[Added 12-14-2000 by Ord.
No. 18-00; amended 4-6-2005 by Ord. No. 3-2005; 9-24-2019 by Ord. No. O-2019-06]
A.
In Holmdel Builder's Association v. Holmdel Township, 121 N.J. 550
(1990), the New Jersey Supreme Court determined that mandatory development
fees are authorized by the Fair Housing Act of 1985 (the Act), N.J.S.A.
52:27D-301 et seq., and the State Constitution, subject to the Council
on Affordable Housing's (COAH's) adoption of rules.
B.
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.
C.
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 New Jersey 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 1, 2025, are under the Court's jurisdiction and are subject to
approval by the Court.
D.
This article 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 article shall be used for the
sole purpose of providing low- and moderate-income housing. This article
shall be interpreted within the framework of COAH's rules on development
fees, codified at N.J.A.C. 5:93-8.[1]
[1]
Editor's Note: In accordance with N.J.S.A. 52:14B-5.1b, Chapter
93, Substantive Rules of the New Jersey Council on Affordable Housing
for the Period Beginning June 6, 1994, expired on 10-16-2016.
E.
This article became effective when COAH approved the Borough's development
fee ordinance and remains effective pursuant to the Superior Court's
jurisdiction in accordance with N.J.A.C. 5:93-8.[2]
[2]
Editor's Note: In accordance with N.J.S.A. 52:14B-5.1b, Chapter
93, Substantive Rules of the New Jersey Council on Affordable Housing
for the Period Beginning June 6, 1994, expired on 10-16-2016.
F.
COAH approved the Borough's initial Spending Plan on November 1,
2000. Upon the entry of an order granting an unconditional Final Judgment
of Compliance and Repose to Riverton, Riverton may spend development
fees in conformance with N.J.A.C. 5:93-8.[3]
[3]
Editor's Note: In accordance with N.J.S.A. 52:14B-5.1b, Chapter
93, Substantive Rules of the New Jersey Council on Affordable Housing
for the Period Beginning June 6, 1994, expired on 10-16-2016.
The following terms, as used in this article, shall have the
following meanings:
A development included in the Housing Element and Fair Share
Plan, and includes, but is not limited to, inclusionary development,
affordable housing overlay zones or an alternative living arrangement
facility.
The New Jersey Council on Affordable Housing established
under the Fair Housing Act.[1]
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.
Money paid by a developer for the improvement of property
as permitted in N.J.A.C. 5:93-8.[2]
The assessed value of a property divided by the current average
ratio of assessed to true value for the municipality in which the
property is situated, as determined in accordance with Sections 1,
5, and 6 of P.L. 1973, c. 123 (N.J.S.A. 54:1-35a through 54:1-35c).
Those strategies that minimize the impact of development
on the environment and enhance the health, safety and well-being of
residents by producing durable, low- maintenance, resource-efficient
housing while making optimum use of existing infrastructure and community
services.
A.
Imposed fees.
(1)
Within the Borough, in 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.
(2)
When an increase in residential density pursuant to N.J.S.A.
40:55D-70d (known as a "d" variance) has been permitted, developers
may be required to pay a development fee of 6% of the equalized assessed
value for each additional unit that may be realized. However, if the
zoning on a site has changed during the two-year period preceding
the filing of such a variance application, the base density for the
purposes of calculating the bonus development fee shall be the highest
density permitted by right during the two-year period preceding the
filing of the variance application. Example: If an approval allows
four units to be constructed on a site that was zoned for two units,
the fees could equal 1.5% of the equalized assessed value on the first
two units; and the specified higher percentage up to 6% of the equalized
assessed value for the two additional units, provided zoning on the
site has not changed during the two-year period preceding the filing
of such a variance application.
B.
Eligible exactions, ineligible exactions and exemptions for residential
development.
(1)
Affordable housing developments, 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.
(2)
Developments that have received preliminary or final site plan
approval prior to the adoption of a municipal development fee ordinance
shall be exempt from development fees, unless the developer seeks
a substantial change in the approval. Where a site plan approval does
not apply, a zoning and/or building permit shall be synonymous with
preliminary or final site plan approval for this purpose. The fee
percentage shall be vested on the date that the building permit is
issued.
(3)
Development fees shall be imposed and collected when an existing
structure undergoes a change to a more intense use, is demolished
and replaced, or is expanded, if the expansion is not otherwise exempt
from the development fee requirement. The development fee shall be
calculated on the increase in the equalized assessed value of the
improved structure.
(4)
Developers of one or two owner-occupied dwelling units, residential
structures demolished and replaced as a result of a natural disaster,
green buildings, etc., shall be exempt from paying a development fee.
A.
Imposed fees.
(1)
Within the Borough, in all zoning districts, nonresidential
developers, except for developers of the types of development specifically
exempted, shall pay a fee equal to 2.5% of the equalized assessed
value of the land and improvements for all new nonresidential construction
on an unimproved lot or lots.
(2)
Nonresidential developers, except for developers of the types
of development specifically exempted, shall also pay a fee equal to
2.5% of the increase in equalized assessed value resulting from any
additions to existing structures to be used for nonresidential purposes.
(3)
Development fees shall be imposed and collected when an existing
structure is demolished and replaced. The development fee of 2.5%
shall be calculated on the difference between the equalized assessed
value of the preexisting land and improvement and the equalized assessed
value of the newly improved structure, i.e., land and improvement,
at the time final certificate of occupancy is issued. If the calculation
required under this section results in a negative number, the nonresidential
development fee shall be zero.
B.
Eligible exactions, ineligible exactions and exemptions for nonresidential
development.
(1)
The nonresidential portion of a mixed-use inclusionary or market
rate development shall be subject to the 2.5% development fee, unless
the development is part of a mixed-use affordable housing overlay
zone or otherwise exempted below.
(2)
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.
(3)
Nonresidential developments shall be exempt from the payment
of nonresidential development fees in accordance with the exemptions
required pursuant to P.L. 2008, c. 46, as specified in the Form N-RDF,
"State of New Jersey Nonresidential Development Certification/Exemption"
form. Any exemption claimed by a developer shall be substantiated
by that developer.
(4)
A developer of a nonresidential development exempted from the
nonresidential development fee pursuant to P.L. 2008, c. 46, shall
be subject to it at such time the basis for the exemption no longer
applies and shall make the payment of the nonresidential development
fee, in that event, within three years after that event or after the
issuance of the final certificate of occupancy of the nonresidential
development, whichever is later.
(5)
If a property which was exempted from the collection of a nonresidential
development fee thereafter ceases to be exempt from property taxation,
the owner of the property shall remit the fees required pursuant to
this section within 45 days of the termination of the property tax
exemption. Unpaid nonresidential development fees under these circumstances
may be enforceable by Riverton as a lien against the real property
of the owner.
A.
Upon the granting of a preliminary, final or other applicable approval
for a development, the applicable approving authority shall direct
its staff to notify the Construction Official responsible for the
issuance of a building permit.
B.
For nonresidential developments only, the developer shall also be
provided with a copy of Form N-RDF, "State of New Jersey Nonresidential
Development Certification/Exemption," to be completed as per the instructions
provided. The developer of a nonresidential development shall complete
Form N-RDF as per the instructions provided. The Construction Official
shall verify the information submitted by the nonresidential 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 building
permit shall notify the local Tax Assessor of the issuance of the
first building permit for a development which is subject to a development
fee.
D.
Within 90 days of receipt of that notice, the Municipal Tax Assessor,
based on the plans filed, shall provide an estimate of the equalized
assessed value of the development.
E.
The Construction Official responsible for the issuance of a final
certificate of occupancy notifies the local Assessor of any and all
requests for the scheduling of a final inspection on property which
is subject to a development fee.
F.
Within 10 business days of a request for the scheduling of a final
inspection, the Municipal Assessor shall confirm or modify the previously
estimated equalized assessed value of the improvements of the development;
calculate the development fee; and thereafter notify the developer
of the amount of the fee.
G.
Should the Borough of Riverton fail to determine or notify the developer
of the amount of the development fee within 10 business days of the
request for final inspection, the developer may estimate the amount
due and pay that estimated amount consistent with the dispute process
set forth in Subsection b of Section 37 of P.L. 2008, c. 46 (N.J.S.A.
40:55D-8.6).
H.
Fifty percent of the development fee shall be collected at the time
of issuance of the building permit. The remaining portion shall be
collected at the issuance of the certificate of occupancy. The developer
shall be responsible for paying the difference between the fee calculated
at building permit and that determined at issuance of certificate
of occupancy.
I.
Appeal of development fees.
(1)
A developer may challenge residential development fees imposed
by filing a challenge with the County Board of Taxation. Pending a
review and determination by the Board, collected fees shall be placed
in an interest-bearing escrow account by the Borough of Riverton.
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.
(2)
A developer may challenge nonresidential development fees imposed
by filing a challenge with the Director of the Division of Taxation.
Pending a review and determination by the Director, which shall be
made within 45 days of receipt of the challenge, collected fees shall
be placed in an interest-bearing escrow account by the Borough of
Riverton. 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.
A.
It is hereby reaffirmed that the Borough has created a separate,
interest-bearing Housing Trust Fund to be maintained by the Borough
Chief Financial Officer for the purpose of depositing development
fees collected from residential and nonresidential developers and
proceeds from the sale of units with extinguished controls.
B.
The following additional funds shall be deposited in the Affordable
Housing Trust Fund and shall at all times be identifiable by source
and amount:
(1)
Payments in lieu of on-site construction of affordable units;
(2)
Developer-contributed funds to make 10% of the adaptable entrances
in a townhouse or other multistory attached development accessible;
(3)
Repayments from affordable housing program loans;
(4)
Recapture funds;
(5)
Proceeds from the sale of affordable units; and
(6)
Any other funds collected in connection with Riverton's affordable
housing program.
C.
All interest accrued in the Housing Trust Fund shall only be used
on eligible affordable housing activities approved by the Court.
A.
The expenditure of all funds shall conform to a spending plan approved
by the Court. Funds deposited in the Housing Trust Fund may be used
for any activity approved by the Court to address the Borough's fair
share obligation and may be set up as a grant or revolving loan program.
Such activities include, but are not limited to, preservation or purchase
of housing for the purpose of maintaining or implementing affordability
controls, rehabilitation, new construction of affordable housing units
and related costs, accessory apartment, market to affordable, or regional
housing partnership programs, conversion of existing nonresidential
buildings to create new affordable units, green building strategies
designed to be cost saving and in accordance with accepted national
or state standards, purchase of land for affordable housing, improvement
of land to be used for affordable housing, extensions or improvements
of roads and infrastructure to affordable housing sites, financial
assistance designed to increase affordability, administration necessary
for implementation of the Housing Element and Fair Share Plan, or
any other activity as permitted pursuant to N.J.A.C. 5:93-8.16[1] and specified in the approved spending plan.
[1]
Editor's Note: In accordance with N.J.S.A. 52:14B-5.1b, Chapter
93, Substantive Rules of the New Jersey Council on Affordable Housing
for the Period Beginning June 6, 1994, expired on 10-16-2016.
B.
Funds shall not be expended to reimburse the Borough for past housing
activities.
C.
At least 30% of all development fees collected and interest earned
shall be used to provide affordability assistance to low- and moderate-income
households in affordable units included in the municipal Fair Share
Plan. One-third of the affordability assistance portion of development
fees collected shall be used to provide affordability assistance to
those households earning 30% or less of median income by region.
(1)
Affordability assistance programs may include down payment assistance,
security deposit assistance, low-interest loans, rental assistance,
assistance with homeowners' association or condominium fees and special
assessments, and assistance with emergency repairs.
(2)
Affordability assistance to households earning 30% or less of
median income may include buying down the cost of low- or moderate-income
units in the municipal Fair Share Plan to make them affordable to
households earning 30% or less of median income.
(3)
Payments in lieu of constructing affordable units on site and
funds from the sale of units with extinguished controls shall be exempt
from the affordability assistance requirement.
D.
The Borough may contract with a private or public entity to administer
any part of its Housing Element and Fair Share Plan, including the
requirement for affordability assistance, in accordance with N.J.A.C.
5:93-8.16.[2]
[2]
Editor's Note: In accordance with N.J.S.A. 52:14B-5.1b, Chapter
93, Substantive Rules of the New Jersey Council on Affordable Housing
for the Period Beginning June 6, 1994, expired on 10-16-2016.
E.
No more than 20% of all revenues collected from development fees
may be expended on administration, including, but not limited to,
salaries and benefits for municipal employees or consultant fees necessary
to develop or implement a new construction program, a Housing Element
and Fair Share Plan, and/or an affirmative marketing program. In the
case of a rehabilitation program, no more than 20% of the revenues
collected from development fees shall be expended for such administrative
expenses. Administrative funds may be used for income qualification
of households, monitoring the turnover of sale and rental units, and
compliance with the monitoring requirements set forth in the Court-approved
April 29, 2019, executed settlement agreement with 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.
F.
Consistent with the terms and conditions of the Borough's Settlement
Agreement with Fair Share Housing Center dated March 4, 2019, as amended,
the Borough has set aside and will continue to reserve the sum of
$50,000 for the benefit of a potential overlay inclusionary developer(s).
The reserved sum of $50,000 will be available to these developer(s)
as a financial incentive to create one very-low-income unit when only
one or two affordable housing units are proposed in any of the overlay
zones outlined in this chapter. In the event the Borough is unsuccessful
in attracting any overlay inclusionary developer(s) to utilize the
reserved funds within 24 months of the date of the adoption of this
ordinance,[3] the Borough commits to immediately revisit the expenditure
of these reserved funds so the same will be expended towards the creation
of one very-low-income affordable housing unit.
[3]
Editor's Note: "This ordinance" refers to Ord. No. O-2019-06,
adopted 9-24-2019.
On or about April 29 of each year through 2025, the Borough
of Riverton shall provide annual reporting of trust fund activity
to the New Jersey Department of Community Affairs (DCA), COAH, or
Local Government Services (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 DCA, COAH, or LGS. 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 Riverton's housing
program, as well as to the expenditure of revenues and implementation
of the plan approved by the Court.
The ability for the Borough of Riverton to impose, collect and
expend development fees shall expire with its Court-issued Judgment
of Compliance and Repose unless Riverton 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 the Borough of Riverton
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 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). The Borough
of Riverton 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 the Borough of
Riverton retroactively impose a development fee on such a development.
The Borough of Riverton shall not expend development fees after the
expiration of its Judgment of Compliance and Repose.
