[Adopted 12-13-2018 by Ord. No. 20-2018[1]]
[1]
Editor's Note: This article also repealed former Art.
I, Development Fees, adopted 9-27-2007 by Ord. No. 19-2007, as amended.
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, 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, and
further subject to such legislative amendments as from time to time
may be enacted.
B.
Pursuant to P.L. 2008, c. 46 § 8 (N.J.S.A. 52:27D-329.2)
and the Statewide nonresidential Development Fee Act (N.J.S.A. 40:55D-8.1
through 8.7), COAH is 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 that are under the jurisdiction of
the Council or court of competent jurisdiction and have a COAH-approved
spending plan may retain fees collected from nonresidential development.
C.
This article establishes standards for the collection, maintenance,
and expenditure of development fees pursuant to COAH's regulations
and in accordance P.L. 2008, c. 46 §§ 8 and 32 through
38. Fees collected pursuant to this article shall be used for the
sole purpose of providing low- and moderate-income housing. This article
shall be interpreted within the framework of COAH's rules on
development fees, codified at N.J.A.C. 5:97-8,[1] the Court-approved spending plan, and the Court-approved
Somers Point settlement agreements.
[1]
Editor's Note: N.J.A.C. 5:97-8.1 through 8.14 are reserved
as of the dateline on this page.
B.
The City of Somers Point received a first and second cycle final
judgment of compliance and repose and a third cycle judgment of immunity
and repose embodying the terms of the Somers Point settlement agreements.
C.
The City of Somers Point shall not spend development fees for purposes
other than set forth in the spending plan approved by the New Jersey
Superior Court as same may be supplemented and amended.
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 100% affordable development.
The agreement between Bay Avenue Redevelopers, l.l.c., Bass
Harbor, L.L.C., Harbour Cove Marina, L.L.C., the City of Somers Point
and the consent to the settlement terms by Shore Memorial Hospital
dated April 11, 2007, approved by a second cycle final judgment of
compliance and repose entered by the New Jersey Superior Court on
July 9, 2007, in docket No. ATL - L - 3204 -05 following a fairness
hearing held on June 21, 2007.
The City of Somers Point.
The New Jersey Council on Affordable Housing or its successor.
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 as permitted
in N.J.A.C. 5:97-8.3.[1]
The value of a property determined by the Municipal Tax Assessor
through a process designed to ensure that all property in the municipality
is assessed at the same assessment ratio or ratios required by law.
Estimates at the time of issuance of a building permit may be obtained
utilizing estimates for construction cost. Final equalized assessed
value will be determined at project completion by the Municipal Tax
Assessor.
Fair Share Housing Center, a nonprofit agency.
The agreement between the City of Somers Point and Fair Share
Housing Center dated April 26, 2018, approved by an order of fairness
and compliance and granting immunity from Mount Laurel lawsuits entered
by the New Jersey Superior Court on June 5, 2018, in Docket No. ATL
- L - 1538 - 15 following a fairness hearing held on June 1, 2018.
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.
The agreement between the City of Somers Point and Plantation
Bay, LLC dated July 29, 2008, approved by a final judgment entered
by the New Jersey Superior Court on June 30, 2011, in Docket No. ATL
- L - 007302-06 P.W. following a fairness hearing held on June 16,
2011, and a modified order granting continued temporary immunity and
repose entered June 30, 2011, in Docket No. ATL - L - 002835-07.
Collectively, the Bay Avenue Redevelopers settlement agreement,
the Plantation Bay Settlement agreement, and the Fair Share Housing
Center settlement agreement; and any future Court- or agency-Approved
settlement agreements.
[1]
Editor's Note: N.J.A.C. 5:97-8.1 through 8.14 are reserved
as of the dateline on this page.
A.
All residential developers of one or more units, except for developers
of the types of development specifically exempted below, shall pay
a fee of 1.5% of the equalized assessed value for residential development
provided no increased density is permitted.
B.
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 shall be
required to pay a development fee of 6% of the equalized assessed
value for each additional unit that may be realized. For example if
a rezoning allows two extra units to be constructed, the fees could
equal 1.5% of equalized assessed value on the first unit and 6% of
equalized assessed value on the two incremental units. 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.
C.
Affordable housing developments, developments where the developer
is providing for the construction of affordable units elsewhere in
the municipality, and developments where the developer has made a
payment in lieu of on-site construction of affordable units shall
be exempt from development fees.
D.
Developments that have received preliminary or final approval prior
to the adoption of a municipal development fee ordinance in 2005 shall
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 shall
be vested on the date that the building permit is issued.
E.
Owner-occupied residential structures demolished as a result of a
fire, flood, or natural disaster and replaced with a substantially
similar residence shall be exempt from paying a development fee. If
the new owner-occupied residential structure is not substantially
similar to the prior, demolished structure, then the owner shall pay
a development fee for the net increase in equalized assessed value.
F.
The expansion of a residential structure to create a separate housekeeping
unit, the conversion of a residential structure to nonresidential
use, or the expansion of a residential structure or conversion to
a more intense use shall be subject to development fees unless the
expansion is not otherwise exempt from the development fee requirement.
The development fee shall be calculated on the increase in the equalized
assessed value of the converted structure or the equalized assessed
value of the newly created residential unit.
G.
The construction or expansion of a house of worship shall be exempt
from development fees.
H.
Exemption for reconstruction resulting from fire, flood or natural
disaster.
(1)
Owner-occupied residential structures that have been issued a demolition
permit, provided that the unit for which the demolition permit has
been issued was occupied by its current owner for at least one year
prior to the demolition, no change in use has occurred, and which
unit shall be subtracted from actual growth, a development fee pursuant
to N.J.A.C. 5:97-8.3(c)[1] based on the increase in equalized assessed value that
results from reconstruction shall be imposed; unless
[1]
Editor's Note: N.J.A.C. 5:97-8.1 through 8.14 are reserved
as of the dateline on this page.
(2)
The owner-occupied structure which shall have been issued a demolition permit which satisfies the requirements of Subsection H(1) shall have been issued the demolition permit as a result of destruction to the premises resulting from fire, flood or natural disaster, then and in such event, no development fee shall be imposed.
A.
Imposed fees.
(1)
All nonresidential developers, except for developers of the types
of development specifically exempted, 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, 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 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.
(4)
The expansion of a nonresidential structure or conversion to a more
intense use shall be subject to development fees unless the expansion
is not otherwise exempt from the development fee requirement.
B.
Eligible exactions, ineligible exactions and exemptions for nonresidential
development.
(1)
The nonresidential portion of a mixed-use inclusionary or market
rate development shall be subject to the 2.5% development fee, unless
otherwise exempted below.
(2)
Nonprofit hospital structures used solely for nonprofit tax-exempt
hospital services/purposes and uses or as referenced in a judgment
approving the settlement of exclusionary zoning litigation shall be
exempt from development fees, to the extent stated in a court-approved
settlement agreement but shall be obligated to pay into the City's
Affordable Housing Trust Fund those amounts specified in any settlement
agreement(s) approved by the New Jersey Superior Court.
(3)
Nonresidential development shall be exempt from the payment of nonresidential
development fees in accordance with the exemptions required pursuant
to N.J.S.A. 40:55D-8.4.b, or as specified in the Form N-RDF "State
of New Jersey nonresidential Development Certification/Exemption."
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 shall 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 City as a lien against the real property
of the owner.
A.
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.
B.
For nonresidential developments only, the developer shall also be
provided with a copy of Form N-RDF "State of New Jersey nonresidential
Development Certification/Exemption" to be completed as per the instructions
provided. The developer of a nonresidential development shall complete
Form N-RDF as per the instructions provided. 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 and final assessments
as per the instructions provided in Form N-RDF.
C.
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.
D.
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.
E.
The construction official responsible for the issuance of a final
certificate of occupancy shall notify the local assessor of any and
all requests for the scheduling of a preliminary or final inspection
on property (whichever first occurs) which is subject to a development
fee.
F.
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
to the construction official who shall calculate the development fee;
and thereafter notify the developer of the amount of the fee.
G.
Should the City fail 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 Subsection b. of § 37 of P.L. 2008, c. 46 (N.J.S.A.
40:55D-8.6).
H.
The developer shall pay 100% of the calculated development fee amount
prior to the municipal issuance of a certificate of occupancy for
the subject property. No certificate of occupancy shall be issued
for any nonresidential development until such time as the fee imposed
pursuant to this section has been paid by the developer.
A.
A developer may challenge residential development fees imposed by
filing a challenge with the County Board of Taxation. Pending a review
and determination by the Board, collected fees shall be placed in
an interest-bearing escrow account by the City. Appeals from a determination
of the Board 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.
B.
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 City. 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.
C.
If all or a portion of the contested fees are returned to the developer,
the accrued interest on the returned amount shall also be returned.
A.
The City has created a separate, interest-bearing housing trust fund
for the purpose of depositing development fees collected from residential
and nonresidential developers, payments in lieu of on-site construction
of affordable units, payments to be made to the City as required by
the court approved Bay Avenue Redevelopers settlement agreement, repayments
from affordable housing program loans, proceeds from the sale of units
with extinguished controls, and any other funds collected in connection
with the City's affordable housing program. All development fees
paid by developers pursuant to this article shall be deposited into
this fund.
B.
The City has provided COAH with written authorization, in the form
of a three-party escrow agreement between the municipality, the bank,
and COAH to permit COAH (or its successor) to direct the disbursement
of the funds as provided for in N.J.A.C. 5:94-6.16(b).[1]
[1]
Editor's Note: N.J.A.C. 5-94-1.1 et seq. expired 9-11-2016.
C.
In the event of a failure by the City to comply with trust fund monitoring
and reporting requirements or to submit accurate monitoring reports
which are not cured; or a failure to comply with the material conditions
of the judgment of compliance or a revocation of the judgment of compliance
by order of the Court; or a failure to implement the approved spending
plan and to expend funds within the applicable required time period
as set forth in In re Tp. of Monroe, 442 N.J. Super. 565 (Law Div.
2015) (aff'd 442 N.J. Super. 563), or any approved extension
of time; or the expenditure of funds on activities not approved by
the Court; or for other good cause demonstrating the unapproved use(s)
of funds, the Court may authorize the State of New Jersey, Department
of Community Affairs, Division of Local Government Services (LGS),
to direct the manner in which the funds in the Affordable Housing
Trust Fund shall be expended, provided that all such funds shall,
to the extent practicable, be utilized for affordable housing programs
within the City, or, if not practicable, then within the county or
the housing region.
A.
Funds deposited in the housing trust fund may be used for any activity
approved by COAH or the Court, and in accordance with the terms and
conditions set forth in any court-approved settlement agreement to
address the City's municipal fair share. Such activities include,
but are not limited to: rehabilitation, new construction, ECHO housing,
purchase of land for affordable housing, improvement of land to be
used for affordable housing, purchase of housing, extensions or improvements
of roads and infrastructure to affordable housing sites, financial
assistance designed to increase affordability, or administration necessary
for implementation of the Housing Element and Fair Share Plan. The
expenditure of all funds shall conform to a spending plan approved
by COAH or the Court.
B.
Future fund payment shall not be expended to reimburse the City for
past housing activities.
C.
At least 30% of the development fees collected and interest earned
thereon 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)
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 City 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.[1]
[1]
Editor's Note: N.J.A.C. 5:96-18.1 through 18.13 are reserved
as of the dateline on this page.
E.
No more than 20% of the revenues collected from development fees
shall 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.
In the manner set forth within Paragraph 15 of the settlement
agreement between the City and Fair Share Housing Center dated April
26, 2018, the City shall complete and return 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, and the expenditure
of revenues and implementation of the plan approved by the Court.
All monitoring reports shall be completed on forms designed by COAH,
New Jersey Department of Community Affairs, New Jersey Division of
Local Government Services, or other entity designated by law or regulation.
The City is also subject to the additional requirements set forth
in the Fair Share Housing Center settlement agreement which require
the City to provide copies of such reports to Fair Share Housing Center
and posting of information on the City's official website.
The Superior Court has approved the City of Somers Point Affordable
Housing Development Fee Ordinance and the City of Somers Point Affordable
Housing Spending Plan and the Fair Share Housing Center settlement
agreement which addresses the City's third round affordable housing
obligation.
A.
The ability for the City to impose, collect and expend development
fees shall be permitted through the expiration of the repose period
covered by its judgment of compliance and shall continue thereafter
so long as the City has filed an adopted Housing Element and Fair
Share Plan with the Court or with a designated state administrative
agency, has petitioned for a judgment of compliance from the Court
or for substantive certification or its equivalent from a state administrative
agency authorized to approve and administer municipal affordable housing
compliance and has received approval of its Development Fee Ordinance
from the entity that will be reviewing and approving the Housing Element
and Fair Share Plan.
B.
If the City is not pursuing authorization to impose and collect development
fees after the expiration of its judgment of compliance, it may be
subject to forfeiture of any or all funds remaining within its Affordable
Housing Trust Fund. Any funds so forfeited shall be deposited into
the "New Jersey Affordable Housing Trust Fund" established pursuant
to § 20 of P.L. 1985, c. 222 (N.J.S.A. 52:27D-320).
C.
After the expiration of its judgment of compliance, if the City does
not pursue or obtain continued authorization, the City shall not retroactively
impose a residential development fee on a development that receives
preliminary or final site plan approval after the expiration of its
judgment of compliance, nor shall the City retroactively impose a
development fee on such a development or expend any of its collected
development fees.
