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BY TOM HESTER SR.
NEWJERSEYNEWSROOM.COM
UPDATED
An Assembly committee Thursday approved legislation that proponents describe as a landmark effort to pull New Jersey out of the economic downturn and opponents call an unconstitutional and backward step toward solving the state’s affordable housing crisis.
The main sponsor is Assembly Speaker Joseph Roberts (D-Camden), who garnered applause last year for pushing affordable housing reform legislation to approval.
Under the measure, A-4048, a temporary moratorium would be placed on the 2.5 percent non-residential development fee to help finance housing established last year by Roberts’ housing legislation. Developers who already have paid the fee would be reimbursed.
Housing advocates said the reimbursement would total at least $20 million with the money coming from the Corzine administration’s financially-strapped state treasury and municipal treasuries.
The affordable housing obligation associated with any project subject to the moratorium would be eliminated.
“A temporary hold on the nonresidential development fee does not mean we are going to allow towns to back away from their responsibilities to provide housing choice and opportunity to all working families,” Roberts said. “This simply recognizes that we are in extraordinary economic times.”
Kevin D. Walsh, counsel for the Cherry Hill-based Fair Kevin Housing Center, has one word to described the legislation: “unconstitutional.‘’
“The bill is unconstitutional under the Mount Laurel doctrine (court ruling) because it reduces housing obligations that were already allocated to towns,’’ he said. “It would never withstand a court challenge. And it is unwise because it removes funds needed for housing for working families at the worst possible time and gives the money to developers. Rebates to builders for development that occurred a year ago isn’t a stimulus. It’s a freebie on the backs of New Jersey’s families.”
Staci Berger, director of policy and advocacy for the Housing and Community Development Network of New Jersey, said housing activists hope Gov. Jon Corzine and legislators will improve the bill to prevent the loss of affordable housing.
"This bill includes an effort to undo the historic housing reforms passed last year,’’ she said. “It will have a chilling effect on the creation of homes people can afford and jobs that people need creating them. It goes far beyond the governor's original proposal of a 12-month moratorium… ’’
According to figures compiled last year by the state Council on Affordable Housing, New Jersey needs 116,000 affordable housing units and that does not account for the need generated by the foreclosures and depressed credit markets caused by the economic downturn.
The requirements for towns to build affordable housing are lower than ever. Presently, there are no plans to build 70,000 of the 116,000 houses and apartments said to be needed through 2018. Housing advocates charge COAH’s regulations look tough on paper but in reality let suburban towns get away with doing next to nothing.
The four Republican members of the Assembly Appropriations Committee abstained from a vote after several members of the public, who would be affected by the legislation, complained the legislation was quickly added to the committee’s agenda before copies were available to the public.
“This is no way to run a democracy,” said Assemblyman Michael Doherty (R-Warren), who opposes affordable housing. “We were given a few hours to consider whether this legislation that touches on urban-tax credits, affordable-housing fees and contains a $15 million appropriation will help New Jersey.''
Roberts said the legislation will give towns and businesses the tools they need to bring about commercial construction and create jobs.
“Growing New Jersey out of this recession requires new approaches,’’ Roberts said. “This multi-faceted effort sends the clear message that New Jersey is open for business and looking to the future.”
Under the legislation, the Urban Transit Hub Tax Credit program would be overhauled to promote corporate capital investment and development near mass transit centers. Created in 2007, the program offers a 100-percent corporate business tax credit to companies planning capital projects that invest at least $75 million and create or relocate at least 250 jobs to within a half-mile of mass transit stations in Trenton, Newark, New Brunswick, Paterson, Elizabeth, Jersey City, Camden and East Orange. The investment threshold would drop to $50 million — businesses that lease space would see their investment floor reduced from $50 million to $17.5 million.
The bill would also replace the state’s unwieldy and largely unused Revenue Allocation District program — only one district has been created since the program’s inception in 2002 – with a new Economic Redevelopment and Growth Grant program (ERGG). The ERGG system would be modeled off the state’s Brownfields Site Reimbursement program, which allows for the financing of redevelopment through revenues derived from a site’s redevelopment — including sales and corporate business taxes rather than solely through local borrowing.
State colleges and universities also would be permitted to partner directly with private developers to build new campus buildings such as dormitories that would be paid-for through revenue generated by the structure.
Sponsors of the legislation said the agreements would curtail the need for colleges to self-finance the costs of construction. Over the past two decades, many colleges have found themselves at or near debt capacity in trying to keep up with needed development.
Under the bill, all public colleges and universities would be required to develop long-range facilities plans and update those plans every five years. The plans would be subject to review by the state Commission of Higher Education.
After the vote was concluded, the measure was still not listed on the Legislature’s web site. It moves to the Assembly Budget Committee for consideration.
