ASSEMBLY HOUSING COMMITTEE

 

STATEMENT TO

 

[First Reprint]

SENATE, No. 406

 

STATE OF NEW JERSEY

 

DATED: JANUARY 23, 1997

 

      The Assembly Housing Committee reports favorably Senate Bill No. 406 (1R).

      Senate Bill No. 406 (1R) establishes a special mortgage assistance program to encourage local law enforcement officers and full-time paid firefighters to purchase homes in specially designated neighborhoods of their employer municipality. The program is called the Secure Neighborhood Mortgage Assistance Program.

      The purpose of the bill is to assist municipal law enforcement officers and firefighters to purchase homes in local neighborhoods, thereby enhancing the viability, stability and safety of certain neighborhoods.

      The program will offer low interest mortgages, low or no down payment offerings, and other such incentives to law enforcement officers and firefighters who wish to purchase a home in a specially designated neighborhood. The program would be administered by the State Treasurer through the New Jersey Housing and Mortgage Finance Agency.

      To participate in the program, the governing body of a municipality must adopt an ordinance, designate the neighborhoods where the purchases must be made, and identify a local official to assist interested law enforcement officers and firefighters in applying for the assistance. The program would only be available to law enforcement officers and firefighters employed by municipalities which qualify for the State's "urban aid" program. The bill requires that a qualified applicant agree to maintain a home purchased with program assistance as the applicant's primary residence for at least five years as a condition to the receipt of program assistance.

      The funds for the program would be available from the Police and Firemen's Retirement System, which currently makes mortgage loans available to members of the retirement system pursuant to a program created in 1992. That existing program will expire on August 5, 1997. However, the program established by this bill will continue for another five years beyond that date. The existing program is also administered by the New Jersey Housing and Mortgage Finance Agency. The State Treasurer, with the advice of the State Investment Council, the Board of Trustees of the Police and Firemen's Retirement System and the New Jersey Housing and Mortgage Finance Agency, currently sets the mortgage loan standards and guidelines for the loans made under the existing program.

      This bill is identical to Assembly Bill No. 503, with Assembly committee amendments, which also was reported by the committee and released on January 23, 1997.