More Proof of the Failure of COAH

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Tuesday, September 23, 2008 BY MARK MUELLER AND PAULA SAHAStar-Ledger Staff
Seeking a middle ground between environmentalists and builders, the state Council on Affordable Housing yesterday adopted a series of amendments to new rules that dramatically increase the number of affordable units required in municipalities.

The amendments are in response to concerns that the rules, proposed earlier this year and signed into law by Gov. Jon Corzine in July, are too onerous for some towns to meet, particularly in the ecologically sensitive Highlands, where development is restricted.

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Under the rules, one-fifth of new development would be set aside as affordable housing.

The amendments approved by COAH yesterday would relax the one-in-five requirement under certain circumstances, taking into account the amount of environmentally sensitive land and vacant land within municipalities.

Still, COAH and the Highlands Council have yet to reach a formal agreement about how to reconcile their mandates, with the council dedicated to restraining development and COAH devoted to ensuring that every municipality build its share of affordable housing.

The council is the body that oversees the Highlands, a 1,250-square-mile swath that includes 88 municipalities in Bergen, Passaic, Morris, Sussex, Warren, Somerset and Hunterdon counties.

The area provides drinking water for more than 5 million New Jerseyans.

Earlier this month, when he approved the Highlands Council's regional master plan, Corzine ordered the two agencies to hammer out an agreement within 60 days.

Eileen Swan, the Highlands Council's executive director, expressed frustration yesterday with one issue, in particular: giving towns that have agreed to conform to the regional master plan an extra year to file their affordable housing plans.

Swan said she thought she had reached agreement with COAH to send a letter to towns explaining how they can apply for the yearlong extension, but COAH took no immediate action, opting to form a task force to study how it will reach agreement with the Highlands Council.

For communities that choose not to conform to the more rigorous master plan, affordable housing plans are due Dec. 31.

Swan said the delay could cost towns money as they proceed with drafting affordable housing plans.

"I look forward to continuing to work with COAH, but I'm very concerned

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Star-Ledger Staff
A state agency on affordable housing decided yesterday to scrap one of its new regulations that requires disaster victims to pay a costly fee to rebuild destroyed homes.

The Council on Affordable Housing proposed an exemption for homeowners rebuilding their homes due to fires, floods or natural disasters. The change is a response to outrage over regulations approved June 2 that consider a burned-down home a demolition that, if rebuilt, would trigger a fee paid to the agency.

[yankee]

In 2001, Jim McGreevey was elected promising, "I will not raise our income taxes. I will not raise our sales taxes."

So instead he raised corporate taxes. And then he raised income taxes. And then Jon Corzine took over to complete the trifecta by raising the sales tax. Meanwhile, property taxes continued to rise. And the Democrats also cut off development in what could be the wealthiest part of the state with the Highlands Act.

And now the Democrats want new jobs. Good for them, but jobs require job sites. Where will those new workers work?

The other evening I participated in a panel discussion on that topic hosted by the New Jersey chapter of the National Association of Industrial and Office Properties. These guys are the big developers, the crude capitalists who were scorned until recently as the despoilers of the planet and the spreaders of sprawl.

All of a sudden, they're the good guys again. The governor is meeting with them and other business leaders to figure out how to generate jobs to make up for those lost when Wall Street giants like Lehman Brothers went bankrupt.

One developer in the audience was Joe Morris, who specializes in cleaning up brownfields sites in places like Perth Amboy and replacing the pollution with commercial properties.

"The business climate in this state is just toxic," Morris told me. "We have no idea how to retain tenants in this state."

This begins with the attitude of state regulators -- "They could be nice and respectful, but they're just arrogant" -- but it goes way beyond that.

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[yankee]

Perhaps the low point occurred in July. It was already obvious by then that we were in an economic downturn. But instead of creating incentives for new business, the Democrats passed a new tax on development that was unprecedented in American history.

While other states are offering economic incentives to lure business, Corzine in July signed a bill that imposes a new 2.5 percent fee on any business executive naive enough to build commercial space in the state. That means that if a developer like Morris were to build a giant, million-square-foot industrial park on a brownfields site in Perth Amboy, the state would charge him about $1.5 million. Why? To build affordable housing for the people who would work there, that's why.

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Perth Amboy already has lots of affordable housing," Morris points out. "We have people knocking on the doors of our trailers looking for jobs."

Of all the nutty regulations that New Jersey developers face, this one angers them the most. It angers local officials, too. If you have to add housing every time you add jobs, you'll never get ahead on property taxes.

They're particularly angry about this in Toms River, the pleasant bedroom community in Ocean County where I grew up. Back when I was a kid, the big employer in town was Ciba-Geigy. The chemical company owned a vast 1,400-acre swath of land, a site the size of Asbury Park. Now that the company has left town, that site represents one of the best commercial opportunities in the state, an opportunity to generate not just jobs but ratables to keep property taxes down. But business can't build there, said attorney John Russo, who represents the town on affordable-housing issues.

"What would happen is we'd get hit twice," said Russo, who is the son of the former state senator of the same name. Not only would the developer have to pay that 2.5 percent fee, but the state would require the township to add hundreds of units more of affordable housing to what is already one of the highest such quotas in the state. But the township already has plenty of affordable housing.

"About 42 percent of Toms River is low- and moderate-income people," Russo said. "We have the affordable housing here. We need the jobs."

In that respect, Toms River isn't much different from Perth Amboy. There are few spots in the state, urban or suburban, where an influx of jobs and ratables wouldn't be welcome. But the state has stacked the deck against such construction.

Meanwhile, across the Delaware River, Gov. Ed Rendell has been luring businesses away from his fellow Democrats.

"Thirty-one corporations have moved to Pennsylvania in the past 32 months," said Morris. "They took anywhere from 18,000 to 21,000 jobs with them."

Well, they don't call Rendell "Fast Eddie" for nothing. But Rendell's real secret is not what he did. It's what he didn't do. He didn't try to run business out of the state.

It's a wild, crazy, innovative concept. But it might work on this side of the river as well.



Paul Mulshine may be reached at pmulshine@starledger.com. To comment on his column, go to NJVoices.com.