with a gross
household income less than or equal to 50% of the regional median
household income by household size.
3. Moderate-income rental units shall be reserved for households with
a gross household income less than 80% of the regional median household
income by household size.
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%
(40% 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% (40% 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% (40% 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.
c. The applicant shall file documentation sufficient to establish the existence of the circumstances in Subsections
a and
b above with the administrative agent, who shall counsel the household on budgeting.
[7-19-2018 by Ord. No.
18-1587]
a. The Township of Montgomery shall appoint a specific municipal employee
to serve as a Municipal Housing Liaison responsible for overseeing
the Township's affordable housing program, including overseeing
the administration of affordability controls on the affordable units
and the affirmative marketing of available affordable units in accordance
with the Township's Affirmative Marketing Plan; fulfilling monitoring
and reporting requirements; and supervising administrative agent(s).
Montgomery Township shall adopt this chapter which creates the position
of Municipal Housing Liaison, and Montgomery Township shall adopt
a resolution which appoints the person to fulfill the position of
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 Montgomery
Township, including the following responsibilities which may not be
contracted out to the administrative agent:
1. Serving as Montgomery Township'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 Montgomery Township's
Fair Share Plan;
3. Compiling, verifying, submitting and posting all monitoring reports
as required by the court and by this chapter;
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 Township of Montgomery
shall designate one or more administrative agent(s) to administer
and to affirmatively market the affordable units constructed in the
Township in accordance with UHAC and this chapter. 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 Township 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 work of the administrative agent(s).
[7-19-2018 by Ord. No.
18-1587]
An 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 N.J.A.C. 5:80-26.14, 5:80-26.16 and 5:80-26.18 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 Township of Montgomery 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 noneligibility;
4. Requiring that all certified applicants for restricted units execute
a certificate substantially in the form, as applicable, of either
the ownership or rental certificate set forth in Appendixes 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;
6. Employing a random selection process as provided in the Affirmative
Marketing Plan of the Township of Montgomery when referring households
for certification to affordable units; and
7. Notifying the following entities of the availability of affordable
housing units in the Township of Montgomery: the Fair Share Housing
Center, the New Jersey State Conference of the NAACP, the Latino Action
Network, and the New Brunswick, Plainfield Area, Perth Amboy, and
Metuchen/Edison branches of the NAACP.
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 Somerset
County Register of Deeds or Somerset 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- (or very-low-) and moderate-income households regarding the
availability of restricted units for resale or rerental.
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 chapter;
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. Posting annually, in all rental properties (including two-family
homes), 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 Township Committee 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 the court-approved
monitoring and reporting requirements in accordance with the deadlines
set forth in this chapter.
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.
[7-19-2018 by Ord. No.
18-1587]
a. The Township of Montgomery 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.
c. The Affirmative Marketing Plan shall provide a regional preference
for all households that live and/or work in Housing Region 3, comprised
of Somerset, Hunterdon and Middlesex 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 Township of Montgomery 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. In addition to other affirmative marketing strategies, the administrative
agent shall provide specific notice of the availability of affordable
housing units in Montgomery Township, and copies of the application
forms, to the following entities: the Fair Share Housing Center, the
New Jersey State Conference of the NAACP, the Latino Action Network,
and the New Brunswick, Plainfield Area, Perth Amboy, and Metuchen/Edison
branches of the NAACP.
j. The costs of advertising and affirmative marketing of the affordable
units shall be the responsibility of the developer, sponsor or owner.
[7-19-2018 by Ord. No.
18-1587]
a. Upon the occurrence of a breach of any of the regulations governing
an 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 Township of Montgomery 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 attorneys' 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 governing affordable
housing units until such time as title is conveyed from the owner.
[7-19-2018 by Ord. No.
18-1587]
a. Purpose.
1. 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 COAH's adoption of rules.
2. COAH was authorized by 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) 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 COAH or a
court of competent jurisdiction and have a COAH- or court-approved
spending plan may retain fees collected from nonresidential development.
3. In Re: Adoption of N.J.A.C. 5:96 and 5:97 by the New Jersey Council on Affordable Housing, 221 N.J.
1 (2015), also known as the "Mount Laurel IV decision," the Supreme
Court remanded COAH's duties to the Superior Court. As a result,
affordable housing development fee collections and expenditures from
the municipal affordable housing trust funds to implement municipal
third-round fair share plans through July 7, 2025, are under the court's
jurisdiction and are subject to approval by the court.
4. This section 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. Fees collected pursuant to this section 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, codified at N.J.A.C. 5:93-8.
b. Basic requirements.
1. COAH had previously approved ordinances adopting and amending Chapter
15, which established the Township's Affordable Housing Trust Fund. The Township's Development Fee Ordinance, which has been further amended and relocated to §
15-24 of Chapter
15, remains effective pursuant to the Superior Court's jurisdiction in accordance with N.J.A.C. 5:93.8.
2. COAH approved the Township's initial spending plan in 1997.
At such time that the court approves the Township's Amended Third
Round Housing Element and Fair Share Plan and the Amended Third Round
Spending Plan, the Township may begin spending development fees in
conformance with N.J.A.C. 5:93-8 for the new 2018 plan activities.
c. Residential development fees.
1. Imposed fees.
(a)
Within all zoning districts, residential developers, except
for developers of the types of development specifically exempted below,
shall pay a fee of 1.5% of the equalized assessed value for residential
development, provided no increased density is permitted.
(b)
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.
2. Eligible exactions, ineligible exactions and exemptions for residential
development.
(a)
Affordable housing developments, developments where the developer
is providing for the construction of affordable units elsewhere in
the municipality, and developments where the developer has made a
payment in lieu of on-site construction of affordable units shall
be exempt from development fees.
(b)
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.
(c)
In addition to the construction of new principal and/or accessory
buildings, development fees shall be imposed and collected for the
construction of additions or expansions to existing buildings, for
the change or conversion of an existing building to accommodate a
more-intense use, and/or for the demolition and replacement of an
existing building, provided that:
(1)
The development fee shall be calculated on the increase in the
equalized assessed value of the improved building.
(2)
No development fee shall be collected for a demolition and replacement
of a residential building resulting from a natural disaster.
(3)
No development fee shall be collected for the construction of
an "accessory structure" which is not a "building" as these terms
are defined in the Montgomery Township Land Development Ordinance.
d. Nonresidential development fees.
1. Imposed fees.
(a)
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.
(b)
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.
(c)
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.
2. Eligible exactions, ineligible exactions and exemptions for nonresidential
development.
(a)
The nonresidential portion of a mixed-use inclusionary or market-rate
development shall be subject to the 2.5% development fee, unless otherwise
exempted below.
(b)
The 2.5% fee shall not apply to an increase in equalized assessed
value resulting from alterations, change in use within existing footprint,
reconstruction, renovations and repairs.
(c)
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.
(d)
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.
(e)
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 Township as a lien against the real property
of the owner.
e. Collection procedures.
1. 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 Official responsible for the
issuance of a building permit.
2. 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 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.
3. The Construction 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.
4. 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.
5. The Construction 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.
6. 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.
7. Should Montgomery Township 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).
8. 50% 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.
9. Appeal of development fees.
(a)
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 Montgomery Township. Appeals
from a determination of the Board may be made to the Tax Court in
accordance with the provisions of the State Uniform Tax 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.
(b)
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 Montgomery Township.
Appeals from a determination of the Director may be made to the Tax
Court in accordance with the provisions of the State Uniform Tax 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.
f. Affordable Housing Trust Fund.
1. 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.
2. The following additional funds shall be deposited in the Affordable
Housing Trust Fund and shall at all times be identifiable by source
and amount:
(a)
Payments in lieu of on-site construction of affordable units;
(b)
Developer-contributed funds to make 10% of the adaptable entrances
in a townhouse or other multistory attached development accessible;
(c)
Rental income from municipally operated units;
(d)
Repayments from Affordable Housing Program loans;
(f)
Proceeds from the sale of affordable units; and
(g)
Any other funds collected in connection with Montgomery Township's
affordable housing program.
3. Montgomery Township previously provided COAH with written authorization,
in the form of three-party escrow agreements between the municipality,
Bank of America, and COAH, to permit COAH to direct the disbursement
of the funds as provided for in N.J.A.C. 5:93-8. The Superior Court
shall now have such jurisdiction to direct the disbursement of the
Township's trust funds per N.J.A.C. 5:93-8.
4. All interest accrued in the housing trust fund shall only be used
on eligible affordable housing activities approved by the court.
g. Use of funds.
1. 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 Township'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, or
any other activity as permitted pursuant to N.J.A.C. 5:93-8.16 and
specified in the approved spending plan.
2. Funds shall not be expended to reimburse Montgomery Township for
past housing activities.
3. 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. 1/3 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.
(a)
Affordability assistance programs may include downpayment assistance,
security deposit assistance, low-interest loans, rental assistance,
assistance with homeowners' association or condominium fees and
special assessments, infrastructure assistance, and assistance with
emergency repairs.
(b)
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.
(c)
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.
4. Montgomery Township may contract with a private or public entity
to administer any part of its Housing Element and Fair Share Plan,
including the requirement for affordability assistance, in accordance
with N.J.A.C. 5:93-8.16.
5. 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 the monitoring requirements set forth in the court-approved
December 8, 2018, executed settlement agreement with the Fair Share
Housing Center. 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.
h. Monitoring.
1. On or about December 8 of each year through 2025, Montgomery Township
shall provide annual reporting of trust fund activity to the DCA,
COAH, or NJLGS, or other entity designated by the State of New Jersey,
with a copy provided to the Fair Share Housing Center and posted on
the municipal website, using forms developed for this purpose by the
DCA, COAH, or NJLGS. This reporting shall include an accounting of
all housing trust fund activity, including the collection of development
fees from residential and nonresidential developers, payments in lieu
of constructing affordable units on site, funds from the sale of units
with extinguished controls, barrier-free escrow funds, rental income,
repayments from Affordable Housing Program loans, and any other funds
collected in connection with Montgomery Township's housing program,
as well as to the expenditure of revenues and implementation of the
plan approved by the court.
i. Ongoing collection of fees.
1. The ability for Montgomery Township to impose, collect and expend
development fees shall expire with its court-issued judgment of compliance
and repose unless Montgomery Township has filed an adopted Housing
Element and Fair Share Plan with the court or other appropriate jurisdiction,
has filed a declaratory judgment action, and has received the court's
approval of its Development Fee Ordinance. If Montgomery Township
fails to renew its ability to impose and collect development fees
prior to the expiration of its judgment of compliance and repose,
it may be subject to forfeiture of any or all funds remaining within
its Municipal Housing 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).
Montgomery Township shall not impose a residential development fee
on a development that receives preliminary or final site plan approval
after the expiration of its judgment of compliance and repose, nor
shall Montgomery Township retroactively impose a development fee on
such a development. Montgomery Township shall not expend development
fees after the expiration of its judgment of compliance and repose.
[7-19-2018 by Ord. No.
18-1587]
Appeals from all decisions of an administrative agent appointed
pursuant to this chapter shall be filed in writing with the court.