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In Re Grant of Third Round Substantive Certification to Old Bridge Township, Middlesex County

A-6362-08T2 (N.J. Super. App. Div. 2010) (Unpublished)

COAH; AFFORDABLE HOUSING — The Council on Affordable Housing has broad authority to assess a municipality’s compliance with its affordable housing obligations, and developers who do not object within forty-five days after the determination has been made with respect to the municipality’s compliance are not entitled to a hearing to discuss its concerns.

A developer challenged a grant of substantive certification the Council on Affordable Housing (COAH) for a municipality’s plan for meeting its affordable housing obligations. The developer objected to the municipality’s plan because it included the developer’s housing project. The developer claimed that COAH should not have granted certification because the municipality continued to frustrate and stall the development, acted in bad faith, and failed to provide a realistic opportunity for affordable housing at the developer’s property.

The developer and the municipality were already involved in litigation over the proposed development. First, the developer successfully challenged the municipality’s denial of its application for preliminary and final site plan approval. Then, the developer claimed that the municipality frustrated its efforts to obtain water and sewer service for the property and effectively “thwarted” the project. The developer sued the municipality seeking to compel it to set aside water for the project. In the course of that case, the lower court found that the delay in completing the project was neither party’s fault because the developer diligently pursued it and the municipality acted with the best interests of its citizens. So, while the project was delayed while the dispute was being resolved, neither party was held to have acted in bad faith.

After the municipality’s application was approved by COAH’s staff, but before COAH’s final determination, the developer objected. The developer claimed that it was improper for the municipality to include the developer’s project in its plan while it continued to frustrate the developer’s attempt to complete the project. COAH did not hold a hearing on the matter but, based on the developer’s objections, COAH granted conditional approval. It required the municipality to submit a status update every six months regarding the status of the developer’s project. It also ordered that if that project became no longer considered a realistic opportunity to create affordable housing units, it had to be removed from the municipality’s compliance plan and that the municipality would have had to amend its plan to add more affordable housing opportunities.

The developer argued that COAH’s grant of certification without granting it a hearing was arbitrary, capricious, and unreasonable. The Appellate Division disagreed, noting that the Fair Housing Act gives the COAH broad authority to assess a municipality’s compliance with its affordable housing obligations. It also noted that once a petition is filed, any objections must be made within 45 days in order to obtain a hearing. In this case, the developer did not object within 45 days and therefore was not entitled to a hearing to discuss its concerns. However, the Court found that even though the COAH was not obligated to consider the developer’s objections, it had nonetheless incorporated conditions into the approval that required the municipality to continually update COAH on the status of the developer’s project and also allowed COAH to amend or revoke that approval if the developer’s project never materialized. As a result, the Court found that COAH’s actions met its responsibilities under the Fair Housing Act and were reasonable.

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