Housing battle heats up in NJ

The perennial battle over "affordable" housing, and who will be obliged to provided it, is heating up once again as the New Jersey legislature considers competing versions of a bill to revise a widely detested regulatory regime.

Yesterday, according to Matt Friedman of the Statehouse Bureau, the Assembly Committee on Housing and Local Government passed and sent to the full Assembly a bill that ostensibly would eliminate the State's Council on Affordable Housing (COAH) and replace it with a simple regulation that every town set aside 10 percent of new residential development for housing that is deemed "affordable." A legislative solution became almost imperative after the Appellate Division of the Superior Court invalidated most of the current rather complex rules that COAH had laid down and gave COAH five months to draw up new rules. (Read the 72-page opinion here.)

The problem is that the Assembly bill would phase in a new 2.5 percent fee on commercial development. Governor Chris Christie has already pledged to veto any bill that contains such a fee. Worth noting is that the governor has fought two major veto wars with this legislature, and won them both. Furthermore, the Senate has already passed its own bill to replace COAH with a simpler statutory requirement, and it does not call for this fee.

That's not the only point of contention, however. Another provision allows towns the option of setting aside 20 percent of new development to be affordable by those making 150 percent of the median income of town residents. Some housing advocates suggest that this could create a problem in counties, like Essex, where the median income is very high. (The median means that as many residents make more as make less.)

COAH was the legislature's response, in 1985, to the Mount Laurel I and II decisions. A developer had sought to build affordable housing in Mount Laurel, and that town denied him a zoning variance. He sued and won the right to build his development. But the court went further than deciding on a strict interpretation of the power to zone, and declared that all communities are obliged to provide "affordable housing stock" to any class of residents who might wish to live in any given community.

COAH was a campaign issue in the 2009 elections, with all three Republican gubernatorial candidates pledging to abolish COAH during the primary campaign. Christie has sought to abolish COAH, but his reason for wanting to abolish the agency is unclear. Simply put, COAH has run out of friends by what Department of Community Affairs Commissioner Lori Grifa called its "rigid, arcane and virtually unintelligible" approach to rule-making. (The reaction to the Appellate Division decision in In re Adoption of NJAC 5:96-7 by NJCOAH makes that abundantly clear; everyone cheered the decision, though for different reasons.) So Christie might want to abolish COAH merely because it is yet another agency seemingly accountable to no one, not because he has any philosophical opposition to telling a town what sort of housing stock it ought to provide.

Commenters to Friedman's piece today raise a number of other problems with the affordable-housing regime generally:

1. It is a political patronage program for developers, most of whose customers end up in foreclosure. (A real-estate agent in Morris County told this Examiner two days ago that residential real estate in New Jersey is, quite simply, "a buyers' market." Foreclosures are the reason for that.)
2. It is an entitlement that is difficult to justify. That last turned into a matter of dispute, which focused on whether the income for most residents of up-scale housing, for example, derives from their own efforts or from interest and dividends from inherited trust funds.
3. It is a never-reachable goal, because its mandates increase the cost of construction for everyone.
4. It is another product of a Supreme Court that for nearly thirty-five years has developed a reputation for exceeding its authority under the Constitution, and only by replacing enough of its members will Governor Christie be able to bring about lasting change in this regard.

Like this article? Want to be notified of more? Click Subscribe, above.