On appeal from a Final Decision of the New Jersey Council on Affordable Housing, Docket No. 07-1924.
The opinion of the court was delivered by: Reisner, J.A.D.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued Telephonically March 9, 2009
Before Judges Reisner, Sapp-Peterson and Alvarez.
Fair Lawn Borough (Fair Lawn or the Borough), challenges a final decision of the New Jersey Council on Affordable Housing (COAH) dismissing Fair Lawn's third round petition for substantive certification of its affordable housing plan. In affirming COAH's decision, we confirm the agency's authority to dismiss a municipality's third round petition, based on the municipality's persistent failure to comply with the terms of its second round certification. Further, where a municipality has not actually satisfied its previously-unmet need for affordable housing, COAH need not allow the municipality to remove from its plan a viable site that has been included for over a decade as part of its vacant land adjustment.
On November 7, 2007, COAH dismissed the petition because Fair Lawn had failed to adopt an overlay zoning ordinance,*fn1 which was needed to authorize the construction of affordable housing on the property of Landmark at Radburn, L.L.C., and Bergen Development Group, L.L.C. (collectively Landmark). The Landmark tract, which comprised the Heyward Site (block 3610, lot 1) and Daly Field (block 3610, lot 2), had been part of Fair Lawn's COAH-approved second round affordable housing plan since 1996; COAH's approval resolution had ordered Fair Lawn to adopt the required overlay zoning within forty-five days of October 2, 1996.*fn2 Thus, Fair Lawn had obtained more than a decade of protection against a builder's remedy lawsuit, which Landmark could otherwise have pursued, by including the Landmark tract in its COAH-approved fair share plan. See Toll Bros., Inc. v. Twp. of W. Windsor, 173 N.J. 502, 511-14 (2002); Elon Assocs., L.L.C. v. Twp. of Howell, 370 N.J. Super. 475, 480-82 (App. Div.), certif. denied, 182 N.J. 149 (2004).
On September 6, 2005, after almost nine years of delay, and a "last-chance" threat from COAH to dismiss its fair share plan, Fair Lawn finally adopted an overlay zoning ordinance covering the Landmark tract, permitting six units per acre.*fn3 It was clear from the wording of the ordinance that Fair Lawn was adopting it over protest, in light of what the ordinance recited to be "the Mayor and Borough Council's unswerving position that Daly Field (Block 3610, Lot 2) remain green and undeveloped."
Landmark immediately filed a lawsuit challenging the overlay zoning as allowing inadequate density to satisfy the Borough's fair housing obligation, and sought a builder's remedy. On October 20, 2006, the Law Division found the zoning ordinance invalid. However, the judge declined to entertain the builder's remedy lawsuit at that time, and instead transferred the Fair Housing Act (FHA) portion of the complaint to COAH by order dated January 31, 2007. See Alexander's Dep't Stores v. Paramus, 125 N.J. 100, 116 (1991)(addressing the respective jurisdictions of the Law Division and COAH in adjudicating issues relating to fair housing); Sod Farm Assocs. v. Twp. of Springfield, 366 N.J. Super. 116, 123-25 (App. Div. 2004).
Fair Lawn had filed its third round petition on December 19, 2005, and included the Landmark tract as part of its fair share plan in that petition. However, despite the court's order invalidating the overlay zoning for the Landmark site in October 2006, Fair Lawn did not adopt a replacement ordinance.
Moreover, in responses to information requests from COAH, Fair Lawn indicated its intent to file an amended third round plan which would not include the Landmark tract. In her submissions to COAH, Fair Lawn's expert planner did not represent that Fair Lawn had already met its fair share obligations. Rather, as Fair Lawn's counsel conceded to us at oral argument, she outlined an alternative method to meet those obligations in the future, and proposed that those methods be included in an amended plan. On July 3, 2007, Landmark filed a motion with COAH to declare that the Landmark tract must be included in the plan and to order specific zoning relief for the site, or to dismiss Fair Lawn's third round petition.
In its November 7, 2007 decision, COAH reviewed at length the Borough's longstanding failure to adopt the overlay zoning required as a condition of COAH's approval of its second round plan. The agency noted that the Borough had allowed market-rate development on other parcels that were supposed to have been preserved for affordable housing. The agency also rejected the Borough's contention that environmental remediation work on the Landmark tract was evidence that it was no longer appropriate for inclusion in the plan. The agency concluded, in essence, that this was a pretext, since the Borough had never previously cited environmental considerations as a bar to the property's inclusion in its plan.*fn4 Further, because the Department of Environmental Protection had approved "the remediation plan for the site" and "the actual remediation work [was] being accomplished," the agency reasoned that the Landmark tract was likely to become "available for development."
COAH concluded that Fair Lawn's third round petition no longer provided a realistic opportunity to satisfy Fair Lawn's affordable housing obligation, because it did not even include the overlay zoning required by Fair Lawn's second round plan. See N.J.S.A. 52:27D-311(a). The agency agreed with Landmark that its third round regulations concerning vacant land adjustments, N.J.A.C. 5:94-3.4(a)(1), required that Fair Lawn comply with "all components" of its previously approved ...