[Adopted by the City Council of the City of Newark 11-1-2023 by Ord. No. 6PSF-E,
11-01-2023. Chapter history includes Ord. No. 6PSF-B,
10-4-2017 as amended by Ord. No. 6PSF-B(s), 07-26-2022; Ord. No. 6PSF-G,
08-02-2023. Amendments noted where applicable.]
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
The purpose of this Chapter is to create mixed-income housing
through new construction, and substantial rehabilitation development,
to assist the City in providing a realistic opportunity for affordable
housing as the City grows and attracts new market-rate residential
development.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
The following terms, when used in this Chapter, shall have the
following definitions:
Shall mean a development in which all of the residential
units are income-restricted units.
Shall mean the entity responsible for the administration
of affordable units in accordance with this Chapter, N.J.A.C. 5:91,
N.J.A.C. 5:93, and N.J.A.C. 5:80-26.1 et seq., which may include the
Division of Housing and Real Estate Development within the City of
Newark Department of Economic and Housing Development, or such other
qualified entity, including without limitation, a private entity,
community benefit organization, or housing consulting agency, as shall
be duly approved by the City from time to time.
Shall mean an average of the percentage of median income
at which income-restricted units are affordable to low- and moderate-income
households. For example, if the rents for the five restricted rental
units in an affordable housing development were affordable at 46,
48, 50, 52 and 54% of median income, respectively, the average affordability
for those units would be 50% of median income.
Shall mean in the case of an income-restricted ownership
unit, a sales price for the unit that 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 an income-restricted rental unit, a rent for the unit
that conforms to the standards set forth in N.J.A.C. 5:80-26.12, as
may be amended or supplemented.
Shall mean a housing development all or a portion of which
consists of income-restricted units.
Shall mean a housing unit designed to meet the needs of,
and exclusively for, the residents of an age-restricted segment of
the population where the head of the household is a minimum age of
either 62 years, or 55 years and meets the provisions of the 42 U.S.C.
§§ 3601 et seq., except that due to death, a remaining
spouse of less than 55 years of age shall be permitted to continue
to reside.
Shall mean the New Jersey Housing and Mortgage Finance Agency
established by N.J.S.A. 55:14K-1 et seq. and in, but not of, the Division
of Community Affairs (DCA).
Shall mean a facility licensed by the New Jersey Department
of Health and Senior Services (NJDHS) 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. Apartment units offer, at a minimum, one unfurnished
room, a private bathroom, a kitchenette and a lockable door on the
unit entrance.
Shall mean the Neighborhood Preservation Balanced Housing
Program of the DACE as set forth at N.J.S.A. 52:27D-320 and N.J.A.C.
5:43 as may be amended or supplemented.
Shall mean a household that has been certified by an administrative
agent as a low-income household or moderate-income household.
Shall mean the Council on Affordable Housing in, but not
of, the DCA, established under the New Jersey Fair Housing Act, N.J.S.A.
52:27D-301 et seq., or its successor.
Shall mean the State of New Jersey Department of Community
Affairs.
Shall mean 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.
Shall mean the Division of Housing in the DCA.
Shall mean the Housing Affordability Service, formerly known
as the "Affordable Housing Management Service," in the Department
of Community Affairs (DACE), Division of Housing.
Shall mean the United States Department of Housing and Urban
Development.
Shall mean low and moderate income housing, as each term
is defined in this section.
Shall mean housing Affordable according to Federal Department
of Housing and Urban Development or other recognized standards for
home ownership and rental costs and occupied or reserved for occupancy
by households with a gross household income equal to 50% or less of
the median gross household income for households of the same size
within the housing region in which the housing is located.
Shall mean the New Jersey Housing and Mortgage Finance Agency's
Market Oriented Neighborhood Investment Program, as it may be authorized
from time to time by that Agency.
Shall mean housing not restricted to low or moderate-income
households that may sell or rent at any price.
Shall mean the median income by household size for the housing
region that includes the City of Newark, as adopted annually by COAH
or its successor, and if no such successor, then by an appropriate
State or federal government agency.
Shall mean development containing a mix of but not limited
to multi-family residential, single-family residential, commercial,
and institutional.
Shall mean housing affordable according to federal Department
of Housing and Urban Development or other recognized standards for
home ownership and rental costs and occupied or reserved for occupancy
by households with a gross household income equal to more than 50%
but less than 80% of the median gross household income for households
of the same size within the housing region in which the housing is
located.
Shall mean any structure change of use, reconstruction, or
addition as defined in the New Jersey Uniform Construction Code, N.J.A.C.
5:23-1 et al.
Shall mean any sale or transfer of ownership other than the
transfer of ownership between spouses; the transfer of ownership between
former spouses ordered as a result of a judicial decree of divorce
or judicial separation, but not including sales to third parties;
the transfer of ownership between family members as a result of inheritance;
the transfer of ownership through an executor's deed to a class
A beneficiary; and the transfer of ownership by court order.
Shall mean 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 DACE for its Section 8 program. With respect to income-restricted
units in an assisted living residence, rent does not include charges
for food and services.
Shall mean residential property shall mean any real property
and the improvements, buildings, structures or house thereon, whether
single or multi-family, whether or not owner occupied, used for residential
purposes.
Shall mean a development project that is in advance stages
of development. Advance stages implies planning and engineering is
advanced enough with sufficient funding, construction can begin immediately.
Shall mean any rehabilitation of a vacant structure or any
rehabilitation that involves the replacement of two or more major
systems.
Shall mean the New Jersey Housing and Mortgage Finance Agency's
Urban Homeownership Recovery Program, as it may be authorized from
time to time by that Agency's Board.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
1.
All new Residential, Mix-Use Development or Substantial Rehabilitation having 15 or more Residential units shall set aside 20% of the total number of Residential units as Income-Restricted Units in accordance with the Standards set forth in Section 41:21-3. Of that 20%
2.
The following compensatory benefits are provided to facilitate the
inclusion of affordable housing:
a.
Density bonus. Except where a density variance is granted, as set
forth in paragraph 1b of this section, a 15% residential density bonus
shall be permitted for all projects that comply with this Chapter.
Where the calculated density bonus results in a fraction, the density
bonus shall be rounded up to the next whole unit.
b.
Density variances. A compensatory benefit will be deemed to have
been awarded, and the density bonus referred to in paragraph 2a above
will not apply where the City's Zoning Board of Adjustment approves
an increase in residential density pursuant to N.J.S.A. 40:55D-70d(5),
(known as a density variance).
c.
Relaxation of zoning standards. In all cases, the City's approving
land use board shall consider the granting of variances and waivers
including but not limited to reduced setbacks, reduced coverage, increased
floor area, increased building heights and/or additional stories so
as to accommodate the increased number of units and to reasonably
result in an opportunity to provide affordable housing.
d.
Additional incentives. Additional incentives to subsidize the creation
of affordable housing may be included in a developer's or redeveloper's
agreement at the discretion of the City.
e.
Further incentives. Further incentives including expedited board
approval and permit processing, partial or full waivers of planning
fees, permitting fees, ten to 20% reduction in parking space requirement
as required by the City-wide or redevelopment plan regulations and
parking study waiver for projects with affordable housing component.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
1.
The income-restricted units required by Section 41:21-2 of this Chapter shall be constructed on-site. Provision of any of the required income-restricted units off-site is prohibited.
2.
Rounding. When any calculation of the mandatory set-aside results
in a fractional income-restricted unit of 1/2 or more, the fraction
shall be rounded up to the next whole unit. When such a calculation
results in a fraction of less than 1/2, the fraction shall be rounded
down to the previous whole unit.
3.
Income-restricted units shall be integrated with and interspersed
among the market-rate units.
4.
Any residential unit which is reserved for the superintendent of
a residential development that is subject to this Chapter shall not
be credited towards satisfaction of the mandatory set-aside.
5.
The marketer of income-restricted units created pursuant to this Chapter shall, without unduly delaying occupancy, affirmatively market with best efforts said units in accordance with the lottery system set forth in Section 41:21-19, paragraph 6 of this Chapter.
6.
It is the intent of this Chapter to prevent evasion of its requirements by the artificial subdivision, separation, construction or rehabilitation of a project into smaller developments through the manipulation of the design or implementation schedule. The Zoning Board of Adjustment, therefore, shall review each application, including the completed checklist required by Section 41:21-6 of this Chapter, to determine whether the project has been artificially subdivided, separated, constructed or rehabilitated through the manipulation of the design or implementation schedule in order to evade the provisions of this Chapter. If the Zoning Board so finds, the application shall not be approved.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
The following shall be exempt from the provisions of this Chapter:
1.
All new Residential, Mix Use Development or Substantial Rehabilitation
having less than 15 Residential units. Any project that seeks amended
site plan application, which increases the number of units to 15 and
over should not be exempt from complying with this Chapter.
2.
Any new Residential, Mix-Use Development or Substantial Rehabilitation
undertaken by the Newark City Housing Authority or a non-profit entity
in which at least 50% of the total Residential units in the development
are for Low or Moderate Income Housing.
3.
Projects that have submitted a complete development application in
accordance with N.J.S.A. 40:55D-10.5 prior to the effectiveness of
this Chapter, unless the developer seeks a substantial change, modification
or amendment
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
1.
Projects may, with the approval of the Office of City Planning, make
a voluntary cash payment into the City of Newark's Affordable
Housing Trust Fund in lieu of constructing all or part of the income-restricted
units required by this Chapter.
2.
The amount of the payment-in-lieu figure is $180,000 per unit. The
Municipal Council, in consultation with the City of Newark, Department
of Economic and Housing Development, should review this construction
cost figure every five years.
4.
The Office of City Planning is authorized to approve voluntary cash
payment-in-lieu only upon written findings, supported by the record,
that such a contribution will further the housing policies of the
City of Newark more than the construction of income-restricted units
at the time of the development application. In making such findings,
the Office of City Planning shall consider and determine the following
factors:
a.
The number of income-restricted units that can be provided with the
payment-in-lieu, as compared with the number of new income-restricted
units otherwise required to be constructed in the subject development.
b.
The availability and stage of readiness of any plans for the actual
provision of income-restricted units within the City of Newark on
which the payment-in-lieu can be expended.
c.
The reasons which make construction of the required income-restricted
units impractical.
5.
The opportunity to make a voluntary payment in lieu of constructing
income-restricted units is not intended to be and should not be construed
as a right available to developers at their sole option. The policy
of this Chapter favors construction of income-restricted units.
6.
The Office of City Planning approval of any payment-in-lieu shall
be conditioned upon the developer and the City entering into a developer's
agreement that details the manner in which the payment-in-lieu commitment
will be fulfilled.
7.
A Developer will not receive a Certification of Occupancy (CO), until
the City has received the agreed upon payment in lieu of construction.
8.
10% of the voluntary payment in lieu of construction acquired shall
be applied or expended within the ward where the development is located.
No moratorium or suspension of this allocation requirement may be
authorized, except upon Resolution adopted by Municipal Council.
9.
The Municipal Council, at its discretion and by Ordinance, has the
authority to make changes to the amount of the payment-in-lieu on
a specific development project.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
A checklist for compliance with this Chapter, in the form attached
to and incorporated into this Chapter as Exhibit A ("Checklist"),
is hereby adopted. The Zoning Board of Adjustment shall provide the
Checklist to each applicant for development who is subject under this
Chapter. Pursuant to N.J.S.A. 40:55D-10.3, applications for development
which are subject to this Chapter, but lack information indicated
on the Checklist, shall be deemed incomplete.
1.
Upon receipt of each submitted Checklist, the Zoning Board of Adjustment
Clerk or Secretary shall forward a copy of same to the Manager of
the City of Newark Division of Housing Assistance in the Department
of Economic and Housing Development.
2.
As soon as reasonably practicable, the Manager of the Division of
Housing and Real Estate Development shall submit any written comments
which the Manager may have on a completed Checklist to the Zoning
Board Clerk or Secretary. Upon receipt, the Zoning Board Clerk or
Secretary shall distribute the Manager's written comments to
the Zoning Board members.
3.
Nothing in this Chapter shall be construed as altering any applicable
time periods established by New Jersey statute or City of Newark Ordinance
for Zoning Office action on a development application.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
Construction of income-restricted units shall take place simultaneously
with the balance of the development triggering the requirements of
this Chapter, and shall be governed by the following phasing schedule:
|
Maximum % of Market-Rate Units Issued Certificates of Occupancy
|
Minimum % of Income-Restricted Units Issued Certificates of
Occupancy
|
|---|---|
|
25% +1 unit
|
10%
|
|
50%
|
50%
|
|
75%
|
75%
|
|
90%
|
100%
|
1.
Certificates of Occupancy for the last 10% of the market-rate units
shall not be issued until Certificates of Occupancy have been issued
for all of the required income-restricted units.
2.
A schedule setting forth the phasing of the actual number of total
units and income-restricted units, by unit size, for each development
shall be incorporated into the resolution of approval for any development
subject to the provisions of this Chapter.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
All income restricted units must be comparable to market rate
units. The intent of this section is to ensure that any development
which is subject to this Chapter satisfies the affordability average
and bedroom distribution standards set forth at N.J.A.C. 5:80-26.3,
as same may be amended or supplemented.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
The intent of this section is to ensure that any development
which is subject to this Chapter satisfies the occupancy standards
set forth at N.J.A.C. 5:80-26.4, as same may be amended or supplemented.
1.
In determining the initial rents and initial sales prices for compliance
with the affordability average requirements for income-restricted
units other than assisted living facilities, 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 1 1/2 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 4 1/2 person household;
and
e.
A four bedroom unit shall be affordable to a six person household.
2.
For assisted living facilities, the following standards shall be
used:
3.
In referring certified households to specific restricted units, to
the extent feasible, and without causing an undue delay in occupying
the unit, the administrative agent shall strive to:
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
The intent of this Section 41:21-10 is to ensure that any development which is subject to this Chapter satisfies the control periods for ownership units set forth at N.J.A.C. 5:80-26.5, as same may be amended or supplemented.
1.
Each income-restricted ownership unit shall remain subject to the
requirements of this Chapter for a period of 30 years; provided, however,
that:
a.
Any unit that, prior to December 20, 2004, received substantive certification
from COAH, was part of a judgment of compliance from a court of competent
jurisdiction or became subject to a grant agreement or other contract
with either the State or a political subdivision thereof, shall have
its control period governed by said grant of substantive certification,
judgment or grant agreement or contract.
2.
The affordability control period for an income-restricted ownership unit shall commence on the date the initial certified household takes title to the income-restricted unit and shall terminate only at such time as is applicable under Subsection 1 above.
3.
Prior to the issuance of the initial Certificate of Occupancy for
an income-restricted ownership unit and upon each successive sale
during the period of income-restricted ownership, the administrative
agent shall determine the income-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. At the time of the sale of the unit, the 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 requirements of this Chapter, an amount equal to
the difference between the unit's non-restricted fair market
value and its restricted price. The recapture note shall be secured
by a recapture lien evidenced by a duly recorded mortgage on the unit.
The recapture note and recapture mortgage lien shall be in favor of
the Agency if the unit was financed New Jersey Housing and Mortgage
Finance Agency (NJHMFA) contributed to the financing of the unit,
and, in all other cases, in favor of the City of Newark. The recapture
note and recapture mortgage lien shall be in the form prescribed in
Subchapter Appendices L, M, N, O, P and Q of N.J.A.C. 5:80-26, as
may be amended or supplemented, incorporated herein by reference,
and as applicable.
a.
The recapture lien shall also provide that the recapture amount shall
be reduced by the cumulative dollar value of capital expenditures
by all owners during the control period for improvements and/or upgrades
to the unit, as approved by the administrative agent.
b.
In the event that the City of Newark exercises the option to purchase
income-restricted ownership units pursuant to Subsection 6 below,
the City of Newark shall not be required to satisfy the recapture
lien.
c.
Upon termination of the affordability control period pursuant to
Subsection 7 below, and satisfaction of the recapture of the lien,
the unit may be sold at fair market value and the proceeds retained
by the seller.
4.
All conveyances of income-restricted ownership units shall be made
by deeds and restrictive covenants substantially in the form prescribed
in Subchapter Appendices A, B, C, D, L, M, N, O, P and Q of N.J.A.C.
5:80-26, as same may be amended or supplemented, incorporated herein
by reference, as applicable.
5.
The affordability controls set forth in this Chapter and incorporated
in instruments in the forms presented Appendices A, D, E, F, G, H,
I, J, K, L, M, N, O, P and Q of N.J.A.C. 5:80-26, as same may be amended
or supplemented, incorporated herein by reference, shall remain in
effect despite the entry and enforcement of any judgment of foreclosure
with respect to income-restricted ownership units.
6.
At the time of the first non-exempt sale following a thirty-year interval from the date of the issuance of the initial Certificate of Occupancy, the City of Newark shall have the right of first refusal to purchase an income-restricted ownership unit at the maximum restricted price, with the exceptions noted under Subsection 1 above, provided that:
7.
All income-restricted ownership units created pursuant to this Chapter shall be released from the requirements of this Chapter upon the expiration of the applicable control period specified under Subsection 1 above, provided that:
a.
The recapture lien described in Subsection 3 above remains in full
force and effect; and
b.
If the lien required under Subsection 3 above is in favor of the
City of Newark, the City of Newark has a COAH-approved spending plan
pursuant to N.J.A.C. 5:94-6.5(c), as may be amended or supplemented,
and to the extent applicable, requiring that all proceeds from the
satisfaction of a recapture lien on an income-restricted ownership
unit be used to create one new affordable unit for every unit released
from affordability controls within the City of Newark.
8.
In those instances in which control periods expire pursuant to this
section, the administrative agent shall, within 60 days of the expiration
of the control period, execute a release, substantially in form set
forth in Appendix F to N.J.A.C. 5:80-26, as same may be amended or
supplemented, incorporated herein by reference, of all restriction
instruments with respect to the unit. The owner of the income-restricted
unit is responsible for recording the release instruments and returning
the recorded originals promptly to the administrative agent. Upon
the expiration of the control period for an income-restricted ownership
unit established in this section, the owner of the unit shall be entitled
to sell it to any purchaser at the fair market price.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
The intent of this section is to ensure that any development
which is subject to this Chapter complies with the price restrictions
for ownership units set forth at N.J.A.C. 5:80-26.6, as same may be
amended or supplemented.
1.
The initial purchase price for an income-restricted ownership unit
shall be approved by the administrative agent and, if the unit is
receiving assistance under the balanced housing program, shall be
consistent with the balanced housing grant agreement.
2.
The initial purchase price for all income-restricted ownership units
except those financed under NJHMFA shall be calculated so that the
monthly carrying costs of the unit, including principal and interest
(based on a mortgage loan equal to 95% of the purchase price and the
Federal Reserve HR15 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 an appropriate household
size as determined under N.J.A.C. 5:80-26.4, as many be amended or
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 or supplemented.
3.
The initial purchase price of an income-restricted ownership unit
financed under NJHMFA unit shall be calculated so that the monthly
carrying costs of the unit, including principal and interest (based
on a mortgage loan equal to 95% of the purchase price and the Federal
Reserve HR15 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 a household whose income does
not exceed 45% of median income, in the case of a low-income unit,
or 72% of median income, in the case of a moderate-income unit, and
that is of an appropriate household size as determined under N.J.A.C.
5:80 — 26.4, as may be amended or supplemented.
4.
The maximum resale price for an income-restricted ownership unit,
if the resale occurs prior to the one-year anniversary of the date
on which title to the unit was first transferred to a certified household,
is the initial purchase price. If the resale occurs on or after such
anniversary date, the maximum resale price shall be consistent with
the regional income limits most recently published by COAH and calculated
pursuant to N.J.A.C. 5:94-7.2(b), as same may be amended or supplemented.
The administrative agent shall approve all resale prices, in writing
and in advance of the resale, to assure compliance with the foregoing
standards.
5.
The master deeds of developments subject to this Chapter 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.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
The intent of this section is to ensure that any development
which is subject to this Chapter complies with the price restrictions
for ownership units set forth at N.J.A.C. 5:80-26.7, as same may be
amended or supplemented.
1.
Low-income ownership units shall be reserved for households with
a gross household income less than or equal to 50% of median income.
Moderate income ownership units shall be reserved for households with
a gross household income less than 80% of median income. For example,
a household earning 48% of median income may be placed in any low-income
unit; however, a household earning 53% does not qualify for a low-income
unit. A household earning 67% of median may be placed in any moderate
income housing unit. A household earning less than 50% of median may
be placed in a moderate income housing unit. Notwithstanding the foregoing,
however, the administrative agent may permit moderate-income purchasers
to buy low-income units in housing markets where, as determined by
COAH or the Division, as applicable, low-income prices are required
but there is an insufficient number of low-income purchasers to permit
prompt occupancy of the units. A certified household that purchases
an income-restricted ownership unit must occupy it as the principal
residence and not lease the unit; provided, however, the administrative
agent may permit the owner of an income-restricted ownership unit,
upon a showing of hardship, to lease the unit to a certified household
for a period not to exceed one year.
2.
The administrative agent shall certify a household as eligible for
an income-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 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. The administrative agent,
however, may exercise the discretion to certify a low-or moderate-income
household as eligible despite the fact that the unit's monthly
housing cost would exceed the 33% level, if the household obtains
a firm mortgage loan commitment at the higher level from a licensed
financial institution, under terms consistent with the requirements
of the New Jersey Home Ownership Security Act of 2002, N.J.S.A. 46:10B-22
et seq., including certification from a non-profit counselor approved
by HUD or the New Jersey Department of Banking and Insurance that
the borrower has received counseling on the advisability of the loan
transaction.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
The intent of this section is to ensure that any development
which is subject to this Chapter complies with the indebtedness limitations
and subordination standards set forth at N.J.A.C. 5:80-26.8, as same
may be amended or supplemented.
1.
Prior to incurring any indebtedness to be secured by an income-restricted
ownership unit, the owner shall submit to the Deputy Mayor/Director
of the Department of Economic and Housing Development and the administrative
agent a notice of intent to incur such indebtedness, in such form
and with such documentary support as determined by the administrative
agent, and the owner shall not incur any such indebtedness unless
and until the administrative agent has determined in writing that
the proposed indebtedness complies with the provisions of this section.
2.
With the exception of original purchase money mortgages, during a
control period, neither an owner nor a lender shall at any time cause
or permit the total indebtedness secured by an income-restricted ownership
unit to exceed 95% of the maximum allowable resale price of that unit,
as such price is determined by the Deputy Mayor/Director of the Department
of Economic and Housing Development in accordance with N.J.A.C. 5:80-26.6(c),
as same may be amended or supplemented.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
The intent of this section is to ensure that any development
which is subject to this Chapter complies with the standards for capital
improvements to ownership units set forth at N.J.A.C. 5:80-26.9, as
same may be amended or supplemented.
1.
The owners of income-restricted ownership units may apply to the
administrative agent to increase the maximum sales price for the unit
on the basis of capital improvements made since the purchase of the
unit. Eligible capital improvements shall be those that render the
unit suitable for a larger household or that add an additional bathroom.
In no event shall the maximum sales price of an improved housing unit
exceed the limits for affordability for the larger household.
2.
Upon the resale of an income-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 signing 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, subject
to ten-year, straight-line depreciation, has been approved by the
administrative agent. Unless otherwise approved by the administrative
agent, the purchase of any property other than central air conditioning
shall not be made a condition of the unit resale. The owner and the
purchaser must personally certify at the time of closing that no unapproved
transfer of funds for the purpose of selling and receiving property
has taken place at resale.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
The intent of this section is to ensure that any development
which is subject to this Chapter complies with the standards for maintenance
of restricted ownership units set forth at N.J.A.C. 5:80-26.10, as
same may be amended or supplemented.
1.
An income-restricted ownership unit shall be required to obtain a
Continuing Certificate of Occupancy or a certified statement from
the City of Newark Building Inspector stating that the unit meets
all code standards upon the first transfer of title that follows the
expiration of the applicable minimum control period provided under
N.J.A.C. 5:80-26.5(a), as may be amended or supplemented.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
The intent of this section is to ensure that any development
which is subject to this Chapter satisfies the control periods for
rental units set forth at N.J.A.C. 5:80-26.11, as same may be amended
or supplemented.
1.
Each income-restricted rental unit created pursuant to this Chapter
shall remain subject to the requirements of this Chapter for a period
of 30 years; provided, however, that:
a.
Any unit that, prior to December 20, 2004, received substantive certification
from COACH, was part of a judgment of compliance from a court of competent
jurisdiction or became subject to a grant agreement or other contract
with either the State or a political subdivision thereof, shall have
its control period governed by said grant of substantive certification,
judgment or grant agreement or contract.
2.
The affordability control period for the income-restricted rental units in a development subject to this Chapter shall commence on the first date that a certified household occupies a unit and shall terminate only at such time that the City of Newark opts to release the unit from the requirements of this Chapter in accordance with Subsection 5 below, except that the affordability controls set forth in this Chapter shall remain in effect until the date on which a rental unit shall become vacant, provided that the occupant household continues to earn a gross annual income of less than 80% of the applicable median income. If, at that time, a rental household's income is found to exceed 80% of the regional median income, the rental rate restriction shall expire at the later of either the next scheduled lease renewal or 60 days.
3.
Deeds of all real property that include income-restricted rental
units shall contain deed restriction language substantially in the
form set forth in Appendix E to N.J.A.C. 5:80-26, as may be amended
or supplemented, incorporated herein by reference. The deed restriction
shall have priority over all mortgages on the property. The deed restriction
shall be filed by the developer or seller with the records office
of Essex County, and a copy of the filed document shall be provided
to the administrative agent within 30 days of the receipt of a certificate
of occupancy. The preparer of the foregoing instrument shall certify
to the administrative agent that the deed restriction language in
Appendix E has been included therein.
4.
An income-restricted rental unit shall remain subject to the affordability
controls of this Chapter despite the occurrence of any of the following
events:
5.
All income-restricted rental units in any development created pursuant
to this Chapter shall be released from the requirements of this Chapter
upon the expiration of the minimum control period specified under
subsection a above, provided that:
a.
The administrative agent shall, within 60 days of the expiration
of the minimum control period specified under Subsection a above,
execute a release, in the form set forth in Appendix F to N.J.A.C.
5:80-26, as may be amended or supplemented, incorporated herein by
reference, of all restriction instruments with respect to the unit(s).
The owner of the income-restricted unit(s) is responsible for recording
the release instruments and returning the recorded originals promptly
to the administrative agent. Upon the expiration of the control period
for a restricted rental unit established in this section, the owner
of the unit shall be entitled to lease it to any tenant at the fair
market rent.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
The intent of this section is to ensure that any development
which is subject to this Chapter complies with the rent restrictions
set forth at N.J.A.C. 5:80-26.12, as same may be amended or supplemented.
1.
The initial rent for an income-restricted rental unit shall be approved
by the administrative agent and, if the unit is receiving assistance
under the Balanced Housing Program, shall be consistent with the Balanced
Housing grant agreement. The initial rent shall be calculated so as
not to exceed 30% of the eligible monthly income of the appropriate
household size as determined under N.J.A.C. 5:80-26.4, as may be amended
or 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 or supplemented.
2.
At the anniversary date of the tenancy of the certified household
occupying an income-restricted rental unit, the rent may be increased,
if such increase is consistent with the regional income limits most
recently published by COACH, calculated pursuant to N.J.A.C. 5:94-7.2(b),
as may be amended or supplemented, and has been filed with the administrative
agent. If the landlord has charged a tenant less than the initial
maximum allowable rent for a restricted unit, the landlord may, with
the approval of the administrative agent, use the maximum allowable
rent instead of the current rent in performing this multiplication
to establish the rent for the next tenant under a new lease.
3.
Approved initial rents may not be increased when an announcement
of a COACH-adopted increase occurs during initial lease-up activity.
Rents may not be increased more than once a year. Rents may not be
increased by more than one COACH-approved increment at one time. Rents
may not be increased at the time of a new occupancy if the new occupancy
occurs within a year of the last occupancy and prior to the next published
COACH-adopted increase. No additional fees or charges may be added
to the approved rent (except, in the case of units in an assisted
living residence, for the customary charges for food and services)
without the express written approval of the administrative agent.
Application fees (including the charge for any credit check) may not
exceed 5% of the monthly rental of the applicable restricted unit
and shall be payable to the administrative agent to be applied to
the costs of administering the controls in this section as applicable
to the unit.
4.
A written lease is required for all income-restricted rental units,
except for units in an assisted living residence. Final lease agreements
are the responsibility of the landlord and the prospective tenant.
Tenants are responsible for security deposits and the full amount
of the rent as stated on the lease. All lease provisions shall comply
with applicable law. The landlord shall provide the administrative
agent with sufficient information for a preparation of a unit inventory
form for entry into the centralized affordable housing unit inventory
system. The landlord shall submit a copy of each lease entered into
with a certified household to the administrative agent within 10 business
days after the execution of each lease.
5.
Those tenant-paid utilities that are included in the utility allowance
shall be so stated in the lease. The allowance for utilities shall
be consistent with the utility allowance approved by DACE for its
Section 8 program.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
The intent of this section is to ensure that any development
which is subject to this Chapter complies with the standards for tenant
income eligibility set forth at N.J.A.C. 5:80-26.13, as same may be
amended or supplemented.
1.
Low-income rental units shall be reserved for households with a gross
household income less than or equal to 50% of median income. Moderate
income rental units shall be reserved for households with a gross
household income less than 80% of median income.
2.
The administrative agent shall certify a household as eligible for
an income-restricted rental unit when the household is a 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 or supplemented;
provided, however, that this limit may be exceeded if one or more
of the following circumstances exists:
a.
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;
b.
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;
c.
The household is currently in substandard or overcrowded living conditions;
d.
The household documents the existence of assets, with which the household
proposes to supplement the rent payments; or
e.
The household documents proposed 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.
3.
The applicant shall file documentation sufficient to establish the existence of the circumstances in Subsection 2 above with the administrative agent, who shall counsel the household on budgeting.
4.
No applicant or tenant shall be discriminated against on the basis
of actual or perceived race, religion, national origin, nationality,
ancestry, pregnancy or breastfeeding, sex, gender identity or expression,
sexual orientation, familial status) defined as having care or custody
of a child under age 18 or being pregnant), disability, liability
for service in the Armed Forces of the United States, marital status,
civil union status, domestic partnership status, criminal background
or legal source of income to be used for rental or mortgage payments.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
The intent of this section is to ensure that any development
which is subject to this Chapter complies with the administrative
agent provisions set forth at N.J.A.C. 5:80-26.14, as same may be
amended or supplemented.
1.
The affordability controls set forth in this Chapter shall be administered
and enforced by the administrative agent. The primary responsibility
of the administrative agent shall be to ensure that the income-restricted
units under administration are sold or rented, as applicable, only
to low and moderate-income households. Among the responsibilities
of the administrative agent are the following:
a.
Conducting an outreach process to insure affirmative marketing of
affordable housing units in accordance with the provisions of N.J.A.C.
5:80-26.15, as may be amended or supplemented;
b.
Soliciting, scheduling, conducting and following up on interviews
with interested households;
c.
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;
d.
Providing written notification to each applicant as to the determination
of eligibility or non-eligibility;
e.
Creating and maintaining a referral list of eligible applicant households
living within the City;
f.
Creating and maintaining a referral list of eligible applicant households
living in the COAH region and eligible applicant households with members
working in the COAH region where the units are located;
g.
Employing a random selection process when referring households for certification to an income restricted unit in accordance with the lottery process set forth in Section 41:21-19, Subsection 6 of this Chapter;
h.
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;
i.
Creating and maintaining a file on each income-restricted unit for
its control period, including the recorded deed with restrictions,
recorded mortgage and note, as appropriate;
j.
Instituting and maintaining an effective means of communicating information
between owners and the administrative agent regarding the availability
of income-restricted units for resale or rental;
k.
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;
l.
Reviewing and approving requests from owners of restricted units
who wish to take out home equity loans or refinance during the term
of their ownership;
m.
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 cost of central air conditioning systems;
n.
Processing requests and making determinations on requests by owners
of restricted units for hardship waivers;
o.
Communicating with lenders regarding foreclosures;
p.
Ensuring the issuance of Continuing Certificates of Occupancy or
certifications pursuant to N.J.A.C. 5:80-26.10, as may be amended
or supplemented;
q.
Notifying the City of an owner's intent to sell a restricted
unit;
r.
Ensuring that the removal of the deed restrictions and cancellation
of the mortgage note are effectuated and properly filed with the appropriate
county's Register of Deeds or County Clerk's Office after
the termination of the affordability controls in this section for
each restricted unit;
s.
Providing annual reports to COAH as required;
t.
Ensure that the developer has posted all available units on NewarkHousingSearch.org;
u.
Compiling, verifying and submitting monthly reports as may be required
by the Deputy Mayor/Director of the Department of Economic and Housing
Development, including without limitation, a list of income restricted
units in each of the developer's developments that are unoccupied
and available for purchase or lease; a list of income restricted units
in each of the developer's developments that are occupied; and
a list of tenant income and rent rolls for each development;
v.
At the direction of the Deputy Mayor/Director of the Department of
Economic and Housing Development, establish a training program to
counsel future applicant households on the Inclusionary Zoning program;
w.
Ensure compliance with all applicable Federal, State and City laws
related to fair housing rules and that income review, applicant eligibility
review, and placement procedures shall not discriminate against any
person on the basis of actual or perceived race, religion, national
origin, nationality, ancestry, pregnancy or breastfeeding, sex, gender
identity or expression, sexual orientation, familial status (defined
as having care or custody of a child under age 18 or being pregnant),
disability, liability for service in the Armed Forces of the United
States, marital status, civil union status, domestic partnership status,
criminal background or legal source of income to be used for rental
or mortgage payments; and
x.
Such other responsibilities as may be necessary to carry out the
provisions of this Chapter.
2.
(Reserved)
3.
The administrative agent shall create and shall publish in plain
English, and in such other languages as may be appropriate to serving
its client base, a written operating manual, as approved by COAH,
to the extent applicable, setting forth procedures for administering
such affordability controls, including procedures for long-term control
of restricted units; for enforcing the covenants set forth in Appendices
A, B, C, D and E of N.J.A.C. 5:80-26, as may be amended or supplemented,
consistent with the provisions of N.J.A.C. 5:80-26.18, as may be amended
or supplemented; and for releasing income-restricted units promptly
at the conclusion of applicable control periods. The administrative
agent shall have authority to take all actions necessary and appropriate
to carrying out its responsibilities hereunder. The operating manual
shall have a separate and distinct Chapter or Section setting forth
the process for identifying applicant households seeking certification
to restricted units, for reviewing applicant household eligibility,
and for certifying applicant households in accordance with the household
certification and referral requirements set forth in N.J.A.C. 5:80-26.16,
as may be amended or supplemented.
a.
Such process shall require that an applicant household be notified
in writing of the results of its application for certification within
20 days of the administrative agent's determination thereof.
b.
At the discretion of the administrative agent, such process may include
either or both an outreach requirement and a face-to-face applicant
interview process.
c.
The administrative agent shall establish and maintain a ready database
of applicant households, which shall include coordinated entry of
existing City and County of Essex databases, as a referral source
for certifications to income restricted units, and shall establish
written procedures to ensure that selection among applicant households
be via the database, and in accordance with a uniformly applied random
selection process and all applicable State and Federal laws relating
to the confidentiality of applicant records.
4.
In the event that the City shall not otherwise appoint one or more
administrative agents, the City of Newark, Division of Housing Assistance
shall serve as the administrative agent for income-restricted units
which are created pursuant to this Chapter.
5.
The administrative agent shall have the authority to discharge and
release any or all instruments filed of record to establish affordability
controls.
6.
The adminsitrative agent shall establish a lottery system for the
selection of eligible applicant households to be referred to the developer
for the purchase or lease of an income restrict unit as follows:
a.
The administrative agent shall randomly select up to 10 certified
households through a lottery from the database of eligible certified
households. The certified households selected shall then be ranked
in the following order:
i.
Certified households residing in the City of Newark, who shall
then be ranked by the length of time each has been on the list of
applicant households;
ii.
All other households not residing in the City of Newark, who
shall then be ranked by the length of time each has been on the list
of applicant households.
b.
No later than seven days after a lottery is held, the administrative
agent shall provide to the developer a written list of the households
selected pursuant to the lottery.
c.
No later than seven days after a lottery is held, the administrative
agent shall provide a written notice to each of the households selected
in the lottery of their selection and shall provide to each household
the address, unit type, and maximum rent or purchase price of the
income restricted unit for which the lottery was held and the means
by which the household may provide the administrative agent and the
developer the information required herein.
d.
Within 10 days after the date of the notice set forth in Subsection
6c of this section, a household shall inform the administrative agent
and the developer of their interest in purchasing or leasing an income
restricted unit.
e.
The developer shall market an income restricted unit to each of the households selected that have provided the notice required pursuant to Section 41:21-19, Subsection 6d of this section, including, but not limited to, showings and providing other marketing information.
f.
The highest ranked household to confirm interest to the administrative
agent and the developer shall have an exclusivity period of 30 days
after the date of providing such notice of interest to purchase or
lease the income restricted unit.
g.
If the highest ranked household that has confirmed interest in the
income restricted unit declines or fails to purchase or lease the
income restricted unit during the exclusivity period, the other households
selected in the lottery that have confirmed their interest shall be
given the opportunity to purchase or lease the income restricted unit
based on their ranking in the lottery selection. No such household
will be given an exclusivity period.
h.
If none of the households selected through a lottery purchase or
lease the income restricted unit, the administrative agent shall continue
to hold lotteries pursuant to the procedures set forth herein until
a household purchases or leases the income restricted unit.
i.
If more than 90 days have passed since the administrative agent provided notice to the developer pursuant to Section 41:21-19, Subsection b of this Chapter and the income restricted unit has not been sold or leased, the developer may sell or lease the income restricted unit to a household that has not been selected pursuant to a lottery, provided however, such household must be in compliance with the income restrictions set forth in this Chapter.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
The intent of this section is to ensure that any development
which is subject to this Chapter complies with the affirmative marketing
standards set forth at N.J.A.C. 5:80-26.15, as same may be amended
or supplemented.
1.
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 or sponsor of income-restricted housing. The affirmative
marketing plan is also intended to target those potentially eligible
persons who are least likely to apply for income-restricted units
in the housing region. It is a continuing program that directs all
marketing activities toward the housing region and covers the period
of deed restriction.
2.
The administrative agent shall assure the affirmative marketing of
income-restricted units which are created pursuant to this chapter,
and shall be responsible for implementing the affirmative marketing
plan. The administrative agent shall attend an affirmative marketing
training program approved by COAH, if such program is available.
3.
The City shall ensure that all original applicant and sales records
of income-restricted units are returned to the City for reporting
purposes and to aid with future resales.
4.
In implementing the affirmative marketing plan, the administrative
agent shall designate an experienced staff person approved by COAH,
to the extent applicable, 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. Alternatively, the administrative agent may contract with an
experienced agency approved by COAH, to the extent applicable, to
provide such counseling services.
5.
The affirmative marketing plan shall provide the following information:
a.
The name and address of the project;
b.
The number of units, including the number of sales and/or rental
units;
c.
The price of sales and/or rental units;
d.
The name of the sales agent and/or rental manager;
e.
A description of the random selection method as set forth in Section 41:21-19, Subsection 6 of this Chapter that will be used to select occupants of affordable housing; and
f.
Disclosure of required application fees.
6.
The affirmative marketing plan shall describe the media to be used
in advertising and publicizing the availability of housing. In developing
the plan, the administrative agent shall consider the use of language
translations. The plan shall include the following:
a.
The names of specific newspapers of general circulation within the
housing region;
b.
The names of specific radio and television stations broadcasting
throughout the housing region;
c.
The names of other publications circulated within the housing region,
such as neighborhood oriented weekly newspapers, religious publications
and organizational newsletters;
d.
The names of employers throughout the housing region that will be
contacted to post advertisements and distribute flyers regarding available
affordable housing;
e.
The names of specific community and regional organizations that will
aid in soliciting low and moderate income applicants. Such organizations
may include non-profit, religious, governmental, fraternal, civic,
and other organizations; and
f.
Other advertising and outreach efforts to groups that are least likely
to be reached by commercial media efforts.
7.
The affirmative marketing process for available income-restricted
units shall begin at least four months prior to expected occupancy.
In implementing the marketing program, the administrative agent shall
undertake all of the following strategies:
a.
Publication of one advertisement in a newspaper listed under Subsection
6.a above;
b.
Broadcast of one advertisement by a radio or television station listed
under Subsection 6.b above; and
c.
At least one additional regional marketing strategy using one of
the sources listed under Subsections 6.c through 6.f above.
d.
Ensure that the developer has posted all available units on NewarkHousingSearch.org.
8.
Such advertising and outreach shall take place during the first week
of the marketing program and each month thereafter until all the units
have been leased or sold. The advertisement shall include at least
the following:
a.
The location of the units;
b.
Directions to the housing units;
c.
A range of prices for the housing units;
d.
The size, as measured in bedrooms, of the housing units;
e.
The maximum income permitted to qualify for the housing units;
f.
The location of applications for the housing units;
g.
The business hours when interested households may obtain an application
for a housing unit; and
h.
Application fees, if any.
9.
Applications for income-restricted housing shall be made available
in several locations, including, the Essex County Administrative Building;
Newark City Hall and the City of Newark Municipal Library; and the
developer's sales office. Applications shall be mailed to prospective
applicants upon request.
10.
The costs of advertising income-restricted units created pursuant
to this Chapter shall be the developer's responsibility, and
said responsibility shall be a condition of Zoning Board of Adjustment
approval.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
The intent of this section is to ensure that any development
which is subject to this Chapter complies with the provisions for
household certification and referral and related project information
set forth at N.J.A.C. 5:80-26.16, as same may be amended or supplemented.
1.
The administrative agent shall secure all information from applicant
households necessary and appropriate to determine that income-restricted
units are occupied by properly sized households with appropriate low
or moderate-income levels. No household may be referred to a restricted
unit, or may receive a commitment with respect to a restricted unit,
unless that household has received a signed and dated certification,
as set forth in this section, and has executed a certificate in the
form set forth in Appendices J or K to N.J.A.C. 5:80-26, as may be
amended or supplemented and as applicable.
2.
The administrative agent shall prepare a standard form of certification
and shall sign and date one for each household when certified. An
initial certification shall be valid for no more than 180 days unless
a valid contract for sale or lease has been executed within that time
period. In this event, certifications shall be valid until such time
as the contract for sale or lease is ruled invalid and no occupancy
has occurred. Certifications may be renewed in writing at the request
of a certified household for an additional period of 180 days at the
discretion of the administrative agent.
a.
When reviewing an applicant household's income to determine
eligibility, the administrative agent shall compare the applicant
household's total gross annual income to the regional low-and
moderate-income limits then in effect. For the purposes of this Chapter,
income includes, but is not limited to, wages, salaries, tips, commissions,
alimony, regularly scheduled overtime, pensions, social security,
unemployment compensation, TANF, verified regular child support, disability,
net income from business or real estate, and income from assets such
as savings, certificates of deposit, money market accounts, mutual
funds, stocks, bonds and imputed income from non-income producing
assets, such as equity in real estate.
b.
Except as otherwise specifically provided in this Chapter, the sources
of income considered by the administrative agent shall be the types
of regular income reported to the Internal Revenue Service and which
can be used for mortgage loan approval. Household annual gross income
shall be calculated by projecting current gross income over a twelve-month
period.
c.
Assets not earning a verifiable income shall have an annual imputed
interest income using a current average annual savings interest rate.
Assets not earning income include present real estate equity. Applicants
owning real estate must produce documentation of a market value appraisal
and outstanding mortgage debt. The difference shall be treated as
the monetary value of the asset and the imputed interest added to
income. If the applicant household owns a primary residence with no
mortgage on the property valued at or above the regional asset limit
as published annually by COAH, a certificate of eligibility shall
be denied by the administrative agent, unless the applicant's
existing monthly housing costs (including principal, interest, taxes,
homeowner and private mortgage insurance, and condominium and homeowner
association fees as applicable) exceed 38% of the household's
eligible monthly income.
d.
Rent from real estate is considered income, after deduction of any
mortgage payments, real estate taxes, property owner's insurance
and reasonable property management expenses as reported to the Internal
Revenue Service. Other expenses are not deductible. If actual rent
is less than fair market rent, the administrative agent shall impute
a fair market rent.
e.
Income does not include benefits, payments, rebates or credits received
under any of the following: Federal or State low-income energy assistance
programs, food stamps, payments received for foster care, relocation
assistance benefits, income of live-in attendants, scholarships, student
loans, personal property such as automobiles, lump-sum additions to
assets such as inheritances, lottery winnings, gifts, insurance settlements,
and part-time income of persons enrolled as full-time students. Income,
however, does include interest and other earnings from the investment
of any of the foregoing benefits, payments, rebates, or credits.
3.
The administrative agent shall require each member of an applicant
household who is 18 years of age or older to provide documentation
to verify the member's income, including income received by adults
on behalf of minor children for their benefit. Household members 18
years of age or older who do not receive income must produce documentation
of current status.
4.
Income verification documentation may include, but is not limited
to, the following for each and every member of a household who is
18 years of age or older:
a.
Four consecutive pay stubs, not more than 120 days old, including
bonuses, overtime or tips, or a letter from the employer stating the
present annual income figure;
b.
Copies of Federal and State income tax returns for each of the preceding
three tax years;
c.
A letter or appropriate reporting form verifying monthly benefits
such as Social Security, unemployment, welfare, disability or pension
income (monthly or annually);
d.
A letter or appropriate reporting form verifying any other sources
of income claimed by the applicant, such as alimony or child support;
e.
Income reports from banks or other financial institutions holding
or managing trust funds, money market accounts, certificates of deposit,
stocks or bonds; and
f.
Evidence or reports of income from directly held assets such as real
estate or businesses.
5.
Court ordered payments for alimony or child support to another household,
whether or not it is being paid regularly, shall be excluded from
income for purposes of determining income eligibility.
6.
At the discretion of the administrative agent, households may also
be required to produce documentation of household composition for
determining the correct unit size and applicable median income guide.
7.
A certificate of eligibility may be withheld by the administrative
agent as a result of an applicant's inability to demonstrate
sufficient present assets for down payment or security deposit purposes,
subject to development phasing that may provide opportunity for future
savings.
8.
A certificate of eligibility may be withheld by the administrative
agent as a result of an applicant's inability to verify funds
claimed as assets, household composition or other facts represented.
9.
A certificate of eligibility shall be denied by the administrative
agent as a result of any willful and material misstatement of fact
made by the applicant in seeking eligibility.
10.
The administrative agent shall screen households that apply for low-and
moderate-income housing for preliminary income eligibility, by comparing
their total gross annual income to the regional low-and moderate-income
limits adopted for that year by COAH.
11.
The following information shall promptly be provided to the administrative
agent by the developer or sponsor of any project containing any affordable
units subject to the requirements of this Chapter, upon the latter
of either final municipal land use approval or issuance of a grant
contract by a governmental authority:
a.
The total number of units in the project, and number of income-restricted
units, broken down by bedroom size, identifying which are low-and
which are moderate-income units, and including street addresses of
restricted units;
b.
Floor plans of all income-restricted units, including complete
and accurate identification of uses and dimensions of all rooms;
c.
A project map identifying the locations of income-restricted
units and market units;
d.
A list of project principals or partners, together with a list
of all other affordable projects in which they have been involved
over the previous five years;
e.
Projected construction schedule;
f.
Proposed pricing for all units, including any purchaser options
and add-on items;
g.
A list of all public funding sources, and copies of grant or
loan agreements for those sources;
h.
Condominium fees or homeowner association and any other maintenance
or other fees;
i.
Estimated real property taxes for sale units;
j.
Sewer, trash disposal and any other utility assessments;
k.
Flood insurance requirement, if applicable;
l.
A description of all HVAC systems;
m.
Location of any common areas and elevators;
n.
Proposed form of lease for any rental units;
o.
The name of the person who will be responsible for official
contact with the administrative agent for the duration of the project;
and
p.
The State-approved Planned Real Estate Development public offering
statement and/or master deed where available.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
Any and all communication and notices as required pursuant to
this Chapter may also be in the form of electronic or database communications
where available and/or appropriate.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
The intent of this section is to ensure that any development
which is subject to this Chapter complies with the enforcement provisions
set forth at N.J.A.C. 5:80-26.18, as same may be amended or supplemented.
1.
The Deputy Mayor/Director of the Department of Economic and Housing
Development shall liaison with the administrative agent on all matters
related to this section as may be necessary and appropriate from time
to time.
2.
The City shall ensure that all income-restricted units are identified
as affordable within the Tax Assessor's Office and any Municipal
Utility Authority (MUA). The City and any MUA shall promptly notify
the administrative agent of a change in billing address, payment delinquency
of two consecutive billing cycles, transfer of title, or institution
of a writ of foreclosure on all income-restricted units.
3.
The City shall provide all reasonable and necessary assistance in
support of the administrative agent's efforts to ensure effective
compliance with the controls set forth in this Chapter.
4.
Administrative agent practices and procedures shall include the following:
a.
Securing from all developers and sponsors of income-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;
b.
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, as may be amended or supplemented;
c.
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 can be made;
d.
Annual mailings to all owners of income-restricted units, reminding
them of the following notices and requirements:
i.
If the unit is owner-occupied, that the unit may be resold only
to a household that has been approved in advance and in writing by
the administrative agent;
ii.
That no sale of the unit shall be lawful, unless approved in
advance and in writing by the administrative agent, and that no sale
shall be for a consideration greater than regulated maximum permitted
resale price, as determined by the administrative agent;
iii.
That no refinancing, equity loan, secured letter of credit,
or any other mortgage obligation or other debt secured by the unit
may be incurred except as approved in advance and in writing by the
administrative agent, and that at no time will the administrative
agent approve any debt, if incurring the debt would make the total
of all such debt exceed 95% of the then applicable maximum permitted
resale price;
iv.
That the owner of the unit shall at all times maintain the unit
as his or her principal place of residence, which shall be defined
as residing at the unit at least 260 days out of each calendar year;
v.
That, except as set forth in N.J.A.C. 5:80-26.18(c)4vii, as
may be amended or supplemented, at no time shall the owner of the
unit lease or rent the unit to any person or persons, except on a
short-term hardship basis, as approved in advance and in writing by
the administrative agent;
vi.
That the maximum permitted rent chargeable to income-restricted
tenants is as stated in the notice required to be posted in accordance
with N.J.A.C. 5:80-26.18(d)3, as may be amended or supplemented, a
copy of which shall be enclosed, and that copies of all leases for
income-restricted rental units must be submitted annually to the administrative
agent;
vii.
If the income-restricted unit is a two-family home, that the
owner shall lease the rental unit only to certified households approved
in writing by the administrative agent, shall charge rent no greater
than the maximum permitted rent as determined by the administrative
agent, and shall submit for written approval of the administrative
agent copies of all proposed leases prior to having them signed by
any proposed tenant; and
viii.
That no improvements may be made to any unit
that would affect its bedroom configuration, except as provided in
subsection (a) of N.J.A.C. 5:80-26.9(a), as may be amended or supplemented,
and in any event, that no improvement made to the unit will be taken
into consideration to increase the maximum permitted resale price,
except for improvements approved in advance and in writing by the
administrative agent;
e.
Securing annually from the City lists of all income-restricted 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;
f.
Establishing a program for diverting unlawful rent payments to the
City of Newark Affordable Housing Trust Fund or other appropriate
municipal fund approved by the DCA. For purposes of this subsection,
unlawful rent payments shall mean:
i.
All rent monies paid by a person who has not been duly certified
in accordance with the provisions of N.J.A.C. 5:80-26.16, as may be
amended or supplemented;
ii.
All rent paid by a person or persons renting an ownership unit
from an owner who has moved out of his or her unit illegally;
iii.
Rent paid by a lawful tenant in excess of amounts permitted
by law; and
iv.
Rent paid to an income-restricted unit owner who is claiming
a hardship, when the owner has not received prior authorization from
the administrative agent as is provided for under the provisions of
N.J.A.C. 5:80-26.7(a), as may be amended or supplemented; and
g.
Establishing a rent-to-equity program, to be implemented in situations
where an income-restricted unit owner has unlawfully rented out his
or her unit, and where the tenant has entered into a tenancy without
knowledge of its unlawful nature. Under such rent-to-equity program,
the tenant, including the immediate family of such tenant, shall be
given an opportunity to purchase the unit from the owner, and the
owner shall be compelled to sell the unit to the tenant, with the
total of all rent paid to the owner being credited to tenant as down
payment money paid to the affordable owner. Anything herein to the
contrary notwithstanding, any person offered a unit under such a rent
to equity program must first be certified as eligible under the provisions
of N.J.A.C. 5:80-26.16, as may be amended or supplemented.
h.
Each development subject to this Chapter shall pay a $2,000 fee to
the City of Newark to cover the administrative costs associated with
the administration and enforcement hereof. The Municipal Council,
in consultation with the City of Newark, Department of Economic and
Housing Development, should appoint staff to oversee inclusionary
zoning ordinance compliance from board approval to permit and/or certificate
of occupancy. Once inclusionary units are completed, monitoring and
stewardship of rental units and especially homeownership units by
dedicated staff on an ongoing basis to ensure that units remain affordable
and that the program is meeting its stated goals is crucial to the
success of the ordinance. In addition, the Municipal Council, in consultation
with the City of Newark, Department of Economic and Housing Development,
should appoint staff for ongoing program administration.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
Where the provisions of this Chapter are dependent upon COAH
adopting or publishing certain increases, increments or limits, and
if COAH has in fact not adopted or published such increases, increments
or limits within two years of the date when such publication or adoption
was to be made by COAH, then the administrative agent shall make a
reasonable determination, based on appropriate standards used by State
or Federal government agencies, as to the applicable increase, increment
or limit.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
This Chapter shall take effect in all Wards in the City of Newark
as follows:
1.
Any developer subject to this Chapter that is substantially rehabilitating
a residential and/or mixed use development 40 or more units in the
City of Newark, this Chapter shall be effective January 1, 2019;
2.
Any developer subject to this Chapter that is not requesting a tax
abatement and/or subsidy from the City of Newark, this Chapter shall
be effective January 1, 2019
4.
Any development that has received its new foundation permit by the
above-listed deadline of January 1, 2018, will not be subject to the
provisions of this Chapter.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
If any Section, Subsection, sentence, cause, phrase or portion
of this Chapter is for any reason held invalid or unconstitutional
by any court of competent jurisdiction, such portion shall be deemed
a separate, distinct and independent provision, and such holding shall
not affect the validity of the remaining portions thereof.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
All ordinances or parts of ordinances inconsistent herewith
are repealed as to such inconsistencies.
[Adopted 11-1-2023 by Ord. No. 6PSF-E, 11-01-2023]
This Chapter shall take effect upon final passage and publication
in accordance with the laws of the State of New Jersey.
