May 26, 2019

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Will Governor Christie Extend the Moratorium on Non-Residential Development Fees?

A new bill (A1907) that would extend the statewide moratorium on the collection of non-residential development fees (“NRDFs”) recently passed both the New Jersey State Assembly and Senate. It now awaits Governor Christie’s signature. If signed into law, the bill would reinstate the moratorium on the collection of NRDFs that expired July 1, 2013, extending it to December 31, 2014. Developers who paid NRDFs during that period would be eligible to seek a refund, which must be granted so long as the NRDF has not already been expended for affordable housing.

NRDFs were initially established in New Jersey by P.L. 2008, c. 46 and codified in the Municipal Land Use Law. For any non-residential development, the required NRDF is 2.5% of the equalized assessed value of land and proposed improvements. The NRDF is collected at the municipal level and paid into a state fund for the development of affordable housing.

The initial moratorium on the collection of NRDFs was contained in P.L. 2009, c. 90 and ended July 1, 2010. The second moratorium was found in P.L. 2011, c. 122, which extended the moratorium to July 1, 2013. As of July 1, 2013, municipalities were again required to impose a n NRDF on new non-residential development. No NRDFs may be assessed against projects that received site plan approval prior to July 1, 2013, provided that a construction permit is issued by July 1, 2015.

If signed into law, the re-imposition of the moratorium would be an important albeit relatively short lived, benefit to non-residential developers.

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About this Author

Michael A. Bruno, Giordano Law Firm, Real Estate Attorney
Shareholder

Mr. Bruno, shareholder in Giordano, Halleran & Ciesla's Real Estate, Land Use & Development practice area, focuses his practice area on real estate transactions and approvals with an emphasis on redevelopment, planned residential development, affordable housing, and mixed use development. Mr. Bruno represents and counsels companies and developers in every phase of real estate acquisitions, financing and development including redevelopment agreements and long and short term financial agreements and other state, regional and local agency financing programs available in connection...

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Steven P. Gouin, Giordano Law Firm, Real Estate Attorney
Associate

Steve Gouin, an associate in the Real Estate, Land Use & Development and Planned Real Estate Development departments devotes his practice to the representation of developers, landlords, and other business interests. Mr. Gouin's practice focuses on land use approvals, redevelopment projects, commercial real estate transactions, landlord and tenant disputes, community association law, and real estate litigation. Mr. Gouin is a member of the New Jersey State Bar Association, Land Use Section and Community Associations Institute - New Jersey.

732-741-3900