On October 25th, New Jersey’s Public Advocate released a report on COAH, Affordable Housing in New Jersey: Reviving the Promise that “outlines several specific policy approaches that COAH should take to facilitate the effective implementation of the constitutional right.” The report is well worth reading as the deadline of December 31, 2007, to redraft the rules so that they comply with the constitutional mandates of the Mt. Laurel decisions.
The following is from the Public Advocates press release:
The report makes recommendations in several key areas that would help ensure that COAH accurately measures the true scope of the state’s affordable housing need:
The COAH rules must address the housing needs of those with very low incomes, and must require municipalities to meet the needs of these families in their affordable housing plans. COAH defines low-income households as those earning less than 50 percent of median income, or approximately $32,000 per year. Actual COAH income eligibility limits vary considerably based on region and family size.
The report states that the 2004 COAH rules will not create significant housing for families that earn less than 40 percent of median income because the rules allow towns to meet their affordable housing obligation while still excluding most of New Jersey’s low-income families. About 580,000 households in the state have incomes less than 40 percent of the median income.
The report urges COAH to consider “cost-burdened” families in calculating New Jersey’s affordable housing needs. Cost-burdened families are those who spend 30 percent or more of their pre-tax income on housing. Nearly 700,000 families – or 60 percent of the low- and moderate-income families in the state – spend more than 30 percent of their pre-tax income on housing. Roughly 325,000 of these households pay more than 50% of their pre-tax income toward housing. Under COAH’s methodology, most of them are excluded from the calculation of New Jersey’s affordable housing need.
COAH should support its estimate of the state’s affordable housing need with current and reliable information. The report explains how COAH’s “filtering” projections in its third round rules relied on questionable assumptions and outdated data. Filtering refers to a process by which homes occupied by middle- and upper-income families are vacated and then become affordable to low- and moderate-income families. In other words, the cost of the home decreases relative to the incomes of COAH-eligible families, making a once unaffordable unit affordable.
The Appellate Division of the Superior Court struck down as unsupported COAH’s projection that filtering would address the affordable-housing needs of more than 59,000 families. The Public Advocate’s report confirms the court’s conclusion that COAH had offered no compelling data to support its filtering claim and had made no attempt to identify the towns where filtering was occurring in New Jersey. Recent reports from COAH indicate, however, that it is now recalculating its filtering projection using more precise and reliable data.
The report urges COAH to adhere to several principles to ensure a clear and accurate projection of New Jersey’s affordable housing needs, including:
Engaging in a transparent and open process that provides access to its data and methodologies and substantiates assumptions with relevant and timely data.
Devising incentives that actually result in the construction of affordable housing and avoiding incentives that credit towns for units that are not built.
Using methodologies that reflect the realities that confront New Jersey families, acknowledging, for example, that redevelopment often forces families out of their homes and results in a loss of affordable units, which should be taken into account in calculating the community’s affordable housing obligation.