TRENTON – The Appellate Division of the state Superior Court issued a stay Monday on the state government’s planned takeover of more than $164 million of municipal affordable housing trust funds.
The takeover of the funds was supported by a resolution passed by the Council on Affordable Housing on May 1. Shortly after, the Fair Share Housing Center, an advocate for affordable housing, filed in court to block the takeover.
The resolution required municipalities to turn over funds that were not “committed for expenditure,” but the Administration has refused to advise municipalities what they must do to protect the funds from seizure, according to advocates.
Kevin Walsh, associate director of FSHC, praised the decision to block the seizure.
“The court correctly halted this process given the Administration’s refusal to follow the laws on the books,” Walsh said in a statement.
“This money is needed to recover from Hurricane Sandy. More than half of the money is from the nine counties hit hardest by the storm.
“The Administration is blocking homes from being built or fixed up at the worst possible time, when rents are increasing and homes are scarce,” he said.
Administration officials however, had defended the move, saying that municipalities had more than enough time to allocate the funds for subsidized housing purposes. They point to a law passed by the Legislature in 2008 that required them to spend the money in four years or risk having the state take over the funds.
At a budget hearing last week, Community Affairs Department Commissioner Richard Constable said many towns were just sitting on the money.
The Housing and Community Development Network of New Jersey applauded the decision.
Executive Director Staci Berger pointed to specific examples of how that money could be used to help victims of last year’s superstorm.
“Over half of the funds at stake are based in the nine Sandy devastated counties, it’s crucial that these funds are spent as intended, in the communities they were intended for,” Berger said in a release.
“In Middle Township for example, in hard-hit Cape May County, $1.3 million is in jeopardy of being taken by the state despite having a plan to create 400 affordable homes.
“Another example is Morris County where Morris Habitat for Humanity has been contracted to develop 62 affordable homes throughout twelve municipalities using over $2.6 million.”