Legislative Reactions to Mount Laurel IV

June 2, 2016Articles In the Zone

On March 10, 2015, the Supreme Court of New Jersey issued the decision formally known as In re Adoption of N.J.A.C. 5:96 & 5:97 ex rel. New Jersey Council on Affordable Housing, 221 N.J. 1 (2015), now commonly referred to as Mount Laurel IV. This decision brought about drastic changes in the procedural process for municipalities to achieve compliance with their affordable housing obligations. In short, the court determined that, after many opportunities, the Council on Affordable Housing (COAH) had failed to meet its legislative obligation to promulgate rules establishing municipal affordable housing obligations and compliance mechanisms for meeting those obligations. The court proceeded to transfer municipalities that had availed themselves of COAH’s jurisdiction to the trial courts for a determination on their respective obligations as well as approval of a Housing Element and Fair Share Plan setting forth the municipality’s strategy for meeting that obligation.

What has resulted is extensive litigation in the Superior Court. Now more than 14 months from the Supreme Court’s decision, there has not been a definitive declaration throughout the state as to the proper methodology and calculation of affordable housing obligations. The legislative response to the court’s decision regarding the inefficacy of COAH and the transfer of municipalities from COAH’s jurisdiction to the trial courts has been relatively silent. However, the Legislature has attempted to initiate legislation on at least one point – clarifying the timeline for when municipalities would be required to submit their Housing Element and Fair Share Plan.

Two identical bills have been introduced in the Senate and Assembly, S162 and A369. Both bills were introduced in January 2016 as carryover bills from the previous session, initially introduced in June and July of 2015. The bills seek to clarify the court’s determination as to when municipalities would have to develop and complete compliant Housing Element and Fair Share Plans. In rendering its decision, the Supreme Court established a five-month window for municipalities to submit Housing Element and Fair Share Plans, during which the trial court could provide temporary immunity from exclusionary zoning or “builder’s remedy” lawsuits. The bill clarifies this to state that the five-month window would not begin until the “the date that the trial judge determines the criteria and guidelines with which the municipality must comply.”

The bill triggers one question: how will this impact trial courts’ decisions on extending temporary immunity from builder’s remedy lawsuits? The trial courts have generally taken a liberal view to extending municipalities’ immunity as the process slowly progresses with one caveat. To date several municipalities have been stripped of immunity from builder’s remedy lawsuits despite the fact that the trial court had not yet decided the methodology and obligations for those municipalities. Those decisions have rested on case law regarding whether the municipalities have been acting in bad faith. Whether or not the proposed legislation could have any impact on this case law remains to be seen.

Ultimately the bill may become moot. It remains in the early stages and has languished since it was originally introduced in 2015, shortly after the Supreme Court’s decision. The Legislature may simply be unwilling to interfere in the current process. Meanwhile, trial courts are slowly but surely moving forward with trials and immunity has been extended pending decisions on fair share obligations so long as municipalities have continued to act in good faith. However, as the process progresses it will be interesting to see if the Legislature decides to take a more active approach as the trial courts navigate unchartered territory.