State Housing Funds Can Stay With Towns, For Now

Appellate judges rule only the Council on Affordable Housing can force municipalities to give their local funds to the state.

New Jersey municipalities' affordable housing funds are safe.

For now.

Late Friday, the Appellate Division of Superior Court issued an order preventing the state from taking $142 million in local trust fund dollars.

The move seemed a bit contradictory, given the court—different judges—had refused to put out a similar injunction last month. But Friday's ruling came as part of a different, yet connected, case.

Warning: This gets really complicated and convoluted.

A majority of the judges agreed Friday with an argument made by the Fair Share Housing Center that only the Council on Affordable Housing can order towns to give the state the money they have been collecting in development fees, some for decades.

This is because in a March 8 order, the appellate division ruled that Gov. Chris Christie did not have the authority to eliminate the council as part of a June 2011 departmental reorganization plan. That effectively reinstated COAH.

"The COAH Board, as it must now be constituted to comply with our March 8, 2012 judgment, has not met and has not authorized the demand imposed on the municipalities by the letters sent at the direction of the Acting Executive Director of COAH on July 24, 2012," the appeals panel ruled.

So the "council" of COAH would need to actually have a meeting and order the seizure of the funds. Before it could do so, though, it would seem to need at least two more members: COAH is supposed to have 12 council members, but 7 of those spots are vacant, according to the state's web page that deals with appointments to boards and commissions.

According to housing advocates, the council has not met in 18 months, even before Christie abolished it. The website for the Department of Community Affairs, where COAH is "in, but not of," shows no record of any meetings about the funds or anything else since the ordered reinstatement five months ago.

But good luck trying to get any further information or clarification about the status of the council out of DCA. Its press office has been declining comment. And an assistant commissioner refused to answer any questions posed by Assembly members during a committee hearing on the trust funds last week, citing pending litigation involving COAH.

Three related appeals are pending before the courts, including the appellate division's overturning of the DCA reorganization, the dispute over the funds and the longest unargued appeal before the state Supreme Court—that of COAH's most recent rules.

None of this stopped Chuck Richmond from saying municipalities that had not spent their money during the past four years knew the state would take it and that some seem uninterested in providing housing for those with low- and moderate-incomes. But when the questions turned to the council itself, its membership, and how council staff could act when the council apparently was not authorizing any actions, Richmond played the "pending litigation" card.

One Assembly member said Richmond was using the court cases as a convenient excuse to avoid discussing the status of the council. Another described it as a great exhibition of dancing around questions.

Given that the acting executive director of COAH had sent out the letter, who gave him the authorization is a valid question. While DCA officials may refuse talking about the council, state law still requires public notice and public meetings and the absence of either makes it clear neither there have been no meetings recently, nor at all for more than a year.

Richmond was right when he said there are municipalities that sat on their housing funds. What went unsaid, and is also true, is that many don't want low- and moderate-income units within their borders. In fact, Mount Laurel, the town where the battle started back in the 1970s, has one of the largest unexpended balances—more than $6 million. A total of $142 million, more than half the $258 million collected through July 2008, had not been spent as of mid July, according to the latest accounting from DCA.

But some municipalities feel differently. Three mayors attended the hearing last week, afraid they were going to lose their money and be unable to build the units they have been planning.

Municipalities that legitimately want to build affordable units should be able to use their money for that purpose.

As for those that don't, the law states that after four years, their money goes into a state fund to be used to provide low-cost housing in the same region from which the money came. In that way, the money is still used for its original intention, rather than going to the general state budget, where it is supposed to be used for some housing-related purposes but is at least partially taking the place of other state funds.

In the meantime, the New Jersey State League of Municipalities is suggesting that towns that have not yet complied with the terms of the state's letter -- they had until today to sign an affidavit and return any funds they had not spent within four years—not do so. And if they have already sent money to DCA, they should ask for it back.

But they probably shouldn't expect to get it back any time soon.

Unspent municipal affordable housing fund balances as of July 17. The following are municipalities in Patch's coverage area in Morris, Passaic, Somerset and Sussex counties.

Bernards Twp.—$254,576




Green Brook—$256,262





Warren Twp.—$4,184,859



The Stig August 13, 2012 at 08:30 PM
How about pointing out all the hypocrites in the legislature who passed this law four years ago, when Corzine was governor, and are now screaming at Christie for enforcing it? They wanted to force the municipalities to Use It or Lose It, and that's what should happen.
Tracy Tobin August 14, 2012 at 01:35 AM
There are a couple of problems here. 1) The money was set aside to provide Affordable Housing in NJ (An oxymoron in itself) not to plug into the State budget as a one time revenue source. To use the money that way just repeats the seemingly endless problem of special purpose taxes getting diverted to other uses leaving us with crumbling infrastructure (gasoline tax funding bridges and highways?), underfunded senior citizen medical services (lottery ticket anybody?), and crippling property taxes to fund education (one of the reasons the NJ State Personal Income Tax was instituted was to fund education). 2) No one seems to know who is steering the Ship of State. Is it the Governor, the Courts, the Legislature? Let's immediately freeze salaries, eliminate free medical care and pensions for all the above, throw in all appointees in State Government and Authorities as well,and divert the money into closing the budget gap. Take all the unspent Affordable Housing funds from all the towns that have not met the four year deadline, and put the money in an interest bearing account. The funds to be released back to the towns to purchase affordable housing approved by COAH or it's successor. The interest to be used to pay down State debt. Fine the towns that can't FIND ANY affordable housing within their municipal boundaries within 18 months of the time the funds are seized. Simplistic and probably impossible to enact and enforce but it's better than the circus we are watching now.
The Stig August 14, 2012 at 05:54 AM
So after blowing four years, we should give towns another 18 months? What makes you think they'll believe anyone this time. The only thing 18 months covers is the balance of Christie's first term in office. If you think he's getting beat and the next Dem governor will just repeal the law, good luck with that. And didn't the state budget, proposed and approved by Dems include this revenue and expenditure of the funds?????


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