TRENTON, NJ-The state Supreme Court ruled Thursday that New Jersey must eliminate the fair-housing formula that automatically requires a town to collect fees from developers to support affordable housing only when there is growth in a community.

The state's Council on Affordable Housing must rewrite its regulations so that towns have an obligation to build a specific minimum number of homes for low-income residents — returning to the type of standards it had before Gov. Chris Christie's effort to dismantle the agency.

Commercial real estate is “double-thrilled,” says the NAIOP organization's Michael McGuinness. On the other hand, says McGuinness, his organization supports modernizing fair-housing standards and affordable-housing regulations to reflect today's “environment and economy.”

“It's a great opportunity for the legislature to revisit the Fair Housing Act and to take a look at the landscape of New Jersey as to what has transpired” since the Mount Laurel court decisions against restrictive zoning delivered in the 1970s, McGuinness tells GlobeSt.com.

“We are a commercial real estate organization,” he says. “Fair housing is not really our core issue, but it seems to us that this is a good time to see how municipalities are shaping up today, in providing places for people of lower income to live.”

The high court voted 3-2 to uphold a lower-court ruling striking down a COAH formula known as “growth share,” under which any development growth in a municipality triggered an affordable housing obligation. Under that formula, towns that avoided growth were thus able to avoid any low-income housing requirements.

Fair housing advocates vociferously opposed the growth share rules, which they said essentially let towns make unfettered decisions and permitted discrimination. Various organizations that participated in the lawsuit to strike them down voiced their jubilation Thursday, and their determination to press for a strengthened COAH.

Last summer, when the Supreme Court ruled that Christie did not have the power to simply eliminate COAH, the NAIOP organization took the position that the more important ruling would concern the “growth share” regulations.

NAIOP's attorney for the case against growth share, Kevin Moore of Sills, Cummis & Gross, is already scheduled to brief members at next week's NAIOP chapter meeting about the new ruling.

McGuinness said that the growth share formula amounted to a skewed calculation of where affordable housing is most needed and imposed a “job tax” on developers who were contributing to the state's economy with their projects.

“Our goal is to keep New Jersey economically competitive so that we can do a better job at attracting and retaining jobs for our residents," McGuiness said. "The COAH 'jobs tax' frustrated this goal."

While these issues have been debated in Trenton and then argued in court, COAH agency officials have met only rarely in the past two years.

The affordable housing issue has bedeviled New Jersey dating back decades. The Mount Laurel Fair Housing law grew out of a series of landmark housing cases brought by civil rights advocates who argued that the community of Mount Laurel was using its zoning policies to discriminate against blacks by disallowing affordable housing development

Christie has scorned the Mount Laurel doctrine as an "abomination" that denied municipalities their right to home rule. The governor has not yet commented on the new ruling.

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