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Wayne Property Holdings v. Township of Wayne

July 19, 2012

WAYNE PROPERTY HOLDINGS, L.L.C., PLAINTIFF-APPELLANT,
v.
TOWNSHIP OF WAYNE, TOWNSHIP OF WAYNE PLANNING BOARD AND THE NEW JERSEY COUNCIL ON AFFORDABLE HOUSING, A PUBLIC ENTITY OF THE STATE OF NEW JERSEY, DEFENDANTS-RESPONDENTS ARC EQUITIES, INC., PLAINTIFF-APPELLANT,
v.
TOWNSHIP OF WAYNE, MAYOR AND TOWNSHIP COUNCIL OF THE TOWNSHIP OF WAYNE, PLANNING BOARD OF THE TOWNSHIP OF WAYNE AND THE NEW JERSEY COUNCIL ON AFFORDABLE HOUSING, DEFENDANTS-RESPONDENTS.



On appeal from Superior Court of New Jersey, Law Division, Passaic County, Docket Nos. L-4636-04 and L-1270-08.

The opinion of the court was delivered by: Yannotti, J.A.D.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

APPROVED FOR PUBLICATION

Argued June 5, 2012

Before Judges Yannotti, Espinosa and Kennedy.

The opinion of the court was delivered by YANNOTTI, J.A.D.

Plaintiffs Wayne Properties Holdings, Inc. (WPH) and ARC Equities, Inc. (ARC) appeal from an order entered by the trial court on October 14, 2010, which dismissed their exclusionary zoning lawsuits against the Township of Wayne (Township) without prejudice and required WPH and ARC to exhaust their administrative remedies before the Council on Affordable Housing (COAH or the Council).*fn1 WPH and ARC also appeal from the trial court's order of February 14, 2011, which denied their motions for reconsideration. We affirm.

I.

The Fair Housing Act (FHA), N.J.S.A. 52:27D-301 to -329.19, was enacted in 1985 in response to the Supreme Court's Mount Laurel decisions, which require each municipality to create a realistic opportunity for the construction of its fair share of the regional need for low and moderate income housing. See S. Burlington Cnty. N.A.A.C.P. v. Twp. of Mount Laurel, 67 N.J. 151, 174-75 (1975) (Mount Laurel I); S. Burlington Cnty. N.A.A.C.P. v. Twp. of Mount Laurel, 92 N.J. 158, 208-09 (1983) (Mount Laurel II). The FHA created COAH and required that it determine the State's housing regions, "estimate the present and prospective need for low and moderate income housing[,]" and establish criteria and guidelines so that municipalities could determine their fair share of their region's need for affordable housing. N.J.S.A. 52:27D-307.

The FHA allows a municipality to submit its housing element and fair share plan to COAH, "based on the [C]ouncil's criteria and guidelines[.]" N.J.S.A. 52:27D-309. A municipality may thereafter petition the Council for substantive certification of the housing element and fair share plan. N.J.S.A. 52:27D-313(a). The Council is required to issue substantive certification if the municipality's compliance plan is: consistent with COAH's rules and criteria; "not inconsistent with [the] achievement of . . . low and moderate income housing needs" as prescribed by COAH's criteria and guidelines; and "make[s] the achievement of the municipality's fair share of low and moderate income housing realistically possible . . . ." N.J.S.A. 52:27D-314(a) and (b).

In 1986, COAH adopted its rules, which prescribed the municipalities' affordable housing obligations for the period from 1987 to 1993, the so-called "first round" of the administrative process. 18 N.J.R. 1267(a) (June 16, 1986) (codified at N.J.A.C. 5:91); 18 N.J.R. 1527(a) (Aug. 4, 1986) (codified at N.J.A.C. 5:92). Under the Council's criteria and guidelines, the Township's pre-credited need for the first round was 1544 units.*fn2 The Township did not petition COAH for substantive certification and several Mount Laurel lawsuits were filed against it in the Law Division, which resulted in a judgment dated September 10, 1993. The judgment declared that the Township's fair share obligation was 1000 units, subject to a potential vacant land adjustment that would reduce the obligation to 932 units.

In 1994, COAH adopted rules that established the municipalities' affordable housing obligations for the period from 1987 to 1999, the so-called "second round" of the process.

26 N.J.R. 2300 (June 6, 1994) (codified at N.J.A.C. 5:93 and codified as amended at N.J.A.C. 5:91-1.3 and 1.4, 5:92-1.1 and 1.3). Under COAH's criteria and guidelines, the Township's pre-credited need for the second round was 1217 units. On March 14, 1996, the Township petitioned COAH for substantive certification of its compliance plan for the second round.

On July 10, 1996, COAH adopted a resolution granting the Township's petition. After applying various credits and reductions, COAH determined that the Township's fair share obligation was fifty-nine units, consisting of twenty-two rehabilitated units and thirty-seven newly-constructed units. The Township's substantive certification was effective for six years from the date of the Council's resolution.

On November 3, 2004, ISP filed a complaint in the trial court, in which it alleged that it was the owner of approximately ninety-nine acres of land in the Township, which previously had been developed with eleven buildings. ISP alleged that, in granting substantive certification to the Township, COAH had properly recognized that the Township's pre-credited need was 1217 units, consisting of fifty nine rehabilitated units and 1158 newly-constructed units. ISP also noted that the Council had granted the Township a vacant land adjustment, which reduced the Township's "new construction obligation by 265 units to 893 units, resulting in a total adjusted housing need of 952 units . . . ."

ISP alleged that the COAH-approved compliance plan yielded "an apparent 'surplus' of 163 units and credits, but only if compared with [the] adjusted housing need of 952 units." According to ISP, if "properly compared with [the Township's] full housing need of 1217 units, the ...


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