Municipalities throughout the state are attempting to make sense of Assembly and Senate Bills A-4/S-50, legislation passed in March, that updates the Fair Share Housing Act and amends the state’s system for municipalities to meet their obligation to provide their “fair share” of affordable housing for New Jersey residents. While proponents believe the effort will create a strong framework for affordable housing throughout the state, it will also place a greater responsibility on municipal leaders to understand their legal obligations, strategize how they will meet them, and implement their plan – all under aggressive, looming deadlines. The legislation poses further challenges for municipalities through a lack of guidance on key provisions required to meet their affordable housing quotas, especially around resource management, including sewer capacity, drinking water availability, and infrastructure needs.
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The updated Fair Share Housing Act carries a notable lack of guidance surrounding utilities, particularly in relation to sewer conveyance and treatment plant capacity, as well as drinking water availability and infrastructure. While the policy requires these elements to exist to serve the added affordable housing, the planning and development of these systems is not quite so simple. Utility resources rely on intelligent planning and sufficient funding, from the federal and state government and system users, to maintain aging infrastructure, construct innovative technology to address emerging contaminants, and to expand to successfully meet new housing and general development needs.
For more information on the Affordable Housing Obligations for 2025-2035 (Fourth Round) Methodology and Background published by the DCA, click here.
Public sewers are a particular area of concern. Too often, municipal, sewerage, and water authorities are left out of critical discussions surrounding expanded development, and municipal planners inaccurately assume their sewer systems can handle all increased demands. In fact, although many towns have public sewer systems, many public wastewater facilities are at the limits of their conveyance capacity in certain areas, or are near or under sewer moratoriums, or sewer bans, due to constraints inherent in the treatment process and cannot meet the increased need. Increasing the capacity of these facilities to accommodate additional flow is typically a long and expensive process that can take five to ten years and cost tens of millions of dollars.
If a public sewer system does have available capacity, they often require sewer extensions and other system improvements, which come with a host of engineering and regulatory challenges. Many sewerage treatment plants that are near their capacity will require facility expansion, which could take longer than the deadlines outlined in the Fourth Round guidance and will likely cost hundreds of millions of dollars. Increasing the capacity of a sewage treatment plant may be difficult due to federal and state surface water quality policies, which also require costly and lengthy studies. Extension or expansion of sewer lines may be impeded by land use regulations such as wetlands, threatened or endangered species, or Green Acres, and can take longer or become more costly to implement.
To be part of the solution to New Jersey’s affordable housing crisis, sewerage authorities as well as local, county, state, and federal governments need to start developing long-term capital plans and implementing those plans as soon as possible.
Another area of concern lies in water availability. While it may be surprising in a state that experiences as much precipitation as New Jersey does and is as advanced and developed as it is, there is a marked lack of available water in many areas. Where water allocation is available, the infrastructure to accommodate the additional demand may not be. In many cases, the water distribution systems need to be hydraulically analyzed to confirm their ability to provide water and fire flow without adversely impacting the water system, adding to the complications of providing water utilities to added housing.
Relying on increased yield from portable water sources, such as surface water from reservoirs or streams or groundwater from aquifers, is a potential remedy for water availability challenges. Unfortunately, both sources are limited. Surface water sources are difficult to expand due to the limited amount and high value of undeveloped land in the state. Many aquifers are contaminated, and high-density development along the coast has caused reduced groundwater levels and led to saltwater intrusion, where ocean water replaces the depleted freshwater within the aquifer. These issues not only limit water availability but are costly to remediate due to their complex treatment process. Here too, extension or expansion of water lines may be impeded by land use regulations.
Municipalities also face the challenge of aging infrastructure in relation to water availability and sewer capacity. Most current systems in the state were built between 1920 and the 1970s, making them more susceptible to leakage. Defective pipes, pipe joints, connections, or manholes related to aging infrastructure can cause Inflow and Infiltration (I&I). Infiltration is caused when groundwater infiltrates a sewer system and can rob it of its available conveyance or treatment capacity within a sewer system. Inflow occurs when water other than sanitary flow enters a sewer system from sources which include things like roof leaders, sump pumps, and cross connections between storm sewers and sanitary sewers. Many systems are subject to a high level of I&I, where a large percentage of the treatment plant capacity is spent on this extraneous flow. I&I is difficult and costly to remove.
And lastly, but surely not least, municipalities face significant pressure to meet their obligations on tight deadlines with limited resources. The plan outlined in the updated Fair Share Housing Act spans a 10-year period, 2024-2035, but the first milestone municipalities must meet – adopting a binding resolution with its calculated fair share obligation – must be done by January 31, 2025. The next deadline, by which municipalities must adopt a Housing Plan Element and Fair Share Plan to meet their obligations, comes soon after – by June 30, 2025. The policy includes aggressive deadlines to help municipalities avoid high-density builder’s remedy lawsuits.
The Local Redevelopment and Housing Law, N.J.S.A. 40A:12A-1 et seq., offers municipalities the ability to help defray costs of conveyance and treatment infrastructure costs for areas that need redevelopment. Redevelopment projects must be implemented in accordance with the applicable redevelopment plan, often leading to redevelopment agreements that require the redeveloper to provide or upgrade infrastructure improvements at the redeveloper’s cost.
At this time, no court has ordered a sewerage authority to expand its facility to provide treatment plant capacity, or extend or upgrade its infrastructure, to achieve the constitutional and statutory mandate of inclusionary zoning. However, courts have made it clear that authorities must show a credible reason for denial of access to its infrastructure. And while municipalities have built-in opportunities to challenge their legal obligation to adhere to the updated policy, unresolved issues will likely face lengthy court proceedings through county Mount Laurel judges.
The permitting and construction process at sewerage and water authorities is a complex process. The sooner municipalities are aware of their obligations, and begin the process to plan to meet them, the better off they will be.
Understanding the limits of existing infrastructure and sewer and water capacity is critical to commence a collaborative effort to find solutions for the Fourth Round. And time is of the utmost importance. The Fourth Round is looming, and municipalities throughout the state will face difficulties if they don’t begin preparing for it now.
The article was co-authored by CP’s Stanley G. Puszcz and Stephen Donati and Maraziti Falcon’s Brad Carney and Diane Alexander originally published in the September 2024 Edition of the New Jersey State League of Municipalities magazine where they addressed the wastewater infrastructure needs of the 4th Round.
The law firm of Maraziti Falcon has been committed to representing sewerage authorities and municipal utility authorities, together with municipalities with redevelopment for decades with the knowledge and experience from permitting of the utility to procurement of engineering and construction contracts, public construction defense, and defraying the costs of the taxpayer or ratepayer in redevelopment agreement. For more information: https://mfhlaw.com/
CP is a multi-discipline engineering, architecture, and environmental services consulting firm that offers effective, precision-crafted solutions that blend art and science to address even the most complex challenges. With expertise across all its disciplines, the firm is known for its comprehensive approach that considers the market, the environment, and the community in every project they touch. CP also has extensive experience in drafting the detailed capital plans needed in sewer and water capacity projects as well as expertise in design and construction surveillance. For more information: https://www.cpengineers.com/
The First Steps for the Fourth Round: Addressing Critical Infrastructure Needs webinar, hosted by CP Engineers, Architecture and Environmental Services, and Maraziti Falcon, LLP, offers expert guidance on tackling critical infrastructure challenges. Watching this webinar will give you valuable insights and practical support to help your municipality meet its compliance goals.