Ted Ihde's Blog: Ted Ihde author of “Thinking About Becoming A Real Estate Developer?” - Posts Tagged "nj"
Impact Fees: New Jersey
Come January 31st, each of New Jersey’s 564 municipalities is required to file their own resolution with the State, adopting affordable housing obligations for their municipality.
Come June 30th, each of New Jersey’s 564 municipalities is required to submit their affordable housing plan to the State, for their municipality.
Last October, the New Jersey Department of Community Affairs released New Jersey affordable housing requirements. These will need to be completed by 2035. And here they are…
A) Create 84,698 new affordable housing units.
B) Preserve an additional 65,410 existing housing units.
140,00 homes built or renovated over the next ten years. That’s a lot of homes. That’s a lot of infrastructure needed.
Impact fees…and Trenton.
The Municipal Development Impact Fee Authorization Act – presently in committee in Trenton – would, if passed, broaden New Jersey municipalities’ ability to pass through development-related costs to real estate developers. By broadening the scope for how impact fees can be collected by municipalities.
New Jersey is one of 22 states which presently authorizes the collection of impact fees by a municipality. Different states may refer to “impact fees” though their own state vernacular. For example, in Kansas – Kansas does authorize impact fees – impact fees are also referred to as adequate facility taxes. Or excise taxes.
At the present time, in New Jersey, the impact fees which can be passed along by municipalities to developers are pretty much limited to off-site improvements which arise as a direct consequence of the development. Direct consequence?
My humble opinion…
The way impact fees are levied upon developers in New Jersey today seems a bit…unjust. Tilted too far in favor of developers. At the expense of municipalities. See, direct consequence.
For example, an increased allocation of funds – and personnel – will likely be required in order to accommodate the higher number of classroom students which will be arrived at through the construction of new homes within any municipality. New homes are built. New families move in. Families have kids. Kids go to school.
Yet, in New Jersey, this increase in education funding which will be required by a municipality – as a result of new development – is not able to be passed through to real estate developers by way of impact fees. Though they should be able to be so.
Because any increase in education funding needed in order to accommodate larger classroom sizes – or additional teachers – which comes about as a direct result of development is as much of a direct development-related cost as one can think of. It’s attributed to…the building of new homes. Isn’t it?
Education funds for a New Jersey municipality – collected through impact fees charged to real estate developers – should be permissible.
Larger classrooms. Additional teachers. Potentially, the construction of a brand new school. These are a few of the costs – real costs – that a municipality will incur as a result of an increase in the student population. Because new homes were built in the municipality.
One proposed solution? A boardening of the scope for the collection of impact fees by New Jersey municipalities.
Whereas critics of increasing impact fees may view additional impact fees charged to developers as impediments to growth, that argument is easily overcome.
Impact fees can be collected in lieu of local property tax hikes. Furthermore, impact fees are specific to the development at hand. To the area being developed. As such, the implantation of impact fees enables the broader property tax-paying populace to not be unduly burdened through an increased annual property tax bill. To fund development in town…which really does not directly affect them.
Come June 30th, each of New Jersey’s 564 municipalities is required to submit their affordable housing plan to the State, for their municipality.
Last October, the New Jersey Department of Community Affairs released New Jersey affordable housing requirements. These will need to be completed by 2035. And here they are…
A) Create 84,698 new affordable housing units.
B) Preserve an additional 65,410 existing housing units.
140,00 homes built or renovated over the next ten years. That’s a lot of homes. That’s a lot of infrastructure needed.
Impact fees…and Trenton.
The Municipal Development Impact Fee Authorization Act – presently in committee in Trenton – would, if passed, broaden New Jersey municipalities’ ability to pass through development-related costs to real estate developers. By broadening the scope for how impact fees can be collected by municipalities.
New Jersey is one of 22 states which presently authorizes the collection of impact fees by a municipality. Different states may refer to “impact fees” though their own state vernacular. For example, in Kansas – Kansas does authorize impact fees – impact fees are also referred to as adequate facility taxes. Or excise taxes.
At the present time, in New Jersey, the impact fees which can be passed along by municipalities to developers are pretty much limited to off-site improvements which arise as a direct consequence of the development. Direct consequence?
My humble opinion…
The way impact fees are levied upon developers in New Jersey today seems a bit…unjust. Tilted too far in favor of developers. At the expense of municipalities. See, direct consequence.
For example, an increased allocation of funds – and personnel – will likely be required in order to accommodate the higher number of classroom students which will be arrived at through the construction of new homes within any municipality. New homes are built. New families move in. Families have kids. Kids go to school.
Yet, in New Jersey, this increase in education funding which will be required by a municipality – as a result of new development – is not able to be passed through to real estate developers by way of impact fees. Though they should be able to be so.
Because any increase in education funding needed in order to accommodate larger classroom sizes – or additional teachers – which comes about as a direct result of development is as much of a direct development-related cost as one can think of. It’s attributed to…the building of new homes. Isn’t it?
Education funds for a New Jersey municipality – collected through impact fees charged to real estate developers – should be permissible.
Larger classrooms. Additional teachers. Potentially, the construction of a brand new school. These are a few of the costs – real costs – that a municipality will incur as a result of an increase in the student population. Because new homes were built in the municipality.
One proposed solution? A boardening of the scope for the collection of impact fees by New Jersey municipalities.
Whereas critics of increasing impact fees may view additional impact fees charged to developers as impediments to growth, that argument is easily overcome.
Impact fees can be collected in lieu of local property tax hikes. Furthermore, impact fees are specific to the development at hand. To the area being developed. As such, the implantation of impact fees enables the broader property tax-paying populace to not be unduly burdened through an increased annual property tax bill. To fund development in town…which really does not directly affect them.
…how Rutgers University came to be.
Rutgers, The State University of New Jersey was founded – originally as a seminary – in 1766.
Founded by William Franklin. William Franklin, son of Benjamin Franklin.
Although, upon its founding, this college, located in New Brunswick along the Raritan River, was not known as Rutgers.
The name Rutgers was affixed to the New Brunswick college 59 years after its founding. In 1825. “Rutgers,” selected to honor Revolutionary War veteran Colonel Henry Rugers. Between the year of its founding – in 1766 – and the year Rutgers was selected as the college’s name, in the honor of Henry Rutgers – in 1825 – Rutgers had been Queens College. Then, for the next one hundred years, it was Rutgers College.
Henry Rutgers…
Born in New York City in 1745 – and in 1745, that would have been, the Province of New York, British America, as New York was still under British rule when Henry Rutgers was born – Henry Rutgers served as a New York state assemblyman. He was a graduate of Columbia University (then, King’s College),
A prominent New York landowner, Henry Rutgers donated much of his land to local New York City schools, charities, and churches. In Manhattan, if you have ever driven down Henry Street or Rutgers Street, those streets were named after Henry Rutgers.
Rutgers College – then Queens College – adopted Henry Rutgers’ name upon receiving a much needed financial infusion from Henry Rutgers.
Through Henry Rutgers’ generosity, prospects for the then-struggling Queens College to continue on as an institution of higher learning, brightened.
At the time of Henry Rutgers’ financial contribution, Queens College had incurred a multi-year shutdown. Its finances, and its future, cast astray as a byproduct of the challenging economic times the United States went through upon the conclusion of the War of 1812.
The University of Newark joined the Rutgers family in 1946. As Rutgers University-Newark.
The College of South Jersey joined the Rutgers family in 1950. As Rutgers University- Camden.
Rutgers is the second oldest university in New Jersey. Founded 20 years prior to Queens College’s founding, Princeton – which had been the College of New Jersey from 1746 until 1896 – is the oldest New Jersey university.
Rutgers’ Board of Trustees consists of 41 voting members. Rutgers’ Border of Trustees functions in an advisory capacity to Rutgers’ Board of Governors.
Rutgers’ Board of Governors consists of 15 voting members. Rutgers’ president is a non voting Board member.
Three of the 15 members of Rutgers’ Board of Governors are voting members, selected by the Rutgers University Senate. Three representatives – selected by the University Senate – are non voting representatives.
Eight members of Rutgers’ Board of Governors are appointed by the New Jersey governor. Seven members are selected by the Board of Trustees. For the 8 members appointed by the New Jersey Governor, confirmation for each member by the New Jersey Senate is required.
The president of Rutgers is a nonvoting Board of Trustees member. Rutgers’ University Senate selects two members of the faculty – as well as two students – as non voting representatives.
The selection of the 41 voting members of the Board of Trustees is done in accordance with State law.
There are 20 charter members. Three of the 20 charter members must be women.
Sixteen Trustees are Rutgers alumni, each of whom is nominated for Board membership by the Nominating Committee of the Board of Trustees.
Five Trustees are public members, appointed by the governor. The five public members who are appointed by the governor require confirmation by the New Jersey State Senate.
The president of Rutgers is selected by the university’s Board of Governors. The Board of Governors oversees the process of identifying the president, while overseeing the Presidential Search Committee.
Rutgers’ Presidential Search Committee develops a profile of prospective candidates…submitting recommendations of potential university presidents to Rutgers’ Board of Governors.
Rutgers’ Board of Governors, upon receiving recommendations and feedback from the Presidential Search Committee, ultimately selects the university president.
On two separate occasions – resulting from acts taken by the New Jersey Legislature – Rutgers was designated as the official state university of New Jersey. New Jersey’s legislature granted Rutgers this distinction in 1945. And once again, in 1956.
Thinking About Becoming a Real Estate Developer?
Founded by William Franklin. William Franklin, son of Benjamin Franklin.
Although, upon its founding, this college, located in New Brunswick along the Raritan River, was not known as Rutgers.
The name Rutgers was affixed to the New Brunswick college 59 years after its founding. In 1825. “Rutgers,” selected to honor Revolutionary War veteran Colonel Henry Rugers. Between the year of its founding – in 1766 – and the year Rutgers was selected as the college’s name, in the honor of Henry Rutgers – in 1825 – Rutgers had been Queens College. Then, for the next one hundred years, it was Rutgers College.
Henry Rutgers…
Born in New York City in 1745 – and in 1745, that would have been, the Province of New York, British America, as New York was still under British rule when Henry Rutgers was born – Henry Rutgers served as a New York state assemblyman. He was a graduate of Columbia University (then, King’s College),
A prominent New York landowner, Henry Rutgers donated much of his land to local New York City schools, charities, and churches. In Manhattan, if you have ever driven down Henry Street or Rutgers Street, those streets were named after Henry Rutgers.
Rutgers College – then Queens College – adopted Henry Rutgers’ name upon receiving a much needed financial infusion from Henry Rutgers.
Through Henry Rutgers’ generosity, prospects for the then-struggling Queens College to continue on as an institution of higher learning, brightened.
At the time of Henry Rutgers’ financial contribution, Queens College had incurred a multi-year shutdown. Its finances, and its future, cast astray as a byproduct of the challenging economic times the United States went through upon the conclusion of the War of 1812.
The University of Newark joined the Rutgers family in 1946. As Rutgers University-Newark.
The College of South Jersey joined the Rutgers family in 1950. As Rutgers University- Camden.
Rutgers is the second oldest university in New Jersey. Founded 20 years prior to Queens College’s founding, Princeton – which had been the College of New Jersey from 1746 until 1896 – is the oldest New Jersey university.
Rutgers’ Board of Trustees consists of 41 voting members. Rutgers’ Border of Trustees functions in an advisory capacity to Rutgers’ Board of Governors.
Rutgers’ Board of Governors consists of 15 voting members. Rutgers’ president is a non voting Board member.
Three of the 15 members of Rutgers’ Board of Governors are voting members, selected by the Rutgers University Senate. Three representatives – selected by the University Senate – are non voting representatives.
Eight members of Rutgers’ Board of Governors are appointed by the New Jersey governor. Seven members are selected by the Board of Trustees. For the 8 members appointed by the New Jersey Governor, confirmation for each member by the New Jersey Senate is required.
The president of Rutgers is a nonvoting Board of Trustees member. Rutgers’ University Senate selects two members of the faculty – as well as two students – as non voting representatives.
The selection of the 41 voting members of the Board of Trustees is done in accordance with State law.
There are 20 charter members. Three of the 20 charter members must be women.
Sixteen Trustees are Rutgers alumni, each of whom is nominated for Board membership by the Nominating Committee of the Board of Trustees.
Five Trustees are public members, appointed by the governor. The five public members who are appointed by the governor require confirmation by the New Jersey State Senate.
The president of Rutgers is selected by the university’s Board of Governors. The Board of Governors oversees the process of identifying the president, while overseeing the Presidential Search Committee.
Rutgers’ Presidential Search Committee develops a profile of prospective candidates…submitting recommendations of potential university presidents to Rutgers’ Board of Governors.
Rutgers’ Board of Governors, upon receiving recommendations and feedback from the Presidential Search Committee, ultimately selects the university president.
On two separate occasions – resulting from acts taken by the New Jersey Legislature – Rutgers was designated as the official state university of New Jersey. New Jersey’s legislature granted Rutgers this distinction in 1945. And once again, in 1956.
Thinking About Becoming a Real Estate Developer?
Ted Ihde author of “Thinking About Becoming A Real Estate Developer?”
Today, a real estate developer and a licensed real estate broker, Ted graduated Summa Cum Laude from Bloomfield College.
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