On August 24, 2011, Acting New Jersey Gov. Kim Guadagno signed into law legislation (S-2974 and A-221) that places another two-year moratorium on the imposition of nonresidential affordable housing fees. The fees, known as Statewide non-residential development fees, were enacted in 2008 as part of revisions to the Fair Housing Act to raise revenue for the construction and rehabilitation of affordable housing. The amount of the non-residential fee is equal to 2.5 percent of a project’s equalized assessed value including land and improvements. A previous moratorium suspended the collection of such fees until July 1, 2010 pursuant to the 2009 Economic Stimulus Act. The current legislation extends the moratorium to July 1, 2013.

The law provides for the following:

  • nonresidential projects that have or will receive preliminary or final approval prior to July 1, 2013 are exempt from paying the 2.5 percent fee, provided a building permit is issued prior to January 1, 2015
  • the moratorium is retroactively extended back to the end of the last moratorium. Thus, any non-residential fees paid between the expiration of the earlier moratorium (July 1, 2010) to the present must be refunded unless the municipality can demonstrate it has already spent the monies on an affordable housing project
  • claims for refunds must be submitted to a municipality in writing within 120 days of the effective date of the law, i.e., December 22, 2011.

It is hoped the extension of the fee moratorium will encourage the development of commercial projects throughout New Jersey.