On September 19, Gov. Chris Christie signed Bill A1338 to amend the Permit Extension Act of 2008 (the PEA).

The process of obtaining land development approvals and permits can be difficult, time-consuming and expensive. Because of this, these approvals typically afford a protection period to allow a developer time to secure financing and complete a project without the fear of changes to governmental regulations or repeated application processes. Unfortunately, as a result of the national recession, in recent years projects have taken longer to complete, because of financing and marketability issues.

Thus, the New Jersey Legislature initially enacted the PEA in 2008 "to prevent the wholesale abandonment of approved projects and activities due to the present unfavorable economic conditions, by tolling the term of these approvals for a period of time, thereby preventing a waste of public and private resources." N.J.S.A. 40:55D-136.2(m). The PEA extended the life span of certain governmental approvals to December 31, 2014, to provide additional time to build a project. However, given the duration of the current economic downturn, the Legislature identified in A1338 the need to further extend and expand the PEA, as follows.

First, the expiration of the PEA's tolling period is extended from December 31, 2012, to December 31, 2014. This means that a qualifying permit or approval covered under the PEA may now be valid up to June 30, 2015.

Second, the scope of the PEA is retroactively expanded to include properties that were previously excluded from PEA protection. The PEA does not extend the life of all government permits and approvals. To qualify for an extension, a permit must meet the act's definition of an approval and fall outside its list of exceptions. The broadest exception excludes any permit or approval involving land located in an Environmentally Sensitive Area. This term initially included any land within the Highlands and Pinelands that was not designated as a growth center.

A1338 redefines and narrows the Environmentally Sensitive Area exception to afford PEA protection to more properties, including the following lands:

  • The Highlands planning area, provided the land is (i) not located in State Planning Areas 4B or 5; (ii) not a critical environmental site; and (iii) not located in a town that has adopted a Highlands master plan element, Highlands land use ordinance or an environmental resource inventory as of May 1.
  • Villages and towns designated in the Pinelands Commission's comprehensive management plan, provided the land is (i) not located in State Planning Areas 4B or 5 and (ii) not a critical environmental site.

Finally, A1338 applies the new, narrower exception retroactively. This can significantly impact development by breathing life into several dormant projects in the Highlands and Pinelands.

The full text of the act is available at http://www.njleg.state.nj.us/2012/Bills/AL12/48_.PDF.