Merging the NJ Senate and Assembly versions of eminent domain reform
S-1975 and A-3257 have been merged and amended. The latest version of the bill issued today is linked here. A hearing on the merged bill is scheduled for tomorrow at 10 a.m. before the Senate Community and Urban Affairs Committee.
The bill is a moving target. The section creating a special Land Use Court has been deleted. Pay-to-play provisions have been included. Of particular concern is the provision regarding the effective date of the act, which would be 121 days from the date the act is adopted:
1[15.] 2[23.1 This] 38. Except as provided below, this2 act shall take effect on the first day of the fourth month next following enactment. Any final action taken by a municipality or redevelopment entity with respect to: a determination that an area is in need of redevelopment or in need of rehabilitation; enactment of a redevelopment plan; or designation of a redeveloper, 2or approval of a redevelopment agreement,2 prior to the effective date of this act shall have full force and effect, but any subsequent official action by the municipality or redevelopment entity after the effective date of this act shall be subject to its provisions. 2Sections 21, 34, 35, 36 and 37 shall remain inoperative until the first day of January following adoption of an amendment to Article VIII, Section 1, paragraph 6 of the New Jersey Constitution extending the period for short-term tax exemptions and abatements from up to five year to up to 15 years. Upon the adoption of that constitutional amendment, sections 4, 5, 6, 7, 25, 26, and 27 shall expire.2 [pages 61-62 of revision]
It also seems that provisions have been added which directly benefit developers. In particular, the adoption of strict notice requirements for redevelopment areas has been made contingent upon the passage of an amendment to Article VIII, Section 1, Paragraph 6 of the New Jersey Constitution. The proposed constitutional amendment would allow property tax-exemptions and abatements for periods longer than 5 years up to 15 years:
2i. The Legislature also declares that the use of the redevelopment process and the taking of property by eminent domain would be reduced, especially in urban areas, if municipalities could provide owners and developers greater incentives for making improvements in rehabilitation areas, specifically in the form of tax exemptions and abatements longer than five years. In anticipation of an amendment to Article VIII, Section 1, paragraph 6, the Legislature believes that it is appropriate to delay the implementation of strict notice requirements for redevelopment areas until a constitutional amendment is adopted to allow for property tax exemptions and abatements of longer than five years in rehabilitation areas, and to provide for transitional provisions that only impose strict notice requirements on those properties intended to be acquired through the use of eminent domain within a redevelopment area.2 [page 3 of the bill]
These tax abatements create other problems in municipalities because taxpayers who are paying the full amount will subsidize developers for the period of the abatement. A conjecture one can easily infer about the influence on these most recent amendments to the bill is that developers, who see increased cost of acquisition in other amendments to the statute, are looking for other benefits in the legislation. There is always a quid-pro-quo, but the legislators should draw the line and not give in to pressures being put on them by the League of Municipalities, New Jersey Builders Association, New Jersey Futures, et al.
New Jersey Public Advocate Ronald Chen gave his testimony at the last hearing of the Community and Urban Affairs Committee. He is one of the few voices in this process seeking to protect the people - the smal business owners, residential property owners, and tenants. The participation by lawyers and lobbyists on behalf of municipalities and developers has overwhelmed the process and the stated objectives of Senator Rice and his committee members in changing this statute. This is problematic because many muncipalities, such as Union Township, are pushing through large redevelopment studies and ordinances in order to get ahead of the pending amendments to the Local Redevlopment Housing Law.
You can listen to tomorrow's session live on your computer by logging on to the New Jersey Legislature web site and following the prompts to access the live broadcast at 10 a.m.