NEW COAH GROWTH SHARE REQUIREMENTS
WHAT IS GROWTH SHARE?
In May 2006, the amendments to the state’s Council on Affordable Housing (COAH)
round three rules went into affect which set a new goal to construct 53,000
units of affordable housing and to rehabilitate 25,000 units over the next
ten years. In order to achieve these goals the 3rd Round regulations
governing municipal housing obligations rely upon a new “growth share”
methodology that determines local affordable housing obligations in
proportion to the actual residential and non-residential for the period
2004-2014.
HOW IT WORKS
COAH’s previous methodology under Rounds 1 and 2 was based on assigning
local housing obligations based on projections. Under COAH Round 3,
municipal affordable housing obligations are now determined based on the
actual planning the development decisions at the local level. Towns must
address those obligations while they are being generated, not sometime in
the future. Specifically, the new growth share methodology requires one
(1) unit affordable housing obligation for every eight (8) market rates
units created in the town and one (1) unit affordable housing for every
twenty five (25) new jobs.
CALCULATING RESIDENTIAL GROWTH SHARE
A town’s residential growth share is calculated by determining the total
number residential certificates projected to be issued from January 1,2004
to January 1, 2014 after subtracting the number of units demolished. This is
called “net growth” and for every eight (8) units built it
generates one (1) affordable housing unit obligation that must be
addressed in the Housing Plan. Also affordable housing units that received
credit from previous COAH Rounds or any court judgments of compliance, which
will be constructed after January 1, 2004 including affordable housing units
in a town’s 3rd Round Fair Share Plan, are excluded from the projected
residential growth calculations and the resulting net growth share.
CALCULATING NON-RESIDENTIAL GROWTH SHARE
The non-residential component of local affordable housing obligations is
based on the net increase of new or expanded construction less demolitions.
Each building permit issued by local Construction Code Officials is assigned
a use group as defined by the International Building Code and
incorporated into the state’s Uniform Construction Code. These use groups
have an assigned number of jobs per 1,000 square feet, which is used to
calculate affordable housing obligations. Every 25 jobs results in one
(1) affordable housing obligation. In addition to residential and
non-residential growth share, towns must also address their Rehabilitation
Share, which represents the number of existing deficient housing occupied by
low and moderate income households in need of rehabilitation, and prior
round obligations from new construction between 1987 to 1999.
GROWTH SHARE ORDINANCES
Towns can address COAH’s 3rd Round affordable housing obligations by
adopting “growth share ordinances” which requires developers to
provide a certain percentage of affordable housing on-site or allows for
payment in lieu options. Some communities are requiring on-site affordable
housing units in particular zones while permitting payment in lieu in other
districts. A model growth share ordinance is available at
www.state.nj.us/dca/coah/round3resources.shtml .
RENTAL AND AGE RESTRICTED HOUSING
A maximum of fifty percent (50%) of local growth share obligations can be
met through affordable age-restricted housing and requires a minimum twenty
five percent (25 %) of the obligation to be rental housing. One-for-one
rental bonus credits can also be granted for rental units available to the
general public in excess of the twenty five percent (25%) minimum.
OTHER AFFORDABLE HOUSING OPTIONS
COAH’s 3rd Round Rules provide an expanded list of options for towns to meet
their affordable housing obligations including:
- Inclusionary zoning
- Municipal sponsored projects
- Regional Contribution Agreements (RCAs)
- Affordable Housing Partnership Programs
- Buy-down Programs
- Municipal Rental Programs
- Alternative Living Arrangements
- Accessory Apartments
- Extension of Expiration Affordability Controls
- Bonus Credits for Very Low Income Housing
- Development Fees
More information on growth share and COAH’s 3rd Round requirements is
available online at COAH’s website:
www.state.nj.us/dca/coah/ .
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