N.J. court hears housing dispute, promises quick decision

A panel of Appellate Division judges heard arguments Monday on whether New Jersey's municipalities must zone for the many thousands of affordable housing units that were not approved between 1999 and 2015.

The court promised a quick decision.

At issue is whether townships and cities that did not zone for their legally mandated share of low- and middle-income housing during this "gap period" must do so on top of their obligations through 2025.

If the panel rules in favor of an affordable-housing advocacy group's position, it could double or triple the Mount Laurel-type housing obligations of some municipalities.

Lawyers for the advocacy group and a home builders' association told the three-judge panel that the state's failure to devise a formula for calculating municipal obligations during the "gap" years did not erase their obligations.

"The [state] Supreme Court said prior obligations have to be fulfilled, and prior unfulfilled obligations have to be fulfilled," Kevin Walsh, lead counsel and executive director of the Fair Share Housing Center, told the judges, who convened at the Old Court House in Mount Holly.

But lawyers for a coalition representing half the state's municipalities, including Barnegat Township, which brought the appeal, told the judges that nothing in the Fair Housing Act of 1985 or subsequent court rulings specifically obliges municipalities to calculate their obligations retroactively.

"It's a forward-looking obligation," Barnegat's attorney, Jeffrey R. Surenian, told the judges.

The panel's ruling is likely to establish statewide precedent on the "gap" question if upheld by the state Supreme Court.

The high court has been ruling on affordable housing issues since 1975, when its first Mount Laurel decision decreed that municipalities may not engage in zoning that excludes low- and middle-income households.

Starting in 1999, however, the state Council on Affordable Housing (COAH), responsible for facilitating enactment of the 1985 act, could not devise an acceptable formula for calculating municipalities' affordable-housing obligations.

Last year, a frustrated Supreme Court unanimously declared COAH dysfunctional, dissolved it, and instructed the state's 15 Superior Court vicinages to review and certify all "fair share" housing plans going forward.

But before any new plans were adopted, a coalition of 287 municipalities, represented by Surenian, argued that there was no residual obligation from the gap.

In February, Judge Mark A. Troncone in Toms River disagreed, ruling in a case involving Barnegat that obligations unmet during the gap must be fulfilled, setting the stage for Surenian's appeal and Monday's hearing.

While market forces and government subsidies will be pivotal in determining how many units are built, Fair Share says the state's 565 municipalities should have zoned for about 100,000 affordable apartments and houses during the gap, and must zone another 100,000 by 2025.

Surenian on Monday told the judges those numbers were "patently ridiculous," as they would exceed all the total new housing likely to be built statewide in the next decade. He said the intent of the legislature in enacting the Fair Housing Act had only been to provide for a "reasonable" number of created homes for low- and middle-income households.

Planners for the consortium he represents say the statewide obligation through 2025 is 37,000 units.

Presiding Judge Marie Lihotz seemed to challenge the thrust of Surenian's argument.

"I understand that municipalities should not be bearing the responsibility for COAH's ineffectiveness," she said. But "the Legislature never expected they would skip 16 years and not do anything. . . . Are we losing households that should be covered?"

Surenian replied that by quantifying the existing supply of affordable housing stock, and projecting New Jersey's population and economic growth over the next decade, municipalities could identify their legal quotas without carrying forward obligations from the gap.

But Judge Douglas Fasciale noted that in its March 2015 decision dissolving COAH, "the Supreme Court said, 'Our decision does not eradicate prior-round obligations. As such, prior unfulfilled obligations should be the starting point for municipalities' responsibilities.' Can you respond?"

Surenian replied that the court's language "supports our position." When the Supreme Court last year told towns and judges to revert to the calculation methods COAH used prior to 1999, Surenian said, "they didn't say . . . 'You have to recapture what might have been.'"

Judge William Nugent later seemed to disagree. There appears to be "some obligation" from the gap period "because some municipalities fulfilled them," he said.

Walsh told the judges that "the issue before the courts has already been decided" by a variety of Supreme Court decisions, and that "municipalities in the past have acknowledged their obligation was cumulative and gapless."

At the close of arguments, Lihotz told the crowded courtroom that she and her colleagues were aware the case was important and closely watched.

"We will do our best to expedite," she said.

doreilly@phillynews.com

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