[HISTORY: Adopted by the Mayor and Council of the Borough
of Park Ridge 8-10-2021 by Ord. No. 2021-017.[1] Amendments noted where applicable.]
[1]
Editor's Note: This ordinance also repealed former Ch. 51,
Development Fees, adopted 11-10-2009 by Ord. No. 2009-22.
A.
In Holmdel Builder's Association v. Holmdel Township, 121 N.J.
550 (1990), the New Jersey Supreme Court determined that mandatory
development fees are authorized by the Fair Housing Act of 1985 (the
Act), N.J.S.A. 52:27D-301 et seq., and the State Constitution, subject
to the Council on Affordable Housing's (COAH's) adoption
of rules.
B.
Pursuant to P.L. 2008, c. 46, § 8 (N.J.S.A. 52:27D-329.2),
and the Statewide Non-Residential Development Fee Act (N.J.S.A. 40:55D-8.1
through 40:55D-8.7), COAH was authorized to adopt and promulgate regulations
necessary for the establishment, implementation, review, monitoring
and enforcement of municipal affordable housing trust funds and corresponding
spending plans. Municipalities that were under the jurisdiction of
the Council or court of competent jurisdiction and had a COAH- or
court-approved spending plan could 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 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 chapter establishes standards for the collection, maintenance,
and expenditure of development fees pursuant to COAH's regulations
and in accordance with P.L. 2008, c. 46, §§ 8 and 32
through 38. Fees collected pursuant to this chapter shall be used
for the sole purpose of providing low- and moderate-income housing.
This chapter shall be interpreted within the framework of COAH's
rules on development fees, codified at N.J.A.C. 5:93-8.
This chapter shall become effective at such time that the Superior
Court approves the Borough's development fee ordinance in accordance
with N.J.A.C. 5:93-8.
The following terms, as used in this chapter, shall have the
following meanings:
A development included in the Housing Element and Fair Share
Plan, and includes, but is not limited to, an inclusionary development,
a municipal construction project or a 100% affordable development.
The New Jersey Council on Affordable Housing established
under the Fair Housing Act which previously had primary jurisdiction
for the administration of housing obligations in accordance with sound
regional planning consideration in the state. Pursuant to the opinion
and order of the New Jersey Supreme Court dated March 10, 2015, in
the matter of "In re Adoption of N.J.A.C. 5:96 and 5:97 by N.J. Council
on Affordable Housing (M-392-14) 067126," any reference to COAH or
the Council shall be understood to refer to the Superior Court of
New Jersey, Law Division-Bergen County.
Any person, partnership, association, company or corporation
that is the legal or beneficial owner or owners of a lot or any land
proposed to be included in a proposed development including the holder
of an option to contract or purchase, or other person having an enforceable
proprietary interest in such land.
Funds paid by a developer for the improvement of property
as permitted in N.J.A.C. 5:93-8.
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 §§ 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 all zone 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(5)
(known as a "d" variance) has been permitted, developers may be required
to pay a development fee of 6% of the equalized assessed value for
each additional unit that may be realized. However, if the zoning
on a site has changed during the two-year period preceding the filing
of such a variance application, the base density for the purposes
of calculating the bonus development fee shall be the highest density
permitted by right during the two-year period preceding the filing
of the variance application.
B.
Eligible exactions, ineligible exactions and exemptions for residential
development.
(1)
Affordable housing developments, and developers of low- and moderate-income
units, shall be exempt from development fees. All other forms of new
construction shall be subject to development fees unless exempted
below.
(2)
Developments that have received preliminary or final site plan approval
prior to the effective date of the Borough's amended development
fee ordinance shall be subject to the law in effect at the time of
such approval, 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)
Developers who expand, enlarge, or improve existing single-family
or two-family residences shall be exempt from development fees, unless
the expansion, enlargement, or improvement leads to the creation of
additional dwelling units.
(4)
An owner-occupied residential structure demolished and replaced as
a result of a fire, flood or natural disaster shall be exempt from
paying a development fee.
A.
Imposed fees.
(1)
Within all zoning districts, nonresidential developers, except for
developers of the types of development specifically exempted, shall
pay a fee equal to 2.5% of the equalized assessed value of the land
and improvements, for all new nonresidential construction on an unimproved
lot or lots.
(2)
Nonresidential developers, except for developers of the types of
development specifically exempted, shall also pay a fee equal to 2.5%
of the increase in equalized assessed value resulting from any additions
to existing structures to be used for nonresidential purposes.
(3)
Development fees shall be imposed and collected when an existing
structure is demolished and replaced. The development fee of 2.5%
shall be calculated on the difference between the equalized assessed
value of the preexisting land and improvement and the equalized assessed
value of the newly improved structure, i.e., land and improvement
at the time final certificate of occupancy is issued. If the calculation
required under this section results in a negative number, the nonresidential
development fee shall be zero.
B.
Eligible exactions, ineligible exactions and exemptions for nonresidential
development.
(1)
The nonresidential portion of a mixed-use inclusionary or market
rate development shall be subject to the 2.5% development fee, unless
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)
The 2.5% fee shall not apply to developers of any not-for-profit
use; federal, state and municipal government uses; churches and other
places of worship; and public schools.
(4)
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,[1] as specified in the Form N-RDF, State of New Jersey Non-Residential
Development Certification/Exemption form. Any exemption claimed by
a developer shall be substantiated by that developer.
[1]
Editor's Note: See N.J.S.A. 52:27D-329.2.
(5)
A developer of a nonresidential development exempted from the nonresidential
development fee pursuant to P.L. 2008, c. 46[2] 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.
[2]
Editor's Note: See N.J.S.A. 52:27D-329.2.
(6)
If a property which was exempted from the collection of a nonresidential
development fee thereafter ceases to be exempt from property taxation,
the owner of the property shall remit the fees required pursuant to
this section within 45 days of the termination of the property tax
exemption. Unpaid nonresidential development fees under these circumstances
may be enforceable by the Borough of Park Ridge 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 Non-Residential
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 Park Ridge 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 § 37 of P.L. 2008,
c. 46 (N.J.S.A. 40:55D-8.6).
H.
50% of the development fee shall be collected at the time of issuance
of the building permit. The remaining portion shall be collected at
the issuance of the certificate of occupancy. The developer shall
be responsible for paying the difference between the fee calculated
at the time of issuance of the building permit and that determined
at 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 Park Ridge. Appeals
from a determination of the Board may be made to the tax court in
accordance with the provisions of the State Tax Uniform Procedure
Law, N.J.S.A. 54:48-1 et seq., within 90 days after the date of such
determination. Interest earned on amounts escrowed shall be credited
to the prevailing party.
(2)
A developer may challenge nonresidential development fees imposed
by filing a challenge with the Director of the Division of Taxation.
Pending a review and determination by the Director, which shall be
made within 45 days of receipt of the challenge, collected fees shall
be placed in an interest-bearing escrow account by Borough of Park
Ridge. Appeals from a determination of the Director may be made to
the tax court in accordance with the provisions of the State Tax Uniform
Procedure Law, N.J.S.A. 54:48-1 et seq., within 90 days after the
date of such determination. Interest earned on amounts escrowed shall
be credited to the prevailing party.
A.
The Borough has created a separate, interest-bearing housing trust
fund to be maintained by the Chief Financial Officer for the purpose
of depositing development fees collected from residential and nonresidential
developers and proceeds from the sale of units with extinguished controls.
B.
The following additional funds shall be deposited in the Affordable
Housing Trust Fund and shall at all times be identifiable by source
and amount:
(1)
Payments in lieu of on-site construction of affordable units;
(2)
Developer-contributed funds to make 10% of the adaptable entrances
in a townhouse or other multistory attached development accessible;
(3)
Rental income from municipally operated units;
(4)
Repayments from affordable housing program loans;
(5)
Recapture funds;
(6)
Proceeds from the sale of affordable units; and
(7)
Any other funds collected in connection with the Borough of Park
Ridge's affordable housing program.
C.
In the event of a failure by the Borough of Park Ridge 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, 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 Park Ridge, or, if not practicable, then within
the county or the housing region.
(1)
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 noncompliant condition(s), and upon
a finding of continuing and deliberate noncompliance, determine to
authorize LGS to direct the expenditure of funds in the trust fund.
The Court may also impose such other remedies as may be reasonable
and appropriate to the circumstances.
D.
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 of Park
Ridge'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
and specified in the approved spending plan.
B.
Development fee revenues shall not be expended to reimburse the Borough
of Park Ridge 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 of Park Ridge 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.
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 monitoring requirements. Legal or other fees related
to litigation opposing affordable housing sites or objecting to the
Council's regulations and/or action are not eligible uses of
the Affordable Housing Trust Fund.
On or about December 1 of each year through 2025, the Borough
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 the Borough'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 Park Ridge to impose, collect
and expend development fees shall expire with the expiration of the
repose period covered by its judgment of compliance unless the Borough
of Park Ridge 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. If the Borough of Park Ridge fails to renew its
ability to impose and collect development fees prior to the expiration
of its judgment of compliance, it may be subject to forfeiture of
any or all funds remaining within its municipal trust fund. Any funds
so forfeited shall be deposited into the New Jersey Affordable Housing
Trust Fund established pursuant to § 20 of P.L. 1985, c.
222 (N.J.S.A. 52:27D-320). The Borough of Park Ridge 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, nor shall the Borough of Park Ridge retroactively impose
a development fee on such a development. The Borough of Park Ridge
shall not expend development fees after the expiration of its judgment
of compliance.
