[1]
Editor’s Note: This ordinance provided that it “is
intended to be in effect retroactively to the expiration date of the
applicable regulations at N.J.A.C. 5:97-8.”
A.
In Holmdel Builder's Association v. Holmdel Township, 121 N.J. 550
(1990), the New Jersey Supreme Court determined that mandatory development
fees are authorized by the Fair Housing Act of 1985 (the "FHA"), N.J.S.A.
52:27D-301 et seq., and the State Constitution, subject to the Council
on Affordable Housing's ("COAH's") adoption of rules.
B.
Pursuant to P.L. 2008, c. 46, § 8 (N.J.S.A. 52:27D-329.2)
and the Statewide Non-residential Development Fee Act (N.J.S.A. 40:55D-8.1
through 40:55D-8.7) ("Development Fee Act"), COAH was authorized to
adopt and promulgate regulations necessary for the establishment,
implementation, review, monitoring, and enforcement of municipal affordable
housing trust funds and corresponding spending plans. Municipalities,
such as the Borough of Norwood, that were or are under the jurisdiction
of COAH, or a court of competent jurisdiction, and that have approved
spending plans, are authorized to retain fees collected from nonresidential
and residential development.
C.
This article ratifies and confirms the standards for the collection,
maintenance, and expenditure of development fees in the Borough after
the expiration of the COAH regulations. All fees collected pursuant
to this article will be used only for the purpose of providing low-
and moderate-income housing or otherwise advancing the Borough's compliance
with its affordable housing obligations.
The following terms, as used in this article, shall have the
following meanings:
A development included in the Housing Element and Fair Share
Plan, and includes, but is not limited to, an inclusionary development,
a municipal construction project, or a one-hundred-percent affordable
development.
The Borough of Norwood.
The New Jersey Council on Affordable Housing.
New construction and additions, but does not include alterations,
reconstruction, renovations, and repairs as those terms are defined
under the State Uniform Construction Code promulgated pursuant to
the State Uniform Construction Code Act, P.L. 1975, c. 217 (N.J.S.A.
52:27D-119 et seq.).
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.
Funds paid by an individual, person, partnership, association,
company, or corporation for the improvement of property in the Borough
pursuant to the Development Fee Act, this article, and the FHA.
The assessed value of a property divided by the current average
ratio of assessed to true value for the municipality in which the
property is situated, as determined in accordance with §§ 1,
5, and 6 of P.L. 1973, c. 123 (N.J.S.A. 54:1-35a through 54:1-35c).
Those strategies that minimize the impact of development
on the environment, and enhance the health, safety, and well-being
of residents by producing durable, low-maintenance, resource-efficient
housing while making optimum use of existing infrastructure and community
services.
Any development which includes both a nonresidential development
component and a residential development component, and shall include
developments for which:
There is a common developer for both the residential development
component and the nonresidential development component, provided that
for purposes of this definition, multiple persons and entities may
be considered a common developer if there is a contractual relationship
among them obligating each entity to develop at least a portion of
the residential or nonresidential development, or both, or otherwise
to contribute resources to the development; and
The residential and nonresidential developments are located
on the same lot or adjoining lots, including but not limited to lots
separated by a street, a river, or another geographical feature.
Any building or structure, or portion thereof, including but
not limited to any appurtenant improvements, which is designated to
a use group other than a residential use group according to the State
Uniform Construction Code promulgated to effectuate the State Uniform
Construction Code Act, P.L. 1975, c. 217 (N.J.S.A. 52:27D-119 et seq.),
including any subsequent amendments or revisions thereto;
Hotels, motels, vacation timeshares, and child-care facilities;
and
The entirety of all continuing care facilities within a continuing
care retirement community which is subject to the Continuing Care
Retirement Community Regulation and Financial Disclosure Act, P.L.
1986, c. 103 (N.J.S.A. 52:27D-330 et seq.).
The fee authorized to be imposed pursuant to the Development
Fee Act.
Any person obtaining approval for a residential development
in the Borough.
Any development in the Borough that includes one or more
residential dwelling units and that is not a mixed-use development.
A.
Imposed fees.
(1)
Within the R-40, R-22.5, R-10, R-7.5, and TH Zoning Districts, or
in any other zoning district in which a developer is granted variance
approval under N.J.S.A. 40:55D-70d for the construction of a building
or buildings, including a residential dwelling or dwellings, residential
developers shall pay a fee of 1.5% of the equalized assessed value
for residential development, provided no increased density is permitted.
(2)
When an increase in residential density pursuant to N.J.S.A. 40:55D-70d(5)
(known as a "d" variance) has been permitted, developers may be required
to pay a development fee of 6% of the equalized assessed value for
each additional unit that may be realized. However, if the zoning
on a site has changed during the two-year period preceding the filing
of such a variance application, the base density for the purposes
of calculating the bonus development fee shall be the highest density
permitted by right during the two-year period preceding the filing
of the variance application.
(3)
Development fees shall be imposed and collected when an existing
structure undergoes a change to a more intense use, is demolished
and replaced with new construction, or is expanded by an addition
to an existing structure, if the expansion is not otherwise exempt
from the development fee requirement.
(4)
Fees for the construction of new buildings not existing will be based
on the equalized assessed value of the land and improvements.
(5)
Fees for the construction of additions to existing buildings will
be based on the increase in the equalized assessed value resulting
from the additions.
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Example: If an approval allows four units to be constructed
on a site that was zoned for two units, the fees could equal 1% of
the equalized assessed value on the first two units; and the specified
higher percentage up to 6% of the equalized assessed value for the
two additional units, provided zoning on the site has not changed
during the two-year period preceding the filing of such a variance
application.
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B.
Eligible exactions, ineligible exactions, and exemptions for residential
development.
(1)
Affordable housing developments and developments where the developer
has made a payment in lieu of on-site construction of affordable units
shall be exempt from development fees.
(2)
Developments that have received preliminary or final site plan approval
prior to the adoption of the Borough's Development Fee Ordinance on
November 5, 2008, will continue to be exempt from development fees,
unless the developer seeks a substantial change in the approval. Where
a site plan approval does not apply, a zoning and/or building permit
shall be synonymous with preliminary or final site plan approval for
this purpose. The fee percentage is vested on the date that the building
permit is issued.
A.
Upon the grant of a preliminary, final, or other applicable approval
for a residential development, the approving authority will direct
its staff to notify the Construction Official responsible for the
issuance of a building permit.
B.
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 residential development that is subject
to a development fee.
C.
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 residential development.
D.
The Construction Official responsible for the issuance of a final
certificate of occupancy will notify the local Assessor of any and
all requests for the scheduling of a final inspection on property
that is subject to a residential development fee.
E.
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 residential development fee; and thereafter notify the
developer of the amount of the fee.
F.
If the Borough fails to determine or notify the residential developer
of the amount of the residential development fee within 10 business
days of the request for final inspection, the residential developer
may estimate the amount due and pay that estimated amount consistent
with the dispute process set forth in Subdivision b of § 37
of P.L. 2008, c. 46 (N.J.S.A. 40:55D-8.6).
G.
Fifty percent of the residential development fee shall be collected
at the time of issuance of the building permit. The remaining portion
shall be collected before the 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 issuance of the certificate of occupancy. No certificate of occupancy
may be issued until the developer pays the required residential development
fee.
A.
In all zoning districts, developers obtaining approval for the construction
of nonresidential developments and mixed-use developments will pay
to the Borough the nonresidential development fee of 2.5% required
by the Development Fee Act.
B.
Imposed fees.
(1)
Within all zoning districts, nonresidential developers, except for
developers of the types of development specifically exempted by the
Development Fee Act, 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 by the Development Fee Act, 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 pre-existing land and improvement and the equalized assessed
value of the newly improved structure, i.e., land and improvement,
at the time the 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.
C.
Eligible exactions, ineligible exactions, and exemptions for nonresidential
development.
(1)
The residential portion of a mixed-use inclusionary or market rate
development will be exempt from the nonresidential development fees,
but the nonresidential portion is subject to the nonresidential development
fee of 2.5%, unless otherwise exempted below.
(2)
The fee of 2.5% shall not apply to an increase in equalized assessed
value resulting from alterations, changes in use within existing building
footprint, reconstruction, renovations, and repairs.
(3)
Nonresidential developments shall be exempt from the payment of nonresidential
development fees in accordance with the exemptions required pursuant
to P.L. 2008, c. 46, as specified in the Form N-RDF, "State of New
Jersey Non-Residential Development Certification/Exemption" Form.
Any exemption claimed by a developer shall be substantiated by that
developer.
(4)
A developer of a nonresidential development exempted from the nonresidential
development fee pursuant to P.L. 2008, c. 46, shall be subject to
it at such time the basis for the exemption no longer applies, and
shall make the payment of the nonresidential development fee, in that
event, within three years after that event or after the issuance of
the final certificate of occupancy of the nonresidential development,
whichever is later.
(5)
If a property which was exempted from the collection of a nonresidential
development fee thereafter ceases to be exempt from property taxation,
the owner of the property will remit the fees required pursuant to
this section within 45 days of the termination of the property tax
exemption. Unpaid nonresidential development fees under these circumstances
may be enforceable by the Borough as a lien against the real property
of the owner.
A.
The Borough's officials, including the Construction Official and
Assessor, will calculate and collect the nonresidential development
fee in accordance with the Development Fee Act.
B.
Upon the granting of a preliminary, final, or other applicable approval
for a development, the applicable approving authority shall direct
its staff to notify the Construction Official responsible for the
issuance of a building permit. The developer will also be provided
with a copy of Form N-RDF, "State of New Jersey Non-Residential Development
Certification/Exemption," which the developer will complete as per
the instructions provided.
C.
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 final assessments as per the instructions provided in Form
N-RDF.
D.
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.
E.
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.
F.
The Construction Official responsible for the issuance of a final
certificate of occupancy will 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.
G.
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.
H.
If the Borough fails 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 Subdivision b of § 37 of P.L. 2008, c. 46 (N.J.S.A.
40:55D-8.6).
I.
The nonresidential development fee shall be collected before the
issuance of the certificate of occupancy. No certificate of occupancy
may be issued until the developer pays the required residential development
fee.
J.
A developer may challenge nonresidential development fees imposed
by filing a challenge with the Director of the Division of Taxation.
Pending a review and determination by the Director, which shall be
made within 45 days of receipt of the challenge, collected fees shall
be placed in an interest-bearing escrow account by the Borough. Appeals
from a determination of the Director may be made to the tax court
in accordance with the provisions of the State Tax Uniform Procedure
Law, N.J.S.A. 54:48-1 et seq., within 90 days after the date of such
determination. Interest earned on amounts escrowed shall be credited
to the prevailing party.
A.
There is hereby ratified and confirmed a separate, interest-bearing
housing trust fund to be maintained by the Chief Financial Officer
for the purpose of depositing residential development fees and nonresidential
development fees collected from residential and nonresidential developers
in the Borough and the proceeds from the sales of units with extinguished
controls.
B.
The following additional funds shall be deposited in the Affordable
Housing Trust Fund and shall at all times be identifiable by source
and amount:
(1)
Payments in lieu of on-site construction of affordable units;
(2)
Developer-contributed funds to make 10% of the adaptable entrances
in a townhouse or other multistory attached development accessible;
(3)
Rental income from municipally operated units;
(4)
Repayments from affordable housing program loans;
(5)
Recapture funds;
(6)
Proceeds from the sale of affordable units; and
(7)
Any other funds collected in connection with the Borough's affordable
housing program.
C.
Within seven days from the opening of the trust fund account, the
Borough shall provide COAH with written authorization, in the form
of a three-party escrow agreement between the municipality, the bank,
and COAH, to permit COAH to direct the disbursement of the funds as
provided for in N.J.A.C. 5:97-8.13(b).[1]
[1]
Editor's Note: In accordance with N.J.S.A. 52:14B-5.1b, N.J.A.C.
Title 5, Chapter 97, Substantive Rules of the New Jersey Council on
Affordable Housing for the Period Beginning June 2, 2008, expired
on June 2, 2015. See 43 N.J.R. 1203(a).
D.
All interest accrued in the housing trust fund shall only be used
on eligible affordable housing activities approved by COAH, or otherwise
consistent with the Borough's affordable housing spending plan and
obligations.
A.
The expenditure of all funds shall conform to the Borough's approved
spending plan. Funds deposited in the housing trust fund may be used
for any activity addressing the Borough's fair share obligation and
may be set up as a grant or revolving loan program. Such activities
include, but are not limited to: preservation or purchase of housing
for the purpose of maintaining or implementing affordability controls,
rehabilitation, new construction of affordable housing units and related
costs, accessory apartment, market to affordable, or regional housing
partnership programs, conversion of existing nonresidential buildings
to create new affordable units, green building strategies designed
to be cost saving and in accordance with accepted national or state
standards, purchase of land for affordable housing, improvement of
land to be used for affordable housing, extensions or improvements
of roads and infrastructure to affordable housing sites, financial
assistance designed to increase affordability, administration necessary
for implementation of the Housing Element and Fair Share Plan, or
any other activity as previously permitted pursuant to N.J.A.C. 5:97-8.7
through 5:97-8.9[1] and specified in the approved spending plan.
[1]
Editor's Note: In accordance with N.J.S.A. 52:14B-5.1b, N.J.A.C.
Title 5, Chapter 97, Substantive Rules of the New Jersey Council on
Affordable Housing for the Period Beginning June 2, 2008, expired
on June 2, 2015. See 43 N.J.R. 1203(a).
B.
Funds shall not be expended to reimburse the Borough for past housing
activities.
C.
At least 30% of all development fees collected and interest earned
shall be used to provide affordability assistance to low- and moderate-income
households in affordable units included in the municipal Fair Share
Plan. One-third of the affordability assistance portion of development
fees collected shall be used to provide affordability assistance to
those households earning 30% or less of median income by region.
(1)
Affordability assistance programs may include down payment assistance,
security deposit assistance, low-interest loans, rental assistance,
assistance with homeowners' association or condominium fees and special
assessments, and assistance with emergency repairs.
(2)
Affordability assistance to households earning 30% or less of median
income may include buying down the cost of low- or moderate-income
units in the municipal Fair Share Plan to make them affordable to
households earning 30% or less of median income. The use of development
fees in this manner shall entitle the Borough to bonus credits pursuant
to N.J.A.C. 5:96-18.[2]
[2]
Editor's Note: In accordance with N.J.S.A. 52:14B-5.1b, N.J.A.C.
Title 5, Chapter 96, Procedural Rules of the New Jersey Council on
Affordable Housing for the Period Beginning on June 2, 2008, expired
on June 2, 2015. See 43 N.J.R. 1203(a).
(3)
Payments in lieu of constructing affordable units on site and funds
from the sale of units with extinguished controls shall be exempt
from the affordability assistance requirement.
D.
The Borough may contract with a private or public entity to administer
any part of its Housing Element and Fair Share Plan, including the
requirement for affordability assistance, in accordance with N.J.A.C.
5:96-18.[3]
[3]
Editor's Note: In accordance with N.J.S.A. 52:14B-5.1b, N.J.A.C.
Title 5, Chapter 96, Procedural Rules of the New Jersey Council on
Affordable Housing for the Period Beginning on June 2, 2008, expired
on June 2, 2015. See 43 N.J.R. 1203(a).
E.
No more than 20% of all revenues collected from development fees
may be expended on administration, including, but not limited to,
salaries and benefits for municipal employees or consultant fees necessary
to develop or implement a new construction program, a Housing Element
and Fair Share Plan, and/or an affirmative marketing program. In the
case of a rehabilitation program, no more than 20% of the revenues
collected from development fees shall be expended for such administrative
expenses. Administrative funds may be used for income qualification
of households, monitoring the turnover of sale and rental units, and
compliance with COAH's monitoring requirements. Legal or other fees
related to litigation opposing affordable housing sites or objecting
to the COAH's regulations and/or action are not eligible uses of the
Affordable Housing Trust Fund.
The Borough shall complete and return to COAH all monitoring
forms included in the annual monitoring report related to the collection
of development fees from residential and nonresidential developers,
payments in lieu of constructing affordable units on site, and funds
from the sale of units with extinguished controls, barrier-free escrow
funds, rental income, repayments from affordable housing program loans,
and any other funds collected in connection with the Borough's housing
program, as well as to the expenditure of revenues and implementation
of the plan certified by COAH. All monitoring reports shall be completed
on forms designed by COAH.
