1. The continued delay by the New Jersey Council on Affordable Housing ("COAH") in

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1 FAIR SHARE HOUSING CENTER 510 Park Boulevard Cherry Hill, New Jersey P: F: Attorneys for Appellants Fair Share Housing Center, Southern Burlington County Branch of NAACP, and Camden County Branch of NAACP By: Peter J. O'Connor, Esq. Kevin D. Walsh, Esq. In Re Failure of the New Jersey Council on Affordable Housing to Adopt Third Round Fair Share Methodology and to Allocate Third Round Fair Share Obligations SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION DOCKET NO: A T CIVIL ACTION CERTIFICATION OF DAVID N. KINSEY I, David N. Kinsey, hereby certify as follows: 1. The continued delay by the New Jersey Council on Affordable Housing ("COAH") in proposing and adopting its third round ( ) fair share housing methodology and implementing regulations has nine significant consequences that undermine the Mount Laurel doctrine and negate its effectiveness: COAH continues to extend second-round ( ) certifications as more and more municipalities reach the end of their certification period with no third-round obligation to address COAH has established an indefinite state-wide moratorium on further lower income housing planning and Mount Laurel compliance Residential and nonresidential development continues in COAH-certified, extended second-round municipalities with insufficient land to address second-round obligations,

2 without protection for scarce land resources needed to address third-round housing obligations Rampant residential and nonresidential development and redevelopment continues throughout New Jersey, squandering opportunities for lower income housing construction Open space acquisition and farmland preservation continues to take place, reducing the supply of developable land, without also preserving sites for lower income housing Actual construction of new lower income housing to address third-round housing obligations is further delayed until at least 2007 or 2008 Rehabilitation of substandard housing occupied by lower income households is delayed COAH faces bureaucratic gridlock when more than 100 third-round plans will be submitted in a single year after COAH's adoption of its third-round rules The unbalanced distribution of lower income housing among New Jersey municipalities will continue 2. I am a licensed professional planner, a member of the American Institute of Certified Planners, and a partner in the planning and historic preservation consulting firm of Kinsey & Hand of Princeton, New Jersey. My professional practice focuses on affordable housing planning, and has included 14 assignments since 1985 as a Court-appointed Special Master in Mount Laurel exclusionary zoning litigation. I have prepared housing elements and fair share plans and plan amendments, and have advised municipalities throughout the process of obtaining substantive certification from COAH. I have also advised public interest and builder plaintiffs in Mount Laurel litigation and objectors in proceedings before COAH. I am fully familiar with COAH rules, policy, proposals, and practice since Finally, I teach graduate courses in affordable housing, New Urbanism, and land use policy and planning at Princeton University. Exhibit A summarizes my background and experience. page 2 of 9

3 3. Appellants have asked me to analyze and I present in this Certification my expert opinion on the consequences of the continued delay by COAH in proposing and adopting its third-round ( ) fair share housing methodology and implementing regulations. 4. First, the continued delay by COAH has led more and more COAH-certified municipalities to reach the end of their six-year second-round certifications with no third-round housing obligation, as defined by COAH, to address. Instead of letting the certification (and protection from litigation) lapse, these municipalities then request and readily obtain extended second-round certification from COAH and now are waiting for COAH to promulgate third-round housing obligations. 5. Since COAH first extended a second-round certification in January 1999, 78 of the 204 municipalities with second-round COAH certifications have received extended certifications. 1 Under COAH's extended certification rule, 2 such municipalities need not submit a thirdround housing plan to COAH until one year after COAH adopts its third-round rules. These 78 municipalities with extended second-round certifications are under no obligation to preserve or rezone land for third-round constitutional housing obligations As COAH has not even proposed, let alone adopted, third-round rules, most municipalities are not currently initiating or undertaking housing planning to create third-round lower income housing opportunities. COAH's continued delay has in effect established an indefinite state-wide moratorium on further lower income housing planning and Mount Laurel compliance, a second consequence of COAH's delay. And as COAH continues to delay the third-round, more and more municipalities will seek and obtain extended second-round certifications, expanding the reach of the moratorium. 3 1 See COAH's monthly municipal status report, last published May 7, 2003; N.J.A.C. 5: An additional 31 municipalities have second round certifications that will expire by the end of 2004 and are likely to be extended by COAH. At that point COAH will have extended the certifications of more than 50%, or more than 100, of the municipalities with second round certifications. page 3 of 9

4 6. Third, COAH has extended second-round certifications in municipalities where vacant land is a scarce resource, according to COAH's own records, without taking steps to protect scarce land resources that most likely will be needed to address third-round housing obligations. Specifically, 14 of the 78 municipalities granted extended certification to date received a vacant land adjustment when COAH granted their initial second-round certifications. 4 This means COAH found then, now more than six years ago, that the municipalities had insufficient vacant, developable land to address their full lower income fair share housing obligations, yet development continues to take place in these municipalities. 5 A consequence of COAH's continued third round delay is that residential and nonresidential development will continue in these and other similar municipalities 6 without-protecting scarce land resources or creating lower income housing opportunities to address third-round housing obligations. 7. A fourth consequence of COAH's extended delay is further squandering of opportunities for building lower income housing needed to comply with the constitutional mandate of the Mount Laurel doctrine. As the unanimous Supreme Court noted in August 2002, Land must be viewed as an essential but exhaustible resource; any land that is developed for any purpose reduces the supply of land capable of being used to build affordable housing. The scarcity of land as a resource bears on the opportunity and means to provide affordable housing. This Court has implicitly recognized [in Southern Burlington County NAACP v. Mount Laurel, 92 N.J. 158, 210 n. 5 (1983),] that unrestrained nonresidential development can itself deepen the shortage of affordable housing Land is certainly being developed in New Jersey, for many purposes. In fact, rampant development, both residential and nonresidential, continues throughout New Jersey. Specifically, since the expiration of COAH's second round, i.e., during (first 4 See COAH's monthly municipal status report, last published May 7, 2003; Mfe:/MYMJ?.^ 5 N.J. Department of Community Affairs, New Jersey Construction Reporter, published monthly, records the building permits issued in these and all municipalities in the state. 6 COAH certified an additional 31 municipalities with second round vacant land adjustments, according to COAH's monthly municipal status report. 7 Holmdel Builders Association v. Township of Holmdel. 121 N.J. 550, (1990), cited in Fair Share Housing Center, Inc., et al. v. Township of Cherry Hill, et al. 173 N.J. 393, 409 (2002). page 4 of 9

5 quarter), New Jersey municipalities issued building permits for a total of 147,231 dwelling units, 28 million square feet of retail development, and 57 million square feet of office development This residential development since 1999 is the equivalent of the total existing housing units in Edison, Woodbridge, Dover, and Hamilton townships combined. This retail development is the equivalent of 20 Quaker Bridge Malls on Route 1 in Mercer County. The office development approved since 1999 is the equivalent of 38 towers the size of New Jersey's tallest building, Goldman Sachs's 40 stories and 1.5 million square feet tower at 30 Hudson Street on the Jersey City waterfront. 9. This continued development and redevelopment is taking place throughout New Jersey without addressing third-round fair share housing obligations, because COAH continues to delay release and adoption of its third-round methodology and implementing rules. 10. In addition to rampant development, significant open space acquisition and farmland preservation continues to take place throughout New Jersey. Nearly 300,000 acres have been preserved since creation of the $1 billion Garden State Preservation Trust in 1999, which is supplemented by local open space and farmland acquisition programs, established and funded by 20 counties and almost two hundred municipalities. 9 A fifth consequence of the continued, multi-year delay by COAH is that these important public and nonprofit land acquisition programs continue to reduce the supply of developable land that is likely to be needed for third-round lower income housing construction, without a comparable effort to preserve sites for lower income housing. 11. The sixth consequence of COAH's continuing delay on the third-round is further delay, for at least another five or six years, in building the new nonprofit affordable housing developments and private sector inclusionary developments that will address the third-round N.J. Department of Community Affairs, New Jersey Construction Reporter, ttp;// page 5 of 9

6 housing obligations of New Jersey municipalities. Even if COAH begins its third-round rulemaking in August 2003, COAH is likely, based on past performance, to take at least one year for public comment, responses to comments, and final adoption of third-round rules, in late 2004 at the earliest under this scenario. COAH's extended certification rules then allow municipalities another year, until late 2005, before they must submit a new housing plan to COAH. COAH typically takes at least another year, until late 2006, to review and certify an uncontested housing plan. Once COAH certifies a municipal housing plan, and implementing municipal ordinances are adopted, nonprofit and private sectors developers must then obtain necessary site-specific approvals and financing, a daunting process that can easily take another year, before construction may begin, in late 2007 or early 2008 under this scenario. If construction takes a year, the first new housing for lower income households to address third-round obligations would not be completed until late 2008 or early Under this optimistic scenario, the 11-year long, third-round would be 85% over before the first lower income housing developed under the third-round is ready for its occupants. 12. Even this scenario is highly optimistic, as COAH will be deluged with more than 100 thirdround new housing plans within a year of adoption of its third-round rules, due to its own rules on extended certifications and its continued third-round delay. Housing plan review gridlock at COAH is likely and completion of plan review within one year is unlikely to be the norm, given COAH's small staff, unless COAH anticipates and addresses this problem. This likely bureaucratic gridlock will lead to further delay in satisfying third-round housing obligations, a seventh consequence of COAH's delay on the third-round In addition to the delay in construction of new housing for lower income households, an eighth consequence of COAH's third-round delay is further delay in rehabilitating 10 Furthermore, housing plans that attract objectors lead to COAH mediation, which currently often takes years before a mediated plan is finally certified. page 6 of 9

7 substandard housing occupied by lower income households. Fair share housing obligations as defined by COAH have two basic components: new construction, which addresses regional housing need, and rehabilitation, which addresses indigenous or local need. The rehabilitation component is significant and in COAH's second-round amounted to about 40,000 housing units, i.e., more than one-third of the statewide housing need. COAH estimates each municipality's indigenous need based on decennial census data and COAHcertified housing plans typically establish a local housing rehabilitation program to upgrade these existing housing units owned or rented by lower income households. COAH's delay on the third-round delays both the identification of third-round indigenous need based on the 2000 census and municipal initiatives to rehabilitate this substandard housing. 14. A ninth consequence of further COAH delay on the third-round is that the unbalanced distribution of lower income housing among New Jersey municipalities will continue, as more and more market-rate housing is developed while the de facto moratorium on Mount Laurel compliance persists, limiting additional production of lower income housing. Specifically, only 5% of New Jersey municipalities have income-restricted lower income housing that is more than 10% of their total housing units, and most of the these municipalities are Urban Aid Municipalities, including Newark, Jersey City, Paterson, Trenton, Camden, East Orange, and Atlantic City. Only four suburban townships have more than 10% income-restricted lower income housing: Berlin (Camden), Greenwich (Cumberland), Upper Deerfield (Cumberland), and Bedminster (Somerset). Only 20% of New Jersey municipalities have income-restricted lower income housing that is more than 5% of their total housing units. The distribution of fair share housing is hardly fair in New Jersey. See Exhibit B. 15. If COAH continues to delay deciding on a third-round methodology and continues to grant extended certifications, and even if COAH begins its third-round rule-making tomorrow, in my opinion land will continue to be developed and redeveloped without meaningful creation page 7 of 9

8 of realistic opportunities for lower income housing construction and the shortage of lower income housing will "deepen," as aptly expressed by the Supreme Court. 16. In my opinion, the remedy for the extraordinarily delayed third round fair share methodology and implementing regulations is for the Court to direct COAH to establish a truly expedited but realistic timetable for completing its statutory duty. As COAH initiated the third-round process more than five years ago, in my opinion a reasonable timetable to begin and conclude the rule-making phase would be six months, with three months for preparing, drafting, and proposing the new rules and three months for considering public comment and adopting the new rules for the third round Even under such an expedited rule-making schedule, municipalities with extended secondround certification would not be required to submit a third-round housing plan to COAH until mid-2005 under current COAH rules. Consequently, part of the remedy for this delay should be to reduce to from one year to six months the maximum time allowed such a municipality to file or petition COAH with its third-round housing plan. In my opinion six months is reasonable, as municipalities can resume their housing planning in earnest once COAH begins its public third-round rule-making process. In effect, municipalities would have nine months to prepare, adopt, and submit their third round plans. 18. Furthermore, the remedy for this COAH delay should also require COAH to obtain sufficient staff and develop expedited procedures to review promptly the anticipated mass submission of housing plans after adoption of COAH's third-round rules, otherwise implementation of the Mount Laurel doctrine will be further stymied by a bureaucratic logjam of housing plans hereby certify that the foregoing statements and attached exhibits are true and correct to the best of my knowledge and belief. I am aware that if any of the foregoing statements by me are willfully false, I am subject to punishment. I recommend this expedited but feasible timetable based in part of my personal experience in State agency rule-making in 1978 and 1980, when I directed the initial rule-making and first comprehensive amendments to N.J.A.C. 7:7E Coastal Zone Management. page 8 of 9

9 Dated: July, 2003 David N. Kinsey Exhibit A: Background of David N. Kinsey Exhibit B: New Jersey Municipalities with 5% of More Lower Income Housing page 9 of 9