Bill > S2508

Introduced Session

This bill, known as the "Municipal Development Impact Fee Authorization Act," would allow municipalities to impose an impact fee on developers under certain circumstances. A municipality which imposes an impact fee must do so by an ordinance which sets forth detailed standards and guidelines regarding the definition of a service unit and the specific purposes for which the impact fee revenues may be expended. The impact fee ordinance shall also contain a delineation of service areas for each capital improvement and a fee schedule which clearly sets forth the amount of the fee to be charged for each service unit. Municipalities may impose an impact fee to cover a broad range of expenditure areas, including any transportation improvement necessitated by new development in a county not covered by a transportation development district created pursuant to the "New Jersey Transportation Development District Act of 1989," water treatment and distribution, wastewater treatment and sewerage, flood control and stormwater management, educational facilities, municipal parks and recreation facilities, public safety and related facilities. The bill exempts low and moderate income housing units as defined under P.L.1985, c.222 (C.52:27D-301 et al.) from the assessment of impact fees and prohibits the internal subsidy within inclusionary developments which would otherwise see purchasers of market-priced units absorb the impact fees forgiven on their affordable counterparts. Capital improvements and facility expansion for which an impact fee is imposed must bear a reasonable relationship to needs created by the new development. A municipality may adopt such an impact fee ordinance only if it has previously adopted a capital improvement program and has a valid master plan in place. The capital improvement program referred to here is more detailed than that which is currently authorized under section 20 of the "Municipal Land Use Law," P.L.1975, c.291 (C.40:55D-29). An impact fee imposed to finance educational facilities shall be based upon a long-term facilities plan approved by the Commissioner of Education. Municipalities which choose not to implement an impact fee ordinance under this bill may continue to prepare the less comprehensive capital improvement program currently authorized under the "Municipal Land Use Law." Similarly, those municipalities may continue to levy a fee for off-tract improvements authorized under section 30 of P.L.1975, c.291 (C.40:55D-42). The bill sets forth terms and conditions under which municipalities may assess and hold onto impact fee revenues. Fifty percent of the amount assessed as an impact fee shall be paid prior to the issuance of a construction permit and the remainder, prior to the issuance of the certificate of occupancy. No impact fee imposed by a municipality shall exceed the development's proportional share of the current reasonable cost of constructing the capital improvement or facility expansion for which the fee is being assessed. In no case shall the municipality maintain unexpended impact fees for more than eight years after the date of collection of the final payment for any development, unless construction has already begun on the capital improvement of facility expansion for which the impact fees were collected. The bill provides for an appeal of an impact fee assessment to an administrative law judge under the "Administrative Procedure Act" as a contested case; unlike decisions of contested cases under the APA, however, decisions of an administrative law judge in these cases would be final and would be appealable directly to the Appellate Division of Superior Court. The bill establishes a permanent 15 member Development Impact Fee Review and Advisory Commission (DIFRAC) in the Department of Community Affairs to provide ongoing technical assistance to municipalities in adopting impact fee ordinances and to evaluate the implementation of those ordinances. The first responsibility of DIFRAC shall be the preparation and dissemination of model ordinance. All municipal development impact fee ordinances must be certified by DIFRAC as to their conformity with law and the standards adopted by the commission.

AI Summary

Committee Categories

Linda Greenstein (D)*,  Shirley Turner (D)*, 

Introduced in the Senate, Referred to Senate Community and Urban Affairs Committee (on 02/05/2024)

Official Document