S1830

An Act concerning assistance and protections for certain homebuyers, designated as the New Jersey Workforce Housing Partnership Act, amending and supplementing various parts of the statutory law, and making appropriations.

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

1. (New section) P.L. , c. (C. ) (pending before the Legislature as this bill) shall be known and may be cited as the “New Jersey Workforce Housing Partnership Act.”

2. (New section) The Legislature finds and declares:

a. Housing affordability remains a major challenge for middle-class workers, including teachers, first responders, healthcare workers, and young professionals.

b. Employers in high-cost areas within the State continue to struggle to attract and retain skilled workers due to unaffordable housing options.

c. Public-private partnerships can bridge the gap between wages and home ownership by incentivizing employer-sponsored housing assistance through the implementation of workforce housing programs that prioritize long-term affordability while preventing displacement of existing residents.

d. Municipal governments can benefit from a broader tax base through the development of workforce housing and the revitalization of underutilized commercial spaces.

e. Municipalities in which there are underutilized commercial spaces that may be developed into workforce housing pursuant to P.L. , c. (C. ) (pending before the Legislature as this bill) are hereby declared areas in need of rehabilitation, provided, however, that this declaration alone shall not be used to allow any property to be taken or acquired.

f. To address the State housing affordability issues, it is necessary to:

(1) establish a Workforce Housing Assistance Program to provide State grants to match employer-provided down payment assistance and low-interest mortgage options;

(2) offer tax incentives to businesses that contribute to their employees’ homeownership;

(3) encourage the development of workforce housing by employers;

(4) incentivize municipal participation through zoning flexibility;

(5) ensure affordability protections for low- and middle-income residents; and

(6) encourage private sector involvement through developer incentives and banking partnerships.

3. (New section) As used in section 4 through section 10 of P.L. , c. (C. ) (pending before the Legislature as this bill):

“Agency” means the New Jersey Housing and Mortgage Finance Agency established pursuant to P.L.1983, c.530 (C.55:14K-1 et seq.).

“Authority” means the New Jersey Economic Development Authority established by section 4 of P.L.1974, c.80 (C.34:1B-4).

“Eligibility period” means the period, as specified in an incentive award agreement, during which a qualified employer may claim tax credits, as such credits and period shall be determined by the authority pursuant to section 9 of P.L. , c. (C. ) (pending before the Legislature as this bill).

“Low- and moderate-income housing” means housing that is affordable, according to the federal Department of Housing and Urban Development or other recognized standards, for home ownership and rental costs and occupied or reserved for occupancy by households with a gross household income not more than 80 percent of the median gross household income for households of the same size within the housing region in which the housing is located.

“Middle-income” means household income below 120 percent of the area median income determined by the United States Department of Housing and Urban Development.

“Program” means the “Workforce Housing Assistance Program” established pursuant to section 4 of P.L. , c. (C. ) (pending before the Legislature as this bill).

“Project cost” means the sum total of all costs incurred by a developer in the acquisition, development, construction, improvement, or rehabilitation of a workforce housing project, which are approved by the authority as reasonable or necessary, which costs shall include, but not limited to: (1) the cost of land acquisition and any buildings thereon; (2) the cost of site preparation, demolition, and development; (3) architect, engineer, legal, and other fees paid or payable in connection with the planning, execution, and financing of the project; (4) the cost of necessary studies, surveys, plans, and permits; (5) insurance, interest, financing, and assessment costs and other operating and carrying costs during construction; (6) the cost of construction, reconstruction, fixtures, and equipment related to the real property; (7) the cost of land improvements; (8) necessary expenses in connection with initial occupancy of the project; (9) a reasonable profit or fee to the builder; (10) an allowance established by the authority for working capital and contingency reserves, and reserves for any operating deficits; (11) costs of guarantees, insurance, or other additional financial security for the project; and (12) the cost of such other items, including tenant relocation, as the authority shall determine to be reasonable or necessary for the development of the project, less any and all net rents and other net revenues received from the operation of the real and personal property on the project site during construction, improvement, or rehabilitation. All components of “project cost” shall be subject to approval by the authority and audit by, or at the direction of, the authority.

“Qualified employee” means a full-time employee of a qualified employer who has worked for the qualified employer for a minimum of one calendar year prior to the employer’s date of application for the program, which employee is middle-income or a member of a middle-income household.

“Qualified employer” means a person or business entity doing business in the State, which person or business entity employs one or more qualified employees residing within this State.

“Relief program” means the “Workforce Housing Impact Relief Program” established pursuant to section 10 of P.L. , c. (C. ) (pending before the Legislature as this bill).

“Underutilized commercial property” means a vacant office building, shopping mall, or other commercial space, which property meets the following criteria:

(1) the commercial space has a vacancy rate of at least 25 percent for a continuous period of at least 18 months immediately preceding the application for development;

(2) the commercial space has suffered an economic downturn over the three-year period immediately preceding the date of the application, as demonstrated by evidence of a quantifiable loss in revenue such that the developer’s expenses for the premises have exceeded revenues by 30 percent or more each year; and

(3) the owner of the property has made and maintained a continuous, good faith effort to redress the vacancy, actively rent, or actively market the property during the 18 months immediately preceding the application for development.

“Workforce housing” means housing that is affordable, according to federal Department of Housing and Urban Development or other recognized standards, for home ownership and rental costs and that is occupied or reserved for occupancy by households with a gross household income not more than 120 percent of the median gross household income for households of the same size within the housing region in which the housing is located.

“Workforce housing project” means a residential housing project developed or financed by a qualified employer that primarily includes workforce housing and includes a minimum set-aside of 20 percent of units for households earning not more than 80 percent of the area median income determined by the federal Department of Housing and Urban Development.

4. (New section) a. Within 12 months after the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill), the New Jersey Economic Development Authority, in coordination with the New Jersey Housing and Mortgage Finance Agency, shall establish a “Workforce Housing Assistance Program” to provide incentives to qualified employers related to the provision of workforce housing assistance to qualified employees. The program shall consist of the following two components:

(1) the provision of matching contribution grants, pursuant to section 5 of P.L. , c. (C. ) (pending before the Legislature as this bill), for down-payment assistance provided by a qualified employer to one or more qualified employees for the purchases of workforce housing in this State; and

(2) the provision of low-interest mortgage loans and loan guarantees, pursuant to section 6 of P.L. , c. (C. ) (pending before the Legislature as this bill), to the qualified employees of a qualified employer for the purchase of workforce housing in this State.

b. The authority shall accept applications from qualified employers, in a form and manner to be determined by the authority, for participation in the program. In addition to such other information as the authority may require, an applicant shall demonstrate that the qualified employer has implemented a down-payment assistance program for qualified employees, consistent with the requirements of section 5 of P.L. , c. (C. ) (pending before the Legislature as this bill). The authority may accept applications for the program on a rolling basis, subject to the availability of funds for the program.

5. (New section) a. Upon approval of an application submitted pursuant to section 4 of P.L. , c. (C. ) (pending before the Legislature as this bill), the authority shall distribute matching contribution grants, as necessary, to each qualified employer solely for the distribution to each qualified employee for which the qualified employer has provided financial contributions for down-payment assistance, subject to the provisions of this section.

b. To be eligible for a matching contribution grant pursuant to this section, the qualified employer shall have provided each eligible employee a financial contribution of at least $5,000 toward a down payment for the purchase of a workforce housing unit, which purchase occurs within 12 months of the date of approval of the qualified employer’s application for the program, and which housing shall be occupied as the qualified employee’s primary residence in this State.

c. Matching contribution grants shall be issued on a rolling basis, during the 12-month period following the date of approval of the qualified employer’s application for the program, as necessary to provide matching contribution grants for each qualified employee, except that the amount of each matching contribution grant shall not exceed:

(1) for a qualified employer that employs 50 or more employees, an amount equal to the financial contribution paid by the qualified employer to the qualified employee, but not to exceed a maximum contribution of $10,000 per qualified employee; or

(2) for a qualified employer that employs fewer than 50 employees, an amount equal to 200 percent of the financial contribution paid by the qualified employer to the qualified employee, but not to exceed a maximum grant of $15,000 per qualified employee.

d. (1) Within no later than 15 calendar days following the provision of a financial contribution to a qualified employee for down-payment assistance purposes, the qualified employer shall provide written notice to the authority, including such information and documentation as may be required by the authority to substantiate the eligibility for a matching contribution grant. Upon review and approval of the written notice, the authority shall issue a matching contribution grant to the qualified employer, and the qualified employer shall distribute the full balance of the grant to the qualified employee within no later than seven calendar days following the date of receipt.

(2) All matching contribution grants awarded pursuant to this section shall be issued from the deposits in the “Workforce Housing Assistance Program Fund,” established pursuant to section 7 of P.L. , c. (C. ) (pending before the Legislature as this bill).

e. The authority shall issue, to any qualified employer providing a financial contribution matched by the authority pursuant to this section, an annual certification of the qualified employer’s financial contribution paid to each qualified employee’s purchase of a primary residence in this State and, as appropriate, the total value of the qualified employer’s financial contributions to qualified employees.

6. (New section) a. Upon approval of an application submitted pursuant to section 4 of P.L. , c. (C. ) (pending before the Legislature as this bill), the authority shall make available low-interest mortgage loans and loan-guarantees to the qualified employees of the qualified employer, subject to the provisions of this section.

b. A qualified employee of a qualified employer that is approved to participate in the program shall apply directly to the authority for the issuance of a low-interest mortgage loan or a loan guarantee. The application shall be submitted in a form and manner prescribed by the authority and shall contain such information and documentation as may be required by the authority. The authority shall approve applications submitted pursuant to this section on a rolling basis, subject to the availability of funds.

c. Any low-interest mortgage loan or loan guarantee shall be issued according to such terms and conditions as may be determined by the authority, provided that such loans and loan guarantees shall only be issued for the purchase of a workforce housing unit by a qualified employee, which purchase occurs within 12 months of the date of approval of the qualified employer’s application for the program, and which housing shall be occupied as the qualified employee’s primary residence in this State.

d. All low-interest mortgage loans and loan guarantees awarded pursuant to this section shall be issued from the deposits in the “Workforce Housing Assistance Program Fund,” established pursuant to section 7 of P.L. , c. (C. ) (pending before the Legislature as this bill), and all loan repayments shall be deposited into the fund.

7. (New section) a. The authority shall establish and administer a special, non-lapsing fund, to be known as the “Workforce Housing Assistance Program Fund,” which shall serve as the repository of all funds necessary to support the program. The fund shall be credited with:

(1) appropriations made by the Legislature;

(2) funds provided by the federal government;

(3) any return on investment of monies deposited in the fund; and

(4) other funds which may be available to the authority for the purpose of implementing the program.

b. Notwithstanding any other provision of law to the contrary, monies in the fund shall be used by the authority for the sole purpose of providing matching contribution grants, low-interest mortgage loans, and loan guarantees under the Workforce Housing Assistance Program established pursuant to section 4 of P.L. , c. (C. ) (pending before the Legislature as this bill).

8. (New section) a. Within three years following the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill), and every three years thereafter, the authority, in coordination with the agency, shall review the effectiveness of the Workforce Housing Assistance Program, including, but not limited to:

(1) the impact of the program on employee retention in the State;

(2) the rates of participation in the program by qualified employers;

(3) the rates of participation in the program by qualified employers with fewer than 50 employees;

(4) the rates of homeownership by qualified employees in the State; and

(5) any other measure by which the authority determines the success of the Workforce Housing Assistance Program may best be studied.

b. The authority, in coordination with the agency, shall report its findings pursuant to each review conducted pursuant to subsection a. of this section and shall recommend the continuation, modification, or termination of the Workforce Housing Assistance Program, including any recommended changes to funding for the program, to the Governor and, pursuant to section 2 of P.L.1991, c.164 (C.52:14-19.1), to the Legislature.

9. (New section) a. A qualified employer shall be eligible to receive an incentive award, including the issuance of tax credits, to support a portion of the project costs incurred in the conversion of underutilized commercial property into a workforce housing project. A qualified employer shall submit an application to the authority, in a form and manner prescribed by the authority, provided that the qualified employer shall demonstrate the following in the application:

(1) the applicant is a qualified employer that seeks to convert underutilized commercial property into a workforce housing project;

(2) evidence satisfactory to the authority that the development of the workforce housing project is in compliance with applicable State and federal laws and safety standards;

(3) the anticipated project costs to be incurred by the qualified employer in developing the workforce housing project;

(4) assurances deemed satisfactory to the authority that a minimum of 20 percent of units in the workforce housing project shall be set aside for low- and moderate-income housing; and

(5) any other information or documentation required by the authority.

b. (1) The authority shall review and approve applications submitted pursuant to this section on a rolling basis. Upon approval of an application, the authority shall enter into an incentive award agreement with the qualified employer for the development of the workforce housing project.

(2) An incentive award agreement shall specify the amount of the incentive award that shall be awarded to the qualified employer and the duration of the eligibility period. The incentive award agreement shall provide an estimated date of completion and include a requirement for periodic progress reports, which agreement shall condition the incentive award upon the qualified employer’s continued compliance with the incentive award agreement and continued submission of progress reports. The obligations of the qualified employer under the incentive award agreement shall include, but not be limited to, ensuring that any rental rates set aside for low- and moderate-income housing are reserved for low- and moderate-income housing for a minimum of 15 years following the date of project completion.

c. A qualified employer shall submit, prior to the first disbursement of tax credits under the incentive award agreement, but no later than six months following project completion, satisfactory evidence of actual project costs, as certified by a certified public accountant, and evidence of a temporary certificate of occupancy, or other event evidencing project completion that begins the eligibility period indicated in the incentive award agreement. The qualified employer, or an authorized agent thereof, shall certify that the information provided pursuant to this subsection is true under the penalty of perjury. Claims, records, or statements submitted by a qualified employer to the authority in order to receive tax credits shall not be considered claims, records, or statements made in connection with State tax laws. Thereafter, the authority shall issue to the qualified employer a certification of the approved project costs for the development of the workforce housing project.

d. In accordance with the incentive award agreement, beginning upon the receipts of occupancy permits for all housing units within the workforce housing project, or upon any other event evidencing project completion as set forth in the incentive award agreement, a qualified employer shall be allowed a total tax credit award of up to 15 percent of the approved project costs for the development of the workforce housing project.

e. (1) Upon the commencement of the eligibility period, a qualified employer shall submit an annual report to the authority indicating whether the qualified employer is aware of any condition, event, or act that would cause the qualified employer not to be in compliance with the incentive award agreement or the provisions of P.L. , c. (C. ) (pending before the Legislature as this bill) and any additional reporting requirements contained in the incentive award agreement or tax credit certificate. The qualified employer, or an authorized agent thereof, shall certify that the information provided pursuant to this subsection is true under the penalty of perjury.

(2) Upon receipt and review of each report submitted during the eligibility period, the authority shall provide to the qualified employer and the director a certificate of compliance indicating the amount of tax credits that the qualified employer may apply against the employer’s tax liability.

f. (1) Upon receipt by the director of the certificate of compliance, the director shall allow the qualified employer a credit against the tax imposed pursuant to the “New Jersey Gross Income Tax Act,” N.J.S.54A:1-1 et seq., section 5 of P.L.1945, c.162 (C.54:10A-5), sections 2 and 3 of P.L.1945, c.132 (C.54:18A-2 and C.54:18A-3), section 1 of P.L.1950, c.231 (C.17:32-15), or N.J.S.17B:23-5, which credit may be first applied in the tax period for which it was issued, in the tax period in which it was issued, or in a successive tax period, as authorized in this subsection, without the need to amend the tax return for the tax period for which the credit was issued, subject to the carry-forward provision in this section. Notwithstanding the foregoing, no more than the amount of tax credits equal to the total credit amount divided by the duration of the eligibility period, in years, may be taken in any tax period. A qualified employer may carry forward an unused credit resulting from the limitations of this subsection, if necessary, for use in the seven tax periods next following the tax period for which the credits are issued.

(2) (a) The director shall prescribe the order of priority of the application of the credit allowed under this section and any other credits allowed by law against the tax imposed under section 5 of P.L.1945, c.162 (C.54:10A-5). The amount of the credit applied under this section against the tax imposed pursuant to section 5 of P.L.1945, c.162 (C.54:10A-5) for a privilege period, together with any other credits allowed by law, shall not reduce the tax liability to an amount less than the statutory minimum provided in subsection (e) of section 5 of P.L.1945, c.162 (C.54:10A-5).

(b) The director shall prescribe the order of priority of the application of the tax credit allowed under this section, together with any other credits allowed by law, against the tax imposed under the “New Jersey Gross Income Tax Act,” N.J.S.54A:1-1 et seq., for a taxable year. The amount of the tax credit applied under this section against the tax imposed pursuant to N.J.S.54A:1-1 et seq. for a taxable year, together with any other credits allowed by law, shall not reduce the tax liability to an amount less than zero.

(3) (a) A business entity that is classified as a partnership for federal income tax purposes shall not be allowed the tax credit directly under N.J.S.54A:1-1 et seq., but the amount of credit of the taxpayer in respect of a distributive share of partnership income shall be determined by allocating to the taxpayer that proportion of the credit acquired by the partnership that is equal to the taxpayer’s share, whether or not distributed, of the total distributive income or gain of the partnership for its taxable year ending within or with the taxpayer’s taxable year.

(b) A business entity that is a New Jersey S corporation shall not be allowed the tax credit directly under N.J.S.54A:1-1 et seq., but the amount of credit of a taxpayer in respect of a pro-rata share of S corporation income shall be determined by allocating to the taxpayer that proportion of the credit acquired by the New Jersey S corporation that is equal to the taxpayer’s share, whether or not distributed, of the total pro-rata share of S corporation income of the New Jersey S corporation for its privilege period ending within or with the taxpayer’s taxable year.

g. (1) A qualified employer may apply to the director and the chief executive officer of the authority for a tax credit transfer certificate, covering one or more years, in lieu of the qualified employer being allowed all or part of the credit against the tax liability of the qualified employer.

(2) The tax credit transfer certificate, upon receipt thereof by the qualified employer from the director and the chief executive officer of the authority, may be sold or assigned, in full or in part in an amount not less than $25,000, in the tax period during which the qualified employer receives the tax credit transfer certificate from the director, to another person, who may apply the credit against a tax liability pursuant to the “New Jersey Gross Income Tax Act,” N.J.S.54A:1-1 et seq., section 5 of P.L.1945, c.162 (C.54:10A-5), sections 2 and 3 of P.L.1945, c.132 (C.54:18A-2 and C.54:18A-3), section 1 of P.L.1950, c.231 (C.17:32-15), or N.J.S.17B:23-5. The certificate provided to the qualified employer shall include a statement waiving the qualified employer’s right to claim the amount of the credit that the qualified employer has elected to sell or assign against the qualified employer’s tax liability.

(3) The qualified employer shall not sell or assign, including a collateral assignment, a tax credit transfer certificate allowed under this section for consideration received by the qualified employer of less than 85 percent of the transferred credit amount before considering any further discounting to present value which shall be permitted. The tax credit transfer certificate issued to a qualified employer by the director shall be subject to any limitations and conditions imposed on the application of State tax credits pursuant to P.L. , c. (C. ) (pending before the Legislature as this bill) and any other terms and conditions that the director may prescribe, provided, however, that the holder of a tax credit certificate may transfer all or part of the tax credit amount, on or after the date of issuance of the tax credit transfer certificate, for use by the transferee in the tax period for which it was issued, in the tax period in which it was issued, or in any of the next three successive tax periods. The tax certificate holder or transferee may first use the credit against tax liabilities in the tax period in which it was issued or in a succeeding tax period, as authorized in this subsection, without the need to amend the tax return for the tax period for which the credit was issued, subject to the provisions of this section. A transferee may carry forward an unused credit for use in any of the next five successive tax periods, and the unused credit shall expire thereafter. Notwithstanding any provision of this section to the contrary, the amount of tax credits that may be claimed by the transferee in any tax period shall not exceed the total tax credit amount divided by the duration of the eligibility period in years.

(4) A purchaser or assignee of a tax credit transfer certificate pursuant to this section shall not make any subsequent transfers, assignments, or sales of the tax credit transfer certificate.

h. The authority shall publish on its Internet website the following information concerning each tax credit transfer certificate approved by the authority and the director pursuant to this section:

(1) the name of the transferor;

(2) the name of the transferee;

(3) the value of the tax credit transfer certificate; and

(4) the consideration received by the transferor.

10. (New section) a. There is established in the New Jersey Economic Development Authority a “Workforce Housing Impact Relief Program” for the purpose of providing grants, in such amounts as may be determined by the authority, to certain long-term homeowners that reside in municipalities impacted by the development of one or more workforce housing projects. The authority may accept applications for a grant pursuant to this section on a rolling basis, subject to the availability of funds.

b. An individual shall be eligible for a grant under the relief program, provided that:

(1) the individual’s household earns not more than 80 percent of the area median income determined by the United States Department of Housing and Urban Development; and

(2) the individual’s principal residence is located in a municipality impacted by the development of workforce housing projects pursuant to section 9 of P.L. , c. (C. ) (pending before the Legislature as this bill), and the individual has owned the principal residence for not less than 10 years prior to the date of application for the relief program.

c. An individual seeking to receive a grant pursuant to this section shall submit an application to the authority, in such form and manner as the authority requires. An applicant shall include, in addition to any other information or documentation which the authority may require:

(1) evidence satisfactory to the authority that the individual meets the eligibility requirements in subsection b. of this section; and

(2) a certification that, to the best of the applicant’s knowledge, no other member of the applicant’s household has applied or plans to apply for a grant pursuant to this section.

d. The authority shall establish and administer a special, non-lapsing fund, to be known as the “Workforce Housing Impact Relief Fund,” for the purpose of providing grants to eligible homeowners pursuant to this section. The fund shall be credited with:

(1) such monies as may be appropriated by the Legislature;

(2) any return on investment of monies deposited in the fund; and

(3) other funds which may be available to the authority for the purpose of effectuating this section.

11. (New section) a. A taxpayer that is a qualified employer shall be allowed a credit against the tax imposed pursuant to section 5 of P.L.1945, c.162 (C.54:10A-5) in an amount equal to 25 percent of the amount of the total financial contributions paid by the taxpayer during the privilege period to one or more qualified employees, pursuant to section 5 of P.L. , c. (C. ) (pending before the Legislature as this bill), toward down payments for the purchase of workforce housing to be occupied as the principal residence of the qualified employee, except that the total credits shall not exceed a maximum value of $500,000 during a privilege period.

b. In addition to the amount authorized pursuant to subsection a. of this section, if a taxpayer is a qualified employer that employs fewer than 50 employees, the taxpayer shall be allowed an additional tax credit amount equal to 10 percent of the amount of the taxpayer’s financial contributions paid during the privilege period to each qualified employee in excess of $5,000 per qualified employee.

c. The order of priority of the application of the credit allowed pursuant to this section and any other credits allowed by law against the tax imposed pursuant to section 5 of P.L.1945, c.162 (C.54:10A-5) shall be as prescribed by the director. The amount of the credit applied under this section against the tax imposed pursuant to section 5 of P.L.1945, c.162 (C.54:10A-5) for a privilege period, together with any other credits allowed by law, shall not exceed 50 percent of the tax liability otherwise due and shall not reduce the tax liability to an amount less than the statutory minimum provided in subsection (e) of section 5 of P.L.1945, c.162 (C.54:10A-5). The amount of the tax credit otherwise allowable under this section which cannot be applied for the privilege period due to the limitations of this subsection or under other provisions of P.L.1945, c.162 (C.54:10A-1 et seq.) may be carried forward, if necessary, to the seven privilege periods following the privilege period for which the tax credit was issued, after which the tax credit shall expire.

d. No tax credit shall be allowed pursuant to this section for any costs or expenses included in the calculation of any other tax credit or exemption granted pursuant to a claim made on a tax return filed with the director, or included in the calculation of an award of business assistance or incentive, for a period of time that coincides with the privilege period for which a tax credit authorized pursuant to this section is allowed.

e. To claim the tax credit allowed pursuant to this section, the taxpayer shall attach, to any return which the taxpayer is required to file under P.L.1945, c.162 (C.54:10A-1 et seq.) to the director, the certificate issued by the authority, pursuant to subsection e. of section 5 of P.L. , c. (C. ) (pending before the Legislature as this bill), for that privilege period.

f. As used in this section:

“Authority” means the New Jersey Economic Development Authority established by section 4 of P.L.1974, c.80 (C.34:1B-4).

“Qualified employee,” “qualified employer,” and “workforce housing” mean the same as those terms are defined in section 3 of P.L. , c. (C. ) (pending before the Legislature as this bill).

12. (New section) a. A taxpayer that is a qualified employer shall be allowed a credit against the tax otherwise due under the “New Jersey Gross Income Tax Act,” N.J.S.54A:1-1 et seq. in an amount equal to 25 percent of the amount of the total financial contributions paid by the taxpayer during the taxable year to one or more qualified employees, pursuant to section 5 of P.L. , c. (C. ) (pending before the Legislature as this bill), toward down payments for the purchase of workforce housing to be occupied as the principal residence of the qualified employee, except that the total credits shall not exceed a maximum value of $500,000 during a taxable year.

b. In addition to the amount authorized pursuant to subsection a. of this section, if a taxpayer is a qualified employer that employs fewer than 50 employees, the taxpayer shall be allowed an additional tax credit amount equal to 10 percent of the amount of the taxpayer’s financial contributions paid during the taxable year to each qualified employee in excess of $5,000 per qualified employee.

c. The order of priority of the application of the credit allowed pursuant to this section and any other credits allowed by law against the tax imposed pursuant to the “New Jersey Gross Income Tax Act,” N.J.S.54A:1-1 et seq., for a taxable year shall be as prescribed by the director. The amount of the credit applied under this section against the tax imposed pursuant to N.J.S.54A:1-1 et seq. for a taxable year, together with other payments, credits, deductions, and adjustments allowed by law, shall not reduce a taxpayer’s tax liability to an amount less than zero. The amount of the tax credit otherwise allowable under this section which cannot be applied for the taxable year due to the limitations of this subsection or under other provisions of N.J.S.54A:1-1 et seq. may be carried forward, if necessary, to the seven taxable years following the taxable year for which the tax credit was issued, after which the tax credit shall expire.

d. No tax credit shall be allowed pursuant to this section for any costs or expenses included in the calculation of any other tax credit or exemption granted pursuant to a claim made on a tax return filed with the director, or included in the calculation of an award of business assistance or incentive, for a period of time that coincides with the taxable year for which a tax credit authorized pursuant to this section is allowed.

e. (1) A business entity that is classified as a partnership for federal income tax purposes shall not be allowed a tax credit pursuant to this section directly, but the amount of tax credit of a taxpayer in respect to a distributive share of entity income shall be determined by allocating to the taxpayer that proportion of the tax credit acquired by the entity that is equal to the taxpayer’s share, whether or not distributed, of the total distributive income or gain of the entity for its taxable year ending within or with the taxpayer’s taxable year.

(2) A New Jersey S Corporation shall not be allowed a tax credit pursuant to this section directly, but the amount of the tax credit of a taxpayer in respect of a pro rata share of S Corporation income shall be determined by allocating to the taxpayer that proportion of the tax credit acquired by the New Jersey S Corporation that is equal to the taxpayer’s share, whether or not distributed, of the total pro rata share of income of the New Jersey S Corporation for its privilege period ending within or with the taxpayer’s taxable year.

f. To claim the tax credit allowed pursuant to this section, the taxpayer shall attach, to any return which the taxpayer is required to file under the “New Jersey Gross Income Tax Act,” N.J.S.54A:1-1 et seq., to the director, the certificate issued by the authority, pursuant to subsection e. of section 5 of P.L. , c. (C. ) (pending before the Legislature as this bill), for that taxable year.

g. As used in this section:

“Authority” means the New Jersey Economic Development Authority established by section 4 of P.L.1974, c.80 (C.34:1B-4).

“Qualified employee,” “qualified employer,” and “workforce housing” mean the same as those terms are defined in section 3 of P.L. , c. (C. ) (pending before the Legislature as this bill).

13. (New section) a. A municipality may adopt an ordinance granting an abatement or exemption from taxation, or both, for any workforce housing project developed pursuant to P.L. , c. (C. ) (pending before the Legislature as this bill), subject to the provisions of this section. The ordinance shall require that, in determining the value of real property, the municipality shall regard up to and including the assessor’s full and true value of the improvements as not increasing the taxable value of the property for a period of five years, notwithstanding that the value of the property to which the improvements are made is increased thereby. During the exemption period, the assessment on the property shall not be less than the assessment thereon immediately prior to the improvements.

b. Upon the adoption of an ordinance pursuant to subsection a. of this section, the owner of a workforce housing project located within the municipality shall enter into a written agreement with the governing body of the municipality for the exemption of real property taxation for the five-year exemption period, subject to the requirement to provide payments in lieu of tax to the municipality, and provided that the workforce housing project remains in compliance with all requirements of P.L. , c. (C. ) (pending before the Legislature as this bill), including the provisions of any incentive award agreement. The agreement shall provide for the property owner to pay to the municipality in lieu of full property tax payments an amount annually to be computed as follows:

(1) in the first full year, no payment in lieu of taxes otherwise due;

(2) in the second full year, an amount not less than 20 percent of taxes otherwise due;

(3) in the third full year, an amount not less than 40 percent of taxes otherwise due;

(4) in the fourth full year, an amount not less than 60 percent of taxes otherwise due; and

(5) in the fifth full year, an amount not less than 80 percent of taxes otherwise due.

14. (New section) a. As used in this section:

"Accessory dwelling unit" means a residential dwelling unit that provides complete independent living facilities for one or more persons on the same lot as a primary dwelling. An "accessory dwelling unit" may be: located within a primary dwelling; located within an accessory structure; constructed in whole or part as an extension to a primary dwelling; or constructed as a separate, detached structure on the same lot as a primary dwelling.

"Accessory structure" means a structure that is accessory, and incidental to, a primary dwelling.

"Complete independent living facilities" means space in a dwelling intended for human habitation, including living, sleeping, eating, cooking, or sanitation.

"Developer" means the same as the term is defined pursuant to section 34 of P.L.2008, c.46 (C.40:55D-8.3).

"Dwelling" means a building or structure or part thereof containing one or more dwelling units.

"Dwelling unit" means a room or group of rooms, or any part thereof, located within a building and forming a single habitable unit with facilities, which are used, or designed to be used, for living, sleeping, cooking, and eating.

"Eligible property" means a commercial space, building, or structure that meets the requirements of subsection c. of this section.

"Mixed-use development" means the same as the term is defined pursuant to section 34 of P.L.2008, c.46 (C.40:55D-8.3).

"Primary dwelling" means a single-family or two-family dwelling proposed or existing on a lot in an area in which single-family and two-family dwellings are permitted uses.

"Single-family dwelling" means a dwelling that is detached or semi-detached, including a row house or townhouse that is not part of a planned real estate development, as defined pursuant to subsection h. of section 3 of P.L.1977, c.419 (C.45:22A-23), which contains a dwelling unit designed for residential use by one family on an individual lot in an area in which single-family dwellings are permitted uses.

"Two-family dwelling" means a dwelling that contains two separate dwelling units, whether separated horizontally or vertically, which are designed for residential use by two families on an individual lot in an area in which two-family dwellings are permitted uses.

"Vacancy rate" means the percentage of unoccupied or unused square footage in a structure or facility, compared to the total square footage of the structure or facility.

b. Subject to the requirements of this section, a municipality may adopt an ordinance that permits:

(1) the development of accessory dwelling units, as specified pursuant to subsection c. of this section;

(2) the development of duplexes and triplexes in an area zoned for single-family residential use; and

(3) mixed-use development, which complies with the provisions of subsection d. of this section.

c. (1) An ordinance adopted pursuant to paragraph (1) of subsection b. of this section shall provide a reasonable opportunity for the development of accessory dwelling units within the municipality.

(2) The ordinance may contain the following provisions, which shall not independently support a determination that the ordinance does not provide a reasonable opportunity for the development of accessory dwelling units:

(a) reasonable landscaping standards for detached accessory dwelling units;

(b) architectural review requirements for an application for development of an accessory dwelling unit within an area designated as a historic district, if the development requires either new construction or exterior modification of an existing structure;

(c) a limit on the rental term for an accessory dwelling unit, including penalties that may be imposed upon the owner of an accessory dwelling unit that violates the term limit; or

(d) a maximum size limit of an accessory dwelling unit that is constructed separately from a primary dwelling, including a requirement that the total square footage of the accessory dwelling unit is not to exceed 60 percent of the lot’s buildable area.

d. (1) The ordinance pursuant to paragraph (3) of subsection b. of this section shall permit the conversion or partial conversion of eligible properties into mixed-use developments, and shall require that the developer demonstrate that the property located on the lot or land included in the application for development meets the following requirements to be deemed an eligible property:

(a) the commercial space has a vacancy rate of at least 25 percent for a continuous period of at least 18 months immediately preceding the application for development;

(b) the commercial space has suffered an economic downturn over the three-year period immediately preceding the date of the application, as demonstrated by evidence of a quantifiable loss in revenue such that the developer’s expenses for the premises have exceeded revenues by 30 percent or more each year; and

(c) the owner of the property has made and maintained a continuous, good faith effort to redress the vacancy, actively rent, or actively market the property during the 18 months immediately preceding the application for development.

(2) The ordinance may provide that:

(a) the planning board shall approve an application to repurpose or redevelop an eligible property into a mixed-use development notwithstanding the eligible property’s location in the municipality if the project complies with the zoning requirements applicable to projects within the municipality’s mixed-use zone; and

(b) if the municipality has multiple mixed-use zones in the municipal ordinance or land use regulations, the municipality may designate which of its mixed-use zones’ land use regulations shall apply to mixed-use developments that meet the requirements of this subsection.

15. Section 25 of P.L.1984, c.73 (C.27:1B-25) is amended to read as follows:

25. a. Notwithstanding the provisions of subtitle 4 of Title 27 of the Revised Statutes and P.L.1946, c.301 (C.27:15A-1 et seq.), the commissioner may, pursuant to appropriations or authorizations being made from time to time by the Legislature according to law, allocate to counties and municipalities funds for the planning, acquisition, engineering, construction, reconstruction, repair, resurfacing and rehabilitation of public highways and the planning, acquisition, engineering, construction, reconstruction, repair, maintenance and rehabilitation of public transportation projects and of other transportation projects which a county or municipality may be authorized by law to undertake.

b. The commissioner shall, pursuant to appropriations or authorizations being made from time to time by the Legislature according to law, allocate at his discretion State aid to counties and municipalities for transportation projects, except that the amount to be appropriated for this program shall be seven percent of the total amount appropriated pursuant to subsection d. of this section. This State aid shall be set aside prior to any formula allocations provided for in subsections c., d., e., f., and g. of this section, and shall be known as the "Local Aid Infrastructure Fund." In the fiscal year commencing July 1, 2016, any amount appropriated to the Local Aid Infrastructure Fund above $7,500,000 shall be deposited into the State Transportation Infrastructure Bank Fund, established pursuant to section 34 of P.L.2016, c.56 (C.58:11B-10.4).

c. The commissioner shall, pursuant to appropriations or authorizations being made from time to time by the Legislature according to law and pursuant to the provisions of subsections b. and d. of this section, allocate State aid to municipalities for public highways under their jurisdiction. The amount to be appropriated shall be allocated on the basis of the following distribution factor:

Pc Cm

DF = ____ + ____

Ps Sm

where, DF equals the distribution factor

Pc equals county population

Ps equals State population

Cm equals municipal road mileage within the county

Sm equals municipal road mileage within the State.

After the amount of aid has been allocated based on the above formula, the commissioner shall determine priority for the funding of municipal projects within each county, based upon whether a municipality has adopted an ordinance pursuant to section 14 of P.L. , c. (C. ) (pending before the Legislature as this bill); subsequently, the commissioner may consider additional criteria relating to volume of traffic, safety considerations, growth potential, readiness to obligate funds, and local taxing capacity. In addition to the above criteria used in determining priority of funding of municipal projects in each county, the commissioner shall consider whether a project is intended to remedy hazardous conditions as identified for the purposes of providing transportation pursuant to N.J.S.18A:39-1.2 for school pupils or to improve pedestrian safety.

For the purposes of this subsection, (1) "population" means the official population count as reported by the New Jersey Department of Labor and Workforce Development; and (2) "municipal road mileage" means that road mileage under the jurisdiction of municipalities, as determined by the department.

d. There shall be appropriated at least $175,000,000 for each fiscal year commencing July 1, 2006 through the fiscal year commencing July 1, 2015, and $400,000,000 for each fiscal year commencing July 1, 2016 and for each fiscal year thereafter, for the purposes provided herein and in subsections b., c., e., f., and g. of this section. (1) Of that appropriation, the commissioner shall allocate 37.5 percent of the total appropriation as State aid for municipalities pursuant to the provisions of subsection c. of this section, provided that $5,000,000 for each fiscal year commencing July 1, 2006 through the fiscal year commencing July 1, 2015, and $10,000,000 for each fiscal year commencing July 1, 2016 and for each fiscal year thereafter of the amount allocated as State aid for municipalities shall be set aside and sub-allocated as State aid to any municipality qualifying for aid pursuant to the provisions of P.L.1978, c.14 (C.52:27D-178 et seq.). The commissioner shall allocate the aid to each municipality in the same proportion that the municipality receives aid under P.L.1978, c.14 (C.52:27D-178 et seq.). (2) The commissioner shall allocate 37.5 percent of the total appropriation pursuant to the provisions of subsection e. of this section for the Local County Aid Program. (3) The commissioner shall allocate seven percent of the total appropriation pursuant to the provisions of subsection b. of this section for the "Local Aid Infrastructure Fund." (4) The commissioner shall allocate seven percent of the appropriation pursuant to the provisions of subsection f. of this section for the "Local Freight Impact Fund." (5) The remaining 11 percent of the appropriation shall be allocated pursuant to the provisions of subsection g. of this section for the "Local Bridges Fund."

The amount of funds allocated as State aid for counties and municipalities, pursuant to paragraphs (3), (4), and (5) of subsection b. of section 8 of P.L.1987, c.460 (C.27:1B-21.1), shall be in addition to the amount of any appropriation required pursuant to this subsection and shall not be subject to any formula allocation provided for in this subsection, and which amounts shall be allocated as follows:

Of the amounts allocated pursuant to paragraph (3) of subsection b. of section 8 of P.L.1987, c.460 (C.27:1B-21.1) for State Fiscal Year 2027, $15,000,000 shall be allocated as State aid to counties for transportation projects pursuant to subsection e. of this section, and $15,000,000 shall be allocated as State aid to municipalities for transportation projects pursuant to subsection c. of this section;

Of the amounts allocated pursuant to paragraph (4) of subsection b. of section 8 of P.L.1987, c.460 (C.27:1B-21.1) for State Fiscal Year 2028, $30,500,000 shall be allocated as State aid to counties for transportation projects pursuant to subsection e. of this section, and $30,500,000 shall be allocated as State aid to municipalities for transportation projects pursuant to subsection c. of this section; and

Of the amounts allocated pursuant to paragraph (5) of subsection b. of section 8 of P.L.1987, c.460 (C.27:1B-21.1) for State Fiscal Year 2029, $46,250,000 shall be allocated as State aid to counties for transportation projects pursuant to subsection e. of this section, and $46,250,000 shall be allocated as State aid to municipalities for transportation projects pursuant to subsection c. of this section.

e. The commissioner may, pursuant to appropriations or authorizations being made from time to time by the Legislature according to law, allocate additional funding to the Local County Aid Program for public highway projects, in accordance with a formula similar to that provided for in subsection c. of this section, except that Cm equals road mileage under county jurisdiction and Sm equals total county road mileage within the State.

f. The commissioner shall, pursuant to appropriations or authorizations being made from time to time by the Legislature according to law, allocate at the commissioner's discretion, State aid to counties and municipalities for transportation projects that address the impacts of freight travel in local communities and on local transportation infrastructure, except that the amount to be appropriated for this program shall be seven percent of the total amount appropriated pursuant to subsection d. of this section. This State aid shall be set aside prior to any formula allocations provided for in subsections c., d., e., and g. of this section, and shall be known as the "Local Freight Impact Fund."

g. The commissioner shall, pursuant to appropriations or authorizations being made from time to time by the Legislature according to law, allocate at the commissioner's discretion, State aid to counties and municipalities for transportation projects that address the condition of bridges under the jurisdiction of counties with an emphasis on repair and reconstruction of those with the greatest structural deficiencies, except that the amount to be appropriated for this program shall be 11 percent of the total amount appropriated pursuant to subsection d. of this section. This State aid shall be set aside prior to any formula allocations provided for in subsections c., d., e., and f. of this section, and shall be known as the "Local Bridges Fund."

(cf: P.L.2024, c.7, s.6)

16. Section 6 of P.L.1975, c.291 (C.40:55D-10) is amended to read as follows:

6. Hearings. a. The municipal agency shall hold a hearing on each application for development, adoption, revision or amendment of the master plan, each application for approval of an outdoor advertising sign submitted to the municipal agency as required pursuant to an ordinance adopted under subsection g. of section 29.1 of P.L.1975, c.291 (C.40:55D-39) or any review undertaken by a planning board pursuant to section 22 of P.L.1975, c.291 (C.40:55D-31).

b. The municipal agency shall make the rules governing such hearings. Any maps and documents for which approval is sought at a hearing shall be on file and available for public inspection at least 10 days before the date of the hearing, during normal business hours in the office of the administrative officer. The applicant may produce other documents, records, or testimony at the hearing to substantiate or clarify or supplement the previously filed maps and documents.

c. The officer presiding at the hearing or such person as he may designate shall have power to administer oaths and issue subpoenas to compel the attendance of witnesses and the production of relevant evidence, including witnesses and documents presented by the parties, and the provisions of the "County and Municipal Investigations Law," P.L.1953, c.38 (C.2A:67A-1 et seq.) shall apply.

d. The testimony of all witnesses relating to an application for development shall be taken under oath or affirmation by the presiding officer, and the right of cross-examination shall be permitted to all interested parties through their attorneys, if represented, or directly, if not represented, subject to the discretion of the presiding officer and to reasonable limitations as to time and number of witnesses.

e. Technical rules of evidence shall not be applicable to the hearing, but the agency may exclude irrelevant, immaterial or unduly repetitious evidence.

f. The municipal agency shall provide for the verbatim recording of the proceedings by either stenographer, mechanical or electronic means. The municipal agency shall furnish a transcript, or duplicate recording in lieu thereof, on request to any interested party at his expense; provided that the governing body may provide by ordinance for the municipality to assume the expense of any transcripts necessary for appeal to the governing body, pursuant to section 8 of [this act] P.L.1975, c.291 (C.40:55D-17), of decisions by the zoning board of adjustment pursuant to subsection [57d. of this act] d. of section 57 of P.L.1975, c.291 (C.40:55D-70), up to a maximum amount as specified by the ordinance.

The municipal agency, in furnishing a transcript or tape of the proceedings to an interested party at his expense, shall not charge such interested party more than the actual cost of preparing the transcript or tape. Transcripts shall be certified in writing by the transcriber to be accurate.

g. The municipal agency shall include findings of fact and conclusions based thereon in each decision on any application for development and shall reduce the decision to writing. The municipal agency shall provide the findings and conclusions through:

(1) A resolution adopted at a meeting held within the time period provided in the act for action by the municipal agency on the application for development; or

(2) A memorializing resolution adopted at a meeting held not later than 45 days, or 30 days for an application for development, for which at least 40 percent of the units to be developed, 40 percent of the lots on which residential dwellings are to be constructed, or 40 percent of the total acreage, is to be used for the development of workforce housing, as defined pursuant to section 3 of P.L. , c. (C. ) (pending before the Legislature as this bill), after the date of the meeting at which the municipal agency voted to grant or deny approval. Only the members of the municipal agency who voted for the action taken may vote on the memorializing resolution, and the vote of a majority of such members present at the meeting at which the resolution is presented for adoption shall be sufficient to adopt the resolution. If only one member who voted for the action attends the meeting at which the resolution is presented for adoption, the resolution may be adopted upon the vote of that member. An action pursuant to section 5 of [the act] P.L.1975, c.291 (C.40:55D-9) (resulting from the failure of a motion to approve an application) shall be memorialized by resolution as provided above, with those members voting against the motion for approval being the members eligible to vote on the memorializing resolution. The vote on any such resolution shall be deemed to be a memorialization of the action of the municipal agency and not to be an action of the municipal agency; however, the date of the adoption of the resolution shall constitute the date of the decision for purposes of the mailings, filings and publications required by subsections h. and i. of this section [(C.40:55D-10)]. If the municipal agency fails to adopt a resolution or memorializing resolution as hereinabove specified, any interested party may apply to the Superior Court in a summary manner for an order compelling the municipal agency to reduce its findings and conclusions to writing within a stated time, and the cost of the application, including attorney's fees, shall be assessed against the municipality.

h. A copy of the decision shall be mailed by the municipal agency within 10 days of the date of decision to the applicant or, if represented, then to his attorney, without separate charge, and to all who request a copy of the decision, for a reasonable fee. A copy of the decision shall also be filed by the municipal agency in the office of the administrative officer. The administrative officer shall make a copy of such filed decision available to any interested party for a reasonable fee and available for public inspection at his office during reasonable hours

i. A brief notice of the decision shall be published in the official newspaper of the municipality, if there be one, or in a newspaper of general circulation in the municipality. Such publication shall be arranged by the applicant unless a particular municipal officer is so designated by ordinance; provided that nothing contained in [this act] P.L.1975, c.291 (C.40:55D-1 et seq.) shall be construed as preventing the applicant from arranging such publication if he so desires. The municipality may make a reasonable charge for its publication. The period of time in which an appeal of the decision may be made shall run from the first publication of the decision, whether arranged by the municipality or the applicant.

(cf: P.L.2004, c.42, s.5)

17. Section 34 of P.L.1975, c.291 (C.40:55D-46) is amended to read as follows:

a. An ordinance requiring site plan review and approval shall require that the developer submit to the administrative officer a site plan and such other information as is reasonably necessary to make an informed decision as to whether the requirements necessary for preliminary site plan approval have been met. The site plan and any engineering documents to be submitted shall be required in tentative form for discussion purposes for preliminary approval. If any architectural plans are required to be submitted for site plan approval, the preliminary plans and elevations shall be sufficient.

b. If the planning board required any substantial amendment in the layout of improvements proposed by the developer that have been the subject of a hearing, an amended application for development shall be submitted and proceeded upon, as in the case of the original application for development. The planning board shall, if the proposed development complies with the ordinance and [this act] P.L.1975, c.291 (C.40:55D-1 et seq.), grant preliminary site plan approval.

c. Upon the submission to the administrative officer of a complete application for a site plan which involves 10 acres of land or less, and 10 dwelling units or less, the planning board shall grant or deny preliminary approval within 45 days, or 30 days for such an application, for which at least 40 percent of the units to be developed, 40 percent of the lots on which residential dwellings are to be constructed, or 40 percent of the total acreage, is to be used for the development of workforce housing, as defined pursuant to section 3 of P.L. , c. (C. ) (pending before the Legislature as this bill), of the date of such submission or within such further time as may be consented to by the developer. Upon the submission of a complete application for a site plan which involves more than 10 acres, or more than 10 dwelling units, the planning board shall grant or deny preliminary approval within 95 days of the date of such submission or within such further time as may be consented to by the developer. Otherwise, the planning board shall be deemed to have granted preliminary approval of the site plan.

(cf: P.L.1984, c.20, s.8)

18. Section 14 of P.L.1979, c.216 (C.40:55D-46.1) is amended to read as follows:

14. An ordinance requiring, pursuant to section 7.1 of P.L.1975, c.291 (C.40:55D-12), notice of hearings on applications for development for conventional site plans, may authorize the planning board to waive notice and public hearing for an application for development, if the planning board or site plan subcommittee of the board appointed by the chairman finds that the application for development conforms to the definition of "minor site plan." Minor site plan approval shall be deemed to be final approval of the site plan by the board, provided that the board or said subcommittee may condition such approval on terms ensuring the provision of improvements pursuant to sections 29, 29.1, 29.3 and 41 of P.L.1975, c.291 (C.40:55D-38, 40:55D-39, 40:55D-41 and 40:55D-53).

a. Minor site plan approval shall be granted or denied within 45 days of the date of submission of a complete application to the administrative office, within 30 days for such application, for which at least 40 percent of the units to be developed, 40 percent of the lots on which residential dwellings are to be constructed, or 40 percent of the total acreage, is to be used for the development of workforce housing, as defined pursuant to section 3 of P.L. , c. (C. ) (pending before the Legislature as this bill), or within such further time as may be consented to by the applicant. Failure of the planning board to act within the period prescribed shall constitute minor site plan approval.

b. Whenever review or approval of the application by the county planning board is required by section 8 of P.L.1968, c.285 (C.40:27-6.6), the municipal planning board shall condition any approval that it grants upon timely receipt of a favorable report on the application by the county planning board or approval by the county planning board by its failure to report thereon within the required time period.

c. The zoning requirements and general terms and conditions, whether conditional or otherwise, upon which minor site plan approval was granted, shall not be changed for a period of two years after the date of minor site plan approval. The planning board shall grant an extension of this period for a period determined by the board but not exceeding one year from what would otherwise be the expiration date, if the developer proves to the reasonable satisfaction of the board that the developer was barred or prevented, directly or indirectly, from proceeding with the development because of delays in obtaining legally required approvals from other governmental entities and that the developer applied promptly for and diligently pursued the approvals. A developer shall apply for this extension before: (1) what would otherwise be the expiration date, or (2) the 91st day after the date on which the developer receives the last of the legally required approvals from the other governmental entities, whichever occurs later.

(cf: P.L.1991, c.256, s.8)

19. Section 36 of P.L.1975, c.291 (C.40:55D-48) is amended to read as follows:

a. An ordinance requiring subdivision approval by the planning board shall require that the developer submit to the administrative officer a plat and such other information as is reasonably necessary to make an informed decision as to whether the requirements necessary for preliminary approval have been met; provided that minor subdivisions pursuant to section 35 of [this act] P.L.1975, c.291 (C.40:55D-47) shall not be subject to this section. The plat and any other engineering documents to be submitted shall be required in tentative form for discussion purposes for preliminary approval.

b. If the planning board required any substantial amendment in the layout of improvements proposed by the developer that have been the subject of a hearing, an amended application shall be submitted and proceeded upon, as in the case of the original application for development. The planning board shall, if the proposed subdivision complies with the ordinance and [this act] P.L.1975, c.291 (C.40:55D-1 et seq.), grant preliminary approval to the subdivision.

c. Upon the submission to the administrative officer of a complete application for a subdivision of 10 or fewer lots, the planning board shall grant or deny preliminary approval within 45 days, or 30 days for a complete application for a subdivision of 10 or fewer lots for which at least 40 percent of the units to be developed, 40 percent of the lots on which residential dwellings are to be constructed, or 40 percent of the total acreage, is to be used for the development of workforce housing, as defined pursuant to section 3 of P.L. , c. (C. ) (pending before the Legislature as this bill), of the date of such submission or within such further time as may be consented to by the developer. Otherwise, the planning board shall be deemed to have granted preliminary approval to the subdivision.

(cf: P.L.1984, c.20, s.9)

20. Section 14 of P.L.1975, c.217 (C.52:27D-132) is amended to read as follows:

14. a. The enforcing agency shall periodically inspect all construction undertaken pursuant to a construction permit issued by it to ensure that the construction or alteration is performed in accordance with the conditions of the construction permit and consistent with the requirements of the code and any ordinance implementing said code.

b. The owner of any premises upon which a building or structure is being constructed shall be deemed to have consented to the inspection by the enforcing agency and the department, of the entire premises and of any and all construction being performed on it until a certificate of occupancy has been issued. An inspector, or team of inspectors, on presentation of proper credentials, shall have the right to enter and inspect such premises, and any and all construction thereon, for purposes of ensuring compliance with the provisions of the applicable construction permit, the code, and other applicable laws and regulations. All inspection pursuant to P.L.1975, c.217 (C.52:27D-119 et seq.) shall be between the hours of 9 a.m. and 5 p.m. on business days or at another time that has been agreed upon by the owner and the relevant inspecting entity, whether the enforcing agency, department, or private on-site inspection agency, or when construction is actually being undertaken, provided, however, that inspections may be conducted at other times if the enforcing agency has reasonable cause to believe that an immediate danger to life, limb or property exists, or if permission is given by an owner, or the owner's agent, architect, engineer or builder. No person shall accompany an inspector or team of inspectors on any inspection pursuant to P.L.1975, c.217 (C.52:27D-119 et seq.), unless the person's presence is necessary for the enforcement of P.L.1975, c.217 (C.52:27D-119 et seq.), or the code, or unless consent is given by an owner or the owner's agent, architect, engineer or builder.

c. If the construction of a structure or building is being undertaken contrary to the provisions of a construction permit, P.L.1975, c.217 (C.52:27D-119 et seq.), the code, or other applicable laws or ordinances, the enforcing agency may issue a stop construction order in writing which shall state the conditions upon which construction may be resumed and which shall be given to the owner or the holder of the construction permit or to the person performing the construction. If the person doing the construction is not known, or cannot be located with reasonable effort, the notice may be delivered to the person in charge of, or apparently in charge of, the construction. No person shall continue, or cause or allow to be continued, the construction of a building or structure in violation of a stop construction order, except with the permission of the enforcing agency to abate a dangerous condition or remove a violation, or except by court order. If an order to stop construction is not obeyed, the enforcing agency may apply to the appropriate court as otherwise established by law for an order enjoining the violation of the stop construction order. The remedy for violation of such an order provided in this subsection shall be in addition to, and not in limitation of, any other remedies provided by law or ordinance.

d. When an inspector or team of inspectors finds a violation of the provisions of a construction permit, the code, or other applicable laws and regulations at an owner-occupied single-family residence, and issues a notice of violation and an order to terminate the violation, the enforcing agency shall require the same inspector or team of inspectors who found the violation to undertake any subsequent reinspection thereof at the premises. When the same inspector or team of inspectors cannot be assigned to undertake the reinspection, the enforcing agency may assign an available inspector provided the scope of the reinspection shall be limited to the violation for which the reinspection is required. The requirements of this subsection shall not apply to violations of the plumbing or electrical subcodes, or to fire safety code violations, or to any violation of any other subcode that the Department of Community Affairs determines to be a health or safety violation. Nothing in this subsection shall be construed to infringe upon the right of a property owner to request a different inspector, team of inspectors, or supervisor, to perform any required reinspection.

e. The owner, agent, or other responsible person in charge of work shall notify the enforcing agency when the work is ready for any required inspection under the code. This notice shall be given in writing at least 24 hours prior to the date and time requested for the inspection. The enforcing agency shall perform an inspection within three business days of the date for which the inspection is requested. The owner, agent, or other responsible person in charge of work may provide oral notice for inspections of minor work projects, as defined by the code.

(1) The owner, agent, or other responsible person in charge of work shall be present and prepared at the time of any inspection that has been scheduled upon the owner, agent, or other responsible person's request. A failure by the owner, agent, or other responsible person in charge of work to be present and prepared for inspection shall be considered a failed inspection.

(2) If the enforcing agency is unable to perform a requested inspection within three business days of the date for which the inspection is requested, the enforcing agency shall inform the owner, agent, or other responsible person in charge of work in writing within 24 hours of receiving the request, at which time the enforcing agency and the owner, agent, or other responsible person in charge of work may agree to a different date and time for inspection. The enforcing agency shall commit the agreed upon inspection date to writing and provide a copy to the owner, agent, or other responsible person in charge of work.

(3) If the enforcing agency is unable to perform the requested inspection within three business days of the date for which the inspection is requested and the enforcing agency and the owner, agent, or responsible person in charge of work are unable to come to an agreement pursuant to paragraph (2) of this subsection, the owner, agent, or other responsible person in charge of work may choose to contract with a private on-site inspection agency authorized by the department to conduct on-site inspections pursuant to paragraph i. of section 6 of P.L.1975, c.217 (C.52:27D-124) to perform the requested inspection or inspections.

(a) The owner, agent, or other responsible person in charge of work shall notify the enforcing agency in writing of any choice to utilize an authorized private on-site inspection agency to conduct the requested inspection or inspections.

(b) The owner, agent, or other responsible person in charge of work may elect to utilize the private on-site inspection agency to conduct all subsequent associated inspections. In the event of a project with multiple units in one building, this provision shall apply to the specific unit or units affected by the inspection delay.

(c) The use of a private on-site inspection agency by an owner, agent, or other responsible person for on-site inspections shall be subject to the conflict-of-interest provisions in the code. In addition to those requirements, no private on-site inspection agency shall perform an inspection for any owner, agent, or other responsible person in charge of work, if an owner, agent, or other responsible person is currently employed by or affiliated with any individual affiliated with the private on-site inspection agency or has employed or was associated with an individual affiliated with the private on-site inspection agency within a timeframe established by the commissioner by regulation.

(d) The enforcing agency shall, if warranted, provide a fee reconciliation to the owner for an inspection completed by a private on-site inspection agency as a result of a missed inspection. The enforcing agency shall perform the reconciliation at the conclusion of the project. This reconciliation shall be based on the fees already paid less administrative costs for the enforcing agency and shall not exceed the amount already paid for the project, nor shall it exceed the amount that the enforcing agency is authorized to impose for inspections, and shall take into account the administrative costs of the enforcing agency.

(4) If the owner, agent, or other responsible person in charge of work believes an enforcing agency has demonstrated a repeated inability to conduct inspections for a construction project within the timelines required by this section, as established by the commissioner by regulation, the owner, agent, or other responsible person in charge of work may notify the department in writing to request authorization to utilize an authorized private on-site inspection agency. Within 15 business days of receiving a notification under this paragraph, the department shall determine whether the enforcing agency has demonstrated repeated inability, and, if the department determines, shall authorize the owner, agent, or other responsible person in charge of work to utilize an authorized private on-site inspection agency for all or a portion of the necessary inspections for the remainder of the project.

f. Each enforcing agency shall establish a process for ensuring inspections are performed within three business days of a requested inspection date, as required by subsection e. of this section. Authorized processes include, but are not limited to, the use of supplemental shared services agreements with other municipalities or enforcing agencies or the use of contracted private on-site inspection agencies, including supplemental private on-site inspection agencies.

g. (1) At timeframes established by the commissioner by regulation, adopted in accordance with the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), the municipal construction official shall submit an annual report detailing compliance with the code. The report shall include, at a minimum information related to the staffing, staff titles, and expenses of the enforcing agency, in addition to any other information required by the commissioner. The annual report shall take into account projected work and agency resource needs for the next budget year.

(2) A municipality that enters into a contract for supplemental services pursuant to subsection f. of this section shall provide a copy of the contract to the department upon entering into the contract.

(3) The information required by paragraphs (1) and (2) of this subsection, in addition to the inspection log, the municipal monthly activity reports, and the fee schedule shall be maintained by the municipal construction official or enforcing agency, and the municipal construction official or enforcing agency shall make the information and documents described in this paragraph available to the department upon request.

(4) The department may utilize the information provided pursuant to this subsection to determine appropriate staffing levels for the enforcing agency. If the department determines that an enforcing agency has not maintained appropriate staffing levels, the department may require the municipality to take corrective actions to ensure that the enforcing agency's staffing needs are met.

(5) The department may take corrective action, including the issuance of penalties, pursuant to subsection k. of section 6 of P.L.1975, c.217 (C.52:27D-124), if an enforcing agency fails to maintain or provide the information required by this subsection or maintain appropriate staffing levels, as determined by the department pursuant to paragraph (4) of this subsection.

h. If an enforcing agency is unable to meet its obligations under P.L.1975, c.217 (C.52:27D-119 et seq.), the enforcing agency shall promptly notify the department within 15 business days. The department may take corrective action, including the issuance of penalties, pursuant to subsection k. of section 6 of P.L.1975, c.217 (C.52:27D-124) if an enforcing agency fails to meet its obligations under P.L.1975, c.217 (C.52:27D-119 et seq.).

i. Notwithstanding any provision of subsection e. of this section to the contrary, the owner, agent, or other responsible person in charge of work, for an inspection of any work related to the development of workforce housing, as defined pursuant to section 3 of P.L. , c. (C. ) (pending before the Legislature as this bill), may elect to contract with and utilize a private on-site inspection agency authorized by the department to conduct on-site inspections pursuant to subsection i. of section 6 of P.L.1975, c.217 (C.52:27D-124) to perform any requested inspection or inspections related to the development of workforce housing, as defined pursuant to section 3 of P.L. , c. (C. ) (pending before the Legislature as this bill), regardless of whether the enforcing agency is able to perform a requested inspection within three business days of the date for which the inspection is requested.

21. (New section) The New Jersey Economic Development Authority, in consultation with the New Jersey Housing and Mortgage Finance Agency and the Division of Taxation in the Department of the Treasury, shall adopt, pursuant to the “Administrative Procedure Act,” P.L.1968, c.410 (C.52:14B-1 et seq.), such rules and regulations as are necessary to effectuate the purposes of section 1 through section 12 of P.L. , c. (C. ) (pending before the Legislature as this bill).

22. a. There is appropriated $50,000,000 from the General Fund to the New Jersey Economic Development Authority for deposit into the “Workforce Housing Assistance Program Fund” established pursuant to section 7 of P.L. , c. (C. ) (pending before the Legislature as this bill).

b. There is appropriated $5,000,000 from the General Fund to the New Jersey Economic Development Authority for deposit into the “Workforce Housing Impact Relief Fund” established pursuant to section 10 of P.L. , c. (C. ) (pending before the Legislature as this bill).

23. This act shall take effect immediately and shall apply to privilege periods and taxable years beginning on or after January 1 of the year next following the date of enactment.

STATEMENT

This bill, designated as the “New Jersey Workforce Housing Partnership Act,” incentivizes employers to provide financial assistance to certain employees buying homes, provides tax credits for the development of certain workforce housing projects, and provides certain assistance and affordability protections for low- and moderate-income residents.

The Workforce Housing Assistance Program

The bill requires the New Jersey Economic Development Authority (authority) to establish a “Workforce Housing Assistance Program” (program) to provide incentives to qualified employers related to the provision of workforce housing assistance to qualified employees. The program consists of two components: (1) the provision of matching contribution grants for down-payment assistance provided by a qualified employer to one or more qualified employees; and (2) the provision of low-interest mortgage loans and loan guarantees to the qualified employees of a qualified employer for the purchase of workforce housing in this State. Under the bill, qualified employers are required to apply to the authority to participate in the program before the qualified employees of the employer may receive benefits under either component of the program.

As defined in the bill, “qualified employee” means a full-time employee of a qualified employer who has worked for the qualified employer for a minimum of one calendar year prior to the employer’s date of application for the program, which employee is middle-income or a member of a middle-income household. “Qualified employer” means a person or business entity doing business in the State, which person or business entity employs one or more qualified employees residing within this State. “Workforce housing” means housing that is affordable, according to federal Department of Housing and Urban Development or other recognized standards, for home ownership and rental costs and that is occupied or reserved for occupancy by households with a gross household income not more than 120 percent of the median gross household income for households of the same size within the housing region in which the housing is located.

The bill authorizes the provision of matching contribution grants for distribution to qualified employees who receive a financial contribution of at least $5,000 from a qualified employer toward a down payment for the purchase of a workforce housing unit. However, to qualify for the matching contribution grant, the purchase of the workforce housing unit is required to occur within 12 months following the qualified employer’s approval for the program, and the property is required to be occupied as the qualified employee’s principal residence. Under the bill, the amount of the matching contribution grant is to equal: (1) for a qualified employer that employs 50 or more employees, an amount equal to the financial contribution paid by the qualified employer to the qualified employee, but not to exceed $10,000 per employee; or (2) for a qualified employer that employs fewer than 50 employees, in an amount equal to 200 percent of the financial contribution paid by the employer to the qualified employer, but not to exceed $15,000 per employee.

In addition to receiving grants under the program, this bill authorizes qualified employees of a qualified employer that is approved to participate in the program to apply to the authority for a low-interest mortgage loan or loan guarantee for the purchase of a workforce housing unit, which purchase occurs within 12 months of the date of approval of the qualified employer’s application for the program, and which housing is to be occupied as the qualified employee’s primary residence in this State.

The bill also provides corporation business tax and gross income tax credits for qualified employers that provide financial contributions for down payment assistance to qualified employees, in accordance with the requirements of the program. Under the bill, the tax credits are to be issued in an amount equal to 25 percent of the amount of the taxpayer’s financial contributions, not to exceed $500,000 during a tax period. However, for a taxpayer that employs fewer than 50 employees, an additional amount of tax credits is available equal to 10 percent of the amount of the taxpayer’s financial contributions paid in excess of $5,000 to each qualified employee during a tax period.

Periodic Program Review and Funding of the Program

This bill appropriates $50 million to the “Workforce Housing Assistance Program Fund,” which is established under the bill for the purposes of providing grants, low-interest loans, and loan guarantees under the program.

Under the bill, the authority, in coordination with the New Jersey Housing and Mortgage Finance Agency (agency), is required to review on the effectiveness of the program every three years, which review is to include: (1) the impact of the program on employee retention in the State; (2) the rates of participation in the program by qualified employers; (3) the rates of participation in the program by qualified employers with fewer than 50 employees; (4) the rates of homeownership by qualified employees in the State; and (5) any other measure by which the authority determines the success of the program may best be studied.

The authority, in coordination with the agency, is required to report its findings and recommend the continuation, modification, or termination of the Workforce Housing Assistance Program, including any recommended changes to funding for the program, to the Governor and the Legislature.

Workforce Housing Development Incentive

This bill provides for incentive awards in the form of tax credits, and potentially tax abatements, for qualified employers that convert underutilized commercial property into a workforce housing project. The bill defines “workforce housing project” as a residential housing project developed or financed by a qualified employer that primarily includes workforce housing and includes a minimum set-aside of 20 percent of units for households earning not more than 80 percent of the area median income determined by the federal Department of Housing and Urban Development.

To receive an incentive award for the development of a workforce housing project, a qualified employer is required to demonstrate the following in an application to the authority: (1) the applicant is a qualified employer that seeks to convert underutilized commercial property into a workforce housing project; (2) evidence satisfactory to the authority that the development of the workforce housing project is in compliance with applicable State and federal laws and safety standards; (3) the anticipated project costs to be incurred by the qualified employer in developing the workforce housing project; (4) assurances deemed satisfactory to the authority that a minimum of 20 percent of units in the project will be set aside for low- and moderate-income households; and (5) any other information required by the authority.

Under the bill, a developer that executes an incentive award agreement with the authority may receive tax credits as authorized under the agreement, subject to the approval of annual compliance reports submitted to the authority. After issuance of the certificate of compliance by the authority, the taxpayer is permitted to claim tax credits in an amount not to exceed 15 percent of approved project costs, as defined in the bill, for the development of a workforce housing project, which credits may be claimed over the course of an eligibility period, as determined by the authority. The bill also allows a taxpayer to apply for a tax credit transfer certificate so that all or part of the credit awarded may be sold or assigned to a third-party purchaser.

Additionally, the bill authorizes a municipality to adopt an ordinance granting an abatement or exemption from taxation, or both, for property in development for the purpose of workforce housing a developer that converts underutilized commercial property into workforce housing or develops on-site workforce housing for qualified employees. If such ordinance is adopted, a developer may be eligible for a five-year tax abatement as described in the bill, subject to the requirement to make payments in lieu of taxes to the municipality.

Zoning and Permitting Requirements

The bill authorizes the adoption of certain municipal ordinances and requires that the adoption of such ordinances be a priority consideration for the Commissioner of Transportation (commissioner) when determining allocations of certain transportation funding for municipal projects within each county.

Specifically, the bill provides that under the local aid program, the commissioner is required to determine priority for the funding, after the amount of aid has been allocated based primarily on the statutory formula, based upon whether a municipality has adopted an ordinance that permits the development of certain accessory dwelling units, development of duplexes and triplexes in an area zoned for single-family residential use, or mixed-use development. The commissioner remains required, as under current law, to consider criteria relating to volume of traffic, safety considerations, growth potential, readiness to obligate funds, and local taxing capacity.

Additionally, this bill accelerates the processing timelines for certain permits necessary to the development of workforce housing.

Workforce Housing Impact Relief Program

The bill establishes a “Workforce Housing Impact Relief Program” (relief program) in the authority for the purpose of providing grants, in such amounts as may be determined by the authority, to certain long-term homeowners that reside in municipalities impacted by the development of one or more workforce housing projects. An individual is eligible for the relief program, provided that only one application may be approved in any household in any calendar year, if: (1) the individual’s household earns not more than 80 percent of the area median income determined by the federal Department of Housing and Urban Development; and (2) the individual’s primary residence is located in a municipality impacted by the development of workforce housing under the bill, and the individual has owned the principal residence for not less than 10 years prior to the date of application for the relief program.

To fund these grants, the bill appropriates $5 million to the “Workforce Housing Impact Relief Fund,” which the authority is to establish pursuant to the bill.