East Hanover Township
City Zoning Code
City Zoning Code
ARTICLE XII
Affordable Housing Regulations
§ 95-125 Affordable housing requirements.
A.
Purpose.
(1)
The purpose of this chapter is to provide for and regulate affordable housing in the Township of East Hanover. This article is intended to ensure that low- and moderate-income units ("affordable units") are created with controls on affordability over time and that low- and moderate-income individuals and households shall occupy these units.
(2)
The Township of East Hanover Planning Board has adopted a housing element and fair share plan pursuant to the Municipal Land Use Law at N.J.S.A. 40:55D-1, et seq. The housing element and fair share plan has been endorsed by the Township Council. The fair share plan describes the ways the Township of East Hanover shall address its fair share for low- and moderate-income housing as determined by the New Jersey Superior Court and documented in the housing element.
(3)
This article implements and incorporates the housing element and fair share plan and addresses the requirements of N.J.A.C. 5:97, as it may be amended and supplemented.
B.
Monitoring requirements.
(1)
Upon approval of the Township's spending plan, the Township shall provide an annual trust fund accounting report to the New Jersey Department of Community Affairs (DCA), Council on Affordable Housing (COAH), Local Government Services (LGS) or other entity designated by the State of New Jersey, with a copy provided to the Fair Share Housing Center (FSHC) and posted on the municipal website, using forms developed for this purpose by the DCA, COAH or LGS.
(2)
On the first anniversary of the entry of the order granting East Hanover a final judgment of compliance and repose in IMO Application of the Township of East Hanover, Docket No.: MRS-L-1658-15, and every anniversary thereafter through the end of 2025, the Township shall provide annual reporting of the status of all affordable housing activity within the Township through posting on the municipal website, with copies provided to FSHC, using forms previously developed for this purpose by COAH or any other forms endorsed by the Court-appointed Special Master and FSHC. In addition to the foregoing, the Township may also post such activity on the CTM system and/or file a copy of its report with COAH or its successor agency at the state level.
(3)
For the midpoint realistic opportunity review, due on July 7, 2020, as required pursuant to N.J.S.A. 52:27D-313, the Township shall post on its municipal website, with copies provided to FSHC, a status report as to its implementation of its plan and an analysis of whether any unbuilt sites or unfulfilled mechanisms continue to present a realistic opportunity and whether any mechanisms to meet unmet need should be revised or supplemented. Such posting shall provide the opportunity for the aforementioned entities to submit comments to the municipality regarding whether any sites no longer present a realistic opportunity and should be replaced and whether the mechanisms to meet unmet need should be revised or supplemented. Any interested party may by motion request a hearing before the Court regarding these issues.
(4)
For the review of very-low income housing requirements required by N.J.S.A. 52:27D-329.1, within 30 days of the third anniversary of the entry of the order granting East Hanover a final judgment of compliance and repose in IMO Application of the Township of East Hanover, Docket No.: MRS-L-1658-15, and every third year thereafter, the Township will post on its municipal website, with copies provided to FSHC, a status report as to its satisfaction of its very-low income requirements, including the family very-low income requirements referenced in the settlement agreement. Such posting shall provide the opportunity for entities to subject their comments to the municipality and FSHC on the issue of whether the Township has complied with its very-low income housing obligation under the terms of the settlement agreement.
C. ACT ADAPTABLE ADMINISTRATIVE AGENT AFFIRMATIVE MARKETING AFFORDABILITY AVERAGE AFFORDABLE AFFORDABLE HOUSING DEVELOPMENT AFFORDABLE HOUSING PROGRAM(S) AFFORDABLE UNIT AGE-RESTRICTED UNIT AGENCY ALTERNATIVE LIVING ARRANGEMENTS ASSISTED LIVING RESIDENCE CERTIFIED HOUSEHOLD COAH COURT DCA DEFICIENT HOUSING UNIT DEVELOPER DEVELOPMENT INCLUSIONARY DEVELOPMENT LOW-INCOME HOUSEHOLD LOW-INCOME UNIT MAJOR SYSTEM MARKET-RATE UNITS MEDIAN INCOME MODERATE-INCOME HOUSEHOLD MODERATE-INCOME UNIT MULTIFAMILY UNIT NONEXEMPT SALE PRINCIPAL PLACE OF RESIDENCE RANDOM SELECTION PROCESS REGIONAL ASSET LIMIT REHABILITATION RENT RESTRICTED UNIT UHAC VERY-LOW-INCOME HOUSEHOLD VERY-LOW-INCOME UNIT
Definitions. The following terms when used in this article shall have the meanings given herein:
The Fair Housing Act of 1985, P.L. 1985, c. 222 (N.J.S.A. 52:27D-301 et seq.).
Constructed in compliance with the technical design standards of the Barrier Free Subcode, N.J.A.C. 5:23-7.
The entity designated by the Township to administer affordable units in accordance with this article, N.J.A.C. 5:93, and UHAC (N.J.A.C. 5:80-26).
A regional marketing strategy designed to attract buyers and/or renters of affordable units pursuant to N.J.A.C. 5:80-26.15.
The average percentage of median income at which new restricted units in an affordable housing development are affordable to low- and moderate-income households.
A sales price or rent level that is within the means of a low- or moderate-income household as defined within N.J.A.C. 5:93-7.4, and, in the case of an ownership unit, that the sales price for the unit conforms to the standards set forth in N.J.A.C. 5:80-26.6, as it may be amended and supplemented, and, in the case of a rental unit, that the rent for the unit conforms to the standards set forth in N.J.A.C. 5:80-26.12, as it may be amended and supplemented.
A development included in or approved pursuant to the housing element and fair share plan or otherwise intended to address the Township's fair share obligation, and includes, but is not limited to, an inclusionary development, a municipal construction project or a 100% affordable housing development.
Any mechanism in a municipal fair share plan prepared or implemented to address a municipality's fair share obligation.
A housing unit proposed or created pursuant to the Act and approved for crediting by the Court and/or funded through an affordable housing trust fund.
A housing unit designed to meet the needs of, and exclusively for, the residents of an age-restricted segment of the population such that: 1) all the residents of the development wherein the unit is situated are 62 years of age or older; or 2) at least 80% of the units are occupied by one person who is 55 years of age or older; or 3) the development has been designated by the Secretary of the U.S. Department of Housing and Urban Development as "housing for older persons" as defined in Section 807(b)(2) of the Fair Housing Act, 42 U.S.C. § 3607.
The New Jersey Housing and Mortgage Finance Agency established by P.L. 1983, c. 530 (N.J.S.A. 55:14K-1, et seq.).
A structure in which households live in distinct bedrooms, yet share kitchen and plumbing facilities, central heat and common areas. Alternative living arrangements include, but are not limited to: transitional facilities for the homeless; Class A, B, C, D and E boarding homes as regulated by the State of New Jersey Department of Community Affairs; residential health care facilities as regulated by the New Jersey Department of Health; group homes for the developmentally disabled and mentally ill as licensed and/or regulated by the New Jersey Department of Human Services; and congregate living arrangements.
A facility that is licensed by the New Jersey Department of Health and Senior Services to provide apartment-style housing and congregate dining and to assure that assisted living services are available when needed for four or more adult persons unrelated to the proprietor and that offers units containing, at a minimum, one unfurnished room, a private bathroom, a kitchenette and a lockable door on the unit entrance.
A household, including all members of the applicant household who will occupy the affordable unit and temporarily absent family members, pursuant to HUD 4350.3 Rev 1: 5-6,B, that has been certified by an administrative agent as a very-low-income household (N.J.S.A. 52:27D-304, Subdivision M), low-income household or moderate-income household (N.J.A.C. 5:80-26.2). Notwithstanding anything herein to the contrary, for the purpose of income-qualifying a household, a certified household does not include a live-in aid for which the affordable unit will not be the primary residence; foster children; or children of a household member who is a noncustodial parent or member of the household who receives child support for that child.
The Council on Affordable Housing, as established by the New Jersey Fair Housing Act (N.J.S.A. 52:27D-301, et seq.), or any successor agency charged with the administration of the Act.
The Superior Court of New Jersey, Law Division, Morris County.
The State of New Jersey Department of Community Affairs.
A housing unit with health and safety code violations that requires the repair or replacement of a major system. A major system includes weatherization, roofing, plumbing (including wells), heating, electricity, sanitary plumbing (including septic systems), lead paint abatement and/or load bearing structural systems.
Any person, partnership, association, company or corporation that is the legal or beneficial owner or owners of a lot or any land included in a proposed development including the holder of an option to contract to purchase, or other person having an enforceable proprietary interest in such land.
The division of a parcel of land into two or more parcels, the construction, reconstruction, conversion, structural alteration, relocation, or enlargement of any use or change in the use of any building or other structure, or of any mining, excavation or landfill, and any use or change in the use of any building or other structure, or land or extension of use of land, for which permission may be required pursuant to N.J.S.A. 40:55D-1, et seq.
A development containing both affordable units and market rate units. This term includes, but is not limited to: new construction, the conversion of a nonresidential structure to residential use and the creation of new affordable units through the gut rehabilitation or reconstruction of a vacant residential structure.
A household with a total gross annual household income equal to 50% or less of the regional median household income by household size.
A restricted unit that is affordable to a low-income household.
The primary structural, mechanical, plumbing, electrical, fire protection, or occupant service components of a building which include, but are not limited to, weatherization, roofing, plumbing (including wells), heating, electricity, sanitary plumbing (including septic systems), lead paint abatement and load bearing structural systems.
Housing not restricted to low- and moderate-income households that may sell or rent at any price.
The median income by household size for the applicable housing region, as adopted annually by COAH or a successor entity approved by the Court.
A household with a total gross annual household income in excess of 50% but less than 80% of the regional median household income by household size.
A restricted unit that is affordable to a moderate-income household.
A structure containing five or more dwelling units.
Any sale or transfer of ownership other than the transfer of ownership between husband and wife; the transfer of ownership between former spouses ordered as a result of a judicial decree of divorce or judicial separation, but not including sales to third parties; the transfer of ownership between family members as a result of inheritance; the transfer of ownership through an executor's deed to a Class A beneficiary and the transfer of ownership by court order.
As defined by the Uniform Housing Affordability Controls, where the owner of an affordable unit shall at all times maintain the unit as his or her principal place of residence, residing at the unit at least 260 days out of each calendar year.
A process by which currently income-eligible households are selected for placement in affordable housing units such that no preference is given to one applicant over another except for purposes of matching household income and size with an appropriately priced and sized affordable unit (e.g., by lottery).
The maximum housing value in each housing region affordable to a four-person household with an income at 80% of the regional median as defined by duly adopted Regional Income Limits published annually by COAH or a successor entity.
The repair, renovation, alteration or reconstruction of any building or structure, pursuant to the Rehabilitation Subcode, N.J.A.C. 5:23-6.
The gross monthly cost of a rental unit to the tenant, including the rent paid to the landlord, as well as an allowance for tenant-paid utilities computed in accordance with allowances published by DCA for its Section 8 program. In assisted living residences, rent does not include charges for food and services.
A dwelling unit, whether a rental unit or an ownership unit, that is subject to the affordability controls of N.J.A.C. 5:80-26.1, as amended and supplemented, but does not include a market-rate unit financed under UHORP or MONI.
The Uniform Housing Affordability Controls set forth in N.J.A.C. 5:80-26, et seq.
A household with a total gross annual household income equal to 30% or less of the regional median household income by household size.
A restricted unit that is affordable to a very-low-income household.
D.
Applicability.
(1)
The provisions of this article shall apply to all affordable housing developments and affordable housing units that currently exist and that are proposed to be created within the Township of East Hanover pursuant to the Township's most recently adopted housing element and fair share plan.
(2)
Moreover, this article shall apply to all developments that contain low- and moderate-income housing units, including any currently anticipated future developments that will provide low- and moderate-income housing units.
E.
Rehabilitation program.
(1)
East Hanover's rehabilitation program shall be designed to renovate deficient housing units occupied by low- and moderate-income households such that, after rehabilitation, these units will comply with the New Jersey State Housing Code pursuant to N.J.A.C. 5:28.
(2)
Both owner-occupied and renter-occupied units shall be eligible for rehabilitation funds.
(3)
All rehabilitated units shall remain affordable to low- and moderate-income households for a period of 10 years (the control period). For owner-occupied units the control period will be enforced with a lien and for renter-occupied units the control period will be enforced with a deed restriction.
(4)
The Township of East Hanover shall dedicate a minimum amount of $10,000 for each unit to be rehabilitated through this program.
(5)
The Township of East Hanover shall adopt a resolution committing to fund any shortfall in the rehabilitation programs for the Township.
(6)
The Township of East Hanover shall designate, subject to the approval of the Court, one or more administrative agents to administer the rehabilitation program in accordance with N.J.A.C. 5:96 and N.J.A.C. 5:97. The administrative agent(s) shall provide a rehabilitation manual for the owner-occupancy rehabilitation program and a rehabilitation manual for the rental-occupancy rehabilitation program to be adopted by resolution of the governing body and subject to approval of the Court. Both rehabilitation manuals shall be available for public inspection in the Office of the Municipal Clerk and in the office(s) of the administrative agent(s).
(7)
Units in a rehabilitation program shall be exempt from N.J.A.C. 5:97-9 and Uniform Housing Affordability Controls (UHAC), but shall be administered in accordance with the following:
(a)
If a unit is vacant, upon initial rental subsequent to rehabilitation, or if a renter-occupied unit is re-rented prior to the end of controls on affordability, the deed restriction shall require the unit to be rented to a low- or moderate-income household at an affordable rent and affirmatively marketed pursuant to N.J.A.C. 5:97-9 and UHAC.
(b)
If a unit is renter-occupied, upon completion of the rehabilitation, the maximum rate of rent shall be the lesser of the current rent or the maximum permitted rent pursuant to N.J.A.C. 5:97-9 and UHAC.
(c)
Rents in rehabilitated units may increase annually based on the standards in N.J.A.C. 5:97-9.
(d)
Applicant and/or tenant households shall be certified as income-eligible in accordance with N.J.A.C. 5:97-9 and UHAC, except that households in owner-occupied units shall be exempt from the regional asset limit.
F.
Alternative living arrangements.
(1)
The administration of an alternative living arrangement shall be in compliance with N.J.A.C. 5:93-5.8 and UHAC, with the following exceptions:
(2)
With the exception of units established with capital funding through a twenty-year operating contract with the Department of Human Services, Division of Developmental Disabilities, alternative living arrangements shall have at least thirty-year controls on affordability in accordance with UHAC, unless an alternative commitment is approved by COAH or the Court.
(3)
The service provider for the alternative living arrangement shall act as the administrative agent for the purposes of administering the affirmative marketing and affordability requirements for the alternative living arrangement.
G.
Township-wide set-aside requirement.
(1)
Any property in the Township of East Hanover that receives approval to construct new multifamily residential development, which would yield five or more units, shall provide a minimum affordable housing set-aside of 20% regardless of tenure.
(2)
This requirement shall not apply to sites zoned for inclusionary residential development to meet the realistic development potential or the overlay zones created to meet the unmet need as part of the Township's housing element and fair share plan, which shall comply with the applicable zoning or redevelopment plan requirements of providing affordable housing units.
(3)
This requirement does not and shall not be construed to grant any developer the right to any rezoning, variance, redevelopment designation or other relief or establish any obligations on the part of the municipality to grant such rezoning, variance, redevelopment designation or other relief.
(4)
A property shall not be permitted to be subdivided so as to avoid compliance with this requirement.
H.
Inclusionary zoning. To implement the fair share plan in a manner consistent with the terms of the settlement agreement executed on June 3, 2019, ensure the efficient use of land through compact forms of development and to create realistic opportunities for the construction of affordable housing, inclusionary zoning shall be permitted as outlined in the Township's 2019 housing element and fair share plan.
I.
Phasing schedule for inclusionary zoning. In inclusionary developments the following schedule shall be followed:
Maximum percentage of market-rate units completed | Minimum percentage of low- and moderate-income units completed |
|---|---|
25 | 0 |
25+1 | 10 |
50 | 50 |
75 | 75 |
90 | 100 |
J.
Fractional units.
(1)
Inclusionary developments that result in a fractional affordable housing obligation of 0.4 or less may round the number of affordable units down. The application shall make a prorated payment-in-lieu to cover the fraction.
(2)
If the required number of affordable units results in a fraction of 0.5 or greater, the applicant shall round up and provide the additional affordable unit.
(3)
The payment-in-lieu for East Hanover shall be $200,000 for 2019. The payment-in-lieu shall increase by 3% each year. To calculate the payment-in-lieu the developer shall multiply the fraction by the payment. For example, a fraction of 0.4 triggered in 2020 would require a payment of $82,400. The payment shall be made to the Township's Affordable Housing Trust Fund.
K.
New construction.
(1)
Low/moderate split and bedroom distribution of affordable housing units:
(a)
The fair share obligation shall be divided equally between low- and moderate-income units, except that where there is an odd number of affordable housing units, the extra unit shall be a low-income unit (thus, at least 50% must be low-income and no more than 50% may be moderate-income). At least 13% of all restricted rental units shall be very-low-income units (affordable to a household earning 30% or less of median income). The very-low-income units shall be counted as part of the required number of low-income units within the development.
(b)
At least 25% of the obligation shall be met through rental units, including at least half in rental units available to families.
(c)
A maximum of 25% of the Township's obligation may be met with age-restricted units. At least half of all affordable units in the Township's plan shall be nonrestricted.
(d)
In each affordable development, at least 50% of the restricted units within each bedroom distribution shall be low-income units.
(e)
Affordable developments that are not age-restricted shall be structured in conjunction with realistic market demands such that:
[1]
The combined number of efficiency and one-bedroom units shall be no greater than 20% of the total low- and moderate-income units;
[2]
At least 30% of all low- and moderate-income units shall be two-bedroom units;
[3]
At least 20% of all low- and moderate-income units shall be three-bedroom units; and
[4]
The remaining units may be allocated among two- and three-bedroom units at the discretion of the developer.
(f)
Affordable developments that are age-restricted shall be structured such that the number of bedrooms shall equal the number of age-restricted low- and moderate-income units within the inclusionary development. This standard may be met by having all one-bedroom units or by having a two-bedroom unit for each efficiency unit. The Township shall not be permitted to claim credit to satisfy its obligations under the settlement agreement for age-restricted units that exceed 25% of all units developed.
(2)
Accessibility requirements.
(a)
The first floor of all restricted townhouse dwelling units and all restricted units in all other multistory buildings shall be subject to the technical design standards of the Barrier Free Subcode, N.J.A.C. 5:23-7.
(b)
All restricted townhouse dwelling units and all restricted units in other multistory buildings in which a restricted dwelling unit is attached to at least one other dwelling unit shall have the following features:
[1]
An adaptable toilet and bathing facility on the first floor; and
[2]
An adaptable kitchen on the first floor; and
[3]
An interior accessible route of travel on the first floor; and
[4]
An adaptable room that can be used as a bedroom, with a door or casing for the installation of a door, on the first floor; and
[5]
If not all of the foregoing requirements in Subsection K(2)(b)[1] through [4] can be satisfied, then an interior accessible route of travel must be provided between stories within an individual unit, but if all of the terms of Subsection K(2)(b)[1] through [4] above have been satisfied, then an interior accessible route of travel shall not be required between stories within an individual unit; and
[6]
An accessible entranceway as set forth at P.L. 2005, c. 350 (N.J.S.A. 52:27D-311a, et seq.) and the Barrier Free Subcode, N.J.A.C. 5:23-7, or evidence that East Hanover has collected funds from the developer sufficient to make 10% of the adaptable entrances in the development accessible:
[a]
Where a unit has been constructed with an adaptable entrance, upon the request of a person with disabilities who is purchasing or will reside in the dwelling unit, an accessible entrance shall be installed.
[b]
To this end, the builder of restricted units shall deposit funds within the Township of East Hanover's Affordable Housing Trust Fund sufficient to install accessible entrances in 10% of the affordable units that have been constructed with adaptable entrances.
[c]
The funds deposited under Subsection K(2)(b)[6][b] above shall be used by the Township of East Hanover for the sole purpose of making the adaptable entrance of an affordable unit accessible when requested to do so by a person with a disability who occupies or intends to occupy the unit and requires an accessible entrance.
[d]
The developer of the restricted units shall submit a design plan and cost estimate to the Construction Official of the Township of East Hanover for the conversion of adaptable to accessible entrances.
[e]
Once the Construction Official has determined that the design plan to convert the unit entrances from adaptable to accessible meet the requirements of the Barrier Free Subcode, N.J.A.C. 5:23-7, and that the cost estimate of such conversion is reasonable, payment shall be made to the Township's Affordable Housing Trust Fund in care of the Township Chief Financial Officer who shall ensure that the funds are deposited into the Affordable Housing Trust Fund and appropriately earmarked.
[f]
Full compliance with the foregoing provisions shall not be required where an entity can demonstrate that it is site impracticable to meet the requirements. Determinations of site impracticability shall be in compliance with the Barrier Free Subcode, N.J.A.C. 5:23-7.
(4)
Maximum rents and sales prices.
(a)
In establishing rents and sales prices of affordable housing units, the administrative agent shall follow the procedures set forth in UHAC, utilizing the regional income limits established by COAH or a successor entity.
(b)
The maximum rent for restricted rental units within each affordable development shall be affordable to households earning no more than 60% of median income, and the average rent for restricted rental units shall be affordable to households earning no more than 52% of median income.
(c)
The developers and/or municipal sponsors of restricted rental units shall establish at least one rent for each bedroom type for both low-income and moderate-income units, provided that at least 13% of all low- and moderate-income rental units shall be affordable to very-low-income households, earning 30% or less of the regional median household income, with such very-low-income units counted the low-income housing requirement.
(d)
The maximum sales price of restricted-ownership units within each affordable development shall be affordable to households earning no more than 70% of median income, and each affordable development must achieve an affordability average of 55% for restricted-ownership units; in achieving this affordability average, moderate-income ownership units must be available for at least three different sales prices for each bedroom type, and low-income ownership units must be available for at least two different sales prices for each bedroom type.
(e)
In determining the initial sales prices and rent levels for compliance with the affordability average requirements for restricted units other than assisted living facilities and age-restricted developments, the following standards shall be used:
[1]
A studio shall be affordable to a one-person household;
[2]
A one-bedroom unit shall be affordable to a one and one-half person household;
[3]
A two-bedroom unit shall be affordable to a three-person household;
[4]
A three-bedroom unit shall be affordable to a four and one-half person household; and
[5]
A four-bedroom unit shall be affordable to a six-person household.
(f)
In determining the initial sales prices and rents for compliance with the affordability average requirements for restricted units in assisted living facilities and age-restricted developments, the following standards shall be used:
(g)
The initial purchase price for all restricted-ownership units shall be calculated so that the monthly carrying cost of the unit, including principal and interest (based on a mortgage loan equal to 95% of the purchase price and the Federal Reserve H.15 rate of interest), taxes, homeowner and private mortgage insurance and condominium or homeowner association fees do not exceed 28% of the eligible monthly income of the appropriate size household as determined under N.J.A.C. 5:80-26.4, as it may be amended and supplemented; provided, however, that the price shall be subject to the affordability average requirement of N.J.A.C. 5:80-26.3, as it may be amended and supplemented.
(h)
The initial rent for a restricted rental unit shall be calculated so as not to exceed 30% of the eligible monthly income of the appropriate size household, including an allowance for tenant paid utilities, as determined under N.J.A.C. 5:80-26.4, as it may be amended and supplemented; provided, however, that the rent shall be subject to the affordability average requirement of N.J.A.C. 5:80-26.3, as it may be amended and supplemented.
(i)
The price of owner-occupied low- and moderate-income units may increase annually based on the percentage increase in the regional median income limit for each housing region. In no event shall the maximum resale price established by the administrative agent be lower than the last recorded purchase price.
(j)
The rent of low- and moderate-income units may be increased annually based on the permitted percentage increase in the Housing Consumer Price Index for the United States. This increase shall not exceed 9% in any one year. Rents for units constructed pursuant to low-income housing tax credit regulations shall be indexed pursuant to the regulations governing low-income housing tax credits.
L.
Utilities.
(1)
Affordable units shall utilize the same type of heating source as market units within an inclusionary development.
(2)
Tenant-paid utilities included in the utility allowance shall be set forth in the lease and shall be consistent with the utility allowance approved by HUD for its Section 8 program.
M.
Occupancy standards. In referring certified households to specific restricted units, the administrative agent shall, to the extent feasible and without causing an undue delay in the occupancy of a unit, strive to:
N.
Control periods for restricted ownership units and enforcement measures.
(1)
Control periods for restricted ownership units shall be in accordance with N.J.A.C. 5:80-26.5, as it may be amended and supplemented, and each restricted ownership unit shall remain subject to the requirements of this article for a period of at least 30 years, until East Hanover takes action to release the unit from such requirements; prior to such action, a restricted ownership unit shall remain subject to the requirements of N.J.A.C. 5:80-26.1, as it may be amended and supplemented.
(2)
The affordability control period for a restricted-ownership unit shall commence on the date the initial certified household takes title to the unit.
(3)
Prior to the issuance of the initial certificate of occupancy for a restricted-ownership unit and upon each successive sale during the period of restricted ownership, the administrative agent shall determine the restricted price for the unit and shall also determine the nonrestricted fair market value of the unit based on either an appraisal or the unit's equalized assessed value without the restrictions in place.
(4)
At the time of the initial sale of the unit, the initial purchaser shall execute and deliver to the administrative agent a recapture note obligating the purchaser (as well as the purchaser's heirs, successors and assigns) to repay, upon the first nonexempt sale after the unit's release from the restrictions set forth in this article, an amount equal to the difference between the unit's nonrestricted fair market value and its restricted price, and the recapture note shall be secured by a recapture lien evidenced by a duly recorded mortgage on the unit.
(5)
The affordability controls set forth in this article shall remain in effect despite the entry and enforcement of any judgment of foreclosure with respect to restricted ownership units.
(6)
A restricted ownership unit shall be required to obtain a continuing certificate of occupancy or a certified statement from the Construction Official stating that the unit meets all Code standards upon the first transfer of title following the removal of the restrictions provided under N.J.A.C. 5:80-26.5(a), as it may be amended and supplemented.
O.
Price restrictions for restricted ownership units, homeowner association fees and resale prices. Price restrictions for restricted ownership units shall be in accordance with N.J.A.C. 5:80-26.1, as it may be amended and supplemented, including:
(1)
The initial purchase price for a restricted ownership unit shall be approved by the administrative agent.
(2)
The administrative agent shall approve all resale prices, in writing and in advance of the resale, to assure compliance with the foregoing standards.
(3)
The master deeds of inclusionary developments shall provide no distinction between the condominium or homeowner association fees and special assessments paid by low- and moderate-income purchasers and those paid by market purchasers.
(4)
The owners of restricted ownership units may apply to the administrative agent to increase the maximum sales price for the unit on the basis of anticipated capital improvements. Eligible capital improvements shall be those that render the unit suitable for a larger household or the addition of a bathroom. See § 95-125P.
P.
Buyer income eligibility.
(1)
Buyer income eligibility for restricted-ownership units shall be in accordance with N.J.A.C. 5:80-26.1, as it may be amended and supplemented, such that low-income-ownership units shall be reserved for households with a gross household income less than or equal to 50% of median income, and moderate-income-ownership units shall be reserved for households with a gross household income less than 80% of median income.
(2)
Notwithstanding the foregoing, however, the administrative agent may, upon approval by the Township Council, and subject to the Court's approval, permit moderate-income purchasers to buy low-income units in housing markets if the administrative agent determines that there is an insufficient number of eligible low-income purchasers to permit prompt occupancy of the units. All such low-income units to be sold to moderate income households shall retain the required pricing and pricing restrictions for low-income units.
(3)
A certified household that purchases a restricted ownership unit must occupy it as the certified household's principal residence and shall not lease the unit.
(4)
The administrative agent shall certify a household as eligible for a restricted-ownership unit when the household is a low-income household or a moderate-income household, as applicable to the unit, and the estimated monthly housing cost for the particular unit (including principal, interest, taxes, homeowner and private mortgage insurance and condominium or homeowner association fees, as applicable) does not exceed 33% of the household's eligible monthly income.
Q.
Limitations on indebtedness secured by ownership unit; subordination.
(1)
Prior to incurring any indebtedness to be secured by a restricted-ownership unit, the owner shall apply to the administrative agent for a determination in writing that the proposed indebtedness complies with the provisions of this section, and the administrative agent shall issue such determination prior to the owner incurring such indebtedness.
(2)
With the exception of first purchase money mortgages, neither an owner nor a lender shall at any time cause or permit the total indebtedness secured by a restricted ownership unit to exceed 95% of the maximum allowable resale price of the unit, as such price is determined by the administrative agent in accordance with N.J.A.C. 5:80-26.6(b).
R.
Capital improvements to ownership units.
(1)
The owners of restricted ownership units may apply to the administrative agent to increase the maximum sales price for the unit on the basis of capital improvements made since the purchase of the unit. Eligible capital improvements shall be those that render the unit suitable for a larger household or that adds an additional bathroom. In no event shall the maximum sales price of an improved housing unit exceed the limits of affordability for the larger household.
(2)
Upon the resale of a restricted ownership unit, all items of property that are permanently affixed to the unit or were included when the unit was initially restricted (for example, refrigerator, range, washer, dryer, dishwasher, wall-to-wall carpeting) shall be included in the maximum allowable resale price. Other items may be sold to the purchaser at a reasonable price that has been approved by the administrative agent at the time of the signing of the agreement to purchase. The purchase of central air conditioning installed subsequent to the initial sale of the unit and not included in the base price may be made a condition of the unit resale provided the price, which shall be subject to ten-year, straight-line depreciation, has been approved by the administrative agent. Unless otherwise approved by the administrative agent, the purchase of any property other than central air conditioning shall not be made a condition of the unit resale. The owner and the purchaser must personally certify at the time of closing that no unapproved transfer of funds for the purpose of selling and receiving property has taken place at the time of or as a condition of resale.
S.
Control periods for restricted units.
(1)
Control periods for restricted rental units shall be in accordance with N.J.A.C. 5:80-26.11, as it may be amended and supplemented, and each restricted rental unit shall remain subject to the requirements of this article for a period of at least 30 years, until East Hanover takes action to release the unit from such requirements. Prior to such action, a restricted rental unit shall remain subject to the requirements of N.J.A.C. 5:80- 26.1, as it may be amended and supplemented.
(2)
Deeds of all real property that include restricted rental units shall contain deed restriction language. The deed restriction shall have priority over all mortgages on the property, and the deed restriction shall be filed by the developer or seller with the records office of the County of Morris. The deed shall also identify each affordable unit by apartment number and/or address and whether that unit is designated as a very-low-, low- or moderate-income unit. Neither the unit nor its affordability designation shall change throughout the term of the deed restriction. A copy of the filed document shall be provided to the administrative agent within 30 days of the receipt of a certificate of occupancy.
(3)
A restricted rental unit shall remain subject to the affordability controls of this article despite the occurrence of any of the following events:
T.
Rent restrictions for rental units; leases.
(1)
A written lease shall be required for all restricted rental units and tenants shall be responsible for security deposits and the full amount of the rent as stated on the lease. A copy of the current lease for each restricted rental unit shall be provided to the administrative agent.
(2)
No additional fees or charges shall be added to the approved rent (except, in the case of units in an assisted-living residence, to cover the customary charges for food and services) without the express written approval of the administrative agent.
(3)
Application fees (including the charge for any credit check) shall not exceed 5% of the monthly rent of the applicable restricted unit and shall be payable to the administrative agent to be applied to the costs of administering the controls applicable to the unit as set forth in this article.
U.
Tenant income eligibility.
(1)
Tenant income eligibility shall be in accordance with N.J.A.C. 5:80-26.13, as it may be amended and supplemented, and shall be determined as follows:
(a)
Very-low-income rental units shall be reserved for households with a gross household income less than or equal to 30% of median income.
(b)
Low-income rental units shall be reserved for households with a gross household income less than or equal to 50% of median income.
(c)
Moderate-income rental units shall be reserved for households with a gross household income less than 80% of median income.
(2)
The administrative agent shall certify a household as eligible for a restricted rental unit when the household is a very-low-income household, low-income household or a moderate-income household, as applicable to the unit, and the rent proposed for the unit does not exceed 35% (40% for age-restricted units) of the household's eligible monthly income as determined pursuant to N.J.A.C. 5:80-26.16, as it may be amended and supplemented; provided, however, that this limit may be exceeded if one or more of the following circumstances exists:
(a)
The household currently pays more than 35% (40% for households eligible for age-restricted units) of its gross household income for rent, and the proposed rent will reduce its housing costs;
(b)
The household has consistently paid more than 35% (40% for households eligible for age-restricted units) of eligible monthly income for rent in the past and has proven its ability to pay;
(c)
The household is currently in substandard or overcrowded living conditions;
(d)
The household documents the existence of assets with which the household proposes to supplement the rent payments; or
(e)
The household documents reliable anticipated third-party assistance from an outside source such as a family member in a form acceptable to the administrative agent and the owner of the unit.
§ 95-126 Municipal Housing Liaison.
A.
The Township of East Hanover shall appoint a specific municipal employee to serve as a Municipal Housing Liaison responsible for administering the affordable housing program, including affordability controls, the affirmative marketing plan, monitoring and reporting, and, where applicable, supervising any contracted administrative agent. The Municipal Housing Liaison shall be appointed by the governing body and may be a full- or part-time municipal employee.
B.
The Municipal Housing Liaison shall be responsible for oversight and administration of the affordable housing program for East Hanover, including the following responsibilities which may not be contracted out to the administrative agent:
(1)
Serving as East Hanover's primary point of contact for all inquiries from the state, affordable housing providers, administrative agents and interested households;
(2)
Monitoring the status of all restricted units in East Hanover's fair share plan;
(3)
Compiling, verifying and submitting annual monitoring reports as may be required by the Court;
(4)
Coordinating meetings with affordable housing providers and administrative agents, as needed; and
(5)
Attending continuing education opportunities on affordability controls, compliance monitoring and affirmative marketing at least annually and more often as needed.
C.
Subject to the approval of the Court, the Township of East Hanover shall designate one or more administrative agent(s) to administer newly constructed affordable units in accordance with UHAC. An operating manual for each affordable housing program shall be provided by the administrative agent(s) to be adopted by resolution of the governing body and subject to approval of the Court. The operating manual(s) shall be available for public inspection in the office of the Township Clerk, in the office of the Municipal Housing Liaison, and in the office(s) of the administrative agent(s). The Municipal Housing Liaison shall supervise the contracting administrative agent(s).
D.
Compensation. Compensation shall be fixed by the governing body at the time of the appointment of the Municipal Housing Liaison.
§ 95-127 Administrative agent.
The administrative agent shall be an independent entity serving under contract to and reporting to the Township. For new sale and rental developments, all of the fees of the administrative agent shall be paid by the owners of the affordable units for which the services of the administrative agent are required. For resales, single-family homeowners and condominium homeowners shall be required to pay 3% of the sales price for services provided by the administrative agent related to the resale of their homes. That fee shall be collected at closing and paid directly to the administrative agent. The administrative agent shall perform the duties and responsibilities of an administrative agent as set forth in UHAC, including those set forth in Sections 5:80-26.14, .16 and .18 thereof, which include:
A.
Conducting an outreach process to affirmatively market affordable housing units in accordance with the affirmative marketing plan of the Township of East Hanover and the provisions of N.J.A.C. 5:80-26.15; and
B.
Providing counseling or contracting to provide counseling services to low- and moderate-income applicants on subjects such as budgeting, credit issues, mortgage qualification, rental lease requirements, and landlord/tenant law.
C.
Household certification.
(1)
Soliciting, scheduling, conducting and following up on interviews with interested households;
(2)
Conducting interviews and obtaining sufficient documentation of gross income and assets upon which to base a determination of income eligibility for a low- or moderate-income unit;
(3)
Providing written notification to each applicant as to the determination of eligibility or noneligibility;
(4)
Requiring that all certified applicants for restricted units execute a certificate substantially in the form, as applicable, of either the ownership or rental certificates set forth in Appendices J and K of N.J.A.C. 5:80-26.1 et seq.;
(5)
Creating and maintaining a referral list of eligible applicant households living in the housing region and eligible applicant households with members working in the housing region where the units are located; and
(6)
Employing a random selection process as provided in the affirmative marketing plan of the Township of East Hanover when referring households for certification to affordable units.
D.
Affordability controls.
(1)
Furnishing to attorneys or closing agents forms of deed restrictions and mortgages for recording at the time of conveyance of title of each restricted unit;
(2)
Creating and maintaining a file on each restricted unit for its control period, including the recorded deed with restrictions, recorded mortgage and note, as appropriate;
(3)
Ensuring that the removal of the deed restrictions and cancellation of the mortgage note are effectuated and properly filed with the Morris County Register of Deeds or County Clerk's office after the termination of the affordability controls for each restricted unit;
(4)
Communicating with lenders regarding foreclosures; and
(5)
Ensuring the issuance of continuing certificates of occupancy or certifications pursuant to N.J.A.C. 5:80-26.10.
E.
Sales and re-rentals.
(1)
Instituting and maintaining an effective means of communicating information between owners and the administrative agent regarding the availability of restricted units for resale or re-rental; and
(2)
Instituting and maintaining an effective means of communicating information to low- and moderate-income households regarding the availability of restricted units for resale or re-rental.
F.
Processing requests from unit owners.
(1)
Reviewing and approving requests for determination from owners of restricted units who wish to take out home equity loans or refinance during the term of their ownership that the amount of indebtedness to be incurred will not violate the terms of this section;
(2)
Reviewing and approving requests to increase sales prices from owners of restricted units who wish to make capital improvements to the units that would affect the selling price, such authorizations to be limited to those improvements resulting in additional bedrooms or bathrooms and the depreciated cost of central air conditioning systems;
(3)
Notifying the Township of an owner's intent to sell a restricted unit; and
(4)
Making determinations on requests by owners of restricted units for hardship waivers.
G.
Enforcement.
(1)
Securing annually from the Township a list of all affordable housing units for which tax bills are mailed to absentee owners, and notifying all such owners that they must either move back to their unit or sell it;
(2)
Securing from all developers and sponsors of restricted units, at the earliest point of contact in the processing of the project or development, written acknowledgement of the requirement that no restricted unit can be offered, or in any other way committed, to any person, other than a household duly certified to the unit by the administrative agent;
(3)
The posting annually in all rental properties, including two-family homes, of a notice as to the maximum permitted rent together with the telephone number of the administrative agent where complaints of excess rent or other charges can be made;
(4)
Sending annual mailings to all owners of affordable dwelling units, reminding them of the notices and requirements outlined in N.J.A.C. 5:80-26.18(d)4;
(5)
Establishing a program for diverting unlawful rent payments to the Township's Affordable Housing Trust Fund; and
(6)
Creating and publishing a written operating manual for each affordable housing program administered by the administrative agent, to be approved by the Township Council and the Court, setting forth procedures for administering the affordability controls.
H.
Additional responsibilities.
(1)
The administrative agent shall have the authority to take all actions necessary and appropriate to carry out its responsibilities hereunder.
(2)
The administrative agent shall prepare monitoring reports for submission to the Municipal Housing Liaison in time to meet any monitoring requirements and deadlines imposed by the Court.
(3)
The administrative agent shall attend continuing education sessions on affordability controls, compliance monitoring, and affirmative marketing at least annually and more often as needed.
§ 95-128 Affirmative marketing requirements.
[Amended 4-5-2021 by Ord. No. 1-2021]
A.
The Township of East Hanover shall adopt by resolution an affirmative marketing plan, subject to the approval of the court that is compliant with N.J.A.C. 5:80-25.15, as it may be amended and supplemented.
B.
The affirmative marketing plan is a regional marketing strategy designed to attract buyers and/or renters of all majority and minority groups, regardless of race, creed, color, national origin, ancestry, marital or familial status, gender, affectional or sexual orientation, disability, age or number of children to housing units which are being marketed by a developer, sponsor or owner of affordable housing. The affirmative marketing plan is intended to target those potentially eligible persons who are least likely to apply for affordable units in that region. In addition, as a result of the settlement agreement with FSHC, the affirmative marketing plan shall require the notification of the FSHC, New Jersey State Conference of the NAACP, the Latino Action Network, Homecorp, Housing Partnership and Morris County Housing Coalition of affordable housing opportunities. It is a continuing program that directs marketing activities toward Housing Region 2 and is required to be followed throughout the period of restriction.
C.
The affirmative marketing plan shall provide a regional preference for all households that live and/or work in Housing Region 2, comprised of Essex, Morris, Union, and Warren Counties.
D.
The Township has the ultimate responsibility for adopting the affirmative marketing plan and for the proper administration of the affirmative marketing program, including initial sales and rentals and resales and rerentals. The administrative agent designated by the Township of East Hanover shall implement the affirmative marketing plan to assure the affirmative marketing of all affordable units.
E.
In implementing the affirmative marketing plan, the administrative agent shall provide a list of counseling services to low- and moderate-income applicants on subjects such as budgeting, credit issues, mortgage qualification, rental lease requirements, and landlord/tenant law.
F.
The affirmative marketing plan shall describe the media to be used in advertising and publicizing the availability of housing. In implementing the affirmative marketing plan, the administrative agent shall consider the use of language translations where appropriate.
G.
The affirmative marketing process for available affordable units shall begin at least four months (120 days) prior to the expected date of occupancy.
H.
Applications for affordable housing shall be available in several locations, including, at a minimum, the Union County Administration Building, the Essex County Hall of Records, Warren County Library Headquarters, Morris County Library, East Hanover Township Library, East Hanover Township Municipal Building, and the developer's rental office. Preapplications may be emailed to prospective applicants upon request. Otherwise, hard copies are available from the Township's Municipal Housing Liaison.
I.
The costs of advertising and affirmative marketing of the affordable units shall be the responsibility of the developer, sponsor or owner.
J.
Pursuant to P.L. 2020, c. 51, effective November 1, 2020, owners, developers, property managers, and all other administrative entities responsible for the affirmative marketing of any affordable housing units shall:
(2)
Post a listing for a lottery, if the entity elects to hold one, to the Housing Resource Center at least 60 days prior to the lottery's occurrence.
(4)
The owner, developer, property manager, or administrative entity shall submit evidence of the listing of their available units and waitlist openings to the Township's administrative agent and Municipal Housing Liaison.
§ 95-129 Enforcement of affordable housing regulations.
[Amended 4-5-2021 by Ord. No. 1-2021]
A.
Biannual residency recertification.
(1)
Every two years, the administrative agent shall notify all owners of affordable units in the municipality that they must submit to the administrative agent the following documents so that the administrative agent may verify the compliance of the household to the residency requirement set forth in § 95-125P(3).
(a)
A municipal residency form, which may be amended from time to time, that requires each head of household to provide the name and age of every resident of the affordable unit, and to certify as to its accuracy.
(b)
A copy of the property tax assessment for the affordable unit.
(c)
A copy of a New Jersey driver's license for every member of the household who has been issued a current driver's license; or for every member of the household over the age of 16 who has not been issued a current New Jersey driver's license, an alternative identification, issued by the State of New Jersey, the federal government, or a school district, that clearly includes the address of the household member.
(d)
A copy of two utility bills issued within the past four months for each of the following services received: water, sewer, gas, electric, TV, phone and internet services provided to the unit.
(e)
A signed and notarized statement from every member of the household 18 years or older that the affordable unit is their primary residence; that they reside in the affordable unit 260 days or more during the course of each year; that no part of the affordable unit is leased to any other party for any purpose; that no person outside of the household resides in the affordable unit or uses the unit address for their residency; and that they understand if they fail to comply with residency requirements, they will be subject to applicable fines or other legal remedies, including but not limited to foreclosure.
(2)
The owner shall have 60 days to provide the documentation requested and shall be sent a second notification after 30 days from the date of the first notification. If the submission of documents is determined to be incomplete, the owner shall be so notified and given another 15 days to provide the recertification documentation. The owner shall be deemed to be in violation of this article if, after 90 days from the date of the first notice, the proper documentation has not been submitted or has revealed that the owner is not in compliance with the residency requirement.
B.
Upon the occurrence of a breach of any of the regulations governing the affordable unit by an owner, developer or tenant, the Township shall have all remedies provided at law or equity, including but not limited to foreclosure, tenant eviction, a requirement for household recertification, acceleration of all sums due under a mortgage, recuperation of any funds from a sale in violation of the regulations, injunctive relief to prevent further violation of the regulations, entry on the premises, and specific performance.
C.
After providing written notice of a violation to an owner, developer or tenant of a low- or moderate-income unit and advising the owner, developer or tenant of the penalties for such violations, the Township may take the following action(s) against the owner, developer or tenant for any violation that remains uncured for a period of 60 days after service of the written notice:
(1)
The Township may file a court action pursuant to N.J.S.A. 2A:58-11 alleging a violation or violations of the regulations governing the affordable housing unit. If the owner, developer or tenant is adjudged by the court to have violated any provision of the regulations governing affordable housing units, the owner, developer or tenant shall be subject to one or more of the following penalties, at the discretion of the court:
(a)
A fine of not more than $500 per day or imprisonment for a period not to exceed 90 days, or both, provided that each and every day that the violation continues or exists shall be considered a separate and specific violation of these provisions and not a continuation of the initial offense. In the case of an owner who has rented a low- or moderate-income unit in violation of the regulations governing affordable housing units, payment into the Township of East Hanover Affordable Housing Trust Fund of the gross amount of rent illegally collected; § 95-129.
(b)
In the case of an owner who has rented a low- or moderate-income unit in violation of the regulations governing affordable housing units, payment of an innocent tenant's reasonable relocation costs, as determined by the court.
(2)
The Township may file a court action in the Superior Court seeking a judgment that would result in the termination of the owner's equity or other interest in the unit, in the nature of a mortgage foreclosure. Any such judgment shall be enforceable as if the same were a judgment of default of the first purchase money mortgage and shall constitute a lien against the low- or moderate-income unit.
(a)
The judgment shall be enforceable, at the option of the Township, by means of an execution sale by the Sheriff, at which time the low- and moderate-income unit of the violating owner shall be sold at a sale price which is not less than the amount necessary to fully satisfy and pay off any first purchase money mortgage and prior liens and the costs of the enforcement proceedings incurred by the Township, including attorneys' fees. The violating owner shall have his right to possession terminated as well as his title conveyed pursuant to the Sheriff's sale.
(b)
The proceeds of the Sheriff's sale shall first be applied to satisfy the first purchase money mortgage lien and any prior liens upon the low- and moderate-income unit. The excess, if any, shall be applied to reimburse the Township for any and all costs and expenses incurred in connection with either the court action resulting in the judgment of violation or the Sheriff's sale. In the event that the proceeds from the Sheriff's sale are insufficient to reimburse the Township in full as aforesaid, the violating owner shall be personally responsible for the full extent of such deficiency, in addition to any and all costs incurred by the Township in connection with collecting such deficiency. In the event that a surplus remains after satisfying all of the above, such surplus, if any, shall be placed in escrow by the Township for the owner and shall be held in such escrow for a maximum period of two years or until such earlier time as the owner shall make a claim with the Township for such. Failure of the owner to claim such balance within the two-year period shall automatically result in a forfeiture of such balance to the Township. Any interest accrued or earned on such § 95-129 balance while being held in escrow shall belong to and shall be paid to the Township, whether such balance shall be paid to the owner or forfeited to the Township.
(c)
Foreclosure by the Township due to violation of the regulations governing affordable housing units shall not extinguish the restrictions of the regulations governing affordable housing units as the same apply to the low- and moderate-income unit. Title shall be conveyed to the purchaser at the Sheriff's sale, subject to the restrictions and provisions of the regulations governing the affordable housing unit. The owner determined to be in violation of the provisions of this plan and from whom title and possession were taken by means of the Sheriff's sale shall not be entitled to any right of redemption.
(d)
If there are no bidders at the Sheriff's sale, or if insufficient amounts are bid to satisfy the first purchase money mortgage and any prior liens and crediting the violating owner with an amount equal to the difference between the first purchase money mortgage and any prior liens and costs of the enforcement proceedings, including legal fees and the maximum resale price for which the low- and moderate-income unit could have been sold under the terms of the regulations governing affordable housing units. This excess shall be treated in the same manner as the excess which would have been realized from an actual sale as previously described.
(e)
Failure of the low- and moderate-income unit to be either sold at the Sheriff's sale or acquired by the Township shall obligate the owner to accept an offer to purchase from any qualified purchaser which may be referred to the owner by the Township, with such offer to purchase being equal to the maximum resale price of the low- and moderate-income unit as permitted by the regulations governing affordable housing units.
(f)
The owner shall remain fully obligated, responsible and liable for complying with the terms and restrictions of governing affordable housing units until such time as title is conveyed from the owner.
D.
Failure of the owner, developer, property manager, or administrative entity to comply with Section § 95-128J may result in the Municipal Housing Liaison levying fines against the owner of the development for instances of noncompliance, following written notice to the owner as follows:
E.
A fine pursuant to Subsection D above shall not be issued unless the Municipal Housing Liaison first provides the owner with written notice no less than two months prior to the date the fine is levied. A fine shall only be issued if the offense has not been cured within that two-month time frame.
F.
Appeals. Appeals from all decisions of an administrative agent appointed to this chapter shall be filed in writing with the Executive Director of COAH or with the Superior Court, Morris County Vicinage.