[HISTORY: Adopted by the Common Council of
the City of Linwood 12-12-2007 by Ord. No. 22-2007; amended in its entirety 8-8-2018 by Ord. No. 17-2018. Subsequent amendments noted where applicable.]
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 (the Act), 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.
B.
Pursuant to P.L. 2008, c. 46, § 8 (N.J.S.A. 52:27D-329.2),
and the Statewide Non-Residential Development Fee Act (N.J.S.A. 40:55D-8.1
through 40:55D-8.7), COAH was 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 chapter 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 (N.J.S.A. 52:27D-329.2) and the Statewide Non-Residential Development
Fee Act (N.J.S.A. 40:55D-8.1 through 40:55D-8.7). Fees collected pursuant
to this chapter shall be used for the sole purpose of providing low-
and moderate-income housing in accordance with a court-approved spending
plan.
The following terms, as used in this chapter, 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 one-hundred-percent affordable
development.
The New Jersey Council on Affordable Housing established
under the Act which has primary jurisdiction for the administration
of housing obligations in accordance with sound regional planning
consideration in the state.
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.
Money paid by a developer for the improvement of property
as permitted in N.J.A.C. 5:97-8.3.
The assessed value of a property divided by the current average
ratio of assessed to true value for the municipality in which the
property is situated, as determined in accordance with Sections 1,
5, and 6 of P.L. 1973, c. 123 (N.J.S.A. 54:1-35a through 54:1-35c).
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.
A.
Imposed fees.
(1)
Within the zoning districts allowing residential development, residential
developers, except for developers of the types of development specifically
exempted below, shall pay a fee of 1 1/2% of the equalized assessed
value for residential development, provided that no increased density
is permitted.
(2)
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 may be required
to pay a development fee of 6% of the equalized assessed value for
each additional unit that may be realized. 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.
(3)
Example: If an approval allows four units to be constructed on a
site that was zoned for two units, the fees could equal 1 1/2%
of the equalized assessed value on the first two units; and the specified
higher percentage up to 6% of the equalized assessed value for the
two additional units, provided that zoning on the site has not changed
during the two-year period preceding the filing of such a variance
application.
B.
Eligible exactions, ineligible exactions and exemptions for residential
development.
(1)
Affordable housing developments and developments where the developer
has made a payment in lieu of on-site construction of affordable units
shall be exempt from development fees.
(2)
Developments that have received preliminary or final site plan approval
prior to the adoption of a municipal development fee ordinance 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.[1]
[1]
Editor's Note: Former Subsection B(3), regarding fees for
improved structures, and (4), regarding fees for single-family residential
structures, which immediately followed this subsection, was repealed 2-23-2023 by Ord. No. 3-2023.
A.
Imposed fees.
(1)
Within all zoning districts, nonresidential developers, except for
developers of the types of development specifically exempted, shall
pay a fee equal to 2 1/2% 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 1/2%
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 1/2%
shall be calculated on the difference between the equalized assessed
value of the preexisting 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.
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 development fee of 2 1/2%
unless otherwise exempted below.
(2)
The fee of 2 1/2% shall not apply to an increase in equalized
assessed value resulting from alterations, change in use within existing
footprint, reconstruction, renovations and repairs.
(3)
Nonresidential developments shall be exempt from the payment of nonresidential
development fees in accordance with the exemptions required pursuant
to P.L. 2008, c. 46,[1] as specified in the Form N-RDF, State of New Jersey Non-Residential
Development Certification/Exemption Form. Any exemption claimed by
a developer shall be substantiated by that developer.
[1]
Editor's Note: See N.J.S.A. 52:27D-329.1 et seq.
(4)
A developer of a nonresidential development exempted from the nonresidential
development fee pursuant to P.L. 2008, c. 46,[2] shall be subject to it at such time as 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.
[2]
Editor's Note: See N.J.S.A. 52:27D-329.1 et seq.
(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 of Linwood as a lien against the real
property of the owner.
(6)
Developers of municipal buildings and houses of worship shall be
exempt from paying a development fee.
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 Non-Residential
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 notifies the local Assessor of any and all
requests for the scheduling of a final inspection on property 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,
calculate the development fee, and thereafter notify the developer
of the amount of the fee.
G.
Should the City of Linwood 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 Section 37 of P.L. 2008, c. 46 (N.J.S.A.
40:55D-8.6).
H.
Fifty percent of the development fee shall be collected at the time
of issuance of the building permit. The remaining portion shall be
collected at the issuance of the certificate of occupancy. The developer
shall be responsible for paying the difference between the fee calculated
at building permit and that determined at issuance of certificate
of occupancy.
I.
Appeal of development fees.
(1)
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 of Linwood. 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.
(2)
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 of Linwood.
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.
A.
There is hereby created a separate, interest-bearing housing trust
fund to be maintained by the Chief Financial Officer for the purpose
of depositing development fees collected from residential and nonresidential
developers and proceeds from the sale of units with extinguished controls.
B.
The following additional funds shall be deposited in the Affordable
Housing Trust Fund and shall at all times be identifiable by source
and amount:
(1)
Payments in lieu of on-site construction of affordable units;
(2)
Developer-contributed funds to make 10% of the adaptable entrances
in a townhouse or other multistory attached development accessible;
(3)
Rental income from municipally operated units;
(4)
Repayments from affordable housing program loans;
(5)
Recapture funds;
(6)
Proceeds from the sale of affordable units; and
(7)
Any other funds collected in connection with the City of Linwood's
affordable housing program. In the event of a failure by the City
of Linwood to comply with trust fund monitoring and reporting requirements
or to submit accurate monitoring reports; or a failure to comply with
the conditions of the judgment of compliance or a revocation of the
judgment of compliance; 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 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 of Linwood, or, if not practicable,
then within the county or the housing region.
C.
Any party may bring a motion before the Superior Court presenting
evidence of such condition(s), and the court may, after considering
the evidence and providing the municipality a reasonable opportunity
to respond and/or to remedy the noncompliant condition(s), and upon
a finding of continuing and deliberate noncompliance, determine to
authorize LGS to direct the expenditure of funds in the trust fund.
The court may also impose such other remedies as may be reasonable
and appropriate to the circumstances.
D.
All interest accrued in the Housing Trust Fund shall only be used
on eligible affordable housing activities approved by the court.
A.
The expenditure of all funds shall conform to a spending plan approved
by the court. Funds deposited in the Housing Trust Fund may be used
for any activity approved by the court to address the City of Linwood's
fair share obligation and may be set up as a grant or revolving loan
program. Such activities include, but are not limited to: preservation
or purchase of housing for the purpose of maintaining or implementing
affordability controls, rehabilitation, new construction of affordable
housing units and related costs, accessory apartment, market to affordable,
or regional housing partnership programs, conversion of existing nonresidential
buildings to create new affordable units, green building strategies
designed to be cost saving and in accordance with accepted national
or state standards, purchase of land for affordable housing, improvement
of land to be used for affordable housing, extensions or improvements
of roads and infrastructure to affordable housing sites, financial
assistance designed to increase affordability, administration necessary
for implementation of the Housing Element and Fair Share Plan, or
any other activity as permitted by the court and specified in the
approved spending plan.
B.
Funds shall not be expended to reimburse the City of Linwood for
past housing activities.
C.
At least 30% of all development fees collected and interest earned
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)
Affordability assistance to households earning 30% or less of median
income may include buying down the cost of low- or moderate-income
units in the municipal Fair Share Plan to make them affordable to
households earning 30% or less of median income. The use of development
fees in this manner may entitle the City of Linwood to bonus credits
pursuant to N.J.A.C. 5:97-3.7.[1]
[1]
Editor's Note: In accordance with N.J.S.A. 52:14B-5.1b, Chapter
97, Substantive Rules of the New Jersey Council on Affordable Housing
for the Period Beginning June 2, 2008, expired on June 2, 2015.
(3)
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 of Linwood 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.[2]
[2]
Editor's Note: In accordance with N.J.S.A. 52:14B-5.1b, Chapter
96, Procedural Rules of the New Jersey Council on Affordable Housing
for the Period Beginning on June 2, 2008, expired on June 2, 2015.
E.
No more than 20% of all revenues collected from development fees
may 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. Legal or other fees
related to litigation opposing affordable housing sites or objecting
to the Council's regulations and/or action are not eligible uses of
the Affordable Housing Trust Fund.
The City of Linwood shall provide annual reporting of Affordable
Housing Trust Fund activity to the State of New Jersey, Department
of Community Affairs, Council on Affordable Housing or Local Government
Services or other entity designated by the State of New Jersey, with
a copy provided to Fair Share Housing Center and posted on the municipal
website, using forms developed for this purpose by the New Jersey
Department of Community Affairs, Council on Affordable Housing or
local government. The reporting shall include an accounting of all
Affordable Housing Trust Fund activity, including the sources and
amounts of funds collected and the amounts and purposes for which
any funds have been expended. Such reporting shall include an accounting
of development fees collected from residential and nonresidential
developers, payments in lieu of constructing affordable units on site
(if permitted by ordinance or by agreement with the City), funds from
the sale of units with extinguished controls, barrier free escrow
funds, rental income from Borough-owned affordable housing units,
repayments from affordable housing program loans, and any other funds
collected in connection with Linwood's affordable housing programs,
as well as an accounting of the expenditures of revenues and implementation
of the spending plan approved by the court.
The ability for the City of Linwood to impose, collect and expend
development fees shall expire with its repose period covered by its
judgment of compliance unless the City of Linwood 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. If the City
of Linwood fails to renew its ability to impose and collect development
fees prior to the expiration of substantive certification, it may
be subject to forfeiture of any or all funds remaining within its
municipal 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). The
City of Linwood shall not impose a residential development fee on
a development that receives preliminary or final site plan approval
after the expiration of its substantive certification or judgment
of compliance, nor shall the City of Linwood retroactively impose
a development fee on such a development. The City of Linwood shall
not expend development fees after the expiration of its substantive
certification or judgment of compliance.