newjerseynewsroom.com

2,292 of 9,736 needed houses, apartments never built

BY TOM HESTER SR.

NEWJERSEYNEWSROOM.COM

A new analysis of publicly available data on prior state-approved so-called Regional Contribution Agreements, an arrangement that enabled wealthier suburban towns top sell their affordable housing requirements to poorer cities, reveals that 25 percent of the money was never used by urban officials to produce housing.

The analysis, released Friday by the Cherry Hill-based Fair Share Housing Center, a non-profit affordable housing advocacy organization, found that based on data on every RCA (the suburban-urban money transfers), 2,292 homes out of 9,736 that were supposed to be created were never constructed.

The analysis was released as the Senate Economic Growth Committee prepares to approve on Monday legislation (S-1) which would abolish the state Council on Affordable Housing and give more power to cities and towns to decide their role in providing affordable housing. The measure is sponsored by Sen. Raymond J. Lesniak (D-Union) and Sen. Christopher "Kip'' Bateman (R-Somerset). The bill would also bring back RCAs, which were banned in 2008.

"The RCAs produced a lot of funds moving around, but far too few homes," said Adam Gordon, a Fair Share attorney.

Here are examples of Gordon's findings:

At least 230 homes that were supposed to be rehabilitated in New Brunswick based on municipalities such as Clinton Township and Monroe Township paying approximately $5 million. These homes have not been rehabilitated.

At least 536 homes supposed to be built or rehabilitated in Trenton based on payments of over $10 million by towns such as West Windsor and Marlboro. It never happened.

A total of 112 homes supposed to be rehabilitated in Freehold based on payments of over $2 million from Freehold Township.

Joseph Vas, the now former mayor of Perth Amboy and former state assemblyman, was indicted last year after using his influence to misappropriate RCA funds in connection with the sale of a multiple unit apartment building to a contractor.

In 2007, U.S. Attorney Chris Christie's office indicted New Brunswick rehabilitation officials along with several contractors who pled guilty to illegally receiving more than $900,000 in rehabilitation contracts from the city of New Brunswick.

Also in 2007, Christie's office indicted contractors associated with Linden's rehabilitation program who pled guilty to receiving corrupt payments.

Corzine and the Legislature banned RCAs after finding they were "no longer appropriate or in harmony with the Mount Laurel doctrine."

Gordon said the Lesniak-Bateman bill would reinstate the transfer of approximately 5,000 more homes and over $100 million more, much of it to the same municipalities such as New Brunswick and Trenton that have failed to spend existing funds.

"It would be a mistake to simply pour more money into a program that isn't working," Gordon said. "Incredibly in a time of great economic need, RCAs have led to over $50 million sitting in the bank. Putting another $100 million into programs that have failed to spend the money they have makes no sense."

Fair Share is calling for an accounting of all unspent money and an investigation into why the funds have not been spent and ensuring that they have not been misappropriated.

"Municipalities that sent RCAs received credit towards their housing obligation based on the premise that homes would be created," said Fair Share Director Peter J. O'Connor. "If those homes have not actually been built, then the credits should not be valid."

Fair Share also argues that when RCAs resulted in homes, it did so in a way that increased racial segregation and decreased access to employment.

The analysis found that RCAs were transferred from suburbs that were on average 7 percent African-American and Latino to cities and older suburbs that were on average 52 percent African-American and Latino. The analysis also maintains RCAs also were transferred from municipalities which on average experienced 21 percent job growth to municipalities experiencing no job growth.