[Added 5-17-2022 by Ord.
No. 2600-22]
This chapter 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 (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 8.7). Fees collected
pursuant to this chapter shall be used for the purpose of providing
very-low-, low- and moderate-income housing in accordance with a Court-approved
spending plan.
[Added 5-17-2022 by Ord.
No. 2600-22]
a. This chapter shall not be effective until approved by the Court.
b. The Township of Milburn shall not spend development fees until the
Court has approved a plan for spending such fees (spending plan).
[Added 5-17-2022 by Ord.
No. 2600-22]
The following terms, when used in this chapter, shall have the
meanings given in this section.
AFFORDABLE HOUSING DEVELOPMENT
A development included in the Housing Element and Fair Share
Plan, and includes, but is not limited to, an inclusionary development,
a municipally sponsored construction project or a 100% affordable
housing development.
COAH or THE COUNCIL
The New Jersey Council on Affordable Housing established
under the Fair Housing Act, or any successor agency charged with the
administration of the Act.
COURT
The Superior Court of New Jersey, Law Division, Essex County.
DEVELOPER
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.
DEVELOPMENT FEE
Money paid by a developer for the improvement of property
as authorized by Holmdel Builders 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.
EQUALIZED ASSESSED VALUE
The assessed value of a property divided by the current average
ratio of assessed to true value for the municipality in which the
property is situated, as determined in accordance with Sections 1,
5, and 6 of P.L. 1973, c. 123 (N.J.S.A. 54:1-35a through 54:35c).
GREEN BUILDING STRATEGIES
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.
[Added 5-17-2022 by Ord.
No. 2600-22]
a. Imposed Fees.
1. Within all 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 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.
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 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 extractions, including extractions 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 Township of Millburn,
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 the Township's initial development fee
ordinance shall be exempt from the payment of development fees, unless
the developer seeks a substantial change in the original approval.
Where 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. Owner-occupied residential structures demolished and replaced as
a result of a fire, flood, or natural disaster shall be exempt from
paying a development fee.
4. Development fees shall be imposed and collected when there is an
addition to an existing structure (except as provided in Subsection
b5) or when an existing structure undergoes a change to a more intense
use or is demolished and replaced. The development fee shall be calculated
on the increase in the equalized assessed value of the improved structure.
5. No fee shall be charged pursuant to this section for any addition
or improvement to an existing residential structure, so long as such
addition or improvement does not increase the equalized assessed value
of the existing structure, as of the date thereof, by more than 50%.
6. Not-for-profit developers shall be exempt.
[Added 5-17-2022 by Ord.
No. 2600-22]
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. Nonresidential developments shall be exempt from the payment of nonresidential
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 Fee Certification/Exemption." 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 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
nonresidential development fee, in that event, within three years
after that event or after the issuance of the final certificate of
occupancy for 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 the Township of Millburn as a lien against the
real property of the owner.
[Added 5-17-2022 by Ord.
No. 2600-22]
a. Upon the granting of a preliminary, final or other applicable approval
for a development, the applicable approving authority or entity shall
notify or 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 Fee 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 shall notify 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 Township of Millburn 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 time of issuance of the certificate of occupancy.
The developer shall be responsible for paying the difference between
the fee calculated at building permit issuance and that determined
at the issuance of the certificate of occupancy. No certificate of
occupancy shall be issued to the developer until all remaining developer
fees have been paid in full.
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 Millburn Township. 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 Millburn Township.
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.
[Added 5-17-2022 by Ord.
No. 2600-22]
a. There is hereby created a separate, interest-bearing Housing Trust
Fund to be maintained by the Chief Financial Officer for the purpose
of depositing development fees collected from residential and nonresidential
developers and proceeds from the sale of units with extinguished controls.
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 dwelling unit development
accessible;
3. Rental income from municipally operated units;
4. Repayments from affordable housing program loans;
6. Proceeds from the sale of affordable units; and
7. Any other funds collected in connection with the Township of Millburn's
affordable housing program.
c. In the event of a failure by the Township of Millburn 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 Township of Millburn, or, if not practicable,
then within the county.
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 Affordable Housing Trust Fund shall only
be used to fund eligible affordable housing activities approved by
the Court.
[Added 5-17-2022 by Ord.
No. 2600-22]
a. The expenditure of all funds shall conform to a spending plan approved
by the Superior Court. Funds deposited in the Affordable Housing Trust
Fund may be used for any activity approved by the Court to address
Millburn Township's fair share obligation and may be set up as
a grant or revolving loan program. Such activities include, but are
not limited to, preservation or purchase of housing for the purpose
of maintaining or implementing affordability controls; 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 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; and/or any other activity
permitted by the Court and specified in the approved spending plan.
b. Funds shall not be expended to reimburse Millburn Township 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
very-low-, 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 in which Millburn 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
and funds from the sale of units with extinguished controls shall
be exempt from the affordability assistance requirement.
d. Millburn Township 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, no more than 20% of the
revenues collected from development fees shall be expended for such
administrative expenses.
2. Administrative funds may be used for income qualification of households,
monitoring the turnover of sale and rental units, and compliance with
the 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.
[Added 5-17-2022 by Ord.
No. 2600-22]
a. The Township of Millburn shall provide annual reporting of Affordable
Housing Trust Fund activity to the New Jersey Department of Community
Affairs, COAH and Local Government Services or other entity designated
by the State of New Jersey, using forms developed for this purpose
by the New Jersey Department of Community Affairs, COAH or Local Government
Services.
[Added 5-17-2022 by Ord.
No. 2600-22]
a. The ability of Millburn Township 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 Millburn Township 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 Township of Millburn fails to renew its ability to impose
and collect development fees after the expiration of its judgment
of compliance and repose, 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 (N.J.S.A. 52:27D-320).
c. After the expiration of the judgment of compliance and repose, if
the Township does not pursue or obtain continued authorization, Millburn
Township 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.