TRENTON, NJ—In a unanimous decision, the New Jersey Supreme Court dealt a devastating setback to the Council on Affordable Housing (COAH), determining that COAH had failed to meet its obligation to develop rules governing municipal compliance with affordable housing obligations. The court effectively dissolved provisions of the Fair Housing Act that required housing advocates to challenge municipal regulations through administrative procedures, and permitted those challenges to go back to the court system.

Noting that COAH was required to develop a set of rules called the “Third Round Rules,” but had not done so, the court said, “We thus are in the exceptional situation in which the administrative process has become nonfunctioning, rendering futile the FHA's administrative remedy. The FHA's exhaustion-of-administrative-remedies requirement, which staves off civil actions, is premised on the existence of a functioning agency, not a moribund one.” The court concluded that “Due to COAH's inaction, we agree that there no longer exists a legitimate basis to block access to the courts.”

The court ordered a 30-day transition period in which some challenges would be permitted to move to the court system and others would need to be certified separately. The court also said its decision did not prevent COAH from acting to develop the Third Round Rules, nor did it block the state legislature from “considering alternative statutory remedies to the present FHA.”

Affordable housing advocates praised the court decision.

“COAH's now 15-year-long failure to promulgate adequate rules has inhibited the state's economic growth and undermined sound planning principles,” says Peter Kasabach, executive director of New Jersey Future. 

“As a result of this decision, more of our hardworking residents, seniors, and people with disabilities will have the opportunity to live in homes they can afford in communities of their choice. Creating affordable homes will help our economy and our residents thrive,” says Staci Berger, president and CEO of the Housing and Community Development Network of New Jersey.

“Perhaps New Jersey can finally get on with the essential work of ensuring a diverse and affordable housing stock for one of the most diverse states in the nation. Only good can come from that,” added Charles Latini, president of the American Planning Association New Jersey Chapter.

GlobeSt.com will have more reactions to the court decision in coming days.