A4271

An Act concerning municipal natural disaster relief grant programs and amending P.L.1999, c.366 and P.L.2008, c.46.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. Section 2 of P.L.1999, c.366 (C.40:48-9.15) is amended to read as follows:

2. a. The Legislature finds and declares that there may be circumstances when it is desirable for municipalities to supplement federal and State disaster relief programs for its residents whose real property was damaged by flood, hurricane or other natural disaster. It is therefore in the public interest to permit municipalities to provide limited grants to certain persons who require relief in addition to insurance or from federal or State loan programs in order to assure that those people are able to remain in the community and rebuild in order to rapidly return their real property to the tax rolls at its full and fair value prior to the disaster.

b. (1) Following a flood, hurricane or other natural disaster for which the Governor has declared a state of emergency, a municipality in the affected area may establish, by resolution, a Municipal Natural Disaster Relief Grant Program pursuant to rules and regulations adopted by the Department of Community Affairs. Under such program the municipality may give grants of up to [$5,000] $10,000 to persons owning residential real property and up to $15,000 to persons owning non-residential real property in the municipality who are without insurance that adequately covers the real property damage inflicted by the natural disaster and for whom the repayment of a low-interest loan under any federal or State program would constitute an extreme hardship based on their income and such other financial circumstances as are deemed relevant pursuant to rules and regulations promulgated by the Department of Community Affairs. Grant money received pursuant to a municipal program under this section shall be used solely for [the repair and reconstruction of the owner's damaged real property situated within the municipality] code compliance repairs and the purchase, repair, and installation of systems equipment by property owners residing in disaster areas.

(2) As used in this section:

“code compliance repairs” means specific repairs required by a municipal official for the issuance of a certificate of occupancy; and

“systems equipment” means plumbing, heating, electrical, ventilating, air conditioning, refrigerating, and fire prevention equipment, and elevators, dumbwaiters, escalators, boilers, pressure vessels, kitchen appliances, and other mechanical facilities or installations.

(3) Persons owning residential real property and non-residential real property in a municipality in the disaster area shall have until the last business day of the sixth full month next following State approval of a municipality’s plan to implement a Municipal Natural Disaster Relief Grant Program to submit an application for a natural disaster relief grant to the municipal engineer. The municipal engineer shall conduct an inspection of the real property within three business days, or as soon as practicable, and certify that the code compliance repairs must be made to the property or that systems equipment on the real property require repair or replacement. The municipal engineer’s certification shall be transmitted to the chief financial officer and shall include an estimate of the cost of the code compliance repairs and the repair and replacement of the systems equipment on the real property. The certification shall include the municipal engineer’s determination of the amount of natural disaster relief grant funding that shall be awarded to the property owner. The chief financial officer shall authorize the payment of natural disaster relief grants in the order in which certifications are received from the municipal engineer, if there are sufficient funds for that purpose, within 14 days of receipt of the certification from the municipal engineer.

(4) Any municipality which establishes a Municipal Natural Disaster Relief Grant Program may by ordinance provide a property tax abatement to affected property owners pursuant to section 4 of P.L.1991, c.441, (C.40A:21-4), and for the purposes of Article VIII, Section I, paragraph 6 of the New Jersey Constitution, the property owned by these affected property owners shall be deemed to be located in an area in need of rehabilitation.

c. A municipality may not implement a Municipal Natural Disaster Relief Grant Program without submitting its resolution and a plan to implement the program to the Department of Community Affairs. A municipality shall not implement its plan, and shall not distribute grants pursuant to that plan without receiving written approval from the Department of Community Affairs. The Department of Community Affairs shall develop criteria for approval of a municipality's plan. Any criteria developed by the department shall include, but not be limited to, provisions which (1) limit the financial burden of the program on taxpayers of the municipality and State; and (2) ensure that the program does not result in the duplication of benefits of applicable State or Federal programs.

d. Monies granted by a municipality pursuant to a Municipal Disaster Relief Grant Program may not be used for any damage or loss which is met by any other source.

e. [The Department of Community Affairs shall adopt and promulgate rules and regulations within 120 days of enactment of P.L.1999, c.366 (C.40:48-9.15 et al.) pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), to effectuate the purposes of this section. Such rules shall include, but not be limited to, criteria for approval of a municipality's plan, eligibility requirements for determining financial hardship, and procedures for approval and administration of grants.] Notwithstanding any provisions of the “Administrative Procedure Act,” P.L.1968, c.410 (C.52:14B-1 et seq.) to the contrary, the Department of Community Affairs, may adopt, immediately upon filing with the Office of Administrative Law, such regulations, including but not limited to, criteria for approval of a municipality’s plan, eligibility requirements for determining financial hardship, and procedures for the approval and administration of grants, as the department deems necessary to implement the provisions of this section, which regulations shall be effective for a period not to exceed 120 days from the date of filing, except that the governing body of the municipality may prescribe rules and regulations to implement the requirements of this section until such time as the temporary guidelines are issued. The department’s temporary regulations may thereafter be amended, adopted, or readopted as the department deems necessary in accordance with the requirements of the “Administrative Procedure Act,” P.L.1968, c.410 (C.52:14B-1 et seq.).

(cf: P.L.1999, c.366, s.2)

2. Section 8 of P.L.2008, c.46 (C.52:27D-329.2) is amended to read as follows:

8. a. The council may authorize a municipality that has petitioned for substantive certification, or that has been so authorized by a court of competent jurisdiction, and which has adopted a municipal development fee ordinance to impose and collect development fees from developers of residential property, in accordance with rules promulgated by the council. Each amount collected shall be deposited and shall be accounted for separately, by payer and date of deposit.

A municipality may not spend or commit to spend any affordable housing development fees, including Statewide non-residential fees collected and deposited into the municipal affordable housing trust fund, without first obtaining the council's approval of the expenditure. The council shall promulgate regulations regarding the establishment, administration and enforcement of the expenditure of affordable housing development fees by municipalities. The council shall have exclusive jurisdiction regarding the enforcement of these regulations, provided that any municipality which is not in compliance with the regulations adopted by the council 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).

b. A municipality shall deposit all fees collected, whether or not such collections were derived from fees imposed upon non-residential or residential construction into a trust fund dedicated to those purposes as required under this section, and such additional purposes as may be approved by the council.

c. (1) A municipality may only spend development fees for an activity approved by the council to address the municipal fair share obligation.

(2) Municipal development trust funds shall not be expended to reimburse municipalities for activities which occurred prior to the authorization of a municipality to collect development fees.

(3) A municipality shall set aside a portion of its development fee trust fund for the purpose of providing affordability assistance to low and moderate income households in affordable units included in a municipal fair share plan, in accordance with rules of the council.

(a) Affordability assistance programs may include down payment assistance, security deposit assistance, low interest loans, common maintenance expenses for units located in condominiums, rental assistance, and any other program authorized by the council.

(b) Affordability assistance to households earning 30 percent or less of median income may include buying down the cost of low income units in a municipal fair share plan to make them affordable to households earning 30 percent or less of median income. The use of development fees in this manner shall not entitle a municipality to bonus credits except as may be provided by the rules of the council.

(4) A municipality 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, or any program or activity for which the municipality expends development fee proceeds, in accordance with rules of the council.

(5) Not more than 20 percent of the revenues collected from development fees shall be expended on administration, in accordance with rules of the council.

d. The council shall establish a time by which all development fees collected within a calendar year shall be expended; provided, however, that all fees shall be committed for expenditure within four years from the date of collection. A municipality that fails to commit to expend the balance required in the development fee trust fund by the time set forth in this section shall be required by the council to transfer the remaining unspent balance at the end of the four-year period to the "New Jersey Affordable Housing Trust Fund," established pursuant to section 20 of P.L.1985, c.222 (C.52:27D-320), as amended by P.L.2008, c.46 (C.52:27D-329.1 et al.), to be used in the housing region of the transferring municipality for the authorized purposes of that fund.

e. Notwithstanding any provision of this section, or regulations of the council, a municipality shall not collect a development fee from a developer whenever that developer is providing for the construction of affordable units, either on-site or elsewhere within the municipality.

f. Notwithstanding any provision of this section, or regulations of the council, a municipality may spend up to 15 percent of the revenues collected from affordable housing development fees to cover the cost of code compliance repairs or the repair and replacment of systems equipment on private property damaged by flood or hurricane in accordance with rules and regulations promulgated by the Department of Community Affairs for a Municipal Natural Disaster Relief Grant Program authorized pursuant to section 2 of P.L.1999, c.366 (C.40:48-9.15).

This section shall not apply to the collection of a Statewide development fee imposed upon non-residential development pursuant to sections 32 through 38 of P.L.2008, c.46 (C.40:55D-8.1 et seq.) by the State Treasurer, when such collection is not authorized to be retained by a municipality.

(cf: P.L.2008, c.46, s.8)

3. This act shall take effect immediately.

STATEMENT

This bill would permit municipalities provide financial assistance grants to the owners of real property which has sustained certain weather-related damaged caused by a flood, hurricane, or other natural disaster, for which the Governor has declared a state of emergency, through the adoption of a resolution establishing a Municipal Natural Disaster Relief Grant Program. Municipalities that establish a grant program would be permitted to use up to 15% of those revenues generated by affordable housing development fees and deposited in municipal affordable housing trust funds to provide grants of up to $10,000 to owners of residential property and $15,000 to owners of non-residential real property. Grant funds could be used to support the purchase, repair, and installation of systems equipment by property owners residing in disaster areas. As used in the bill, “systems equipment” means plumbing, heating, electrical, ventilating, air conditioning, refrigerating, and fire prevention equipment, and elevators, dumbwaiters, escalators, boilers, pressure vessels, kitchen appliances and other mechanical facilities or installations. Financial assistance can also be used to pay for repairs necessary for the issuance of a certificate of occupancy for the property.

Property owners in the affected area would have six full months after State approval of a municipality’s plan to implement a Municipal Natural Disaster Grant Program to file an application for grant funding with the municipal engineer. The municipal engineer must conduct an inspection of real property within three business days, or as soon as practicable, and certify that the systems equipment on the real property may require repair or replacement. The municipal engineer would also provide an estimate of the cost of repairing and replacing the equipment and determine the amount of grant funding to be awarded to each property owner. The chief financial officer of the municipality would authorize payment of the natural disaster relief grant to the property owner within 14 days of the receipt of the municipal engineer’s certification, to the extent that funds are available.

Any municipality that establishes a Municipal Natural Disaster Relief Grant Program would also be deemed to be an “area in need of rehabilitation” for the purposes of the “Five-Year Exemption and Abatement Law,” N.J.S.A.40A:21-1 et seq. Article VIII, Section I, paragraph 6 of the New Jersey Constitution permits the enactment of laws establishing short-term property tax abatements and exemptions for buildings and structures in these areas.

Finally, the Department of Community Affairs would be authorized to adopted temporary rules and regulations necessary to implement the provisions of this legislation. Municipalities would be permitted to adopt their own rules and regulations governing their grant programs until the State guidelines and regulations are issued.