ASSEMBLY, No. 133

STATE OF NEW JERSEY

Introduced Pending Technical Review by Legislative Counsel

PRE-FILED FOR INTRODUCTION IN THE 1996 SESSION

By Assemblyman JONES

An Act concerning certain limited-dividend nonprofit housing corporations and associations, and supplementing P.L.1974, c.49 (C.2A:18-61.1 et al.).

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

    1. For the purposes of P.L.1974, c.49 (C.2A:18-61.1 et al.) the term "landlord" shall be deemed to include any limited dividend or non-profit urban renewal entity organized in the form of a cooperative under the provisions of P.L.1991, c.431 (C.40A:20-1 et seq.) or prior legislation; the term "lease" shall be deemed to include any occupancy agreement under which a member or stockholder in any such cooperative is entitled to the right to occupancy of a particular residential unit under the management of that cooperative; the term "tenant" shall be deemed to include any such member or stockholder; and the term "rent" shall be deemed to include the carrying charges assessed by the cooperative under the occupancy agreement.

    2. This act shall take effect immediately.

STATEMENT

    This bill would define the carrying charges paid by occupants of dwelling units in nonprofit cooperatives as "rent" for the purposes of enabling the cooperative association to obtain summary judgment in eviction proceedings against those members of the cooperative who fail to make the payments upon which the association depends to maintain the cooperative. Because of the legal status of each member of a cooperative as part "owner" of the entire complex, the courts have held that associations cannot use the summary eviction process available against tenants. This would require an association to engage in an elaborate and expensive legal action. Nonprofit cooperatives organized for the benefit of lower-income families can not afford either to mount such an action, or to bear the extra burden that falls on every other member when units are occupied by non-paying members.

Defines members of certain cooperatives organized as "tenants" under law governing eviction procedures.