S3991

An Act concerning affordable housing rehabilitation, making associated funding available, and supplementing Title 55 of the Revised Statutes.

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

1. a. (1) There is established in the New Jersey Housing and Mortgage Finance Agency a program to be known as the “Affordable Housing Rehabilitation and Renovation Program” for the purpose of allocating available moneys, from the rehabilitation fund and other sources authorized pursuant to subsection c. of this section, to be provided for:

(a) the rehabilitation of multiple dwellings to be used as affordable housing; and

(b) the renovation and preservation of existing affordable housing units that have reached or are approaching the end of the periods of affordability controls established pursuant to the “Fair Housing Act,” P.L.1985, c.222 (C.52:27D-301 et al.).

(2) In allocating funding for the rehabilitation program, the agency shall prioritize an eligible developer who commits to use the funding for a project based in a targeted urban municipality. The executive director in consultation with the commissioner, shall establish an application and review process through which an eligible developer may receive an allocation of moneys through the rehabilitation program.

b. There is established in the New Jersey Housing and Mortgage Finance Agency a fund to be known as the “Affordable Housing Rehabilitation and Renovation Fund” for the purpose of providing the moneys necessary for the rehabilitation program established pursuant to subsection a. of this section. The fund shall be administered by the agency and shall be credited with moneys that are made available pursuant to section 3 of P.L. , c. (C. ) (pending before the Legislature as this bill), or otherwise made available or appropriated by the Legislature, and any return on investment on moneys deposited in the fund.

c. Allocations of moneys for eligible developers through the rehabilitation program shall be provided initially from the rehabilitation fund. If moneys in the rehabilitation fund are not sufficient to adequately support an eligible developer who commits to using the funding for purposes consistent with subsection a. of this section, then the eligible developer shall be eligible to obtain funding from the “New Jersey Affordable Housing Trust Fund,” established pursuant to section 20 of P.L.1985, c.222 (C.52:27D-320).

d. (1) Within 180 days after the date of enactment of P.L. , c. (C. ) (pending before the Legislature as this bill), and notwithstanding the provisions of the “Administrative Procedure Act,” P.L.1968, c.410 (C.52:14B-1 et seq.) to the contrary, the executive director, in consultation with the commissioner, shall immediately upon filing proper notice with the Office of Administrative Law, adopt any rules and regulations necessary to implement the provisions of P.L. , c. (C. ) (pending before the Legislature as this bill).

(2) The rules and regulations adopted pursuant to paragraph 1 of this subsection shall be in effect for a period not to exceed one year after the date of filing. These rules and regulations shall thereafter be adopted, amended, or readopted by the executive director in consultation with the commissioner in accordance with the requirements of the “Administrative Procedure Act” P.L.1968, c.410 (C.52:14B-1 et seq.).

e. As used in this section:

“Affordable housing” means “low income housing,” or “moderate income housing,” as those terms are defined in section 4 of P.L.1985, c.222 (C.52:27D-304).

“Agency” means the New Jersey Housing and Mortgage Finance Agency.

“Commissioner” means the Commissioner of Community Affairs.

“Eligible developer” means a qualified developer that commits to using rehabilitation program funding for purposes consistent with subsection a. of this section.

“Executive director” means the Executive Director of the New Jersey Housing and Mortgage and Finance Agency.

“Multiple dwelling” means a building or structure and land appurtenant thereto containing three or more units of dwelling space that are occupied, or intended to be occupied, by three or more households.

“Rehabilitation fund” means the “Affordable Housing Rehabilitation and Renovation Fund,” established pursuant to subsection b. of this section.

“Rehabilitation program” means the Affordable Housing Rehabilitation and Renovation Program, established pursuant to subsection a. of this section.

“Targeted urban municipality” means a municipality designated by the agency as a targeted urban municipality based on factors determined by the agency, including the Department of Community Affairs Municipal Revitalization Index, housing density, population, and employment to housing ratio.

2. a. Federal funds shall be made available for the Division of Disaster Recovery and Mitigation in the Department of Community Affairs from the federal “American Rescue Plan Act of 2021,” Pub.L.117-2. Amounts made available for the Division of Disaster Recovery and Mitigation pursuant to this subsection shall be deposited into the Affordable Housing Rehabilitation and Renovation Fund, established pursuant to subsection b. of section 1 of P.L. , c. (C. ) (pending before the Legislature as this bill), for the purposes of the fund, and of such amounts not more than 2.5 percent, subject to the division’s review and approval, shall be utilized by the New Jersey Housing and Mortgage Finance Agency for organizational, administrative and other work and services, including salaries, equipment, services, and materials necessary to administer the activities authorized by this subsection. The New Jersey Housing and Mortgage Finance Agency shall enter into a memorandum of understanding or grant agreement, as applicable, with the division to effectuate the purposes of this subsection, to define what constitutes appropriate administrative costs, and to ensure compliance with federal rules and guidance, including with respect to the federal “American Rescue Plan Act of 2021,” Pub.L.117-2.

b. As the State’s grant manager for funds received by the State pursuant to the federal “American Rescue Plan Act of 2021,” Pub.L.117-2, the division is authorized to utilize not more than one percent of the funds made available pursuant to this section to provide for the division’s organizational, administrative, and other work and services, including salaries, services, equipment, and materials necessary to administer the applicable provisions of P.L. , c. (C. ) (pending before the Legislature as this bill).

c. Notwithstanding the provisions of subsection a. of this section to the contrary, the division may transfer the uncommitted balance of any funds made available pursuant to this section for any use authorized pursuant to P.L. , c. (C. ) (pending before the Legislature as this bill). The division shall submit notice to the Joint Budget Oversight Committee, or its successor, no less than five calendar days before the date of a transfer made pursuant to this subsection. The notice shall indicate the amount of the transferred funds and the purpose for which the funds are transferred.

3. This act shall take effect immediately.

STATEMENT

This bill would establish the “Affordable Housing Rehabilitation and Renovation Program” (“rehabilitation program”) in the New Jersey Housing and Mortgage Finance Agency (“HMFA”) in order to allocate available funding for the purposes of rehabilitating multiple dwellings to be used as affordable housing, and renovating and preserving existing affordable housing units nearing the end their affordability control periods established in accordance with the “Fair Housing Act,” P.L.1985, c.222 (C.52:27D-301 et al.). In allocating funding for the rehabilitation program, the bill directs HMFA to prioritize eligible developers who commit to use the funding for projects based in “targeted urban municipalities,” as designated in accordance with criteria established in HMFA regulations. The prioritization is established for targeted urban municipalities in order to establish balance in the funding of affordable housing between urban and suburban areas following recent commitments to disproportionately fund these developments in suburban areas.

The bill further establishes the Affordable Housing Rehabilitation and Renovation Fund (“rehabilitation fund”) to support the purposes of the rehabilitation program. The rehabilitation fund would be supported by federal funds allocated to New Jersey from the federal “American Rescue Plan Act of 2021,” Pub.L.117-2. The rehabilitation fund would be administered by HMFA.

Allocations of moneys for eligible developers through the rehabilitation program would be provided initially from the rehabilitation fund. If moneys in the rehabilitation fund are not sufficient to adequately support a developer eligible for the rehabilitation program, then the developer would be eligible to obtain funding from New Jersey Affordable Housing Trust Fund.

The bill directs HMFA to enter into a memorandum of understanding or grant agreement, as applicable, with the Division of Disaster Recovery and Mitigation in the Department of Community Affairs (“division”) to effectuate the purposes of the fund, to establish appropriate administrative costs, and to ensure compliance with federal rules and guidance, including with respect to the “American Rescue Plan Act of 2021,” Pub.L.117-2. The bill permits the transfer the uncommitted balance of any moneys made available. However, the bill requires the division to submit notice to the Joint Budget Oversight Committee, or its successor, no less than five calendar days before the date of the transfer. The notice would indicate the amount of the transferred funds and the purpose for which the funds are transferred.