SENATE, No. 2190







By Senators KYRILLOS, SINGER and Scott



An Act concerning municipal land use and supplementing chapter 55D of Title 40 of the New Jersey Statutes.


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


    1. This bill shall be known and may be cited as the "Home-Based Business Promotion Act.”


    2. The Legislature finds and declares:

    a. Corporate restructuring and the rise of telecommunications has led to an explosion of individuals working out of their homes. According to a national survey, as many as 40 million people work at least part time at home, with about 8,000 businesses of this nature starting daily;

    b. In New Jersey alone, 6,000 home-based businesses are started each month. Over the past decade, New Jersey gained over a quarter million new home-based, service-oriented businesses. Two-thirds of all home-based business owners have school aged children at home. Entrepreneurial owners have an average income of $69,900;

    c. Many of these businesses are operating in violation of outmoded local ordinances. Many zoning ordinances permit home-based businesses of recognized professionals, such as doctors, lawyers and accountants, but prohibit other for-profit businesses under certain circumstances;

    d. Most zoning ordinances enacted in the 1960s and 1970s were based on good intentions and focused on the protection of residential neighborhoods from the negative effects of industry; this occurred at a time when more than 75% of the working public then pursued occupations outside of the home;

    e. The changing economic structure and technological development have catalyzed the development of home-based businesses. According to the Partnership for Work at Home, over 90% of such businesses do not create the traffic, pollution, noise or safety problems of other industries. New approaches in zoning are needed to ensure that this very important segment of the economy, which may lay the groundwork for the expansion of companies which later grow to a "Fortune 100" or "Fortune 500" levels, and which generates many jobs and increased revenues to the State economy, is provided the opportunity for growth. Such growth cannot occur unless the Legislature ensures that municipalities will not overregulate or place burdensome obstacles in the way of home-based businesses.

    f. The Legislature finds it timely and appropriate to work in partnership with local governments, individuals, organizations and the business community to promote a business-friendly environment for home-based businesses while protecting the safety and health of the citizens of communities across the State.

    g. This act is intended to establish State guidelines for municipalities to follow in their treatment of home-based businesses, in order to bolster business growth in the State and carefully balance the interests of home-based business owners with the needs of the residential area in which they operate.

    The Legislature further finds that these guidelines will prevent such businesses from being forced into high cost regulatory environments or being impeded in their formation by existing ordinances.


    3. As used in this act:

            “Home Based Business” means any activity performed for pecuniary gain in or directed from a dwelling unit by one or more residents of that dwelling unit which is located in a residential zone and which:

    a. is not inconsistent with the residential character of the dwelling unit;

    b. is subordinate to the use of the dwelling unit for residential purposes and requires no external modifications that detract from the residential appearance of the dwelling unit;

    c. uses no equipment or process that creates noise, vibration, glare, fumes odors, or electrical or electronic interference detectable by neighbors;

    d. in the case of a dwelling unit which is part of a common interest ownership community, does not cause an increase in common expenses that can be attributable to a home-based business;

    e. does not involve use, storage, or disposal or any grouping or classification of materials that the federal secretary of Transportation or the State or any local governing body designates as a hazardous material; and

    f. does not present any appreciable traffic or safety concerns.


    4. Home-based businesses shall be a permitted use in all residential districts of a municipality; provided, however, such businesses shall comply with any municipal ordinances pertaining to parking or use of signs in the residential district. No municipality shall impose fines or penalties for home-based businesses that are residential in character and will not pose significant traffic, trash, noise or safety problems.


    5. A home-based business shall be a permitted use in any condominium, cooperative or planned real estate development or any dwelling unit under the control of a horizontal property regime. Any deed restriction that would prohibit the use of a single family dwelling unit as a home-based business shall not be enforceable unless that restriction is necessary for the preservation of the health, safety, and welfare of the other residents in the neighborhood. The burden of proof shall be on the party seeking to enforce the deed restriction to demonstrate, on a case-by-case basis, that the restriction is necessary for the preservation of the health, safety and welfare of the residents in the neighborhood who were meant to benefit from the restriction.


    6. A home-based business owner, may, at his or her discretion, convene a neighbor advisory council, the purpose of which shall be to communicate the nature of the business to the neighborhood and allow input from neighbors who are within 1000 feet of the home-based business or the property upon which it is located. The neighbor advisory council shall function as a mechanism to enhance a business owner’s relationship with neighbors in close proximity to the business and address any concerns that may arise concerning the conducting of such a business.


    7. a. A municipality which has imposed any fines or penalties which have not yet been collected upon a homeowner maintaining a home-based business shall grant the homeowner a hearing to review the imposition of such fines and penalties.

    b. The owner of a home-based business which is required to be a permitted use under this act shall have any fines and penalties previously assessed but not collected by the municipality negated. A municipality shall reduce, as appropriate, fines previously imposed for home-based businesses which substantially meet the definition of home-based business pursuant to section 3 of P.L. , c. (C. )(pending before the Legislature as this bill.)

    A neighbor advisory council which has been formed pursuant to section 6 of P.L. , c. (C. )(pending before the Legislature as this bill) may be requested by a homeowner to assist in the appeal of such fines or penalties, and any testimony from an advisory council shall be given considerable weight by the municipal offical conducting the hearing.


    8. This act shall take effect immediately.



    This legislation promotes a business friendly environment for small, home-based businesses. Over the years, the State legislative and executive branches have worked together to create incentives for small, medium and large company retention and expansion. The Legislature, under this bill, intends to promote the development of small businesses. The bill authorizes home-based businesses as permitted uses in municipalities so long as certain conditions are met. These businesses must have no negative impact on the residential character of the neighborhood and must not cause pollution, traffic, noise or other safety problems.

    In light of the growing number of home-based businesses and the positive benefits they offer in terms of built-in day care, increased variety of goods and services available, and reduced transportation and traffic congestion associated with travel to and from work, this legislation is intended to foster a State-local partnership in promoting a small business friendly environment.





"Home-Based Business Promotion Act;” requires that home-based businesses be a permitted municipal land use.