The New Jersey Legislature passed affordable housing legislation today that will usher in a new era of state affordable housing guidelines. While A4 has passed in both the New Jersey Assembly and Senate, it still awaits the signature of Gov. Phil Murphy. The governor is expected to sign the bill into law within the next 30 days. For New Jersey municipalities, the affordable housing compliance process was previously decided through lengthy and complex litigation in New Jersey courts between municipalities, public interest groups, landowners and developers. The bill[1] creates a new, streamlined process for how municipal housing obligations are calculated, when municipalities need to complete their compliance filings and procedures, when challengers need to file their respective filings, and how disputes between adverse parties in these matters are handled. Additionally, the bill abolishes the Council on Affordable Housing (COAH) which previously presided over statewide affordable housing matters.
Critically, the bill specifies new deadlines for the fourth round of municipal affordable housing compliance. In contrast with the prior process, these new deadlines provide for expedient action on the part of state and municipal agencies The bill sets forth the following deadlines for the fourth round process:
The Department of Community Affairs (DCA) Report
By December 1, 2024 (or seven (7) months after the effective date of the bill, whichever is earlier):
The DCA must publish reports on calculations of regional need and municipal present and prospective obligations for the Fourth Round. The DCA calculation of need is non-binding, allowing municipalities flexibility in calculating their specific affordable obligations.
Municipal Resolutions on Present & Prospective Fair Share Obligations
By January 31, 2025:
Municipalities must pass binding resolutions setting forth their present and prospective fair share obligations. Municipalities may consider the DCA’s report for its calculations.
No more than 48 hours after adoption of the above resolutions:
Municipalities must file an action regarding the resolutions with the Affordable Housing Dispute Resolution Program. If a municipality does not meet this deadline, it will lose immunity from exclusionary zoning litigation until such time as the municipality has come into compliance.
If the municipality meets the January 31 deadline to prepare a binding resolution, then the municipality’s determination of its obligation is established by default and, importantly, will bear a presumption of validity beginning on March 1, 2025 as the municipality’s obligation for the fourth round, unless challenged by an interested party on or before February 28, 2025.
Challenges to Municipal Present & Prospective Fair Share Obligation Calculations
On or before February 28, 2025:
An interested party may file a challenge with the Program after adoption of the binding resolution and must allege that the municipality’s determination of its present and prospective obligation does not comply with the requirements of the Bill.
By March 31, 2025:
The Program provides its decision to the municipality and all parties that have filed a challenge.
Adoption of Housing Element & Fair Share Plan
On or before June 30, 2025:
Municipalities must adopt their housing element and fair share plans (HEFSP) and propose drafts of the zoning and other ordinances and resolutions to implement their present and prospective obligations.
By June 30, 2025 (or 48 hours after adoption, whichever is sooner):
Municipalities must file their adopted HEFSP and proposed ordinances and resolutions with the program. If a municipality does not file such plans by June 30, 2025, it will not retain immunity from exclusionary zoning litigation until it is compliant.
If not challenged by August 31, 2025, then the Program will apply an objective standard to conduct a limited review of the HEFSP for consistency and to determine whether it enables the municipality to satisfy the fair share obligation, applies compliant mechanisms, meets the threshold requirements for rental and family units, does not exceed limits on other unit or category types, and is compliant with the Fair Housing Act and the Mount Laurel doctrine. If these objective standards are met, the Program will issue a compliance certification.
Challenges to Housing Element and Fair Share Plan
On or before August 31, 2025:
After the filing of an action of an adopted HEFSP, an interested party may file a response by the above deadline, alleging that the municipality’s HEFSP is not in compliance. The allegation cannot include a claim that a site on real property proposed by the interested party is a better site than a site in the plan but instead must be based on whether the HEFSP, as proposed, is compliant with the Fair Housing Act or the Mount Laurel doctrine.
December 31, 2025:
The program will facilitate communication between the municipality and any interested parties for a challenge and provide the municipality until December 31, 2025, to commit to revising its HEFSP in compliance with the changes requested in the challenge or provide an explanation as to why it will not make all of the requested changes or both.
If by December 31, 2025, the municipality and any interested party that has filed a response have resolved the issues raised in the response through agreement or withdrawal of filing, then the program will review the HEFSP for consistency and compliance.
Adoption of Implementing Ordinances
On or before March 15, 2026:
The implementing ordinances and resolutions must be adopted by this deadline, otherwise, the municipality will not retain immunity from exclusionary zoning litigation until it is compliant.
Conclusion
The implementation of the procedures in the bill will be a significant change for municipalities, developers and other interested parties alike. The new deadlines provide for a much more expedited process than ever before. Fox will continue to review and monitor any developments concerning the bill’s implementation and affordable housing in the State of New Jersey.
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