SENATE, No. 1919

STATE OF NEW JERSEY

213th LEGISLATURE

 

INTRODUCED JUNE 5, 2008

 


 

Sponsored by:

Senator PAUL A. SARLO

District 36 (Bergen, Essex and Passaic)

Senator JEFF VAN DREW

District 1 (Cape May, Atlantic and Cumberland)

 

Co-Sponsored by:

Senators Haines, Sweeney, Buono, Cardinale, Oroho, Pennacchio, Ciesla, Bateman, Sacco, Allen, Kyrillos, Singer, Codey, Bucco, Madden and Stack

 

 

 

 

SYNOPSIS

     The “Permit Extension Act of 2008.”

 

CURRENT VERSION OF TEXT

     As introduced.

  


An Act concerning the extension of certain permits and approvals affecting the physical development of property located within the State of New Jersey, superseding all statutory and regulatory requirements to the contrary, and supplementing Title 40 of the Revised Statutes.

 

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

 

     1.  This act shall be known and may be cited as the “Permit Extension Act of 2008.”

 

     2.  The Legislature finds and declares that:

     a.  There exists a state of economic emergency in the State of New Jersey, which began on January 1, 2006, and is anticipated to extend at least through December 31, 2012, which has drastically affected various segments of the New Jersey economy, but none as severely as the State's banking, real estate and construction sectors.

     b.  The real estate finance sector of the economy is in severe decline due to the sub-prime mortgage problem and the resultant widening mortgage finance crisis.  The extreme tightening of lending standards for home buyers and other real estate borrowers has reduced access to the capital markets.

     c.  As a result of the crisis in the real estate finance sector of the economy, real estate developers and redevelopers, including homebuilders, and commercial, office, and industrial developers, have experienced an industry-wide decline, including reduced demand, cancelled orders, declining sales and rentals, price reductions, increased inventory, fewer buyers who qualify to purchase homes, layoffs, and scaled back growth plans.

     d.  A myriad of new regulations with regard to environmental protection have significantly increased the costs of infrastructure, site remediation, and construction, putting an additional strain on the economy.

     e.  The process of obtaining planning board and zoning board of adjustment approvals for subdivisions, site plans, and variances is difficult, time consuming and expensive, both for private applicants and government bodies.

     f.  The process of obtaining the myriad other government approvals, such as wetlands permits, treatment works approvals, on-site wastewater disposal permits, stream encroachment permits, flood hazard area permits, highway access permits, and numerous waivers and variances, is also difficult and expensive; further, changes in the law can render these approvals, if expired or lapsed, impossible to renew or re-obtain.

     g.  County and municipal governments, including local sewer and water authorities, obtain permits and approvals from State government agencies, particularly the Department of Environmental Protection, which permits and approvals may expire or lapse due to the state of the economy and the inability of both the public sector and the private sector to proceed with projects authorized by the permit or approval.

     h.     County and municipal governments also obtain determinations of master plan consistency, conformance, or endorsement with State or regional plans, from State and regional government entities which may expire or lapse without implementation due to the state of the economy.

     i.  The current economic crisis has severely weakened the building industry, and many landowners and developers are seeing their life's work destroyed by the lack of credit and dearth of buyers and tenants, due to the crisis in real estate financing and the building industry, uncertainty over the state of the economy, and increasing levels of unemployment in the construction industry.

     j.     The construction industry and related trades are sustaining severe economic losses, and the lapsing of government development approvals is exacerbating those losses.

     k.  Financial institutions that lent money to property owners, builders, and developers are experiencing erosion of collateral and depreciation of their assets as permits and approvals expire, and the extension of these permits and approvals is necessary to maintain the value of the collateral and the solvency of financial institutions throughout the State.

     l.      Due to the current inability of builders and their purchasers to obtain financing, under existing economic conditions, more and more once-approved permits are expiring or lapsing and, as these approvals lapse, lenders must re-appraise and thereafter substantially lower real estate valuations established in conjunction with approved projects, thereby requiring the reclassification of numerous loans which, in turn, affects the stability of the banking system and reduces the funds available for future lending, thus creating more severe restrictions on credit and leading to a vicious cycle of default.

     m.    As a result of the continued downturn of the economy, and the continued expiration of approvals which were granted by State and local governments, it is possible that thousands of government actions will be undone by the passage of time.

     n.     Obtaining an extension of an approval pursuant to existing statutory or regulatory provisions is both costly in terms of time and financial resources, and insufficient to cope with the extent of the present financial emergency; moreover, the costs imposed fall on the public as well as the private sector.

     o.    Obtaining extensions of approvals granted by State government is frequently impossible, always difficult, and always expensive and no policy reason is served by the expiration of these permits, which were approved only after exhaustive review of the application.

     p.    It is the purpose of this act to prevent the wholesale abandonment of approvals due to the present unfavorable economic conditions, by tolling the term of these approvals until such time as the economy improves, thereby preventing a waste of public and private resources.

 

     3.    As used in this act:

     "Approval" means any approval of a soil erosion and sediment control plan granted by a local soil conservation district under the authority conferred by R.S.4:24-22 et seq., waterfront development permit issued pursuant to R.S.12:5-1 et seq., permit issued pursuant to "The Wetlands Act of 1970," P.L.1970, c.272 (C.13:9A-1 et seq.), permit issued pursuant to the "Freshwater Wetlands Protection Act," P.L.1987, c.156 (C.13:9B-1 et seq.), approval of an application for development granted by the Delaware and Raritan Canal Commission pursuant to the "Delaware and Raritan Canal State Park Law of 1974," P.L.1974, c.118 (C.13:13A-1 et seq.), permit issued by the New Jersey Meadowlands Commission pursuant to the "Hackensack Meadowlands Reclamation and Development Act," P.L.1968, c.404 (C.13:17-1 et seq.), approval of an application for development granted by the Pinelands Commission and determination of municipal and county plan conformance pursuant to the "Pinelands Protection Act," P.L.1979, c.111 (C.13:18A-1 et seq.), permit issued and center designations pursuant to the "Coastal Area Facility Review Act," P.L.1973, c.185 (C.13:19-1 et seq.), permit and approval issued by the Highlands Water Protection and Planning Council and the Department of Environmental Protection pursuant to the "Highlands Water Protection and Planning Act," P.L. 2004, c.120 (C.13:20-1 et al.), septic approval granted pursuant to Title 26 of the Revised Statutes, permit granted pursuant to R.S.27:7-1 et seq. or any supplement thereto, permit granted by the Department of Transportation pursuant to Title 27 of the Revised Statutes or under the general authority conferred by State law, approval granted by a sewerage authority pursuant to the "sewerage authorities law," P.L.1946, c.138 (C.40:14A-1 et seq.), approval granted by a municipal authority pursuant to the "municipal and county utilities authorities law," P.L.1957, c.183 (C.40:14B-1 et seq.), approval issued by a county planning board pursuant to Chapter 27 of Title 40 of the Revised Statutes, preliminary and final approval granted in connection with an application for development pursuant to the "Municipal Land Use Law," P.L.1975, c.291 (C.40:55D-1 et seq.), permit granted pursuant to the "State Uniform Construction Code Act," P.L.1975, c.217 (C.52:27D-119 et seq.), plan endorsement and center designations pursuant to the "State Planning Act," P.L.1985, c.398 (C.52:18A-196 et seq.), permit or certification issued pursuant to the "Water Supply Management Act," P.L.1981, c.262 (C.58:1A-1 et seq.), permit granted authorizing the drilling of a well pursuant to P.L.1947, c.377 (C.58:4A-5 et seq.), certification or permit granted, exemption from a sewerage connection ban granted, wastewater management plan approved, and pollution discharge elimination system permit pursuant to the "Water Pollution Control Act," P.L.1977, c.74 (C.58:10A-1 et seq.), certification granted pursuant to "The Realty Improvement Sewerage and Facilities Act (1954)," P.L.1954, c.199 (C.58:11-23 et seq.), certification or approval granted pursuant to P.L.1971, c.386 (C.58:11-25.1 et seq.), certification issued and water quality management plan approved pursuant to the "Water Quality Planning Act," P.L.1977, c.75 (C.58:11A-1 et seq.), approval granted pursuant to the "Safe Drinking Water Act," P.L.1977, c.224 (C.58:12A-1 et seq.), permit issued pursuant to the "Flood Hazard Area Control Act," P.L.1962, c.19 (C.58:16A-50 et seq.), any municipal, county, regional, or State county or municipal approval or permit granted under the general authority conferred by State law or rule or regulation, or any other government authorization of any development application or any permit related thereto whether that authorization is in the form of a permit, approval, license, certification, permission, determination, interpretation, exemption, variance, exception, waiver, letter of interpretation, no further action letter, agreement or any other executive or administrative decision which allows a development or governmental project to proceed.

     "Development" means the division of a parcel of land into two or more parcels, the construction, reconstruction, conversion, structural alteration, relocation or enlargement of any building or other structure or facility, or of any grading, soil removal or relocation, excavation or landfill or any use or change in the use of any building or other structure or land or extension of the use of land.

     "Economic emergency" means the period beginning January 1, 2006 and continuing through to December 31, 2012.

     "Government" means any municipal, county, regional, or State government, or any agency, department, commission or other instrumentality thereof.

 

     4.    a.  For any government approval in existence during the economic emergency, the running of the period of approval is automatically suspended for the period of the economic emergency, except as otherwise provided hereunder; however, the tolling provided for herein shall not extend the government approval more than two years beyond the period of the economic emergency.  Nothing in this act shall prohibit the granting of such additional extensions as are provided by law when the tolling granted by this act shall expire.

     b.  Nothing in this act shall be deemed to extend or purport to extend any permit issued by the government of the United States or any agency or instrumentality thereof, or to any permit by whatever authority issued of which the duration of effect or the date or terms of its expiration are specified or determined by or pursuant to law or regulation of the federal government or any of its agencies or instrumentalities.

     c.  Nothing in this act shall be deemed to extend any permit or approval issued pursuant to the "Pinelands Protection Act," P.L.1979, c.111 (C.13:18A-1 et seq.) if the extension would result in a violation of federal law, or any State rule or regulation requiring approval by the Secretary of the Interior pursuant to Pub.L.95-625 (16 U.S.C. s.471(i)).

     d.  This act shall not affect any administrative consent order issued by the Department of Environmental Protection in effect or issued during the period of the economic emergency, nor shall it be construed to extend any approval in connection with a resource recovery facility as defined in section 2 of P.L.1985, c.38 (C.13:1E-137).

     e.  In the event that any approval tolled pursuant to this act is based upon the connection to a sanitary sewer system, the approval's extension shall be contingent upon the availability of sufficient capacity, on the part of the treatment facility, to accommodate the development whose approval has been extended. If sufficient capacity is not available, those permit holders whose approvals have been extended shall have priority with regard to the further allocation of gallonage over those approval holders who have not received approval of a hookup prior to the enactment of this act.  Priority regarding the distribution of further gallonage to any permit holder who has received the extension of an approval pursuant to this act shall be allocated in order of the granting of the original approval of the connection.

     f.  This act shall not toll any approval issued under the "Municipal Land Use Law," P.L.1975, c.291 (C.40:55D-1 et seq.) in connection with an application for development involving a residential use where, subsequent to the expiration of the permit but prior to January 1, 2005, an amendment has been adopted to the master plan and the zoning ordinance to rezone the property to industrial or commercial use when the permit was issued for residential use.

 

     5.  State agencies shall, within 30 days after the effective date of this act, place a notice in the New Jersey Register tolling all approvals in conformance with this act.

 

     6.  The provisions of this act shall be liberally construed to effectuate the purposes of this act.

 

     7.  This act shall take effect immediately. 


STATEMENT

 

     This bill provides that for any government approval, as defined by the bill, in existence during the economic emergency, the running of the period of approval is automatically suspended for the period of the economic emergency, except as otherwise provided.  The bill provides, however, that the tolling provided by the bill would not extend the government approval more than two years beyond the period of the economic emergency.  The bill defines “economic emergency” to be the period beginning January 1, 2006 and continuing through December 31, 2012.

     This bill would not extend any permit issued by the federal government or any agency or instrumentality thereof, nor would the bill affect any administrative consent order issued by the Department of Environmental Protection in effect or issued during the period of the economic emergency.  In addition, the bill would not extend any approval of a resource recovery facility.

     Also, the provisions of this bill would not extend any permit or approval issued pursuant to the "Pinelands Protection Act" if the extension would result in a violation of federal law or any State rule or regulation requiring approval by the Secretary of the Interior pursuant to Pub.L.95-625 (16 U.S.C.A. s.471 (i)).

     In addition, this bill would provide that if the approval extended was based upon the acquisition of a hookup to a sanitary sewer system, the approval’s extension would be contingent upon the availability of sufficient capacity to accommodate the development.  If the capacity is not available at the time the approval would otherwise be extended by this act, the bill establishes priority on behalf of those approval holders whose approvals are extended, once additional capacity becomes available.  Priority would be accorded in order of the granting of the original connection approval by the granting agency.

     Also, the bill would not extend any approval granted under the "Municipal Land Use Law" involving a residential development where the master plan and zoning ordinance have been amended to rezone the property to industrial or commercial use subsequent to the expiration of the permit but prior to January 1, 2005, when the permit was issued for residential use.

     A state of economic emergency has existed in New Jersey since January 1, 2006, and is anticipated to extend through December 31, 2012.  It has drastically affected various segments of the New Jersey economy, but none as severely as the State's banking, real estate and construction sectors that are no longer able to obtain financing under existing economic conditions.

     As a result, more and more once-approved permits are in danger of expiring or lapsing because gaining permit extensions is difficult and costly.  In addition, no policy reason is served by the expiration of these permits, which were approved only after exhaustive review of the application.

     As permit approvals lapse, lenders must re-appraise and thereafter substantially lower real estate valuations established in conjunction with approved projects, thereby requiring the reclassification of numerous loans.  This in turn affects the stability of the banking system and reduces the funds available for future lending, thus creating more severe restrictions on credit and leading to a vicious cycle of default. 

     The same external factors were present in the 1990s resulting in the passage of the “Permit Extension Act,” P.L.1992, c.82 (C.40:55D-130 et seq.), to save the work of many in the development field which had, by virtue of the collapse of the savings and loan industry, been in danger of expiration.  The same external factors are present today, and the permits which have been so laboriously obtained will expire, unless extended.  Accordingly, this bill would extend permits which have been granted by State, regional, county, and municipal agencies in order to prevent a waste of public and private resources.