Governor Corzine knows there is an affordable housing crisis in New Jersey and he intends to do something about it.  A campaign promise became an Administration initiative when the Governor outlined an ambitious 100,000 plan – 100,000 affordable homes and apartments created over the next ten years.

There can be no doubt of the need. Seniors struggle to stay in the homes they raised their families in.  Young people can’t buy a house in the town where they grew up.  Tenants are squeezed out of apartments because rents are too high.  All over our state, families and seniors and those with special needs seek safe, affordable housing.

When I became DCA Commissioner in 2002, we made a commitment to finance 20,000 affordable housing units over four years — an increase of 33 percent over the prior four-year period.  Many were skeptical, but we did it and then some.  We have provided more than $2.23 billion in financing for more than 22,000 units in 500 towns across the state.  Many people now have a place to call home because of our initiative.

            That is why Governor Corzine has asked the Department of Community Affairs to lead the effort for 100,000 units. It will take cooperation with our sister agencies — the state departments of Children and Families, of Human Services, of Health and Senior Services, of Military and Veterans Affairs, of Environmental Protection and of course, the New Jersey Housing and Mortgage Finance Agency.  It will also take the cooperation of the state’s municipalities and counties, with the non-profit and faith-based community, and with builders.

            Because land is limited in our state, we are also mindful of the natural resources we must preserve while pursuing our affordable housing goal.

            It is in this comprehensive, cooperative spirit, that we at DCA are developing initiatives that make it easier for municipalities to provide affordable housing to our residents who need it.

For example, we now offer the Municipal Acquisition and Construction (MAC) program to eligible municipalities. The program provides towns with funds to purchase land for the construction of affordable housing so that municipalities can decide where affordable housing will be built. MAC also supplies funding for construction costs when the municipality is the developer or owner of the affordable housing being constructed. And we provide technical assistance to the town to take you through the process.

Alpine Borough in Bergen County has already availed itself of the MAC program, receiving a $2 million interest-free loan to construct, own and manage an 8-unit, low and moderate income rental project. Tenants should be moving into the new apartments by this fall.  

Once MAC funding has been used to acquire land, the DCA’s Balanced Housing program provides loans and grants to subsidize construction. And if the developer, whether a nonprofit or a for-profit entity, is building rental units, they can apply to us for federal tax credits.

What is an “eligible municipality?”  State law requires that Balanced Housing funds be used only by towns that are complying with the rules of the Council on Affordable Housing (COAH).  The new COAH rules are based on a town’s growth – as you grow, you have an obligation to provide your fair share of affordable housing.  Gone are the days of the seemingly arbitrary number assigned to towns according to a complicated, black-box formula.   

The new methodology, based on actual growth, is much more reasonable and easier to understand. The proof of this is in the number of municipalities that are complying, with over 225 towns having already submitted plans to COAH, including about 40 towns submitting plans for the first time.

COAH itself does not build affordable housing. But when a town complies with COAH, in addition to gaining protection from builder’s lawsuits, it becomes eligible for the MAC program and other forms of assistance to build those necessary affordable units.

COAH municipalities can charge developer fees. This money is earmarked for the creation of affordable housing. Currently, about $119 million in developer fee balances is sitting unused in municipal accounts. We need to change this – to make our money work for us and for the people of New Jersey.  We will become more proactive in working with towns in beneficial ways of using this money.

Under the new rules, a town’s COAH plan must also receive endorsement from the State Planning Commission. In this way we can ensure that affordable housing is built in the right places, according to Smart Growth principles.

DCA’s Office of Smart Growth provides Smart Future Grants directly to municipalities to assist in local planning efforts, including downtown revitalizations, grayfield redevelopment and green building initiatives, where environmentally sound materials and practices are used.

At the same time, we make low-interest loans and mortgages, as well as tax credits, available to developers throughout the state, including developers in revitalized areas and those who do green building.

We are offering yet another valuable tool to municipalities to plan their own development while increasing the number of affordable housing units. That is the transfer of development rights, or TDR, program, which we are currently piloting in several communities.

This is how TDR works. Say there’s a large farm in your town that developers would like to convert into a colony of McMansions, and the owner of the farm is tempted to sell, and may be even more tempted in the future. But the municipality wants to preserve that big open space and develop housing closer to the downtown. In a TDR arrangement, the owner of the farm sells the property’s development rights — that is the right to subdivide and build. He continues to own the farm. He may live on it, mortgage it or sell it, but only as property not to be developed. That land is now protected, and potential development is transferred to a predetermined receiving zone elsewhere in town.

The municipality must initiate the process by establishing a specific TDR program. The Office of Smart Growth is ready to help municipal officials get started in obtaining this valuable planning tool, with TDR planning assistance grants.

I want to emphasize that the assistance elements DCA offers are designed to work together. A town could, for instance, make use of TDR, MAC, Balanced Housing loans and Smart Future Grants to meet its COAH obligations for affordable housing, while redeveloping a downtown area where developers and homebuyers can obtain lower mortgages and low-interest loans from the state for locating there.

We also provide funding through our Low Income Housing Tax Credit program for developers who build affordable housing units in Smart Growth areas. Tax credits are also available for developers of pedestrian friendly projects.

While many of these programs do not offer credits and loans directly to municipalities,  the indirect benefits are substantial.   These programs draw development and investment to areas of your towns where they are most needed.

Our Housing Affordability Service is also available to municipalities, and currently about 70 towns participate – we want to double this number.   This service enables municipalities to track affordable housing, ensure that developers and renters of affordable units are properly qualified, monitor occupancy and rental and resale prices, work to prevent foreclosures and to extend affordability controls and prepare annual reports.  The Housing Affordability Service can make your job easier (and save municipal staff time!).

Look for our affordable housing “Road Show” this fall,  a seminar for municipal and county officials on how to use the tools and funding we provide to accomplish our common goal —housing that is affordable to New Jerseyans as an integral part of sound, environmentally safe development and redevelopment.

These are some of the initiatives that will make it possible for municipalities to participate in the Governor’s effort to create 100,000 units of affordable housing in 10 years.

We also have programs geared to for-profit and nonprofit developers, first-time homebuyers, tenants of low and moderate income, the homeless, veterans, senior citizens and the state’s special needs population. Our most vulnerable populations are often those most in need of decent, affordable housing, and we are not going to forget them.

Another tool is the Housing Resource Center. Located at www.njhousing.gov, the HRC is a free, online registry of affordable, market-rate and accessible housing units available throughout New Jersey.  Check it out and see what’s happening in your town.  Or go to the main

DCA website at www.nj.gov/dca, where you can find out about all our housing programs.

Affordable housing is a constitutional right in New Jersey. It is also the right thing to do to provide safe, decent homes for all our residents. Let’s do the right thing, and work together and make this happen.

 

Below are contact telephone numbers for programs mentioned in the article:

Housing & Mortgage Finance Agency programs:

Home Buyer Mortgages                            — 1-800-NJ-HOUSE

Reverse Mortgages for Seniors                       — 609-278-8838

Low Income Housing Tax Credit program         — 609-278-7577

Multifamily Loan programs                             — 609-278-7527

Special Needs programs                                 — 609-278-7603

New Jersey Housing Resource Center              — 609-278-7411

Housing Affordability Services                         — 609-278-7504

 

Municipal Acquisition and Construction program          — 609-633-6258

Council on Affordable Housing                                   — 609-292-3000

Transfer of Development Rights program                   — 609-943-9938