S4124

An Act concerning accessory dwelling units, supplementing and amending P.L.1975, c.291, and amending P.L.1985, c.222.

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

1. Section 3 of P.L.1975, c.291 (C.40:55D-3) is amended to read as follows:

For the purposes of this act, unless the context clearly indicates a different meaning:

The term "shall" indicates a mandatory requirement, and the term "may" indicates a permissive action.

“Accessory dwelling unit” means a second dwelling unit that:

(1) is attached or detached, or located within or appurtenant to a permitted principal dwelling unit or single-family dwelling;

(2) is located on the same lot as a permitted principal dwelling unit;

(3) contains no less than 30 percent of the net floor area of the principal dwelling unit, or one thousand square feet, whichever is less; and

(4) has facilities and provisions for independent living, including space for sleeping, food preparation, and sanitation.

"Administrative officer" means the clerk of the municipality, unless a different municipal official or officials are designated by ordinance or statute.

"Agricultural restriction" means an "agricultural deed restriction for farmland preservation purposes" as defined in section 3 of P.L.1983, c.32 (C.4:1C-13).

"Agricultural land" means "farmland" as defined pursuant to section 3 of P.L.1999, c.152 (C.13:8C-3).

"Applicant" means a developer submitting an application for development.

"Application for development" means the application form and all accompanying documents required by ordinance for approval of a subdivision plat, site plan, planned development, cluster development, conditional use, zoning variance or direction of the issuance of a permit pursuant to section 25 or section 27 of P.L.1975, c.291 (C.40:55D-34 or C.40:55D-36).

"Approving authority" means the planning board of the municipality, unless a different agency is designated by ordinance when acting pursuant to the authority of P.L.1975, c.291 (C.40:55D-1 et seq.).

"Board of adjustment" means the board established pursuant to section 56 of P.L.1975, c.291 (C.40:55D-69).

"Building" means a combination of materials to form a construction adapted to permanent, temporary, or continuous occupancy and having a roof.

"Cable television company" means a cable television company as defined pursuant to section 3 of P.L.1972, c.186 (C.48:5A-3).

"Capital improvement" means a governmental acquisition of real property or major construction project.

"Circulation" means systems, structures and physical improvements for the movement of people, goods, water, air, sewage or power by such means as streets, highways, railways, waterways, towers, airways, pipes and conduits, and the handling of people and goods by such means as terminals, stations, warehouses, and other storage buildings or transshipment points.

"Cluster development" means a contiguous cluster or noncontiguous cluster that is not a planned development.

"Common open space" means an open space area within or related to a site designated as a development, and designed and intended for the use or enjoyment of residents and owners of the development. Common open space may contain such complementary structures and improvements as are necessary and appropriate for the use or enjoyment of residents and owners of the development.

"Conditional use" means a use permitted in a particular zoning district only upon a showing that such use in a specified location will comply with the conditions and standards for the location or operation of such use as contained in the zoning ordinance, and upon the issuance of an authorization therefor by the planning board.

"Conservation restriction" means a "conservation restriction" as defined in section 2 of P.L.1979, c.378 (C.13:8B-2).

"Contiguous cluster" means a contiguous area to be developed as a single entity according to a plan containing a section or sections to be developed for residential purposes, nonresidential purposes, or a combination thereof, at a greater concentration of density or intensity of land use than authorized within the section or sections under conventional development, in exchange for the permanent preservation of another section or other sections of the area as common or public open space, or for historic or agricultural purposes, or a combination thereof.

"Conventional" means development other than cluster development or planned development.

"County agriculture development board" or "CADB" means a county agriculture development board established by a county pursuant to the provisions of section 7 of P.L.1983, c.32 (C.4:1C-14).

"County master plan" means a composite of the master plan for the physical development of the county in which the municipality is located, with the accompanying maps, plats, charts and descriptive and explanatory matter adopted by the county planning board pursuant to R.S.40:27-2 and R.S.40:27-4.

"County planning board" means the county planning board, as defined in section 1 of P.L.1968, c.285 (C.40:27-6.1), of the county in which the land or development is located.

(cf: P.L.2013, c.106, s.2)

2. (New section) a. An accessory dwelling unit shall be permitted on a lot that contains a single-family dwelling. A municipality may, but shall not be required to restrict occupancy of an accessory dwelling unit to low- and moderate-income households.

b. A municipal zoning ordinance may require a principal dwelling unit with an accessory dwelling unit to be subject to the same dimensional controls and other controls, except for residential density controls, as are required for the same principal dwelling unit without the accessory dwelling unit, as long as such restrictions do not altogether prohibit the construction of an accessory dwelling unit on any individual lot that contains a single-family dwelling, in violation of subsection a. of this section.

c. A municipal zoning ordinance shall be prohibited from requiring:

(1) a passageway between an accessory dwelling unit and a principal dwelling unit;

(2) an exterior door for an accessory dwelling;

(3) any more than one parking space for an accessory dwelling unit;

(4) a familial, marital, or employment relationship between occupants of a principal dwelling unit and an accessory dwelling unit;

(5) a minimum age requirement for occupants of an accessory dwelling unit;

(6) a separate billing of utilities otherwise connected to, or used by, the principal dwelling unit; or

(7) periodic renewals for permits for accessory dwelling units.

d. Nothing in this section shall exempt an accessory dwelling unit from:

(1) applicable building code requirements pursuant to the “State Uniform Construction Code Act,” P.L.1975, c.217 (C.52:27D-119 et seq.);

(2) the ability of a municipality to prohibit or limit the use of an accessory dwelling unit for short-term rentals or vacation stays; or

(3) sewerage system related requirements where a private sewerage system is being used, provided that approval for an accessory dwelling unit shall not be unreasonably withheld.

e. A municipal agency shall not condition the approval of an accessory dwelling unit on the correction of a nonconforming use, structure or lot, or require the installation of fire sprinklers in an accessory dwelling unit if sprinklers are not required for the principal dwelling unit located on the same lot.

f. An accessory dwelling unit shall not be considered a new residential use for the purpose of calculating or imposing connection fees or capacity charges for a purveyor of water and sewer service, unless the accessory dwelling unit is constructed together with a new single-family dwelling unit on the same lot, or requires the installation of a new or separate utility connection directly to the accessory dwelling unit.

g. A municipality may amend its land use regulations to comply with the provisions of "Municipal Land Use Law," P.L.1975, c.291 (C.40:55D-1 et seq.), prior to January 1, 2023. On and after January 1, 2023, any provision of a municipality’s land use regulations that are inconsistent with the provisions of P.L. , c. (C. ) (pending before the Legislature as this bill) or other regulation shall be null and void and a municipal agency shall approve or deny applications for the development of accessory dwelling units in accordance with the requirements for regulations set forth under the provisions of P.L. , c. (C. ) (pending before the Legislature as this bill). A municipality may not impose additional standards beyond those set forth in this section related to the regulation of accessory dwelling units.

h. The governing body of a municipality, by a two-thirds vote of the full authorized membership, may opt out of all or some of the provisions of this section regarding the allowance of accessory dwelling units, provided the governing body:

(1) convenes a public hearing on the proposal to opt out prior to the vote;

(2) states upon its record the reasons for the governing body’s decision opting out of the requirements; and

(3) not later than fifteen days after such decision has been rendered, notifies the Division of Local Government Services in the Department of Community Affairs that the municipality has elected to opt out of the requirements and publishes notice of such decision in the official newspaper of the municipality, if there be one, or in a newspaper of general circulation in the municipality.

3. (New section) a. A zoning ordinance shall not:

(1) establish for any dwelling unit a minimum floor area that is greater than the minimum floor area set pursuant to the “State Uniform Construction Code Act,” P.L.1975, c.217 (C.52:27D-119 et seq.) and any regulations adopted thereafter; and

(2) require more than one parking space for each studio or one-bedroom dwelling unit, or more than two parking spaces for each dwelling unit with two or more bedrooms, unless the municipality opts out in accordance with subsection b. of this section.

b. The governing body of a municipality, by a two-thirds vote of the full authorized membership, may opt out of the provision of subparagraph (2) of subsection a. of this section regarding limitations on parking spaces for dwelling units, provided the governing body:

(1) convenes a public hearing on the proposal to opt out prior to the vote;

(2) states upon its record the reasons for the governing body’s decision opting out of the requirements; and

4. Section 4 of P.L.1985, c.222 (C.52:27D-304) is amended to read as follows:

4. As used in P.L.1985, c.222 (C.52:27D-301 et al.):

a. "Council" means the Council on Affordable Housing established in P.L.1985, c.222 (C.52:27D-301 et al.), which shall have primary jurisdiction for the administration of housing obligations in accordance with sound regional planning considerations in this State.

b. "Housing region" means a geographic area of not less than two nor more than four contiguous, whole counties which exhibit significant social, economic and income similarities, and which constitute to the greatest extent practicable the primary metropolitan statistical areas as last defined by the United States Census Bureau prior to the effective date of P.L.1985, c.222 (C.52:27D-301 et al.).

c. "Low income housing" means housing affordable according to 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 equal to 50 percent or less of the median gross household income for households of the same size within the housing region in which the housing is located.

d. "Moderate income housing" means housing affordable according to 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 equal to more than 50% but less 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.

e. "Resolution of participation" means a resolution adopted by a municipality in which the municipality chooses to prepare a fair share plan and housing element in accordance with P.L.1985, c.222 (C.52:27D-301 et al.).

f. "Inclusionary development" means a residential housing development in which a substantial percentage of the housing units are provided for a reasonable income range of low and moderate income households.

g. "Conversion" means the conversion of existing commercial, industrial, or residential structures for low and moderate income housing purposes where a substantial percentage of the housing units are provided for a reasonable income range of low and moderate income households.

h. "Development" means any development for which permission may be required pursuant to the "Municipal Land Use Law," P.L.1975, c.291 (C.40:55D-1 et seq.).

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

j. "Prospective need" means a projection of housing needs based on development and growth which is reasonably likely to occur in a region or a municipality, as the case may be, as a result of actual determination of public and private entities. In determining prospective need, consideration shall be given to approvals of development applications, real property transfers, and economic projections prepared by the State Planning Commission established by sections 1 through 12 of P.L.1985, c.398 (C.52:18A-196 et seq.).

k. " Person with a disability" means a person with a physical disability, infirmity, malformation, or disfigurement which is caused by bodily injury, birth defect, aging, or illness including epilepsy and other seizure disorders, and which shall include, but not be limited to, any degree of paralysis, amputation, lack of physical coordination, blindness or visual impairment, deafness or hearing impairment, the inability to speak or a speech impairment, or physical reliance on a service animal, wheelchair, or other remedial appliance or device.

l. "Adaptable" means constructed in compliance with the technical design standards of the barrier free subcode adopted by the Commissioner of Community Affairs pursuant to the "State Uniform Construction Code Act," P.L.1975, c.217 (C.52:27D-119 et seq.) and in accordance with the provisions of section 5 of P.L.2005, c.350 (C.52:27D-123.15).

m. "Very low income housing" means housing affordable according to 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 equal to 30 percent or less of the median gross household income for households of the same size within the housing region in which the housing is located.

n. “Accessory dwelling unit” means a second dwelling unit that:

(1) is attached or detached, or located within or appurtenant to a permitted principal dwelling unit or single-family dwelling;

(2) is located on the same lot as a permitted principal dwelling unit;

(3) contains no less than 30 percent of the net floor area of the principal dwelling unit, or one thousand square feet, whichever is less; and

(4) has facilities and provisions for independent living, including space for sleeping, food preparation, and sanitation.

(cf: P.L.2017, c.131, s.199)

5. Section 10 of P.L.1985, c.222 (C.52:27D-310) is amended to read as follows:

10. A municipality's housing element shall be designed to achieve the goal of access to affordable housing to meet present and prospective housing needs, with particular attention to low and moderate income housing, and shall contain at least:

a. An inventory of the municipality's housing stock by age, condition, purchase or rental value, occupancy characteristics, and type, including the number of units affordable to low and moderate income households and substandard housing capable of being rehabilitated, and in conducting this inventory the municipality shall have access, on a confidential basis for the sole purpose of conducting the inventory, to all necessary property tax assessment records and information in the assessor's office, including but not limited to the property record cards;

b. A projection of the municipality's housing stock, including the probable future construction of low and moderate income housing, for the next ten years, taking into account, but not necessarily limited to, construction permits issued, approvals of applications for development and probable residential development of lands;

c. An analysis of the municipality's demographic characteristics, including but not necessarily limited to, household size, income level and age;

d. An analysis of the existing and probable future employment characteristics of the municipality;

e. A determination of the municipality's present and prospective fair share for low and moderate income housing and its capacity to accommodate its present and prospective housing needs, including its fair share for low and moderate income housing; and

f. A consideration of the lands that are most appropriate for construction of low and moderate income housing and of the existing structures most appropriate for conversion to, or rehabilitation for, low and moderate income housing, including:

(1) a consideration of lands of developers who have expressed a commitment to provide low and moderate income housing, and

(2) a consideration of lands and existing structures that are appropriate for the development of accessory dwelling units for low- and moderate-income housing.

(cf: P.L.2001, c.435, s.2)

6. Section 11 of P.L.1985, c.222 (C.52:27D-311) is amended to read as follows:

11. a. In adopting its housing element, the municipality may provide for its fair share of low and moderate income housing by means of any technique or combination of techniques which provide a realistic opportunity for the provision of the fair share. The housing element shall contain an analysis demonstrating that it will provide such a realistic opportunity, and the municipality shall establish that its land use and other relevant ordinances have been revised to incorporate the provisions for low and moderate income housing. In preparing the housing element, the municipality shall consider the following techniques for providing low and moderate income housing within the municipality, as well as such other techniques as may be published by the council or proposed by the municipality:

(1) Rezoning for densities necessary to assure the economic viability of any inclusionary developments, either through mandatory set-asides or density bonuses, as may be necessary to meet all or part of the municipality's fair share in accordance with the regulations of the council and the provisions of subsection h. of this section;

(2) Determination of the total residential zoning necessary to assure that the municipality's fair share is achieved;

(3) Determination of measures that the municipality will take to assure that low and moderate income units remain affordable to low and moderate income households for an appropriate period of not less than six years;

(4) A plan for infrastructure expansion and rehabilitation if necessary to assure the achievement of the municipality's fair share of low and moderate income housing;

(5) Donation or use of municipally owned land or land condemned by the municipality for purposes of providing low and moderate income housing;

(6) Tax abatements for purposes of providing low and moderate income housing;

(7) Utilization of funds obtained from any State or federal subsidy toward the construction of low and moderate income housing;

(8) Utilization of municipally generated funds toward the construction of low and moderate income housing; and

(9) The purchase of privately owned real property used for residential purposes at the value of all liens secured by the property, excluding any tax liens, notwithstanding that the total amount of debt secured by liens exceeds the appraised value of the property, pursuant to regulations promulgated by the Commissioner of Community Affairs pursuant to subsection b. of section 41 of P.L.2000, c.126 (C.52:27D-311.2).

b. The municipality may provide for a phasing schedule for the achievement of its fair share of low and moderate income housing.

c. (Deleted by amendment, P.L.2008, c.46)

d. Nothing in P.L.1985, c.222 (C.52:27D-301 et al.) shall require a municipality to raise or expend municipal revenues in order to provide low and moderate income housing.

e. When a municipality's housing element includes the provision of rental housing units in a community residence for the developmentally disabled, as defined in section 2 of P.L.1977, c.448 (C.30:11B-2), which will be affordable to persons of low and moderate income, and for which adequate measures to retain such affordability pursuant to paragraph (3) of subsection a. of this section are included in the housing element, those housing units shall be fully credited as permitted under the rules of the council towards the fulfillment of the municipality's fair share of low and moderate income housing.

f. It having been determined by the Legislature that the provision of housing under P.L.1985, c.222 (C.52:27D-301 et al.) is a public purpose, a municipality or municipalities may utilize public monies to make donations, grants or loans of public funds for the rehabilitation of deficient housing units and the provision of new or substantially rehabilitated housing for low and moderate income persons, providing that any private advantage is incidental.

g. A municipality which has received substantive certification from the council, and which has actually effected the construction of the affordable housing units it is obligated to provide, may amend its affordable housing element or zoning ordinances without the approval of the council.

h. Whenever affordable housing units are proposed to be provided through an inclusionary development, a municipality shall provide, through its zoning powers, incentives to the developer, which shall include increased densities and reduced costs, in accordance with the regulations of the council and this subsection.

i. The council, upon the application of a municipality and a developer, may approve reduced affordable housing set-asides or increased densities to ensure the economic feasibility of an inclusionary development.

j. A municipality may enter into an agreement with a developer or residential development owner to provide a preference for affordable housing to low to moderate income veterans who served in time of war or other emergency, as defined in section 1 of P.L.1963, c.171 (C.54:4-8.10), of up to 50 percent of the affordable units in that particular project. This preference shall be established in the applicant selection process for available affordable units so that applicants who are veterans who served in time of war or other emergency, as referenced in this subsection, and who apply within 90 days of the initial marketing period shall receive preference for the rental of the agreed-upon percentage of affordable units. After the first 90 days of the initial 120-day marketing period, if any of those units subject to the preference remain available, then applicants from the general public shall be considered for occupancy. Following the initial 120-day marketing period, previously qualified applicants and future qualified applicants who are veterans who served in time of war or other emergency, as referenced in this subsection, shall be placed on a special waiting list as well as the general waiting list. The veterans on the special waiting list shall be given preference for affordable units, as the units become available, whenever the percentage of preference-occupied units falls below the agreed upon percentage. Any agreement to provide affordable housing preferences for veterans pursuant to this subsection shall not affect a municipality's ability to receive credit for the unit from the council, or its successor.

k. An accessory dwelling unit built or permitted after January 1, 2022, shall only be credited towards a municipality's fair share affordable housing obligation as the equivalent of a studio apartment, which is affordable to a one person household.

(cf: P.L.2013, c.6, s.1)

7. This act shall take effect immediately.

STATEMENT

The bill concerns the development of accessory dwelling units.

Under this bill, an accessory dwelling unit would be permitted on a lot that contains a single-family dwelling. The bill allows a municipality to restrict occupancy of an accessory dwelling unit to those who qualify for low and moderate income housing.

The bill provides a municipal zoning ordinance may require a principal dwelling unit with an accessory dwelling unit to be subject to the same dimensional controls and other controls as are required for the same principal dwelling unit without the accessory dwelling unit, as long as such restrictions do not prohibit the construction of accessory dwelling units, as specified in the bill.

Under this bill a municipal zoning ordinance would be prohibited from requiring:

(1) a passageway between an accessory dwelling unit and a principal dwelling unit;

(2) an exterior door for an accessory dwelling;

(3) any more than one parking space for an accessory dwelling unit;

(4) a familial, marital, or employment relationship between occupants of a principal dwelling unit and an accessory dwelling unit;

(5) a minimum age requirement for occupants of an accessory dwelling unit;

(6) a separate billing of utilities otherwise connected to, or used by, the principal dwelling unit; or

(7) periodic renewals for permits for accessory dwelling units.

The bill provides, however, that an accessory dwelling unit is not exempt from:

(1) applicable building code requirements;

(2) restrictions on the use of an accessory dwelling unit for short-term rentals or vacation stays; or

(3) sewerage system related requirements where a private sewerage system is being used, provided that approval for an accessory dwelling unit shall not be unreasonably withheld.

The bill requires that a municipal agency not condition the approval of an accessory dwelling unit on the correction of a nonconforming use, structure or lot, or require the installation of fire sprinklers in an accessory dwelling unit if sprinklers are not required for the principal dwelling unit located on the same developable site.

Under the bill, an accessory dwelling unit would not be considered a new residential use for the purpose of calculating or imposing connection fees or capacity charges for a purveyor of water and sewer service, unless the accessory dwelling unit is constructed together with a new single-family dwelling unit on the same lot, or requires the installation of a new or separate utility connection directly to the accessory dwelling unit.

The bill provides that a municipality may amend its land use regulations to comply with the provisions of "Municipal Land Use Law," P.L.1975, c.291 (C.40:55D-1 et seq.), prior to January 1, 2023. On and after January 1, 2023, any provision of a municipality’s land use regulations that are inconsistent with the provisions of the bill or other regulation would be null and void and a municipal agency would approve or deny applications for the development of accessory dwelling units in accordance with the requirements for regulations set forth under the bill. Under the bill, a municipality is prohibited from imposing additional standards related to the regulation of accessory dwelling units, except as provided for in the bill.

Under the bill the governing body of a municipality, by a two-thirds vote of the full authorized membership, may opt out of the allowance of accessory dwelling units, provided the governing body:

(1) convenes a public hearing;

(2) states upon its record the reasons for opting out; and

(3) not later than fifteen days after such decision has been rendered, notifies the Division of Local Government Services in the Department of Community Affairs (DCA) that the municipality has elected to opt out of the requirements and publishes notice of such decision in the official newspaper of the municipality, if there be one, or in a newspaper of general circulation in the municipality.

The bill also prohibits a zoning ordinance from:

(1) establishing for any dwelling unit a minimum floor area that is greater than the minimum floor area set; and

(2) requiring more than one parking space for each studio or one-bedroom dwelling unit, or more than two parking spaces for each dwelling unit with two or more bedrooms, unless the municipality opts out. The governing body of a municipality, by a two-thirds vote of the full authorized membership, may opt out regarding limitations on parking spaces for dwelling units, provided the governing body:

(1) convenes a public hearing;

(2) states upon its record the reasons for opting out; and

(3) not later than fifteen days after such decision has been rendered, notifies DCA that the municipality has elected to opt out of the requirements and publishes notice of such decision in the official newspaper of the municipality, if there be one, or in a newspaper of general circulation in the municipality.

The bill would also amend the "Fair Housing Act," P.L.1985, c.222 (C.52:27D-301 et al.), to require a municipality's master plan housing element to contain a consideration of lands and existing structures that are appropriate for the development of accessory dwelling units that can provide low- and moderate-income housing, and to provide that accessory dwelling units built or permitted after January 1, 2022, would only be credited towards a municipality's fair share affordable housing obligation as the equivalent of a studio apartment, which is affordable to a one person household.