For low- and moderate-income purchasers, the condominium or homeowners' association fees, and special assessments levied by such association, shall be 50 percent of the association fees or association special assessments for market units. The master deed for each inclusionary development shall regulate the low- and moderate-income unit fees in accordance with this section. Once established within the master deed, the percentage shall not be amended by the township, condominium association or homeowners' association without prior approval from the council on affordable housing. (Ord. No. 8-96, § 175-142.2, 6-4-1996; Ord. No. 58-96, 9-17-1996)

(a) Expiration of restrictions. Restrictions on low- and moderate-income sales and rental housing shall expire and terminate at the earliest of the following:

(1) Thirty years from the date the restrictions initially encumber the unit;

(2) The date upon which a judgment of foreclosure is entered in favor of a first purchase money mortgagee; or

(3) The date after restrictions expire as set forth in subsection (a)(1) of this section when any affordable housing rental unit which continues to be occupied by a low- or moderate-income household becomes vacant.

(b) Repayment. A repayment mortgage and a repayment note shall be executed in favor of the affordable housing advisory commission by a purchaser of a low- or moderate-income housing unit. The repayment mortgage and repayment note shall provide for repayment to the authority of 95 percent of the price differential at the first nonexempt transfer of title after the expiration of restrictions as set forth in subsection (a) of this section. The repayment mortgage shall be recorded simultaneously with the deed. The recorded original repayment mortgage, together with the original repayment note, shall be filed with the affordable housing advisory commission. (Code 1988, § 175-143; Ord. No. 2009-30, § I, 7-28-2009)

(a) Notwithstanding the restriction on resale of low- or moderate-income housing units set forth in this division, there shall be no such restriction if foreclosure and resale by a first purchase money mortgagee after foreclosure occurs. Execution of foreclosure sales by any other class of creditor or mortgagee shall not result in a release of the affordable housing unit from the restrictions imposed thereon.

(b) If a foreclosure sale occurs, the owner of the affordable housing unit shall be personally obligated to pay any surplus funds to the affordable housing advisory commission in accordance with the terms of the affordable housing agreement. (Code 1988, § 175-144; Ord. No. 2009-30, § I, 7-28-2009)

Developers of lower-income housing shall affirmatively market such housing to all segments of the lower-income population within the Mount Laurel housing region in which the township is located and to all qualified low- or moderate-income households, irrespective of race, color, religion, sex or national origin. Toward that end, the developer shall formulate and submit an affirmative marketing plan acceptable to the affordable housing advisory commission, which plan shall be incorporated into any approval of the development application. At a minimum, the plan shall provide for advertisement in newspapers with general circulation in the following urban core areas: Jersey City, Newark, Elizabeth, Paterson, New Brunswick and Perth Amboy. The plan shall also require the developer to notify the following agencies, on a regular basis, of the availability of any low- or moderate-income housing units: the Civil League of Greater New Brunswick, the Housing Coalition of Middlesex County, the Middlesex County Office of Community Development and other fair housing centers, housing referral organizations and government social service and public welfare departments located in the four-county region consisting of Middlesex, Somerset, Warren and Hunterdon counties. (Code 1988, § 175-145; Ord. No. 2009-30, § I, 7-28-2009)

Where a developer has diligently attempted to market a lower-income housing unit and that unit has not been sold within six months after issuance of the certificate of occupancy for that unit, the developer may seek relief under this section by submitting to the affordable housing advisory commission documentation of all efforts made to sell the unit and the hardship suffered by the continued vacancy. If the authority finds that the developer has made reasonably diligent efforts and has suffered hardship and that it is not realistic to expect sale to a qualified household within a reasonable time if sales efforts were to continue, the authority, in its sole discretion, may provide relief to the developer by permitting the unit to be offered for sale to a purchaser whose income level is up to 50 percent higher than the income ceiling fixed for the income category for which the unit was originally offered for sale. The unit shall, nevertheless, be sold at the maximum affordable price originally determined by the affordable housing advisory commission, and a covenant embodying the restrictions of section 62-1992(a), (b) and (c) shall be recorded with the deed for the sale of the property subject to the restriction of this division. (Code 1988, § 175-146; Ord. No. 2009-30, § I, 7-28-2009)

(a) Findings and purpose.

(1) In Holmdel Builder's Association V. Holmdel Township, 121 N.J. 550 (1990), the New Jersey Supreme Court determined that mandatory development fees are authorized by the Fair Housing Act of 1985 (the Act), N.J.S.A. 52:27D-301 et seq., and the State Constitution, subject to the Council on Affordable Housing's (COAH's) adoption of rules.

(2) Pursuant to P.L.2008, c.46 section 8 (C. 52:27D-329.2) and the Statewide Non-Residential Development Fee Act (C. 40:55D-8.1 through 8.7), COAH is authorized to adopt and promulgate regulations necessary for the establishment, implementation, review, monitoring and enforcement of municipal affordable housing trust funds and corresponding spending plans. Municipalities that are under the jurisdiction of the council or court of competent jurisdiction and have a COAH-approved spending plan may retain fees collected from nonresidential development.

(3) This section establishes standards for the collection, maintenance, and expenditure of development fees pursuant to COAH's regulations and in accordance P.L.2008, c.46, Sections 8 and 32-38. Fees collected pursuant to this section shall be used for the sole purpose of providing low- and moderate-income housing. This Section shall be interpreted within the framework of COAH's rules on development fees, codified at N.J.A.C. 5:97-8.

(b) Basic requirements.

(1) This Section shall not be effective until approved by COAH pursuant to N.J.A.C. 5:96-5.1.

(2) South Brunswick Township shall not spend development fees until COAH has approved a plan for spending such fees in conformance with N.J.A.C. 5:97-8.10 and N.J.A.C. 5:96-5.3.

(c) Definitions.

(1) The following terms, as used in this section, shall have the following meanings:

i. AFFORDABLE HOUSING DEVELOPMENT means a development included in the housing element and fair share plan, and includes, but is not limited to, an inclusionary development, a municipal construction project or a 100 percent affordable development.

ii. COAH OR THE COUNCIL means the New Jersey Council on Affordable Housing established under the Act which has primary jurisdiction for the administration of housing obligations in accordance with sound regional planning consideration in the state.

iii. DEVELOPMENT FEE means money paid by a developer for the improvement of property as permitted in N.J.A.C. 5:97-8.3.

iv. DEVELOPER means the legal or beneficial owner or owners of a lot or of any land proposed to be included in a proposed development, including the holder of an option or contract to purchase, or other person having an enforceable proprietary interest in such land.

v. EQUALIZED ASSESSED VALUE means the assessed value of a property divided by the current average ratio of assessed to true value for the municipality in which the property is situated, as determined in accordance with sections 1, 5, and 6 of P.L.1973, c.123 (C.54:1-35a through C.54:1-35c).

vi. GREEN BUILDING STRATEGIES means those strategies that minimize the impact of development on the environment, and enhance the health, safety and well-being of residents by producing durable, low-maintenance, resource-efficient housing while making optimum use of existing infrastructure and community services.

(d) Residential development fees. (1) Imposed fees.

i. Within all zoning district(s), residential developers, except for developers of the types of development specifically exempted below, shall pay a fee of 1.5 percent of the equalized assessed value for residential development provided no increased density is permitted.

ii. When an increase in residential density pursuant to N.J.S.A. 40:55D-70d(5) (known as a "d" variance) has been permitted, developers may be required to pay a development fee of six percent of the equalized assessed value for each additional unit that may be realized. However, if the zoning on a site has changed during the two-year period preceding the filing of such a variance application, the base density for the purposes of calculating the bonus development fee shall be the highest density permitted by right during the two-year period preceding the filing of the variance application.

Example: If an approval allows four units to be constructed on a site that was zoned for two units, the fees could equal one and a half percent of the equalized assessed value on the first two units; and the specified higher percentage up to six percent of the equalized assessed value for the two additional units, provided zoning on the site has not changed during the two-year period preceding the filing of such a variance application.

(2) Eligible exactions, ineligible exactions and exemptions for residential development.

i. Affordable housing developments, developments where the developer is providing for the construction of affordable units elsewhere in the municipality, and developments where the developer has made a payment in lieu of on-site construction of affordable units shall be exempt from development fees.

ii. Developments that have received preliminary or final site plan approval prior to the adoption of a municipal development fee ordinance shall be exempt from development fees, unless the developer seeks a substantial change in the approval. Where a site plan approval does not apply, a zoning and/or building permit shall be synonymous with preliminary or final site plan approval for this purpose. The fee percentage shall be vested on the date that the building permit is issued.

iii. Development fees shall be imposed and collected when an existing structure undergoes a change to a more intense use, is demolished and replaced, or is expanded, if the expansion is not otherwise exempt from the development fee requirement. The development fee shall be calculated on the increase in the equalized assessed value of the improved structure.

iv. Developers of residential structures demolished and replaced as a result of a natural disaster shall be exempt from paying a development fee.

(e) Nonresidential development fees. (1) Imposed fees.

i. Within all zoning districts, nonresidential developers, except for developers of the types of development specifically exempted, shall pay a fee equal to two and one-half (2.5) percent of the equalized assessed value of the land and improvements, for all new nonresidential construction on an unimproved lot or lots.

ii. Nonresidential developers, except for developers of the types of development specifically exempted, shall also pay a fee equal to two and one-half (2.5) percent of the increase in equalized assessed value resulting from any additions to existing structures to be used for nonresidential purposes.

iii. Development fees shall be imposed and collected when an existing structure is demolished and replaced. The development fee of two and a half (2.5) percent shall be calculated on the difference between the equalized assessed value of the pre-existing land and improvement and the equalized assessed value of the newly improved structure, i.e. land and improvement, at the time a final certificate of occupancy is issued. If the calculation required under this section results in a negative number, the nonresidential development fee shall be zero.

(2) Eligible exactions, ineligible exactions and exemptions for nonresidential development.

i. The nonresidential portion of a mixed-use inclusionary or market rate development shall be subject to the two and a half (2.5) percent development fee, unless otherwise exempted below.

ii. The two and one-half (2.5) percent fee shall not apply to an increase in equalized assessed value resulting from alterations, change in use within existing footprint, reconstruction, renovations and repairs.

iii. Nonresidential developments shall be exempt from the payment of nonresidential development fees in accordance with the exemptions required pursuant to P.L. 2008, c.46, as specified in the Form N-RDF "State of New Jersey Non-Residential Development Certification/Exemption" Form. Any exemption claimed by a developer shall be substantiated by that developer.

iv. A developer of a nonresidential development exempted from the nonresidential development fee pursuant to P.L.2008, c.46 shall be subject to it at such time as the basis for the exemption no longer applies, and shall make the payment of the nonresidential development fee, in that event, within three years after that event or after the issuance of the final certificate of occupancy of the nonresidential development, whichever is later.

v. If a property which was exempted from the collection of a nonresidential development fee thereafter ceases to be exempt from property taxation, the owner of the property shall remit the fees required pursuant to this section within 45 days of the termination of the property tax exemption. Unpaid nonresidential development fees under these circumstances may be enforceable by South Brunswick as a lien against the real property of the owner.

(f) Collection procedures.

(1) Upon the granting of a preliminary, final or other applicable approval, for a development, the applicable approving authority shall direct its staff to notify the construction official responsible for the issuance of a building permit.

(2) For nonresidential developments only, the developer shall also be provided with a copy of Form N-RDF "State of New Jersey Non-Residential Development Certification/ Exemption" to be completed as per the instructions provided. The developer of a nonresidential development shall complete Form N-RDF as per the instructions provided. The construction official shall verify the information submitted by the nonresidential developer as per the instructions provided in the Form N-RDF. The tax assessor shall verify exemptions and prepare estimated and final assessments as per the instructions provided in Form N-RDF.

(3) The construction official responsible for the issuance of a building permit shall notify the local tax assessor of the issuance of the first building permit for a development which is subject to a development fee.

(4) Within 90 days of receipt of that notice, the municipal tax assessor, based on the plans filed, shall provide an estimate of the equalized assessed value of the development.

(5) The construction official responsible for the issuance of a final certificate of occupancy shall notify the local assessor of any and all requests for the scheduling of a final inspection on property which is subject to a development fee.

(6) Within ten business days of a request for the scheduling of a final inspection, the municipal assessor shall confirm or modify the previously estimated equalized assessed value of the improvements of the development; calculate the development fee; and thereafter notify the developer of the amount of the fee.

(7) Should South Brunswick fail to determine or notify the developer of the amount of the development fee within ten business days of the request for final inspection, the developer may estimate the amount due and pay that estimated amount consistent with the dispute process set forth in subsection (b) of section 37 of P.L. 2008, c.46 (C.40:55D-8.6).

(8) Fifty percent of the development fee shall be collected at the time of issuance of the building permit. The remaining portion shall be collected at the issuance of the certificate of occupancy. The developer shall be responsible for paying the difference between the fee calculated at building permit and that determined at issuance of the certificate of occupancy.

(9) Appeal of development fees.

i. A developer may challenge residential development fees imposed by filing a challenge with the county board of taxation. Pending a review and determination by the board, collected fees shall be placed in an interest bearing escrow account by South Brunswick Township. Appeals from a determination of the board may be made to the tax court in accordance with the provisions of the State Tax Uniform Procedure Law, R.S. 54:48-1 et seq., within 90 days after the date of such determination. Interest earned on amounts escrowed shall be credited to the prevailing party.

ii. A developer may challenge nonresidential development fees imposed by filing a challenge with the director of the division of taxation. Pending a review and determination by the director, which shall be made within 45 days of receipt of the challenge, collected fees shall be placed in an interest bearing escrow account by South Brunswick. Appeals from a determination of the director may be made to the tax court in accordance with the provisions of the State Tax Uniform Procedure Law, R.S. 54:48-1 et seq., within 90 days after the date of such determination. Interest earned on amounts escrowed shall be credited to the prevailing party.

(g) Affordable housing trust fund.

(1) There is hereby created a separate, interest-bearing housing trust fund to be maintained by the chief financial officer for the purpose of depositing development fees collected from residential and nonresidential developers and proceeds from the sale of units with extinguished controls.

(2) The following additional funds shall be deposited in the affordable housing trust fund and shall at all times be identifiable by source and amount:

i. Payments in lieu of on-site construction of affordable units;

ii. Developer contributed funds to make ten percent of the adaptable entrances in a townhouse or other multistory attached development accessible;

iii. Rental income from municipally operated units;

iv. Repayments from affordable housing program loans;

v. Recapture funds;

vi. Proceeds from the sale of affordable units; and

vii. Any other funds collected in connection with South Brunswick's affordable housing program.

(3) Within seven days from the opening of the trust fund account, South Brunswick Township shall provide COAH with written authorization, in the form of a three-party escrow agreement between the municipality, the bank, and COAH to permit COAH to direct the disbursement of the funds as provided for in N.J.A.C. 5:97-8.13(b).

(4) All interest accrued in the housing trust fund shall only be used on eligible affordable housing activities approved by COAH.

(h) Use of funds.

(1) The expenditure of all funds shall conform to a spending plan approved by COAH. Funds deposited in the housing trust fund may be used for any activity approved by COAH to address South Brunswick's fair share obligation and may be set up as a grant or revolving loan program. Such activities include, but are not limited to: preservation or purchase of housing for the purpose of maintaining or implementing affordability controls, rehabilitation, new construction of affordable housing units and related costs, accessory apartment, market to affordable, or regional housing partnership programs, conversion of existing nonresidential buildings to create new affordable units, green building strategies designed to be cost saving and in accordance with accepted national or state standards, purchase of land for affordable housing, improvement of land to be used for affordable housing, extensions or improvements of roads and infrastructure to affordable housing sites, financial assistance designed to increase affordability, administration necessary for implementation of the Housing Element and Fair Share Plan, or any other activity as permitted pursuant to N.J.A.C. 5:97-8.7 through 8.9 and specified in the approved spending plan.

(2) Funds shall not be expended to reimburse South Brunswick Township for past housing activities.

(3) At least 30 percent of all development fees collected and interest earned shall be used to provide affordability assistance to low- and moderate-income households in affordable units included in the municipal fair share plan. One-third of the affordability assistance portion of development fees collected shall be used to provide affordability assistance to those households earning 30 percent or less of median income by region.

i. Affordability assistance programs may include down payment assistance, security deposit assistance, low interest loans, rental assistance, assistance with homeowners association or condominium fees and special assessments, and assistance with emergency repairs.

ii. Affordability assistance to households earning 30 percent or less of median income may include buying down the cost of low or moderate income units in the municipal fair share plan to make them affordable to households earning 30 percent or less of median income.

iii. Payments in lieu of constructing affordable units on site and funds from the sale of units with extinguished controls shall be exempt from the affordability assistance requirement.

(4) South Brunswick Township may contract with a private or public entity to administer any part of its housing element and fair share plan, including the requirement for affordability assistance, in accordance with N.J.A.C. 5:96-18.

(5) No more than 20 percent of all revenues collected from development fees, may be expended on administration, including, but not limited to, salaries and benefits for municipal employees or consultant fees necessary to develop or implement a new construction program, a housing element and fair share plan, and/or an affirmative marketing program. In the case of a rehabilitation program, no more than 20 percent of the revenues collected from development fees shall be expended for such administrative expenses. Administrative funds may be used for income qualification of households, monitoring the turnover of sale and rental units, and compliance with COAH's monitoring requirements. Legal or other fees related to litigation opposing affordable housing sites or objecting to the council's regulations and/or action are not eligible uses of the affordable housing trust fund.

(i) Monitoring.

(1) South Brunswick Township shall complete and return to COAH all monitoring forms included in monitoring requirements related to the collection of development fees from residential and nonresidential developers, payments in lieu of constructing affordable units on site, funds from the sale of units with extinguished controls, barrier free escrow funds, rental income, repayments from affordable housing program loans, and any other funds collected in connection with South Brunswick's housing program, as well as to the expenditure of revenues and implementation of the plan certified by COAH. All monitoring reports shall be completed on forms designed by COAH.

(j) Ongoing collection of fees. The ability for South Brunswick Township to impose, collect and expend development fees shall expire with its substantive certification unless South Brunswick has filed an adopted housing element and fair share plan with COAH, has petitioned for substantive certification, and has received COAH's approval of its development fee ordinance. If South Brunswick fails to renew its ability to impose and collect development fees prior to the expiration of substantive certification, it may be subject to forfeiture of any or all funds remaining within its municipal trust fund. Any funds so forfeited shall be deposited into the "New Jersey Affordable Housing Trust Fund" established pursuant to section 20 of P.L. 1985, c.222 (C.52:27D-320). South Brunswick shall not impose a residential development fee on a development that receives preliminary or final site plan approval after the expiration of its substantive certification or judgment of compliance, nor shall South Brunswick Township retroactively impose a development fee on such a development. South Brunswick Township shall not expend development fees after the expiration of its substantive certification or judgment of compliance. (Code 1988, § 175-147; Ord. No. 07-05, § I, 2-22-2005; Ord. No. 2009-30, § I, 7-28-2009; Ord. No. 2009-51, § I, 11-24-2009)

(a) Residential development.

(1) Except as otherwise provided below, any residential development application in any zoning district in the township that has not received final approval from the planning board or zoning board of adjustment proposing five or more lots or units shall set aside 11.1 percent of said units (rounded to the next higher number if 0.5 or greater) for affordable housing as said term is defined under the FHA and COAH's rules.

(2) Any residential development application in any zoning district in the township that has not received final approval from the planning board or zoning board of adjustment proposing four or less lots or units shall pay an affordable housing development fee pursuant to section 62-2001, Development fees.

(b) Nonresidential development. Except as otherwise provided below, any nonresidential development application that has not received final approval from the planning board or zoning board of adjustment that is required to produce at least one affordable unit (rounded to the next number if 0.5 or greater) pursuant to COAH's regulations found in Appendix E to N.J.A.C. 5:94-1 et seq., shall be required to provide such affordable housing. The calculation of the number of jobs and employment opportunities shall be in accordance with Appendix E to N.J.A.C. 5:94-1, et seq. entitled "UCC Use Groups for Projecting and Implementing Nonresidential Components of Growth Share."

(c) Affordable housing compliance mechanisms. The applicant referred to in subsections (a) and (b) may choose to satisfy its affordable housing growth share obligation(s) through the mechanisms permitted in COAH's rules, including, with South Brunswick Township's advanced written permission:

(1) On-site housing production in connection with residential projects;

(2) Off-site housing production in the township in connection with residential or nonresidential development;

(3) The purchase of an existing market-rate home at another location in the community and its conversion to an affordable price-restricted home in accordance with COAH's criteria, regulations and policies;

(4) Participation in gut rehabilitation and/or buy-down/write-down, buy-down/rent-down programs;

(5) Contribution in-lieu of providing affordable housing in connection with nonresidential development; and/or

(6) Any other compliance mechanism pursuant to COAH's rules pursuant to N.J.A.C. 5:94-et seq.

Evidence of a compliance mechanism shall be produced to the planning or zoning board at the time of application filing and shall be a condition of all "completeness" determinations. Thereafter, the satisfaction of the affordable housing compliance mechanism shall be an automatic condition of all approvals that must be satisfied in accordance with COAH's phasing requirements pursuant to N.J.A.C. 5:94 et seq.

(d) Compliance with COAH's rules. The affordable unit(s) to be produced pursuant to subsections (a), (b), and (c) of this section shall be available to a low income individual or household should only one affordable unit be required. Thereafter, each of the units shall be split evenly between low and moderate income individuals and households except in the event of an odd number in which event the unit shall be a low income unit. All affordable units shall strictly comply with COAH's rules and policies including, but not limited to, phasing, bedroom distribution, controls on affordability, range of affordability, affirmative marketing, income qualification, etc. It shall be the developer's responsibility, at its cost and expense, to arrange for an administering agency that may either be the South Brunswick Township Affordable Housing Office or some other entity approved by COAH and the township to ensure full COAH compliance and file such certifications, reports and/or monitoring forms as may be required by COAH to verify COAH compliance of each affordable unit.

(e) Payments in lieu of construction.

(1) Payments in lieu of the construction of affordable housing shall be based upon a proportionate share of the total project cost embodied in one or more pro-forma statements (pro-forma(s)) for the construction of an affordable housing development elsewhere within the Township of South Brunswick, which pro-forma(s) shall be on file in the office of the township clerk. The payment in lieu of construction to be made by the developer may be subject to negotiation with the township based upon the following considerations: the actual cost of buying down or subsidizing one or more existing or planned market priced dwelling units to achieve an average rent level affordable to a household earning 52.0 percent of median income; the actual land cost of site(s) earmarked for off-site affordable housing construction within the Township of South Brunswick; or reasonable and acceptable offers to substitute land, site preparation and/or construction services for all or a portion of the monetary payment otherwise required.

(2) Regardless of the mechanism by which the applicant has been approved to satisfy the required number of affordable housing units pursuant to this section, any development or portion thereof that generates a fraction of an affordable housing unit as all or a portion of the obligation, shall be required to make a payment in lieu of construction for that fraction of a unit based on the pro-rated cost of constructing an affordable housing unit in the Township of South Brunswick. (Ord. No. 55-05, § I, 9-13-2005)