JUST IN: New Jersey Governor Phil Murphy Signs Affordable Housing Legislation

At an event in Perth Amboy this morning, New Jersey Governor Murphy signed the landmark affordable housing legislation, which was approved by the Senate and Assembly earlier this week.

“Ensuring that every family has a safe, dignified place to call home — where parents can raise their children, and senior citizens can live out their golden years — is a cornerstone of the American dream,” Murphy said in his remarks.

The package of bills completely revamps the process of determining constitutionally mandated affordable housing obligations, giving municipalities greater flexibility and input.

For the previous decade, confusion about how much housing needs to be built has led to litigation, wasting taxpayer resources and resulting in significant delays in the ability to build housing.

Under the bill, the defunct Council on Affordable Housing (COAH), would be abolished, and disputes about how much and where new housing is to be built would be resolved first before a panel of experts.

The primary bill establishes a new, streamlined framework for determining and enforcing municipalities’ affordable housing obligations under the New Jersey Supreme Court’s Mount Laurel doctrine and the State’s Fair Housing Act. Starting with the compliance period that begins in 2025, the Department of Community Affairs will publish non-binding calculations of municipalities’ current and prospective need for affordable housing using a formula based on prior court decisions.
Disputes about municipalities’ affordable housing obligations and plans to meet those obligations will be resolved on an expedited basis by the Judiciary with assistance from a new dispute resolution program.
This process will replace the role previously played by the Council on Affordable Housing (COAH), which has been defunct for over a decade and is formally abolished under this bill.
The new process will streamline compliance and reduce litigation-related delays to the construction of new affordable housing and will give municipalities and developers more certainty, which will enable smarter planning around where housing should be built.

Murphy also noted that in 2023, New Jersey permitted more new housing units than New York state for the first time ever, despite New York’s population having ten million more residents than New Jersey.

As part of this process, the bill contains provisions outlining how municipalities may receive “bonus credits” that allows units of affordable housing to be credited as 1.5 or 2 units in certain circumstances. This bonus credit system incentivizes age-restricted housing, housing set aside for individuals with special needs, and other location or purpose-specific housing projects, such as housing near mass transit stations. The bill caps the use of bonus credit units at 25% of a municipality’s prospective need obligations and establishes related parameters for how much of a municipality’s obligations must be satisfied through housing available to families with children and through rental housing.

Additional bills signed today include:

  1. Requires the New Jersey Housing Mortgage and Finance Agency to establish a pilot program to support insurance premiums for eligible affordable housing projects constructed by for-profit affordable housing developers.
  2. S-1422/A-3365 which allows taxpayers to accelerate depreciation of eligible property expenditures in connection with construction of new affordable housing developments in order to realize cost savings.
  3. A-2296/S-2309 which allows a municipal governing body to delegate to the municipal clerk the authority to issue certain approvals to facilitate development of affordable housing projects.
  4. A-3337/S-2312 which permits “payment in lieu of taxation” (PILOT) agreements between municipalities and affordable housing projects that receive funding through the State Affordable Housing Trust Fund or municipal affordable housing trust funds.
  5. A-1495/S-1484 which exempts receipts from sales made to contractors or repairmen of materials, supplies, or services related to the construction of 100%-affordable housing projects in order to help reduce costs for the construction of such projects.
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  1. Good. I’m glad. Changes need to be made in affordable housing for those who need it. But putting into perspective that affordable housing is for everyone. Not for selective few.

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