A Plea to New Yorkers: Don’t Reinvent the Wheel on Affordable Housing Policy - Just Look to New Jersey
On April 27, 2023, The New York Times reported on the collapse of Governor Kathy Hochul’s housing plan, known as The New York Housing Compact, during budget negotiations with other Democratic lawmakers over the prior week. Governor Hochul’s plan was initially announced on January 10th and would have made way for the construction of 800,000 new homes over the next decade. The proposed target of new homes to be built was intended to make up for decades of underproduction that has been widely reported by the U.S. Department of Housing and Urban Development (HUD) and housing advocacy organizations like the National Low Income Housing Coalition. More importantly the plan sought to combat the rising cost of housing that was exacerbated by the coronavirus pandemic. So, what brought about the setback for the Governor? It was not a surprise - opposition from suburbs and Democratic lawmakers afraid of losing their seats in Albany. What’s the answer to (what seems like) an intractable problem? Well, I cannot profess to have the perfect answer, but what I do know is that what has been established in New Jersey for nearly 40 years has made a profound impact on the production and access to affordable housing throughout the state. As proud as Governor Hochul is in the amount of public funding that has been allocated to build affordable housing, it’s clear that the state needs to claw back power from local governments when it comes to land use regulations especially amid a statewide affordable housing crisis.
Reading about this setback pained me not only because I am a city planner that has worked in housing policy, but also because I was born in New York City and raised in the suburbs of New York (specifically one of the most difficult parts of the state to build affordable housing - Long Island). What followed that Times article was a predictable (and myopic) response from local officials claiming to have achieved some kind of victory over a Governor who saw the affordability problem clearly and understood that state intervention was absolutely necessary. Beyond the feeling of disappointment was frustration in seeing New York continue to struggle to make significant progress in advancing affordable housing policy in the face of a nationwide housing inventory and homelessness crisis. The interesting thing about Governor Hochul’s plan is that there really wasn’t anything particularly groundbreaking in it because each component represents the most tried and true proposals that most city planners and housing policy experts would have proposed. One of the three prongs of her plan that pleased me the most was the requirement that every municipality in New York do their part by increasing their housing stocks every three years by a specific percentage. For upstate municipalities it would be one percent and for downstate municipalities (that includes Long Island) it would be three percent. That proposal is generally based on New Jersey’s fair share principle.
With all due respect to Governor Hochul, the problem as I see it in comparison to New Jersey’s approach to housing policy is that her plan does not go far enough. The plan cites that from 2000 to 2019 downstate municipalities in the Hudson Valley, New York City, and Long Island saw 516,000 more jobs created than housing units, yet the Governor’s fair share proposal would have given municipalities the option to build a certain number of market rate homes or half as many affordable units. Setting aside the value of incrementalism, the state needs a more aggressive housing plan and it becomes particularly clear when considering that there is enough case law in New York to suggest that municipalities have too much power when it comes to resisting the construction of multifamily and affordable housing. There are several notable cases that demonstrate a failure by municipalities in New York to not only resist expanding access to affordable housing but have revealed a discriminatory intent. Of those notable cases, there are a series of cases involving the Town of Huntington beginning with the 1981 ruling in the case of Huntington Branch NAACP v. Town of Huntington, 530 F. Supp. 838 (E.D.N.Y. 1981) heard before the U.S. District Court for the Eastern District of New York. The 1981 case involved a proposed 162-unit rental development known as Matinecock Court for which the non-profit developer and plaintiff (Housing Help, Inc.) submitted a preliminary proposal for Section 8 construction funding to HUD on August 28, 1980 following the agency’s publication of a Notice of Funding Availability (or “NOFA”) on June 28, 1980. Due to objections from the municipality (i.e. that the site of the project was in an area not zoned for multifamily housing and was not consistent with the Town’s 1979-1982 Housing Assistance Plan or “HAP”) and the project’s ranking by HUD against others in Suffolk County, federal funding could not be approved for the proposed Matinecock Court development. Prior to the submission of the proposed development, the Town was told by HUD to amend their HAP because there were “zero” goals for HUD assisted new constructed rental units even though the Town submitted a proposal for a separate 150-unit project that received conditional approval pending the required amendment. The case was dismissed due to the plaintiff’s lack of standing, but their complaint reiterates a failure in some communities in New York to prioritize access to quality affordable housing at a rate consistent with demand. The decision begins by noting the following.
“This is a class action brought on behalf of black, Hispanic and lower income persons residing in the Town of Huntington and its surrounding areas who allegedly would qualify for residency in housing areas developed with the support of funding obtained pursuant to the Housing & Community Development Act of 1974. 42 U.S.C. § 5301 et seq. Specifically, the plaintiffs claim to have been injured by discriminatory housing and zoning practices within the meaning of the Fourteenth Amendment and, more importantly, Title VIII of the Civil Rights Acts of 1968, 42 U.S.C. § 3601 et seq., which was designed to provide fair housing throughout the nation. In addition, plaintiffs have filed other causes of action based on 42 U.S.C. §§ 1981, 1982, 1983, and the New York State Town Law.”
There would be another case in 1988 involving the Town of Huntington that would make its way to the U.S. Supreme Court, Town of Huntington v. NAACP, 488 U.S. 15. The Court in that ruling affirmed a lower court ruling by the U.S. Court of Appeals for the Second Circuit, which found that the Town’s failure to amend the zoning ordinance and allow the private construction of multifamily housing outside of a designated urban renewal zone and refusing to rezone a proposed development site to allow multifamily housing resulted in a “discriminatory impact because a disproportionately high percentage of households that use and that would be eligible for subsidized rental units are minorities, and because the ordinance restricts private construction of low-income housing to the largely minority urban renewal area, which ‘significantly perpetuated segregation in the Town’."
There were reports of resistance in 2011, when the project was negotiated down to 155 units. Resolution on the question of whether or not the (now 146-unit) mixed rental-cooperative affordable housing project in the Town of Huntington would not come until some 40 years later when on December 4, 2019 Suffolk County’s then-County Executive Steve Bellone signed a bill approving funding for the development. Construction of Matinecock Court is now expected to be completed in 2025.
Separately, there have been rulings against the Village of Garden City that culminated in a 2014 ruling in the case of Mhany Mgmt. Inc. v. Inc. Vill. of Garden City a federal district judge concluded that the Village had “acted with discriminatory intent when they eliminated R–M [Multi–Family Residential Group] zoning and endorsed R–T [Residential Townhouse] zoning after they received public opposition to the prospect of affordable housing in Garden City” and required the municipality to (1) implement a yearly fair housing training program for all elected Garden City officials and officials or municipal employees “who have duties related to the planning, zoning, permitting, construction, or occupancy of residential housing”; (2) the enactment of a fair housing resolution “to assure equal housing opportunities and nondiscrimination in its zoning and other land use processes.”; (3) rezoning of a social services site to a designated R-M zoning district, participate in the Nassau County Urban Consortium, and construct affordable housing; (4) appoint a Fair Housing Compliance Officer; and “expenditure of reasonable sums to fund the relief required by the judgment.”
It was not until I moved to New Jersey to study city and regional planning in graduate school that I discovered Jersey’s nearly 50-year history in requiring every municipality to construct their fair share of affordable housing. If you have ever studied urban planning or land use law in the United States, then you have more than likely come across two court cases that are almost as famous as the 1926 U.S. Supreme Court case Village of Euclid v. Ambler Realty Company that upheld the constitutionality of a municipality’s police power to regulate land uses through zoning. Those two prominent land use cases are the 1975 and 1983 Southern Burlington County NAACP v. Township of Mount Laurel cases that are also known as Mount Laurel I and II, respectively. Both cases were argued before the Supreme Court of New Jersey and ultimately laid the groundwork for the state to become a leader in affordable housing policy (even though Pennsylvania preceded New Jersey in addressing exclusionary zoning when the Supreme Court of Pennsylvania struck down a large-lot zoning ordinance in the 1965 case National Land and Investment Company v. Easttown Township Board of Adjustment – a case referenced in the court opinion of Mount Laurel I).
What were the rulings in Mount Laurel I and II?
In Mount Laurel I, the Court’s opinion prepared by Justice Frederick Hall closely analyzed the zoning ordinance of the Township of Mount Laurel, but more importantly it introduced the “fair share” principle when it ruled that:
“[E]very [developing] municipality must, by its land use regulations, presumptively make realistically possible an appropriate variety and choice of housing. More specifically, presumptively it cannot foreclose the opportunity of the classes of people mentioned for low and moderate income housing and in its regulations must affirmatively afford that opportunity, at least to the extent of the municipality's fair share of the present and prospective regional need therefor. These obligations must be met unless the particular municipality can sustain the heavy burden of demonstrating peculiar circumstances which dictate that it should not be required so to do.”
To establish the constitutional basis for the fair share position, Justice Hall went on to state that:
“[i]t is elementary theory that all police power enactments, no matter what level of government, must conform to the basic state constitutional requirements of substantive due process and equal protection of the laws. These are inherent in Art. I, par. 1 of our Constitution, the requirements of which may be more demanding than those of the federal Constitution…It is required that, affirmatively, a zoning regulation, like any policy power enactment, must promote health, safety, morals or general welfare. (The last term seems broad enough to encompass the others). Conversely, a zoning enactment which is contrary to the general welfare is invalid.”
Eight years later in Mount Laurel II, the Court (despite ordering the Township of Mount Laurel to conducted studies of the housing needs of low and moderate income households in the municipality) had to re-engage the issue of each municipality’s constitutional obligation to construct their fair share of affordable housing because not enough progress had been made by the municipality to provide a realistic opportunity for affordable housing and the community remained “afflicted with a blatantly exclusionary [zoning] ordinance.” The court opinion prepared by Chief Justice Robert Wilentz not only reaffirmed the ruling in Mount Laurel I, but it established the principle that municipalities had to take “affirmative actions” to comply with their fair share obligation.
What followed the rulings in Mount Laurel I and II?
In 1985, lawmakers in Trenton passed the New Jersey Fair Housing Act (NJFHA), which encapsulated the main points from the rulings in Mount Laurel I and II. It begins by acknowledging that “[t]he New Jersey Supreme Court, through its rulings in South Burlington County NAACP v. Mount Laurel, 67 N.J. 151 (1975) and South Burlington County NAACP v. Mount Laurel, 92 N.J. 158 (1983), has determined that every municipality in a growth area has a constitutional obligation to provide through its land use regulations a realistic opportunity for a fair share of its region's present and prospective needs for housing for low and moderate income families.” While the New Jersey legislature included essential components to achieve the fair share requirement established by the judiciary such as the creation of a now-abolished agency known as the Council on Affordable Housing (or generally known more simply as “COAH”) that was tasked with determining the state’s housing regions and establish the criteria municipalities would use to determine present and future fair share of housing need based on their region, one of the best products to come out of the NJFHA is the Uniform Housing Affordability Controls (UHAC). For context, there are six housing regions across New Jersey with each one comprised of multiple counties (an example would be Region 1 that is comprised of Sussex, Passaic, Bergen, and Hudson Counties).
While dependent upon court orders or municipal trigger policies that require the construction of set-aside units such as an inclusionary zoning ordinance, New Jersey’s UHAC regulations make clear the required affordability and unit-type breakdown of affordable units in projects that would be eligible for credits toward meeting a municipality’s fair share obligations under the NJFHA. In particular, UHAC regulations require that (1) at least half of all affordable units are reserved for low-income households with the other half reserved for moderate-income households; (2) at least 13 percent of bedroom types are reserved for households earning 30 percent or below the median income of each of New Jersey’s six regions; (3) at least 30 percent of all affordable units are two-bedroom units; and (4) at least 20 percent of units are three-bedroom units. The Act also includes marketing requirements and management standards that are similar to HUD’s regulations for federally funded projects.
The road to a more inclusive housing future in New Jersey since 1985 has not been without some bumps along the way. Almost immediately after being elected governor in 2009 and less than a month after his inauguration on January 19, 2010, then-Governor Christie issued Executive Order No. 12 on February 9th to unilaterally suspend COAH’s operations for 90 days to convene a five-member “Housing Opportunity Task Force” that would evaluate nine different dimensions of the NJFHA. Specifically: “(1) the best means for determining whether a municipality should have any further affordable housing obligation; (2) the regions that have been used by COAH for more than 20 years and whether they are still appropriate; (3) the means of incorporating workforce housing into the concept of affordable housing; (4) the diverse and significantly divergent state projections for housing and employment growth to determine the obligation for a variety and choice of housing, taking into consideration the need for open space preservation and environmental protection as elements of sound land use planning; (5) mechanisms that should be used to support the rehabilitation of deteriorating housing in the urban centers; (6) the means of developing economies, efficiencies, and savings in the development process; (7) ways to encourage rehabilitation as well as new development in meeting the need for affordable housing; (8) the appropriateness of methodologies that continue to include prior round need or include retroactive growth as part of a growth share approach; and (9) any other issue referred to the Task Force by the Governor.” The impetus of the executive order was couched in the long-delayed release of COAH’s “third round” regulations for determining each municipality’s fair share obligations that were expected in 1999, but not adopted until 2004, and set to expire in 2018. The executive order also characterized COAH’s governing procedures as “burdensome” and “excessively complex.” In a report issued by the taskforce in March of 2010, it was concluded that COAH was “irrevocably broken” and called for its elimination in favor of oversight by county planning boards in determining municipal capacity for affordable housing construction, though requiring a 10 percent set-aside of all new units.
Over a year later on June 29, 2011, Mr. Christie submitted a reorganization plan (Reorganization Plan No. 001-2011) to lawmakers that called for the abolition of COAH. As noted in the reorganization plan, the intended purpose was to (1) reduce the complexity of affordable housing administration, (2) lower regulatory process costs, (3) streamline new housing development, and (4) improve management effectiveness without the need for a multimember Council and separate full-time staff. Since the legislature did not adopt a resolution disapproving the plan within the required sixty days of its filing by Mr. Christie’s office, the plan went into effect by the end of August of 2011. Mr. Christie’s reorganization report was swiftly challenged before the State Supreme Court by the state’s most outspoken affordable housing legal non-profit, Fair Share Housing Center. On July 10, 2013, the court ruled that the former Governor’s use of the Executive Reorganization Act of 1969 did not provide him with the authority to pursue the abolition of an independent agency such as COAH.
What followed that decision was another on September 26, 2013 by the State Supreme Court to affirm a decision by the Appellate Division that found COAH’s “third round” methodology for determining a municipality’s fair share obligation was inconsistent with the NJFHA and setting a five-month deadline for establishing a methodology based on one established in previous rounds. On March 14, 2014, a motion was granted by the State Supreme Court to extend the deadline to May 1, 2014 (for publication in the New Jersey Register by June 2, 2014). The process of determining rules for each municipality’s affordable housing obligation would eventually continue past another deadline of October 22, 2014 due to a tie vote on approving proposed rules. On Tuesday, March 10, 2015, the State Supreme Court (after COAH’s failure to meet the extended deadline to produce a revised methodology) issued another major ruling that stripped the agency of its authority to determine affordable housing obligations in favor of having the courts oversee the process for each municipality via litigation prompted by affordable housing advocates resulting in “settlement agreements”.
The irony in this “third round”-saga throughout the Christie Administration, was that much of what Mr. Christie called for eventually manifested with the passage of the recently amended NJFHA (also known as the A4/S50 Bill) that was signed by Governor Phil Murphy on March 20, 2024. The updated NJFHA formally abolishes COAH, transfers the regulatory and fair share determination process to the state’s Department of Community Affairs (NJDCA), and establishes a clear methodology and schedule for determining the next and future housing round periods. Some of the major elements of the new affordable housing law include:
Establishing a new compliance period starting in 2025.
Requires the NJDCA to publish and submit a report of non-binding calculations of each region and each municipality’s current and prospective need for affordable housing to the Governor, Legislature, and each municipality by December 1, 2024 using a “fourth round” formula based on prior court decisions, which shall also be used to determine all future 10-year rounds of housing obligations.
Requires that the NJDCA to prepare and submit a report to the Governor, Legislature, and each municipality by August 1st of the year prior to the start of each new round.
Requires municipalities to adopt a binding resolution on fourth round affordable housing obligations by January 31, 2025.
Retains the requirement under the prior version of the NJFHA for a municipality to adopt a housing element and fair share plan to obtain immunity from exclusionary zoning litigation. Under the new law the initial deadline for adoption of such documents is June 30, 2025.
How has the New Jersey Fair Housing Act performed thus far?
In January of 2013, the Times published an editorial piece that included an assessment of the impact of the Mount Laurel cases by Douglas Massey who is a Princeton University sociology professor. At the time, Massey indicated that since the rulings in the Mount Laurel cases (and the passage of the NJFHA) New Jersey had produced 60,000 low- and moderate-income housing units and anticipated the construction of another 40,000 affordable homes. The Times piece went on to note a study performed by Massey and his colleagues that examined the lives of current and former residents of the Ethel Lawrence Homes (an affordable housing development in Mount Laurel Township that was constructed in 2000 and named after the lead plaintiff in the first Mount Laurel case). The study compared the outcomes of residents in the development with those that had applied to live in the development but found housing elsewhere. Massey and his colleagues had found that when comparing current and former residents of the development to those families that were not offered an opportunity for housing – for current and former residents the rates of employment and family income were higher, there were much lower rates of welfare dependency, higher academic achievement among children (with some being placed into more competitive schools), no reduction in the value of surrounding properties, no increase in taxes, and a seamless integration of those families into the development and the broader community. So, what’s the takeaway here? There is no economic basis for any state lawmaker in Albany or local officials to resist legislation that would require every municipality in New York to build their fair share of affordable housing. Since New Jersey’s fair share model has shown to be a proven approach, then the motivation for any resistance appears to be irrational and (as the theme across much if not all the case law suggests) is rooted in racism and classism that obviously has a direct throughline from the Great Migration that spanned between 1910 to 1970 and prompted the redlining policies that began in the 1930s.
What are the obstacles in New York?
In order to better understand the obstacles preventing New York from achieving something akin to the NJFHA, it is important to understand the context that Governor Hochul laid bare in her housing proposal. The New York Housing Compact included some damning data from my former employer, the New York City Department of City Planning, which reported that between 2011 and 2020 the inner New Jersey region of the metro area topped the list of housing units permitted per 1,000 residents per year with 32. This was followed by 27 in New York City, 26 in outer New Jersey, and 21 in the Mid-Hudson region of New York. Long Island was dead last with an average of 7 permitted housing units per year during the same period.
With that context firmly established, there are some high-level policy differences (i.e. state laws) at play here between New Jersey and New York. Going back to the opinion and ruling of New Jersey’s Supreme Court in 1975, Justice Hall makes it clear that every municipality is legally bound to ensure the general welfare of their residents by prioritizing access to affordable housing when he makes the connection between the state constitution and the enabling legislation that grants municipalities the police powers to regulate land use, known as the Municipal Land Use Law – “The legislative delegation of the zoning power followed in 1928, by adoption of the standard zoning enabling act, now found, with subsequent amendments, in N.J.S.A. 40:55-30 to 51.” At the beginning of Article 1 of the Municipal Land Use Law, under §40:55D-2(a), it states plainly that the first purpose of the law is “[t]o encourage municipal action to guide the appropriate use or development of all lands in this State, in a manner which will promote the public health, safety, morals, and general welfare.”
In New York, Article IX of the State’s Constitution establishes the bill of rights for local governments, however the only explicit reference to the delegation of land use police powers to municipalities is in regard to the use of eminent domain. In 2015, the New York State Department of State’s Division of Local and Government Services revised a report entitled “Zoning and the Comprehensive Plan” where it makes no reference to the delegation of police powers from the State to municipalities, but it does note that in regards to courts in New York “[a] common theme in the cases interpreting the requirement that zoning be in accordance with a comprehensive plan is that the zoning law (or amendment) be carefully studied before it is enacted. The report goes not to reference the 1963 case of Udell v. Haas 21 N.Y. 2d 463 that was heard before the Court of Appeals where the court found that one of the factors for “determining whether zoning is ‘in accordance with a comprehensive plan’ is whether forethought has been given to the community’s land use issues. The opinion of the court in Udell v. Haas held the following:
“Where a community, after a careful and deliberate review of ‘the present and reasonably foreseeable needs of the community’, adopt a general development policy for the community as a whole and amends its zoning law in accordance with that plan, courts can have some confidence that the public interest is being served.”
While the notion of a comprehensive plan and case law sounds reasonable, there are laws on the books in New York that actually make “reasonably foreseeing needs of [a] community” and responding accordingly very difficult. Under the Consolidated Laws of New York, the classification of a municipality allows towns (further subdivided into “First Class” towns generally with 10,000 or more persons or “Second Class” towns generally with less than 10,000 persons) and villages are able to lean on language that provides a basis for preventing development that would increase the inventory of housing in general. Under §263 of Article 16 in Chapter 62, the zoning and planning regulations governing villages states the following.
“Such regulations shall be made in accordance with a comprehensive plan and designed to lessen congestion in the streets; to secure safety from fire, flood, panic and other dangers; to promote health and general welfare; to provide adequate light and air; to prevent the overcrowding of land; to avoid undue concentration of population;…”
Under §7-704 of Article 7 in Chapter 64, the building zone language governing villages repeats the same language that was used above for towns.
In addition to having served as an advisor to the director of Jersey City’s Division of Affordable Housing, I have also testified before planning and zoning boards throughout New Jersey, I can affirm that guiding development in line with neighborhood character is a goal and top priority for virtually every community that I have had the pleasure of working in. Blocking multifamily development in places like Long Island as if we were still living in the 1930s or if redlining was still permissible is morally repugnant and indefensible. There is a way to construct multifamily housing that does not concentrate poverty while being consistent with the neighborhood character for any municipality – the standards need only to be clear and achievable for developers. As I often say, every community likes schools, police departments, fire departments, coffee shops, books stores, ice cream shops, restaurants, and movie theaters – but people work at these places and deserve the opportunity to live near their place of work. As Adam Gordon, the current executive director of New Jersey’s Fair Share Housing Center, noted in 2010 when he was a staff attorney - "I don’t think the people in New Jersey generally would, all things being equal, say, ‘I want a longer commute. I want less time with my family. I want more time sitting in traffic.’" Amending New York’s constitution and tighten up the proposed policy to follow New Jersey’s affordable housing law requiring statewide compliance with affordable housing production standards would bring municipalities throughout New York together (like a family at a dinner table) and make a significant step in ensuring no single municipality must shoulder the responsibility of constructing quality affordable housing based on measurable demand.
This piece was originally published on LinkedIn on September 21, 2024.
