Court Ruling Wednesday to Affect Affordable Housing in Franklin Lakes and Beyond

The New Jersey Supreme Court will issue an opinion Wednesday, according to a notice posted Tuesday by the state judiciary, that will decide the fate of the state’s Council on Affordable Housing, where millions in local housing funds have remained in legal limbo, including almost $2 million held by Franklin Lakes.

The decision comes a year, almost to the day, after the borough announced it had concluded an agreement with Temple Emanuel to purchase 14 acres for affordable units. The project has since been tied up in red tape while the battle over COAH at the state level has played out.

COAH, established in 1985 to ensure access to low-income housing as rising real estate prices would otherwise squeeze those residents out, has had a controversial history including a 2011 plan by Governor Christie to abolish the agency entirely and transfer its responsibilities to his administration.

Christie has eyed over $160 million in “uncommitted” local housing trust funds, which are funded through municipal construction fees, to supplement the state budget. The court decision comes as those uncommitted funds reached an expiration date this month, set by a 2008 law, that required them to be turned over to the state if they were not being used for an active project.

But municipalities around the state, including Franklin Lakes, have argued that COAH has been a roadblock in the process, failing to meet for years and withholding approvals to spend the money as the clock ticked down.

The Franklin Lakes plan would purchase 14 acres on a plot of land at the intersection of McCoy and Colonial Roads, creating up to 40 special needs housing units to meet the borough’s affordable housing obligations.

According to COAH’s records, nearly $1.7 million in borough funds could in the end be forfeited to the state.

An appellate court ruling last month stalled the governor’s attempt to claim the uncommitted funds, requiring COAH to provide more detailed guidelines on their use, while the state’s Supreme Court waited to rule on the larger issue of whether his administration has the authority to absorb the independent agency.

Opponents argue that allowing him to do so could be a slippery slope, setting a precedent under which he and future governors would have the legal authority to absorb any independent state commission for political reasons.

The administration, meanwhile, argues that COAH has been controversial with both parties in the legislature, and that centralizing the state’s affordable housing efforts within the administration will make the policy more efficient.

Prior to Christie’s plan, the legislature passed a bill that would have abolished COAH, but the governor vetoed it over concerns about other provisions of the law.

COAH sent a letter to municipalities in May requesting the return of uncommitted funds, and then after the appellate ruling revised its request in a June 25 letter, asking local governments to confirm or challenge COAH’s figures by Aug. 2.

The NJ League of Municipalities sent its own letter to Jersey mayors last week emphasizing their right to challenge COAH’s figures and reminding them not to return funds without exploring legal challenges to the council’s rulings.

Franklin Lakes officials have previously said they would appeal a take back of affordable housing funds should the state persist in claiming the money.