NJ Courts Prepare for Affordable Housing Lawsuits

NJ Courts Prepare for Affordable Housing LawsuitsThe decades-long battle of implementing affordable housing throughout New Jersey is still underway. With the Supreme Court ruling demanding that more low to median income housing be built statewide, cities are scrambling to accommodate the rule at the last moment. Last week, we discussed the New Affordable Housing Law, and more recently, New Jersey courts are gearing up to manage an influx of housing lawsuits that are in violation of this law. As we discuss the repercussions of the low income housing demand, be sure to install your NJ Construction Liability Insurance to protect your firm.

The new law allows builders to go directly to courts rather than a state agency to oppose towns’ building restrictions for local housing. This is the first time in 30 years this has been permitted.

The Council on Affordable Housing (COAH) has long caused heated debate among cities and residents as it oversaw how towns regulated affordable housing. Although the Christie administration attempted to dissolve the COAH in 2011, the Supreme Court disagreed and ruled in favor of regulating low income housing, giving judges authority to regulate how many low-income housing units each city should build.

The initial ruling took place in March and gave a 90 day grace period for cities and developers to create a system to effectively manage the litigation; and an additional 30 days to provide evidence that each city has enough appropriate housing and should be exempt from builder’s lawsuits, which started June 8th. If the town has not taken action, they can face potential litigation by builders.

While the majority of towns are submitting their qualifications, some claim to be exempt from the law as they don’t have “developable or desirable land,” or they have environmental restrictions. These cities are awaiting a court to determine whether or not legal action is going to arise. Each city who did not file a plan will be individually evaluated by the courts to determine a course of action.

Mike Cerra, assistant executive director of the League of Municipalities, said “We’re dealing with hundreds of towns, hundreds of unique situations that will make the management of this difficult.” However, the dust is expected to settle in the coming weeks.

New Jersey builders are facing potentially large risks as their firms are beginning to build numerous housing developments. At Tri-State Insurance Agency, we understand the broad scope risks that builders regularly endure. We offer comprehensive coverage to ensure property and asset protection. For more information on our offerings, contact us today at (888) 990-0526.