Agenda - Planning Commission - 01/09/2014

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November 10, 2013 I Volume 7 I Issue 21 Zoning Bulletin housing needs and the criteria for the satisfaction of such needs (the "Third Round Rules"). Among other things, in the Third Round Rules, COAH proposed a new approach —a "growth share" methodology —for assessing prospective need in the allocation of a municipality's fair share of the region's need for affordable housing. This growth share approach tied a municipality's affordable housing obligation to its own actual rate of growth. Thus, under the growth share methodology, a municipality's constitutional obligation "would be a simple . . . alloca[tion of] a share of whatever growth actually occurs to low -and moderate -housing." Municipalities would accrue affordable housing obligations as a percent- age of the residential and nonresidential growth that occurred within its borders. The New Jersey Builders Association and affordable housing advocacy organizations, among others, (the "Opponents") challenged the validity of COAH's Third Round Rules. They maintained that the growth share ap- proach in the Third Round Rules was inconsistent with the Mount Laurel directives and the FHA. They argued that the Third Round, Rules were in- consistent with the FHA's command to COAH "to develop criteria establishing municipal determinations of present and prospective fair share of housing that results in firm, fair share allocations." The Superior Court, Appellate Division agreed with the Opponents. The Appellate Division expressed doubt about whether any growth share methodology adopted by COAH could be compatible with the Mount Laurel II remedy that "appears to militate against the use of' a growth share approach for determining a municipality's affordable housing obligation. The Appellate Division invalidated a substantial portion of the Third Round Rules, including the growth share methodology used by COAH. It remanded the matter to COAH to promulgate a new set of rules. COAH appealed. DECISION: Judgment of superior court, appellate division, af- firmed as modified. The Supreme Court of New Jersey recognized that its judicial remedy imposed in its Mount Laurel decisions reflected the conditions of the time, 30 years ago, and emphasized that that remedy "should not now be viewed as a constitutional straightjacket to legislative innovation." Nevertheless, the court also found that the growth share methodology of the Third Round Rules conflicted with the FHA and were therefore invalid. The court explained that, under the Third Round Rules' growth share methodology, even if a municipality were allocated a large projected growth share obligation —based on COAH projections, if the municipali- ty's actual growth fell below that rate, its growth share obligation would be reduced to reflect that slowed residential and job growth. The court found that result was: facially inconsistent with the FHA's command to COAH "to develop criteria establishing municipal deteuiiinations of pres- ent and prospective fair share of housing that results in firm, fair share al- 6 © 2013 Thomson Reuters