[Amended in entirety 6-12-2018 by Ord. No. 18-11; Added 3-4-2008 by Ord. No. 08-05; amended 5-5-2009 by Ord. No. 09-10; amended in entirety 6-12-2018 by Ord. No. 18-11]
The Code of the Borough of Hillsdale is hereby replaced to include
provisions addressing Hillsdale's constitutional obligation to provide
for its fair share of low- and moderate-income housing, as directed
by the Superior Court and consistent with N.J.A.C. 5:93-1, et seq.,
as amended and supplemented, N.J.A.C. 5:80-26.1, et seq., as amended
and supplemented, and the New Jersey Fair Housing Act of 1985. This
Article is intended to provide assurances that low and moderate income
units ("affordable units") are created with controls on affordability
over time and that low and moderate income households shall occupy
those units. This Article shall apply except where inconsistent with
applicable law.
The Hillsdale Borough Planning Board has adopted a Housing Element
and Fair Share Plan pursuant to the Municipal Land Use Law at N.J.S.A.
40:55D-1, et seq. The Housing Element and Fair Share Plan have been
endorsed by the Governing Body. This Article implements and incorporates
the adopted and endorsed Housing Element and Fair Share Plan and addresses
the requirements of N.J.A.C. 5:93-1, et seq., as amended and supplemented,
N.J.A.C. 5:80-26.1, et seq. as amended and supplemented, and the New
Jersey Fair Housing Act of 1985.
The purpose of this Article is to provide for and regulate affordable
housing in the Borough.
A.
On the first anniversary of the Court's approval of the Settlement
Agreement, executed October 10, 2017, and every anniversary thereafter
through July 1, 2025, the Borough shall provide annual reporting of
its Affordable Housing Trust Fund activity to the New Jersey Department
of Community Affairs, Council on Affordable Housing, or Local Government
Services, or other entity designated by the State of New Jersey, with
a copy provided to Fair Share Housing Center and posted on the municipal
website, using forms developed for this purpose by the New Jersey
Department of Community Affairs, Council on Affordable Housing or
Local Government Services. Such forms shall be provided to the Borough
prior to the Fairness Hearing. 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 bene expended.
B.
On the first anniversary of the Court's approval of the Settlement
Agreement, executed October 10, 2017, and every anniversary thereafter
through July 1, 2025, the Borough shall provide annual reporting of
the status of all affordable housing activity within the municipality
through posting on the municipal website, with copies provided to
Fair Share Housing Center, using forms previously developed for this
purpose by the Council on Affordable Housing or any other forms endorsed
by the Court-appointed Special Master and Fair Share Housing Center.
Such forms shall be provided to the Borough prior to the Fairness
Hearing.
C.
For the midpoint realistic opportunity review, due on July 1, 2020,
as required pursuant to N.J.S.A. 52:27D-313, the Borough shall post
on its municipal website, with copies provided to Fair Share Housing
Center, 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 and whether any mechanisms to meet
unmet need should be revised or supplemented. Such posting shall invite
any interested party to submit comments to the municipality, with
copies provided to Fair Share Housing Center, regarding whether any
sites no longer present a realistic opportunity and should be replaced
and whether any mechanisms to meet unmet need should be revised or
supplemented.
D.
For the review of very-low income housing requirements required by
N.J.S.A. 52:27D-329.1, within 30 days of the third anniversary of
the Court's approval of the Settlement Agreement, executed October
10, 2017, and every third year thereafter, the Borough will post on
its municipal website, with copies provided to Fair Share Housing
Center, a status report as to its satisfaction of its very-low income
requirements, including the family very-low income requirements referenced
in the Settlement Agreement. Such posting shall invite any interested
party to submit comments to the municipality, with copies provided
to Fair Share Housing Center, on the issue of whether the municipality
has complied with its very-low income housing obligation under the
terms of the Settlement Agreement.
The following terms when used in this Article shall have the
meanings given in this section:
The Fair Housing Act of 1985, P.L. 1985, c. 222 (N.J.S.A.
52:27D-301 et seq.).
Constructed in compliance with the technical design standards
of the Barrier Free Subcode, N.J.A.C. 5:23-7.
The entity designated by the Borough to administer affordable
units in accordance with this Article, N.J.A.C. 5:93, and UHAC (N.J.A.C.
5:80-26).
A regional marketing strategy designed to attract buyers
and/or renters of affordable units pursuant to N.J.A.C. 5:80-26.15.
The average percentage of median income at which new restricted
units in an affordable housing development are affordable to low-
and moderate-income households.
A sales price or rent level that is within the means of a
low- or moderate-income household as defined within N.J.A.C. 5:93-7.4,
and, in the case of an ownership unit, that the sales price for the
unit conforms to the standards set forth in N.J.A.C. 5:80-26.6, as
may be amended and supplemented, and, in the case of a rental unit,
that the rent for the unit conforms to the standards set forth in
N.J.A.C. 5:80-26.12, as may be amended and supplemented.
A development included in or approved pursuant to the Housing
Element and Fair Share Plan or otherwise intended to address the Borough's
fair share obligation, and includes, but is not limited to, an inclusionary
development, a municipal construction project or a 100% affordable
housing development.
Any mechanism in a municipal Fair Share Plan prepared or
implemented to address a municipality's fair share obligation.
A housing unit proposed or created pursuant to the Act and
approved for crediting by the Court and/or funded through an affordable
housing trust fund.
The New Jersey Housing and Mortgage Finance Agency established
by P.L. 1983, c. 530 (N.J.S.A. 55:14K-1, et seq.).
A housing unit designed to meet the needs of, and exclusively
for, the residents of an age- restricted segment of the population
such that: 1) all the residents of the development wherein the unit
is situated are 62 years of age or older; or 2) at least 80% of the
units are occupied by one person who is 55 years of age or older;
or 3) the development has been designated by the Secretary of the
U.S. Department of Housing and Urban Development as "housing for older
persons" as defined in Section 807(b)(2) of the Fair Housing Act,
42 U.S.C. § 3607.
A structure in which households live in distinct bedrooms,
yet share kitchen and plumbing facilities, central heat and common
areas. Alternative living arrangements include, but are not limited
to: transitional facilities for the homeless; Class A, B, C, D and
E boarding homes as regulated by the State of New Jersey Department
of Community Affairs; residential health care facilities as regulated
by the New Jersey Department of Health; group homes for the developmentally
disabled and mentally ill as licensed and/or regulated by the New
Jersey Department of Human Services; and congregate living arrangements.
A facility that is licensed by the New Jersey Department
of Health and Senior Services to provide apartment-style housing and
congregate dining and to assure that assisted living services are
available when needed for four or more adult persons unrelated to
the proprietor and that offers units containing, at a minimum, one
unfurnished room, a private bathroom, a kitchenette and a lockable
door on the unit entrance.
A household that has been certified by an Administrative
Agent as a low income household or moderate income household.
The Council on Affordable Housing, as established by the
New Jersey Fair Housing Act (N.J.S.A. 52:27D-301, et seq.), or any
successor agency charged with the administration of the Act.
The Superior Court of New Jersey, Law Division, Bergen County.
The State of New Jersey Department of Community Affairs.
A housing unit with health and safety code violations that
requires the repair or replacement of a major system. A major system
includes weatherization, roofing, plumbing (including wells), heating,
electricity, sanitary plumbing (including septic systems), lead paint
abatement and/or load bearing structural systems.
Any person, partnership, association, company or corporation
that is the legal or beneficial owner or owners of a lot or any land
included in a proposed development including the holder of an option
to contract to purchase, or other person having an enforceable proprietary
interest in such land.
The division of a parcel of land into two or more parcels,
the construction, reconstruction, conversion, structural alteration,
relocation, or enlargement of any use or change in the use of any
building or other structure, or of any mining, excavation or landfill,
and any use or change in the use of any building or other structure,
or land or extension of use of land, for which permission may be required
pursuant to N.J.S.A. 40:55D-1, et seq.
A development containing both affordable units and market
rate units. This term includes, but is not limited to: new construction,
the conversion of a non-residential structure to residential use and
the creation of new affordable units through the gut rehabilitation
or reconstruction of a vacant residential structure.
A household with a total gross annual household income equal
to 50% or less of the regional median household income by household
size.
A restricted unit that is affordable to a low income household.
The primary structural, mechanical, plumbing, electrical,
fire protection, or occupant service components of a building which
include but are not limited to, weatherization, roofing, plumbing
(including wells), heating, electricity, sanitary plumbing (including
septic systems), lead paint abatement and load bearing structural
systems.
Housing not restricted to low and moderate income households
that may sell or rent at any price.
The median income by household size for the applicable housing
region, as adopted annually by COAH or a successor entity approved
by the Court.
A household with a total gross annual household income in
excess of 50% but less than 80% of the regional median household income
by household size.
A restricted unit that is affordable to a moderate income
household.
A structure containing five or more dwelling units.
Any sale or transfer of ownership other than the transfer
of ownership between husband and wife; the transfer of ownership between
former spouses ordered as a result of a judicial decree of divorce
or judicial separation, but not including sales to third parties;
the transfer of ownership between family members as a result of inheritance;
the transfer of ownership through an executor's deed to a class A
beneficiary and the transfer of ownership by court order.
A process by which currently income-eligible households are
selected for placement in affordable housing units such that no preference
is given to one applicant over another except for purposes of matching
household income and size with an appropriately priced and sized affordable
unit (e.g., by lottery).
The maximum housing value in each housing region affordable
to a four-person household with an income at 80% of the regional median
as defined by duly adopted Regional Income Limits published annually
by COAH or a successor entity.
The repair, renovation, alteration or reconstruction of any
building or structure, pursuant to the Rehabilitation Subcode, N.J.A.C.
5:23-6.
The gross monthly cost of a rental unit to the tenant, including
the rent paid to the landlord, as well as an allowance for tenant-paid
utilities computed in accordance with allowances published by DCA
for its Section 8 program. In assisted living residences, rent does
not include charges for food and services.
A dwelling unit, whether a rental unit or an ownership unit,
that is subject to the affordability controls of N.J.A.C. 5:80-26.1,
as amended and supplemented, but does not include a market-rate unit
financed under UHORP or MONI.
The Uniform Housing Affordability Controls set forth in N.J.A.C.
5:80-26, et seq.
A household with a total gross annual household income equal
to 30% or less of the regional median household income by household
size.
A restricted unit that is affordable to a very-low income
household.
Building insulation (for attic, exterior walls and crawl
space), siding to improve energy efficiency, replacement storm windows,
replacement storm doors, replacement windows and replacement doors,
and is considered a major system for purposes of a rehabilitation
program.
A.
The provisions of this Article shall apply to all affordable housing
developments and affordable housing units that currently exist and
that are proposed to be created within the Borough of Hillsdale pursuant
to the Borough's most recently adopted Housing Element and Fair Share
Plan.
B.
Moreover, this Article shall apply to all developments that contain
low and moderate income housing units, including any currently unanticipated
future developments that will provide low and moderate income housing
units.
C.
Any property in the Borough of Hillsdale that is currently zoned
for nonresidential uses and subsequently receives a zoning change
or use variance or approval of a redevelopment or rehabilitation plan
to permit multifamily residential development, or that is currently
zoned for residential uses and receives a zoning change or density
variance or approval of a redevelopment or rehabilitation plan to
permit multifamily residential development, which multifamily residential
development will yield five or more new dwelling units, shall provide
a minimum affordable housing set-aside of 15% percent if the affordable
units will be for rent and a minimum 20% percent if the affordable
units will be for sale. This provision does not affect residential
development on sites that are zoned for inclusionary residential development
as part of the Borough's Housing Element and Fair Share Plan, which
are subject to the affordable housing set-aside requirements set forth
in the applicable zoning. 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 Borough of Hillsdale to grant such
rezoning, variance or other relief. A property shall not be permitted
to be subdivided so as to avoid compliance with this requirement.
All affordable units created pursuant to this subsection shall be
governed by the provisions of this article. However, properties within
the Hillsdale-Patterson Street Redevelopment Plan shall be exempt
from the requirements of this subsection.
[Amended 12-14-2021 by Ord. No. 21-18]
A.
Hillsdale's rehabilitation program shall be designed to renovate
deficient housing units occupied by low- and moderate-income households
such that, after rehabilitation, these units will comply with the
New Jersey State Housing Code pursuant to N.J.A.C. 5:28.
B.
Both owner occupied and renter occupied units shall be eligible for
rehabilitation funds.
C.
All rehabilitated units shall remain affordable to low- and moderate-income
households for a period of 10 years (the control period). For owner
occupied units the control period will be enforced with a lien and
for renter occupied units the control period will be enforced with
a deed restriction.
D.
The Borough of Hillsdale shall dedicate a minimum of $10,000 for
each unit to be rehabilitated through this program. The Borough will
main sufficient funds in its affordable housing trust fund account
to finance the rehabilitation program.
E.
The Borough of Hillsdale shall designate, subject to the approval
of the Court, one or more Administrative Agents to administer the
rehabilitation program in accordance with N.J.A.C. 5:91 and N.J.A.C.
5:93. The Administrative Agent(s) shall provide a rehabilitation manual
for the owner occupancy rehabilitation program and a rehabilitation
manual for the rental occupancy rehabilitation program to be adopted
by resolution of the Governing Body and subject to approval of the
Court. Both rehabilitation manuals shall be available for public inspection
in the Office of the Municipal Clerk and in the office(s) of the Administrative
Agent(s).
F.
Units in a rehabilitation program shall be exempt from the Uniform
Housing Affordability Controls (UHAC), but shall be administered in
accordance with the following:
(1)
If a unit is vacant, upon initial rental subsequent to rehabilitation,
or if a renter-occupied unit is re-rented prior to the end of controls
on affordability, the deed restriction shall require the unit to be
rented to a low- or moderate-income household at an affordable rent
and affirmatively marketed pursuant to UHAC.
(2)
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 UHAC.
(3)
Rents in rehabilitated units may increase annually based on
the standards in UHAC.
(4)
Applicant and/or tenant households shall be certified as income-eligible
in accordance with UHAC, except that households in owner occupied
units shall be exempt from the regional asset limit.
A.
The administration of an alternative living arrangement shall be
in compliance with N.J.A.C. 5:93-5.8 and UHAC, with the following
exceptions:
B.
With the exception of units established with capital funding through
a 20-year operating contract with the Department of Human Services,
Division of Developmental Disabilities, alternative living arrangements
shall have at least 30 year controls on affordability in accordance
with UHAC, unless an alternative commitment is approved by COAH or
the Court.
(1)
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.
A.
To implement the fair share plan in a manner consistent with the
terms of the October 10, 2017 Settlement Agreement, ensure the efficient
use of land through compact forms of development and to create realistic
opportunities for the construction of affordable housing, inclusionary
zoning shall be permitted on the following properties consistent with
the provisions of the Borough of Hillsdale's Housing Plan Element
and Fair Share Plan, and the terms of the settlement agreement:
(1)
The Bank of America site, known as Block 1102, Lots 2, 3 and
4, shall be rezoned to permit mixed-use development with commercial
uses on the first floor and residential units above with a maximum
of 20 units to the acre.
(2)
The Verizon site, known as Block 1201, Lot 11, shall be rezoned
to permit mixed-use development with commercial uses on the first
floor and residential units above with a maximum of 20 units to the
acre.
(3)
To the extent feasible, the previously approved Walsky (Block
1212, Lots 15 and 16) and Paterno (Block 1205, Lot 8) shall be consistent
with the terms of the Settlement Agreement.
(4)
The Industrial Zone site, which is located off of Patterson
Street. These parcels are known as Block 1207, Lots 8-11; Block 1208,
Lots 1-5; Block 1209, Lots 2-6; Block 1210, Lots 6-11; Block 1211,
Lots 1 and 2; Block 1212, Lot 13. The Borough has designated Block
1207, Lots 8-10, Block 1208, Lots 1-5, Block 1209, Lots 2-4, Block
1210, Lots 8-11, and Block 1211, Lots 1 and 2, as an area in need
of redevelopment and subsequently adopted the Hillsdale-Paterson Street
Redevelopment Plan. The redevelopment plan, which supersedes the underlying
zoning, permits a variety of uses, including townhomes, multifamily
dwellings, senior/independent housing, continuing care retirement
communities, co-living complexes, commercial and personal service
uses, public purposes, and mixed uses. The redevelopment plan permits
up to 28 units to the acre with an affordable housing set-aside of
15% (if rental) and 20% (if for-sale). Additionally, a density bonus
is available for redevelopment projects on Blocks 1208, 1210, and
1211 through a redevelopment agreement where the developer agrees
to provide certain public improvements such as a community center,
dedicated public open space, or sustainable design practices. The
Borough will adopt an overlay zone on the remaining parcels of the
Industrial Zone site, Block 1207, Lot 11, Block 1209, Lots 5 and 6,
Block 1210, Lots 6 and 7, and Block 1212, Lot 13, that will permit
inclusionary development at a maximum density of 28 units per acre.
[Amended 12-14-2021 by Ord. No. 21-18]
A.
In inclusionary developments the following schedule shall be followed:
|
Maximum Percentage of Market-Rate Units Completed
|
Minimum Percentage of Low and Moderate Income Units Completed
|
|---|---|
|
25
|
0
|
|
25+1
|
10
|
|
50
|
50
|
|
75
|
75
|
|
90
|
100
|
A.
Inclusionary developments that result in an affordable housing obligation
that is fractional shall pay a payment-in-lieu for the fraction.
B.
The payment-in-lieu for Hillsdale shall be $195,000 for 2018. The
payment-in-lieu shall increase by 3% each year. To calculate the payment-in-lieu
the developer shall multiply the fraction by the payment. For example,
a fraction of 0.6 triggered in 2018 would require a payment of $117,000.
The payment shall be made to the Borough's Affordable Housing Trust
Fund.
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 median
income). The very-low income units shall be counted as part of the
required number of low income units within the development.
(2)
At least 25% of the obligation shall be met through rental units,
including at least half in rental units available to families.
(3)
A maximum of 25% of the Borough's obligation may be met with
age restricted units. At least half of all affordable units in the
Borough's Plan shall be non-restricted.
(4)
In each affordable development, at least 50% of the restricted
units within each bedroom distribution shall be low income units.
(5)
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.
(6)
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. The Borough shall not
be permitted to claim credit to satisfy its obligations under the
Settlement Agreement for age-restricted units that exceed 25% of all
units developed.
B.
Accessibility Requirements.
(1)
The first floor of all restricted townhouse dwelling units and
all restricted units in all other multi-story buildings shall be subject
to the technical design standards of the Barrier Free SubCode, N.J.A.C.
5:23-7.
(2)
All restricted townhouse dwelling units and all restricted units
in other multi-story 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 casing for the installation of a door, on the first floor; and
(e)
If not all of the foregoing requirements in paragraphs (2)(a)
through (2)(d) can be satisfied, then an interior accessible route
of travel must be provided between stories within an individual unit,
but if all of the terms of paragraphs (2)(a) through (2)(d) above
have been satisfied, then an interior accessible route of travel shall
not be required between stories within an individual unit; and
(f)
An accessible entranceway as set forth at P.L. 2005, c. 350
(N.J.S.A. 52:27D-311a, et seq.) and the Barrier Free SubCode, N.J.A.C.
5:23-7, or evidence that Hillsdale 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 person with disabilities who is purchasing or
will reside in the dwelling unit, an accessible entrance shall be
installed.
[2]
To this end, the builder of restricted units shall deposit funds
within the Borough of Hillsdale'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 paragraph (f)[2] above shall be used
by the Borough of Hillsdale for the sole purpose of making the adaptable
entrance of an affordable unit accessible when requested to do so
by a person with a disability who occupies or intends to occupy the
unit and requires an accessible entrance.
[4]
The developer of the restricted units shall submit a design
plan and cost estimate to the Construction Official of the Borough
of Hillsdale for the conversion of adaptable to accessible entrances.
[5]
Once the Construction Official has determined that the design
plan to convert the unit entrances from adaptable to accessible meet
the requirements of the Barrier Free SubCode, N.J.A.C. 5:23-7, and
that the cost estimate of such conversion is reasonable, payment shall
be made to the Borough's Affordable Housing Trust Fund in care of
the Borough Chief Financial Officer who shall ensure that the funds
are deposited into the Affordable Housing Trust Fund and appropriately
earmarked.
[6]
Full compliance with the foregoing provisions shall not be required
where an entity can demonstrate that it is "site impracticable" to
meet the requirements. Determinations of site impracticability shall
be in compliance with the Barrier Free SubCode, N.J.A.C. 5:23-7.
D.
Maximum Rents and Sales Prices.
(1)
In establishing rents and sales prices of affordable housing
units, the Administrative Agent shall follow the procedures set forth
in UHAC, utilizing the regional income limits established by COAH
or a successor entity.
(2)
The maximum rent for restricted rental units within each affordable
development shall be affordable to households earning no more than
60% 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, earning 30% or less of the regional
median household income, with such very-low income units counted the
low income housing 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:
(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, homeowner and private mortgage insurance and condominium or
homeowner association fees do 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 rent of low and moderate income units may be increased annually
based on the permitted percentage increase in the Housing Consumer
Price Index for the United States. This increase shall not exceed
nine percent in any one year. Rents for units constructed pursuant
to low income housing tax credit regulations shall be indexed pursuant
to the regulations governing low income housing tax credits.
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 its Section 8 program.
A.
In referring certified households to specific restricted units, the
Administrative Agent shall, to the extent feasible and without causing
an undue delay in the occupancy of a unit, strive to:
A.
Control periods for restricted ownership units shall be in accordance
with N.J.A.C. 5:80- 26.5, as may be amended and supplemented, and
each restricted ownership unit shall remain subject to the requirements
of this Article for a period of at least 30 years, until Hillsdale
takes action to release the unit from such requirements; prior to
such action, a restricted ownership unit shall 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 non-restricted,
fair market value of the unit based on either an appraisal or the
unit's equalized assessed value without the restrictions in place.
D.
At the time of the initial sale of the unit, the initial purchaser
shall execute and deliver to the Administrative Agent a recapture
note obligating the purchaser (as well as the purchaser's heirs, successors
and assigns) to repay, upon the first non-exempt sale after the unit's
release from the restrictions set forth in this Article, an amount
equal to the difference between the unit's non-restricted fair market
value and its restricted price, and the recapture note shall be secured
by a recapture lien evidenced by a duly recorded mortgage on the unit.
E.
The affordability controls set forth in this Article shall remain
in effect despite the entry and enforcement of any judgment of foreclosure
with respect to restricted ownership units.
F.
A restricted ownership unit shall be required to obtain a Continuing
Certificate of Occupancy or a certified statement from the Construction
Official stating that the unit meets all Code standards upon the first
transfer of title following the removal of the restrictions provided
under N.J.A.C. 5:80-26.5(a), as may be amended and supplemented.
A.
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:
(1)
The initial purchase price for a restricted ownership unit shall
be approved by the Administrative Agent.
(2)
The Administrative Agent shall approve all resale prices, in
writing and in advance of the resale, to assure compliance with the
foregoing standards.
(3)
The master deeds of inclusionary developments shall provide
no distinction between the condominium or homeowner association fees
and special assessments paid by low and moderate income purchasers
and those paid by market purchasers.
(4)
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 310-154.
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, however, the Administrative Agent
may, upon approval by the Borough Council, and subject to the Court's
approval, permit moderate income purchasers to buy low income units
in housing markets if the Administrative Agent determines that there
is an insufficient number of eligible low income purchasers to permit
prompt occupancy of the units. All such low income units to be sold
to moderate income households shall retain the required pricing and
pricing restrictions for low income units.
C.
A certified household that purchases a restricted ownership unit
must occupy it as the certified household's principal residence and
shall not lease the unit; provided, however, that the Administrative
Agent may permit the owner of a restricted ownership unit, upon application
and a showing of hardship, to lease the restricted unit to another
certified household for a period not to exceed one year.
D.
The Administrative Agent shall certify a household as eligible for
a restricted ownership unit when the household is a low income household
or a moderate income household, as applicable to the unit, and the
estimated monthly housing cost for the particular unit (including
principal, interest, taxes, homeowner and private mortgage insurance
and condominium or homeowner association fees, as applicable) does
not exceed 33% of the household's eligible monthly income.
A.
Prior to incurring any indebtedness to be secured by a restricted
ownership unit, the owner shall apply to the Administrative Agent
for a determination in writing that the proposed indebtedness complies
with the provisions of this section, and the Administrative Agent
shall issue such determination prior to the owner incurring such indebtedness.
B.
With the exception of First Purchase Money Mortgages, neither an
owner nor a lender shall at any time cause or permit the total indebtedness
secured by a restricted ownership unit to exceed 95% of the maximum
allowable resale price of the unit, as such price is determined by
the Administrative Agent in accordance with N.J.A.C. 5:80-26.6(b).
A.
The owners of restricted ownership units may apply to the Administrative
Agent to increase the maximum sales price for the unit on the basis
of capital improvements made since the purchase of the unit. Eligible
capital improvements shall be those that render the unit suitable
for a larger household or that adds an additional bathroom. In no
event shall the maximum sales price of an improved housing unit exceed
the limits of affordability for the larger household.
B.
Upon the resale of a restricted ownership unit, all items of property
that are permanently affixed to the unit or were included when the
unit was initially restricted (for example, refrigerator, range, washer,
dryer, dishwasher, wall-to-wall carpeting) shall be included in the
maximum allowable resale price. Other items may be sold to the purchaser
at a reasonable price that has been approved by the Administrative
Agent at the time of the signing of the agreement to purchase. The
purchase of central air conditioning installed subsequent to the initial
sale of the unit and not included in the base price may be made a
condition of the unit resale provided the price, which shall be subject
to 10-year, straight- line depreciation, has been approved by the
Administrative Agent. Unless otherwise approved by the Administrative
Agent, the purchase of any property other than central air conditioning
shall not be made a condition of the unit resale. The owner and the
purchaser must personally certify at the time of closing that no unapproved
transfer of funds for the purpose of selling and receiving property
has taken place at the time of or as a condition of resale.
A.
Control periods for restricted rental units shall be in accordance
with N.J.A.C. 5:80- 26.11, as may be amended and supplemented, and
each restricted rental unit shall remain subject to the requirements
of this Article for a period of at least 30 years, until Hillsdale
takes action to release the unit from such requirements. Prior to
such action, a restricted rental unit shall 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. The deed shall also identify each affordable
unit by apartment number and/or address and whether that unit is designated
as a very-low, low or moderate income unit. Neither the unit nor its
affordability designation shall change throughout the term of the
deed restriction. A copy of the filed document shall be provided to
the Administrative Agent within 30 days of the receipt of a Certificate
of Occupancy.
C.
A restricted rental unit shall remain subject to the affordability
controls of this Article despite the occurrence of any of the following
events:
A.
A written lease shall be required for all restricted rental units
and tenants shall be responsible for security deposits and the full
amount of the rent as stated on the lease. A copy of the current lease
for each restricted rental unit shall be provided to the Administrative
Agent.
B.
No additional fees or charges shall be added to the approved rent
(except, in the case of units in an assisted living residence, to
cover the customary charges for food and services) without the express
written approval of the Administrative Agent.
C.
Application fees (including the charge for any credit check) shall
not exceed five percent of the monthly rent of the applicable restricted
unit and shall be payable to the Administrative Agent to be applied
to the costs of administering the controls applicable to the unit
as set forth in this Article.
D.
No rent control ordinance or other pricing restriction shall be applicable
to either the market units or the affordable units in any development
in which at least 15% of the total number of dwelling units are restricted
rental units in compliance with this Article.
A.
Tenant income eligibility shall be in accordance with N.J.A.C. 5:80-26.13,
as may be amended and supplemented, and shall be determined as follows:
(1)
Very-low income rental units shall be reserved for households
with a gross household income less than or equal to 30% of median
income.
(2)
Low income rental units shall be reserved for households with
a gross household income less than or equal to 50% of median income.
(3)
Moderate income rental units shall be reserved for households
with a gross household income less than 80% of median income.
B.
The Administrative Agent shall certify a household as eligible for
a restricted rental unit when the household is a very-low income household,
low income household or a moderate income household, as applicable
to the unit, and the rent proposed for the unit does not exceed 35%
(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 A(1) through B(5) above with the
Administrative Agent, who shall counsel the household on budgeting.
A.
The Borough of Hillsdale shall appoint a specific municipal employee
to serve as a Municipal Housing Liaison responsible for administering
the affordable housing program, including affordability controls,
the Affirmative Marketing Plan, monitoring and reporting, and, where
applicable, supervising any contracted Administrative Agent. The Municipal
Housing Liaison shall be appointed by the Governing Body and may be
a full or part time municipal employee.
B.
The Municipal Housing Liaison shall be responsible for oversight
and administration of the affordable housing program for Hillsdale,
including the following responsibilities which may not be contracted
out to the Administrative Agent:
(1)
Serving as Hillsdale'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 Hillsdale's
Fair Share Plan;
(3)
Compiling, verifying and submitting annual monitoring reports
as may be required by the Court;
(4)
Coordinating meetings with affordable housing providers and
Administrative Agents, as needed; and
(5)
Attending continuing education opportunities on affordability
controls, compliance monitoring and affirmative marketing at least
annually and more often as needed.
C.
Subject to the approval of the Court, the Borough of Hillsdale shall
designate one or more Administrative Agent(s) to administer newly
constructed affordable units in accordance with UHAC. An Operating
Manual for each affordable housing program shall be provided by the
Administrative Agent(s) to be adopted by resolution of the Governing
Body and subject to approval of the Court. The Operating Manual(s)
shall be available for public inspection in the office of the Borough
Clerk, in the office of the Municipal Housing Liaison, and in the
office(s) of the Administrative Agent(s). The Municipal Housing Liaison
shall supervise the contracting Administrative Agent(s).
D.
Compensation. Compensation shall be fixed by the Governing Body at
the time of the appointment of the Municipal Housing Liaison.
A.
The Administrative Agent shall be an independent entity serving under
contract to and reporting to the municipality. For new sale and rental
developments, all of 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. For resales, single family
homeowners and condominium homeowners shall be required to pay three
percent of the sales price for services provided by the Administrative
Agent related to the resale of their homes. That fee shall be collected
at closing and paid directly to the Administrative Agent. The Administrative
Agent shall perform the duties and responsibilities of an Administrative
Agent as set forth in UHAC, including those set forth in Sections
5:80-26.14, 16 and 18 thereof, which include:
(1)
Conducting an outreach process to affirmatively market affordable
housing units in accordance with the Affirmative Marketing Plan of
the Borough of Hillsdale and the provisions of N.J.A.C. 5:80-26.15;
and
(2)
Providing counseling or contracting to provide counseling services
to low and moderate income applicants on subjects such as budgeting,
credit issues, mortgage qualification, rental lease requirements,
and landlord/tenant law.
B.
Household Certification:
(1)
Soliciting, scheduling, conducting and following up on interviews
with interested households;
(2)
Conducting interviews and obtaining sufficient documentation
of gross income and assets upon which to base a determination of income
eligibility for a low or moderate income unit;
(3)
Providing written notification to each applicant as to the determination
of eligibility or non-eligibility;
(4)
Requiring that all certified applicants for restricted units
execute a certificate substantially in the form, as applicable, of
either the ownership or rental certificates set forth in Appendices
J and K of N.J.A.C. 5:80-26.1 et seq.;
(5)
Creating and maintaining a referral list of eligible applicant
households living in the housing region and eligible applicant households
with members working in the housing region where the units are located;
and
(6)
Employing a random selection process as provided in the Affirmative
Marketing Plan of the Borough of Hillsdale when referring households
for certification to affordable units.
C.
Affordability Controls:
(1)
Furnishing to attorneys or closing agents forms of deed restrictions
and mortgages for recording at the time of conveyance of title of
each restricted unit;
(2)
Creating and maintaining a file on each restricted unit for
its control period, including the recorded deed with restrictions,
recorded mortgage and note, as appropriate;
(3)
Ensuring that the removal of the deed restrictions and cancellation
of the mortgage note are effectuated and properly filed with the Bergen
County Register of Deeds or County Clerk's office after the termination
of the affordability controls for each restricted unit;
(4)
Communicating with lenders regarding foreclosures; and
(5)
Ensuring the issuance of Continuing Certificates of Occupancy
or certifications pursuant to N.J.A.C. 5:80-26.10.
D.
Sales and Rerentals:
(1)
Instituting and maintaining an effective means of communicating
information between owners and the Administrative Agent regarding
the availability of restricted units for resale or rerental; and
(2)
Instituting and maintaining an effective means of communicating
information to low and moderate income households regarding the availability
of restricted units for resale or re-rental.
E.
Processing Requests from Unit Owners:
(1)
Reviewing and approving requests for determination from owners
of restricted units who wish to take out home equity loans or refinance
during the term of their ownership that the amount of indebtedness
to be incurred will not violate the terms of this Article;
(2)
Reviewing and approving requests to increase sales prices from
owners of restricted units who wish to make capital improvements to
the units that would affect the selling price, such authorizations
to be limited to those improvements resulting in additional bedrooms
or bathrooms and the depreciated cost of central air conditioning
systems;
(3)
Notifying the municipality of an owner's intent to sell a restricted
unit; and
(4)
Making determinations on requests by owners of restricted units
for hardship waivers.
F.
Enforcement:
(1)
Securing annually from the municipality a list of all affordable
housing units for which tax bills are mailed to absentee owners, and
notifying all such owners that they must either move back to their
unit or sell it;
(2)
Securing from all developers and sponsors of restricted units,
at the earliest point of contact in the processing of the project
or development, written acknowledgement of the requirement that no
restricted unit can be offered, or in any other way committed, to
any person, other than a household duly certified to the unit by the
Administrative Agent;
(3)
The posting annually in all rental properties, including two-family
homes, of a notice as to the maximum permitted rent together with
the telephone number of the Administrative Agent where complaints
of excess rent or other charges can be made;
(4)
Sending annual mailings to all owners of affordable dwelling
units, reminding them of the notices and requirements outlined in
N.J.A.C. 5:80-26.18(d)4;
(5)
Establishing a program for diverting unlawful rent payments
to the municipality's Affordable Housing Trust Fund; and
(6)
Creating and publishing a written operating manual for each
affordable housing program administered by the Administrative Agent,
to be approved by the Borough Council and the Court, setting forth
procedures for administering the affordability controls.
G.
Additional Responsibilities:
(1)
The Administrative Agent shall have the authority to take all
actions necessary and appropriate to carry out its responsibilities
hereunder.
(2)
The Administrative Agent shall prepare monitoring reports for
submission to the Municipal Housing Liaison in time to meet any monitoring
requirements and deadlines imposed by the Court.
(3)
The Administrative Agent shall attend continuing education sessions
on affordability controls, compliance monitoring, and affirmative
marketing at least annually and more often as needed.
A.
The Borough of Hillsdale shall adopt by resolution an Affirmative
Marketing Plan, subject to the approval of the Court that is compliant
with N.J.A.C. 5:80-25.15, 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.
In addition, as a result of the Settlement Agreement with FSHC, the
Affirmative Marketing Plan shall require the notification of the New
Jersey State Conference of the NAACP, FSHC, the Bergen County Chapter
of the NAACP, the Latino Action Network and the Bergen Urban League
of affordable housing opportunities. It is a continuing program that
directs marketing activities toward Housing Region 1 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 1, comprised
of Bergen, Hudson, Passaic and Sussex Counties.
D.
The municipality has the ultimate responsibility for adopting the
Affirmative Marketing Plan and for the proper administration of the
Affirmative Marketing Program, including initial sales and rentals
and resales and rerentals. The Administrative Agent designated by
the Borough of Hillsdale 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 Danforth Memorial Library,
Johnson Free Public Library, Hudson County Library, Sussex County
Main Library, Sussex County Administration Building, Hudson County
Administration Building, Passaic County Administration Building, Bergen
County Administration Building, Hillsdale Library, the Hillsdale Municipal
Building and the developer's rental office. Pre-applications may be
emailed to prospective applicants upon request. Otherwise, hard copies
are available from the Municipal Housing Liaison.
I.
The costs of advertising and affirmative marketing of the affordable
units shall be the responsibility of the developer, sponsor or owner.
A.
Upon the occurrence of a breach of any of the regulations governing
the affordable unit by an Owner, Developer or Tenant, the municipality
shall have all remedies provided at law or equity, including but not
limited to foreclosure, tenant eviction, a requirement for household
recertification, acceleration of all sums due under a mortgage, recuperation
of any funds from a sale in violation of the regulations, injunctive
relief to prevent further violation of the regulations, entry on the
premises, and specific performance.
B.
After providing written notice of a violation to an Owner, Developer
or Tenant of a low or moderate income unit and advising the Owner,
Developer or Tenant of the penalties for such violations, the municipality
may take the following action(s) against the Owner, Developer or Tenant
for any violation that remains uncured for a period of 60 days after
service of the written notice:
(1)
The municipality may file a court action pursuant to N.J.S.A.
2A:58-11 alleging a violation or violations of the regulations governing
the affordable housing unit. If the Owner, Developer or Tenant is
adjudged by the Court to have violated any provision of the regulations
governing affordable housing units the Owner, Developer or Tenant
shall be subject to one or more of the following penalties, at the
discretion of the Court:
(a)
A fine of not more than $500.00 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. In the case of an Owner who has rented a low
or moderate income unit in violation of the regulations governing
affordable housing units, payment into the Borough of Hillsdale Affordable
Housing Trust Fund of the gross amount of rent illegally collected;
(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 of an innocent tenant's reasonable relocation costs,
as determined by the Court.
(2)
The municipality may file a court action in the Superior Court
seeking a judgment that would result in the termination of the Owner's
equity or other interest in the unit, in the nature of a mortgage
foreclosure. Any such judgment shall be enforceable as if the same
were a judgment of default of the First Purchase Money Mortgage and
shall constitute a lien against the low or moderate income unit:
(a)
The judgment shall be enforceable, at the option of the municipality,
by means of an execution sale by the Sheriff, at which time the low
and moderate income unit of the violating Owner shall be sold at a
sale price which is not less than the amount necessary to fully satisfy
and pay off any First Purchase Money Mortgage and prior liens and
the costs of the enforcement proceedings incurred by the municipality,
including attorney's fees. The violating Owner shall have his right
to possession terminated as well as his title conveyed pursuant to
the Sheriff's sale.
(b)
The proceeds of the Sheriff's sale shall first be applied to
satisfy the First Purchase Money Mortgage lien and any prior liens
upon the low and moderate income unit. The excess, if any, shall be
applied to reimburse the municipality for any and all costs and expenses
incurred in connection with either the court action resulting in the
judgment of violation or the Sheriff's sale. In the event that the
proceeds from the Sheriff's sale are insufficient to reimburse the
municipality in full as aforesaid, the violating Owner shall be personally
responsible for the full extent of such deficiency, in addition to
any and all costs incurred by the municipality in connection with
collecting such deficiency. In the event that a surplus remains after
satisfying all of the above, such surplus, if any, shall be placed
in escrow by the municipality for the Owner and shall be held in such
escrow for a maximum period of two years or until such earlier time
as the Owner shall make a claim with the municipality for such. Failure
of the Owner to claim such balance within the two-year period shall
automatically result in a forfeiture of such balance to the municipality.
Any interest accrued or earned on such balance while being held in
escrow shall belong to and shall be paid to the municipality, whether
such balance shall be paid to the Owner or forfeited to the municipality.
(c)
Foreclosure by the municipality due to violation of the regulations
governing affordable housing units shall not extinguish the restrictions
of the regulations governing affordable housing units as the same
apply to the low and moderate income unit. Title shall be conveyed
to the purchaser at the Sheriff's sale, subject to the restrictions
and provisions of the regulations governing the affordable housing
unit. The Owner determined to be in violation of the provisions of
this plan and from whom title and possession were taken by means of
the Sheriff's sale shall not be entitled to any right of redemption.
(d)
If there are no bidders at the Sheriff's sale, or if insufficient
amounts are bed to satisfy 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.
Appeals from all decisions of an Administrative Agent appointed
pursuant to this Article shall be filed in writing with the Court.
[Added 6-12-2018 by Ord.
No. 18-10]
This Article establishes standards for the collection, maintenance,
and expenditure of development fees that are consistent with COAH's
regulations developed in response to P.L. 2008, c. 46, Sections 8
and 32-38 (C. 52:27D-329.2) and the Statewide Non-Residential Development
Fee Act (C. 40:55D-8.1 through 8.7). Fees collected pursuant to this
Article shall be used for the sole purpose of providing very-low,
low and moderate income housing in accordance with a Court-approved
Spending Plan.
The following terms when used in this Article shall have the
meanings given in this section:
A development included in or approved pursuant to the Housing
Element and Fair Share Plan or otherwise intended to address the Borough's
fair share obligation, and includes, but is not limited to, an inclusionary
development, a municipal construction project or a 100% affordable
housing development.
The Council on Affordable Housing, as established by the
New Jersey Fair Housing Act, or any successor agency charged with
the administration of the Fair Housing Act.
The Superior Court of New Jersey, Law Division, Bergen County.
Money paid by a developer for the improvement of property
as authorized by Holmdel Builder's Association v. Holmdel Borough,
121 N.J. 550 (1990) and the Fair Housing Act of 1985, N.J.S.A. 52:27d-301,
et seq., and regulated by applicable COAH Rules.
The legal or beneficial owner or owners of a lot or of any
land proposed to be included in a proposed development, including
the holder of an option or contract to purchase, or other person having
an enforceable proprietary interest in such land.
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 (C.54:1-35a through C.54:1-35c).
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.
A.
Imposition of Fees.
(1)
Within the Borough of Hillsdale, all residential developers,
except for developers of the types of developments specifically exempted
below and developers of developments that include affordable housing,
shall pay a fee of 1.5% of the equalized assessed value for all new
residential development provided no increased density is permitted.
(2)
When an increase in residential density is permitted pursuant
to a "d" variance granted under N.J.S.A. 40:55D-70d(5), developers
shall be required to pay a "bonus" development fee of 6% of the equalized
assessed value for each additional unit that may be realized, except
that this provision shall not be applicable to a development that
will include affordable housing. 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.
B.
Eligible Exactions, Ineligible Exactions and Exemptions for Residential
Developments
(1)
Affordable housing developments and/or developments where the
developer has made a payment in lieu of on-site construction of affordable
units, if permitted by Ordinance or by Agreement with the Borough
of Hillsdale, shall be exempt from the payment of development fees.
(2)
Developments that have received preliminary or final site plan
approval prior to the adoption of this Article shall be exempt from
the payment of development fees, unless the developer seeks a substantial
change in the original approval. Where site plan approval is not applicable,
the issuance of a Zoning Permit and/or Construction Permit shall be
synonymous with preliminary or final site plan approval for the purpose
of determining the right to an exemption. In all cases, the applicable
fee percentage shall be determined based upon the Development Fee
Ordinance in effect on the date that the Construction Permit is issued.
(3)
Residential development fees shall not be imposed and collected
when an existing structure is expanded or undergoes a change, except
for the following: when there is the removal and replacement of 50%
or more of the sum of the area of all floors of the existing building,
excluding a basement or cellar area. The development fee shall be
calculated on the increase in the equalized assessed value of the
improved structure.
(4)
Developers of residential structures demolished and replaced
in-kind as a result of a natural disaster shall be exempt from paying
a development fee.
A.
Imposition of Fees.
(1)
Within all zoning districts, non-residential developers, except
for developers of the types of developments specifically exempted
below, shall pay a fee equal to 2.5% of the equalized assessed value
of the land and improvements, for all new non-residential construction
on an unimproved lot or lots.
(2)
Within all zoning districts, non-residential developers, except
for developers of the types of developments specifically exempted
below, 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 non-residential purposes.
(3)
Development fees shall be imposed and collected when an existing
structure is demolished and replaced. The development fee of 2.5%
shall be calculated on the difference between the equalized assessed
value of the pre-existing land and improvements and the equalized
assessed value of the newly improved structure, i.e. land and improvements,
and such calculation shall be made at the time a final Certificate
of Occupancy is issued. If the calculation required under this section
results in a negative number, the non-residential development fee
shall be zero.
B.
Eligible Exactions, Ineligible Exactions and Exemptions for Non-residential
Development.
(1)
The non-residential portion of a mixed-use inclusionary or market
rate development shall be subject to a 2.5% development fee, unless
otherwise exempted below.
(2)
The 2.5% development fee shall not apply to an increase in equalized
assessed value resulting from alterations, change in use within the
existing footprint, reconstruction, renovations and repairs.
(3)
Non-residential developments shall be exempt from the payment
of non-residential development fees in accordance with the exemptions
required pursuant to the Statewide Non-Residential Development Fee
Act (N.J.S.A. 40:55D-8.1 through 8.7), as specified in Form N-RDF
"State of New Jersey Non-Residential Development Certification/ Exemption".
Any exemption claimed by a developer shall be substantiated by that
developer.
(4)
A developer of a non-residential development exempted from the
non-residential development fee pursuant to the Statewide Non-Residential
Development Fee Act shall be subject to the fee at such time as the
basis for the exemption no longer applies and shall make the payment
of the non-residential development fee, in that event, within three
years after that event or after the issuance of the final Certificate
of Occupancy for the non-residential development, whichever is later.
(5)
If a property which was exempted from the collection of a non-residential
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 non-residential development fees under these circumstances
may be enforceable by the Borough of Hillsdale as a lien against the
real property of the owner.
A.
Upon the granting of a preliminary, final or other applicable approval
for a development, the approving authority or entity shall notify
or direct its staff to notify the Construction Official responsible
for the issuance of a Construction Permit.
B.
For non-residential developments only, the developer shall also be
provided with a copy of Form N-RDF "State of New Jersey Non-Residential
Development Certification/ Exemption" to be completed as per the instructions
provided. The developer of a non-residential development shall complete
Form N-RDF as per the instructions provided. The Construction Official
shall verify the information submitted by the non-residential developer
as per the instructions provided in the Form N-RDF. The Tax Assessor
shall verify exemptions and prepare estimated and final assessments
as per the instructions provided in Form N-RDF.
C.
The Construction Official responsible for the issuance of a Construction
Permit shall notify the Borough Tax Assessor of the issuance of the
first Construction Permit for a development which is subject to a
development fee.
D.
Within 90 days of receipt of such notification, the Borough Tax Assessor
shall prepare an estimate of the equalized assessed value of the development
based on the plans filed.
E.
The Construction Official responsible for the issuance of a final
Certificate of Occupancy shall notify the Borough Tax Assessor of
any and all requests for the scheduling of a final inspection on a
property which is subject to a development fee.
F.
Within 10 business days of a request for the scheduling of a final
inspection, the Borough Tax Assessor shall confirm or modify the previously
estimated equalized assessed value of the improvements associated
with the development; calculate the development fee; and thereafter
notify the developer of the amount of the fee.
G.
Should the Borough of Hillsdale 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 (C.40:55D-8.6).
H.
Except as provided in Section 167A.(3) hereinabove, 50% of the initially
calculated development fee shall be collected at the time of issuance
of the Construction Permit. The remaining portion shall be collected
at the time of issuance of the Certificate of Occupancy. The developer
shall be responsible for paying the difference between the fee calculated
at the time of issuance of the Construction Permit and that determined
at the time of issuance of the Certificate of Occupancy.
I.
Appeal of Development Fees.
(1)
A developer may challenge residential development fees imposed
by filing a challenge with the County Board of Taxation. Pending a
review and determination by the Board, collected fees shall be placed
in an interest bearing escrow account by the Borough of Hillsdale.
Appeals from a determination of the Board may be made to the tax court
in accordance with the provisions of the State Tax Uniform Procedure
Law, R.S. 54:48-1, et seq., within 90 days after the date of such
determination. Interest earned on amounts escrowed shall be credited
to the prevailing party.
(2)
A developer may challenge non-residential development fees imposed
by filing a challenge with the Director of the Division of Taxation.
Pending a review and determination by the Director, which shall be
made within 45 days of receipt of the challenge, collected fees shall
be placed in an interest bearing escrow account by the Borough of
Hillsdale. Appeals from a determination of the Director may be made
to the tax court in accordance with the provisions of the State Tax
Uniform Procedure Law, R.S.54:48-1, et seq., within 90 days after
the date of such determination. Interest earned on amounts escrowed
shall be credited to the prevailing party.
A.
There is hereby created a separate, interest-bearing Affordable Housing
Trust Fund to be maintained by the Chief Financial Officer of the
Borough of Hillsdale for the purpose of depositing development fees
collected from residential and non-residential developers and proceeds
from the sale of units with extinguished controls.
B.
The following additional funds shall be deposited in the Affordable
Housing Trust Fund and shall at all times be identifiable by source
and amount:
(1)
Payments in lieu of on-site construction of a fraction of an
affordable unit, where permitted by ordinance or by agreement with
the Borough of Hillsdale;
(2)
Funds contributed by developers to make 10% of the adaptable
entrances in a townhouse or other multistory attached dwelling unit
development accessible;
(3)
Rental income from municipally operated units;
(4)
Repayments from affordable housing program loans;
(5)
Recapture funds;
(6)
Proceeds from the sale of affordable units; and
(7)
Any other funds collected in connection with Hillsdale's affordable
housing program.
C.
In the event of a failure by the Borough of Hillsdale to comply with
trust fund monitoring and reporting requirements or to submit accurate
monitoring reports; or a failure to comply with the conditions of
the judgment of compliance or a revocation of the judgment of compliance;
or a failure to implement the approved Spending Plan and to expend
funds within the applicable required time period as set forth in In
re Tp. of Monroe, 442 N.J. Super. 565 (Law Div. 2015) (aff'd 442 N.J.
Super. 563); or the expenditure of funds on activities not approved
by the Court; or for other good cause demonstrating the unapproved
use(s) of funds, the Court may authorize the State of New Jersey,
Department of Community Affairs ("DCA"), Division of Local Government
Services ("LGS"), to direct the manner in which the funds in the Affordable
Housing Trust Fund shall be expended, provided that all such funds
shall, to the extent practicable, be utilized for affordable housing
programs within the Borough of Hillsdale, or, if not practicable,
then within the County.
Any party may bring a motion before the Superior Court presenting
evidence of such condition(s), and the Court may, after considering
the evidence and providing the municipality a reasonable opportunity
to respond and/or to remedy the non-compliant condition(s), and upon
a finding of continuing and deliberate non-compliance, determine to
authorize LGS to direct the expenditure of funds in the Trust Fund.
The Court may also impose such other remedies as may be reasonable
and appropriate to the circumstances.
D.
Interest accrued in the Affordable Housing Trust Fund shall only
be used to fund eligible affordable housing activities approved by
COAH or the Court.
A.
The expenditure of all funds shall conform to a Spending Plan approved
by the Court. Funds deposited in the Affordable Housing Trust Fund
may be used for any activity approved by the Court to address the
Borough of Hillsdale'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; housing rehabilitation;
new construction of affordable housing units and related costs; accessory
apartments; a market to affordable program; Regional Housing Partnership
programs; conversion of existing non-residential buildings to create
new affordable units; green building strategies designed to be cost
saving and in accordance with accepted national or State standards;
purchase of land for affordable housing; improvement of land to be
used for affordable housing; extensions or improvements of roads and
infrastructure to affordable housing sites; financial assistance designed
to increase affordability; administration necessary for implementation
of the Housing Element and Fair Share Plan; and/or any other activity
permitted by the Court and specified in the approved Spending Plan.
B.
Funds shall not be expended to reimburse the Borough of Hillsdale
for past housing activities.
C.
At least 30% of all development fees collected and interest earned
on such fees shall be used to provide affordability assistance to
low- and moderate-income households in affordable units included in
the municipal Fair Share Plan. One-third of the affordability assistance
portion of development fees collected shall be used to provide affordability
assistance to those households earning 30% or less of the median income
for Housing Region 1, in which Hillsdale is located.
(1)
Affordability assistance programs may include down payment assistance,
security deposit assistance, low interest loans, rental assistance,
assistance with homeowners association or condominium fees and special
assessments, and assistance with emergency repairs. The specific programs
to be used for affordability assistance shall be identified and described
within the Spending Plan.
(2)
Affordability assistance to households earning 30% or less of
median income may include buying down the cost of low or moderate
income units in the municipal Fair Share Plan to make them affordable
to households earning 30% or less of median income. The specific programs
to be used for very low income affordability assistance shall be identified
and described within the Spending Plan.
(3)
Payments in lieu of constructing affordable housing units on
site, if permitted by Ordinance or by Agreement with the Borough of
Hillsdale, and funds from the sale of units with extinguished controls
shall be exempt from the affordability assistance requirement.
D.
The Borough of Hillsdale may contract with a private or public entity
to administer any part of its Housing Element and Fair Share Plan,
including its programs for affordability assistance.
E.
No more than 20% of all revenues collected from development fees
may be expended on administration, including, but not limited to,
salaries and benefits for municipal employees or consultants' fees
necessary to develop or implement a new construction program, prepare
a Housing Element and Fair Share Plan, and/or administer an affirmative
marketing program or a rehabilitation program.
(1)
In the case of a rehabilitation program, the administrative
costs of the rehabilitation program shall be included as part of the
20% of collected development fees that may be expended on administration.
(2)
Administrative funds may be used for income qualification of
households, monitoring the turnover of sale and rental units, and
compliance with COAH's monitoring requirements. Legal or other fees
related to litigation opposing affordable housing sites or related
to securing or appealing a judgment from the Court are not eligible
uses of the Affordable Housing Trust Fund.
The Borough of Hillsdale shall provide annual reporting of Affordable
Housing Trust Fund activity to the New Jersey DCA, COAH, LGS, or other
entity designated by the State of New Jersey, with a copy provided
to Fair Share Housing Center and posted on the municipal website,
using forms developed for this purpose by the New Jersey DCA, COAH
or LGS. The reporting shall include an accounting of all Affordable
Housing Trust Fund activity, including the sources and amounts of
funds collected and the amounts and purposes for which any funds have
been expended.
A.
The ability for the Borough of Hillsdale to impose, collect and expend
development fees shall be permitted through the expiration of the
repose period covered by its Judgment of Compliance and shall continue
thereafter so long as the Borough of Hillsdale has filed an adopted
Housing Element and Fair Share Plan with the Court or with a designated
State administrative agency, has petitioned for a Judgment of Compliance
from the Court or for Substantive Certification or its equivalent
from a State administrative agency authorized to approve and administer
municipal affordable housing compliance and has received approval
of its Development Fee Ordinance from the entity that will be reviewing
and approving the Housing Element and Fair Share Plan.
B.
If the Borough of Hillsdale is not pursuing authorization to impose
and collect development fees after the expiration of its Judgment
of Compliance, it may be subject to forfeiture of any or all funds
remaining within its Affordable 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 (C. 52:27D-320).
C.
After the expiration of the Judgment of Compliance, if the Borough
does not pursue or obtain continued authorization, the Borough of
Hillsdale shall not impose a residential development fee on a development
that receives preliminary or final site plan approval, retroactively
impose a development fee on such a development, or expend any of its
collected development fees.
