Christie’s No Friend to Housing for Poor and Middle-Income New Jerseyans

Nor it is clear that he wants to. On January's "Ask the Governor" radio program on NJ 101.5, Christie responded to a question on the issue by stating, "But I also don't think we have this overwhelming need for affordable housing in the state either."

Nina Arce, a spokeswoman for the Housing and Community Development Network of New Jersey, said Christie's statement on the radio program "says it all" about his housing policy.

Five years after his initial election, the governor seems to have accomplished at least part of his goal when it comes to housing -- the abolishment of the Council on Affordable Housing (COAH). The state Supreme Court recently removed authority over administration of the Fair Housing Act from the Council on Affordable Housing.

It's unclear whether the rest of the decision, which puts the courts in charge of the construction of units for the low- and moderate-income, will make Christie happy. It could lead to more affordable homes being built, or to an expensive bureaucracy that forces local property tax payers to cover lawyers' fees.

According to data from the US Census Bureau, more than half of all renters and 40 percent of owners of mortgaged homes in New Jersey paid more than 30 percent of their income on rent and utilities -- a widely used measure of affordability -- in 2013. The National Low Income Housing Coalition's 2014 Out of Reach report found that a worker needs to make about $52,000 to reasonably afford fair market rental in the state, but the typical renter's income is only $34,000.

Arce and others say Christie has taken action on a number of bills that have hampered the advance of housing development in the state. For instance:

  • Three times, the governor has vetoed legislation such as 2012’s Senate Bill S-1566 that would have had the state purchase foreclosed properties and turn them into affordable housing. Christie said it is better for the state to use $300 million in federal funds for a program that gives financial assistance to home owners who have been good at paying their mortgages but are at risk of foreclosure due to unemployment or underemployment. The website for the HomeKeeper program, however, indicates that it is closed to new applications. Its most recent report, for the last quarter of 2014, indicates that nearly 6,000 people -- about 46 percent of all applicants -- have received $206 million in assistance, with another $23 million spent on administration and counseling.

  • Christie conditionally vetoed Assembly Bill A-3206 of 2013 that would have increased by $5 million the amount of credits available through the Neighborhood Revitalization State Tax Credit program. The program provides only $10 million in assistance and became even more competitive as the governor approved one portion of the bill expanding the program to allow taxpayers with business income, as well as business entities themselves, to get credit for the funds they give to nonprofits that in turn use the money for housing and economic development in distressed areas. The Legislature concurred with his veto.

  • The governor tried twice to circumvent the COAH process early in his tenure, and the state Supreme Court ultimately ruled that he didn't have the power to disband the council. Christie has declined to appoint a full complement of members to the council -- only 6 of 12 seats are filled. His administration attempted to take $160 million from municipal affordable-housing trust funds to help balance the state budget, which an appellate panel recently ruled illegal. COAH missed a court-imposed deadline for introducing new affordable housing rules, asking for an extension at the 11th hour. When the proposed rules did not, according to advocates, meet the court's order, council members split and could not agree to adopt them, setting the stage for last month's ruling.

That unanimous decision gave Christie essentially what he had wanted since taking office in that it has rendered COAH virtually powerless. The courts are going to resume the determination of affordable housing obligations and challenges when a builder or advocate contends a community is not providing its "fair share" of units for the low- and moderate-income, as the court required in its landmark Mount Laurel decisions.

In July 2013, Christie called those rulings a "failed social experiment in housing."

The governor had made his feelings about COAH clear even earlier, in his 12th executive order, signed as he began his fourth week in office. In ordering COAH to take no action for 90 days while a new task force studied whether the council should continue to exist, Christie wrote, "the burdensome procedures governing the provision of affordable housing in New Jersey for those with low and moderate income developed by COAH are excessively complex and unworkable, resulting in delays, inefficiencies, litigation and unreasonable costs to municipalities and the private sector without appreciable progress being made for our citizens."

The Fair Share Housing Center, a housing advocacy group that has fought many of the administration's actions regarding COAH and post-Superstorm Sandy housing relief, sued Christie the day the governor signed the executive order. Three days before the Appellate Division of Superior Court was to hold oral arguments on that suit, Christie rescinded his order, stating it was no longer necessary because his task force had completed its work. Only 30 days after Christie had appointed its members, the task force completed a 99-page report in which it declared COAH "irrevocably broken" and laid out very different affordable housing rules.

His Housing Opportunity Task Force wound up recommending two dozen reforms that would have reduced municipal obligations dramatically. As bills to change affordable housing rules moved through the Legislature, Christie made his requirements known: 10 percent of units in new developments of more than 10 units would be designated affordable and builders would pay into a municipal affordable-housing trust fund when they build smaller developments.

Ultimately, Christie and the Legislature could not agree on a new set of rules. Yet COAH stopped meeting. Even after the Supreme Court invalidated Christie's 2011 reorganization plan eliminating the council, the council did not meet until it had to consider new rules -- by order of the highest court.

Arce said that Christie has also taken money from the state's Affordable Housing Trust Fund, which is supposed to be used for housing production, and used it instead for such other housing items as the State Rental Assistance Program, rather than funding those programs separately.

"It has left no funding for housing production whatsoever," she said.

Christie's actions hostile to COAH and the creation of affordable housing are not the only complaints advocates have with how his administration has handled housing issues.

Adam Gordon, a Fair Share attorney, cited "the lack of a coherent response to the foreclosure crisis which has hit New Jersey as hard or harder than any other state in the country."

He said that one out of every 553 homes in New Jersey is in foreclosure, more than double the national rate and 172 percent higher than in neighboring Pennsylvania.

"It’s a grim picture that has not improved much even as other states make progress in their recoveries," Gordon said. Citing statistics from RealtyTrac, a real estate database, he added, "While foreclosure rates nationally are on the decline, New Jersey was one of only nine states in which the overall foreclosure rate increased in the first half of 2014."

Tammori Petty, a spokeswoman for the Department of Community Affairs, said the HomeKeeper Program has been an effective tool to help those facing foreclosure.

"Presently we are working to close out the HomeKeeper program and finalizing the few remaining applications in the system," she said, adding that any remaining funds would be "reprogrammed and spent before the end of 2017" as required.

New Jersey has other programs helping those in foreclosure as well, Petty said. The National Foreclosure Mitigation Program administered by the state Housing and Mortgage Finance Agency provides counseling services to homeowners and helps them work with lenders to negotiate more affordable mortgage payments and avoid foreclosure. And the New Jersey Judiciary Foreclosure Mediation Program uses mediation to work out payment arrangements.

Sen. Raymond Lesniak (D-Union) and a sponsor of the foreclosure bill Christie vetoed three times, said that's not enough.

"This is both a housing failure and an economic failure under Gov. Christie," Lesniak said in a statement last spring on learning New Jersey had the highest foreclosure rate in the nation. "His indifference to this crisis is dragging down our economic recovery, depressing home values and allowing vandalism and crime to spread in neighborhoods with empty homes. Three times we placed legislation on the governor’s desk to help solve this pressing issue and three times he turned his back on the problem."

"He has also signed bills to expedite foreclosures which we supported but vetoed a bill that would allow municipalities to implement land banks, which are a useful tool for addressing vacant and abandoned properties," Arce said. "He also used funds from the big bank foreclosure settlement to backfill the state budget rather than dedicating those funds to foreclosure prevention."

Gordon also complained that the administration has not been focused on, or provided enough funding for, community development in urban areas.

Arce faulted Christie's veto of the Neighborhood Revitalization Tax Credit expansion bill, saying the program has been "highly successful" and noting it continues to be touted by the administration.

In a press release last month on the awarding of about $2 million to two Essex County groups, then-DCA Commissioner Richard Constable said, "The Christie Administration continues to support the NRTC program which encourages new housing options and economic development opportunities for small businesses in New Jersey’s urban neighborhoods. This program continues to have positive impacts in New Jersey and has allowed the state to work with local organizations to foster revitalization in communities throughout Essex County. We will continue to invest in innovative programs such as this that will support New Jersey’s working families, seniors, and children."

The state DCA website boasts dozens of housing projects supported by the state:

  • Last month, the Housing and Mortgage Finance Agency began accepting applications for a new Rental Assistance Program to give as much as $825 a month to homeowners in the state's major Sandy rebuilding program pay for temporary housing while their primary homes are being repaired or raised.

  • In February, state and federal officials broke ground on a new 90-unit affordable housing development in Atlantic City built with $5.8 million in federal Sandy recovery funds and a 64-unit project for families and people with special needs that got $4.8 million in Sandy money.

  • At the beginning of this year, the Department of Community Affairs created a Sandy Recovery Housing Counseling Program to help low- and moderate-income families get help in accessing two new assistance efforts -- the LMI Homeowners Rebuilding Program and the Tenant-Based Rental Assistance Program.

"Most of those releases are, indeed, Sandy based," Gordon said, adding the administration has little else to show in terms of pro-housing policies.

Petty touted the administration's Sandy housing work.

Through the state's Community Development Block Grant action plan, DCA received an initial $230 million for three affordable-housing programs in the nine counties hardest hit by Sandy: The Fund for Restoration of Multifamily Housing (FRM) got $179 million and the Sandy Special Needs Housing Fund (SSNHF) and the Sandy Homebuyer Assistance Program (SHAP) got $25 million each.

As of December 31, 2014, FRM funds had been committed to 36 projects, 24 of which are under construction, she said. These should add almost 3,000 units for low- and moderate-income working families and people on fixed incomes. The U.S. Department of Housing and Urban Development approved a second round of CDBG funds last May, with another $200 million going to restore multifamily housing. Program guidelines have been adopted and the state anticipates that this money will be awarded later this quarter.

Petty said SSNHF funds have been committed to 23 projects that should create about 250 affordable units for individuals with special needs. That fund got an additional $25 million in the second CDBG round. Through SHAP, 259 low- and moderate-income home buyers got money to help buy homes in communities impacted by Sandy. As of the end of last year, the state had spent or committed to spend $15 million, or three-fifths of the total.

Arce said the HCDN is happy that the administration is now using local HUD-certified housing counselors to help those affected by Sandy. Overall, however, she doesn't give the administration high marks in rebuilding after the storm.

"It’s been a slow process," she said. "There’s still thousands of families out of their homes two-and-half-years later, that’s just not acceptable."

The Housing and Mortgage Finance Agency has funded other projects, many for those with special needs, using money from the Special Needs Housing Trust Fund. However the state announced it would no longer take applications for funds on October 31, 2011 because the program met its "goal" of spending $200 million in trust-fund financing, according to a letter from HMFA executive director Anthony Marchetta. The fund opened in 2005, five years before Christie took office. Marchetta wrote that the agency could accept applications "if we do eventually determine that there is money available in the future." So far, that has not happened.

Petty said that since 2010, the HMFA has committed to creating about 12,800 multifamily rental units, 1,525 supportive-housing beds for the homeless and the disabled, and 840 homes available for sale to workers statewide.

"The HMFA’s philosophy has been to generate the maximum number of affordable housing units with the limited amount of resources at our disposal to insure that supportive-housing opportunities are available in the majority of projects funded through the agency, and to finance affordable housing projects in locations that provide residents with employment and transit opportunities and quality public education," she said.

Additionally, the HMFA created the Multifamily Conduit Bond Program in 2011 to help fund more affordable rental housing, Petty said. The agency has issued more than $310 million in conduit bonds, resulting in the construction of 3,500 new rental units. These are "pass through" bonds, which the borrower has to repay.

On balance, housing advocates like Arce are not impressed.

"Overall, this governor has chosen to ignore New Jersey’s affordability problem," she said. "He has produced zero policies that would produce more quality, sustainable home options for our residents who are dealing with housing costs that outpace wages. New Jersey consistently ranks high in foreclosure and unaffordability and nothing has been done to improve that. While our neighbors are experiencing economic growth, ours has moved at a snail’s pace."

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