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April 16, 2014

The State House Commission’s 60th Anniversary May Be Dampened By New Proposed New Jersey Legislation

The State House Commission of New Jersey is celebrating its 60th anniversary this year.  Two bills making their way through the legislative process will dramatically change the Commission’s jurisdiction concerning Green Acres land dispositions.

The Commission’s original mandate by the legislature was to oversee the construction of buildings in the State Capital – the City of Trenton but also the review and approval of the sale, lease or other disposition of public lands acquired by local government with State funding.

There have been several amendments to the 1953 enabling statute.  In 1993 my former legislative colleagues, State Assemblywoman Maureen Ogden and Assemblyman John Rooney, successfully sponsored a broad reaching amendment to the law that has come to be known as the “Ogden-Rooney” law.  Their amendment brought transparency to the Statehouse Commission’s deliberative process requiring various analysis, public notice and public hearings.

Historically, any application to lease Green Acres lands for 25 years or more triggered the Commission’s jurisdiction.  The pending aforementioned bills would dramatically reduce the lease threshold to five years.  The two companion bills are Senate Bill 826 and Assembly Bill 2329.

More importantly, these two bills propose a new unworkable compensation valuation standard. Currently, the Commission must ascertain the value of the properties “intended use” or the “highest and best use” standard to assess compensation to the State for the use of public lands – typically park land for commercial use.  The proposed standard for valuation requires an estimation of the “revenue generation potential of the land” to be conveyed or the highest and best use, whichever is greater.

Apparently, the sponsors are dissatisfied with the outcome of the current compensation methodology due to the diminished value of land zoned for recreational purposes.  The State House Commission does not convene often or predictably.  When the Commission does convene a meeting, various Departments of the State have land related business before the Commission such as the sale of excess lands.  The NJ DEP presents applications on behalf of local governments for permission to sell, lease or exchange public property often to adjoining private land owners for a variety of reasons.  Some applications seek approval for the installation of underground utilities through Green Acres properties.  At my last visit to the Commission, our client sought permission to run a second-redundant utility line through an existing easement as a safety precaution to avoid service interruption.

I imagine future applicants and the Commission itself will find it difficult to estimate the “revenue generation potential” of a utility line segment as part of a bigger system.  If the proposed legislation becomes law, our “smaller-smarter government” would become a partner in the utility company’s business.  If so, will State government share the applicant’s risks and cash outlay?

© 2014 Giordano, Halleran & Ciesla, P.C. All Rights Reserved

About the Author

Steven J. Corodemus, Giordano Law Firm, Governmental Affairs Attorney
Of Counsel

Steven J. Corodemus focuses his practice on government affairs, transactional, and real estate development. As Chairman of the law firm’s Government Affairs Department, he seeks to identify expeditious resolution of client issues at all levels of government. He also works to assure clear and direct communications between his clients and government representatives. Furthermore he provides guidance to his clients through the administrative and legislative processes. He also counsels clients on anti pay to play compliance for clients doing business with federal, state, county and...

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