Date: September 23, 2020
From: Hillsdale Economic Growth and Business Development Committee
Re. Update on the status of a redevelopment plan for identified properties in the Hillsdale “industrial area” along Patterson Street designated as an area for redevelopment.
Background:
The State of New Jersey adopted into law legislation which revised and updated the State's local redevelopment and housing enabling legislation. The Local Redevelopment and Housing Law, N.J.S.A. 40A:12A-1 et seq (LRHL) replaced a number of former redevelopment statutes, including the Redevelopment Agencies Law, Local Housing and Redevelopment Corporation Law, Blighted Area Act, and Local Housing Authorities Law, with a single comprehensive statute.
The LRHL was ultimately designed by the New Jersey State Legislature to assist municipalities in the process of redevelopment and rehabilitation as evident in its preamble which states that: “There exist, have existed and persist in various communities of this State conditions of deterioration in housing, commercial and industrial installations, public services and facilities and other physical components and supports of community life, and improper, or lack of proper development which result from forces which are amenable to correction and amelioration by concerted effort of responsible public bodies, and without this public effort are not likely to be corrected or ameliorated by private effort.” The LRHL provides the statutory authority for municipalities to designate an “area in need of redevelopment,” prepare and adopt redevelopment plans, and implement redevelopment projects.
Specifically, the Governing Body has the power to cause a preliminary investigation to determine if an area is in need of redevelopment, determine that an area is in need of redevelopment, adopt a redevelopment plan, and/or determine that an area is in need of rehabilitation. When authorized by the Governing Body, the Planning Board has the power to conduct a preliminary investigation and hearing and make a recommendation as to whether an area is in need of redevelopment. The Planning Board may also make recommendations concerning a redevelopment plan at the appropriate time.
The LRHL provides municipalities with a broad array of economic development tools in areas that have been designated as being “in need of redevelopment”. However, concerns regarding the potential for eminent domain have often been an obstacle to effective redevelopment. Part of the problem arose from the statutory sequence of events; under the previous law, municipalities were required to designate redevelopment areas first, with the identification of areas that would be subject to eminent domain coming months or even years later in the process, in the adoption of a redevelopment plan.
P.L. 2013, Chapter 159, signed into law on September 6, 2013, moves this critical question to the very beginning of the redevelopment process. Now, when asking the local planning board to investigate whether an area should be designated as in need of redevelopment, the municipality must indicate whether it may seek to designate a “Non-Condemnation Redevelopment Area” or a “Condemnation Redevelopment Area”. The criteria for each type of area are the same.
This change allows municipalities to designate a redevelopment area and use all the other statutory tools, without eminent domain.
In addition, the recent amendments have also expanded the “e” criterion, which concerns the redevelopment designation of underutilized properties which have become stagnant and unproductive. The amendments also expand the criteria for designating an area in need of rehabilitation where there is environmental contamination or a persistent pattern of property tax delinquencies.
Redevelopment begins with the following two-fold process, set forth in the LRHL :
- The designation of an identified site as an area in need of redevelopment
- The preparation of a redevelopment plan. This can be completed by the Governing Body or delegated to the Planning Board or a Redevelopment entity/committee.
For a more detailed diagram see https://www.hillsdalenj.org/economicdevelopment
The process begins with a Governing Body’s adoption of a resolution retaining a redevelopment planner and directing the Planning Board to work with this professional to complete an investigation that determines whether an identified area meets the criteria for it to be designated an area in need of redevelopment, it continues to the preparation and adoption of a redevelopment plan.
Actions by Hillsdale:
The Hillsdale Governing Body decided that it would proceed using the non-condemnation route and passed Resolution 19289. This Resolution identifies properties in the industrial area along Patterson Street to the Pascack Brook (“industrial area”) and directs the Planning Board to work with a redevelopment planner (Fran Reiner) in undertaking a preliminary investigation to determine whether the identified properties in the “industrial area” constitute an area in need of redevelopment.
Working with the redevelopment planner the Planning Board held a series of public meetings which resulted their passing Planning Board Resolution 19039. This recommends those identified properties it believes should be designated an area in need of redevelopment.
The Hillsdale Governing Body then passed Resolution 19225. This Resolution formally designates an identified area as an area for redevelopment and specifically identifies the properties that fall within that designation. The Hillsdale Governing Body also directed the redevelopment planner to work with the Hillsdale Economic Growth and Business Development Committee to begin conceptually thinking about a Redevelopment Plan. Unfortunately, the process was delayed due to the COVID-19 pandemic.
On September 8, 2020, as COVID-19 limitations lifted, the Hillsdale Governing Body passed Resolution 20155 which retains Redevelopment Counsel (Joseph Baumann) and directs him to review the work completed so far by the Hillsdale committee and to work with the Redevelopment Planner to complete a Proposed Redevelopment Plan, schedule and other documentation for the Hillsdale Governing Body to review.
When the Proposed Redevelopment Plan is complete, it will be provided to the Hillsdale Planning Board. The Planning Board will review the Proposed Redevelopment Plan, hold all required public hearings and must within 45 days of receiving the referral, submit its recommendation to the Governing Body for final action.
We anticipate that a final Redevelopment Plan will be adopted through the adoption of an ordinance before the end of 2020.
I would like to clarify that the Hillsdale Governing Body is working on a redevelopment plan and emphasize that a redevelopment plan is very different from a developer’s agreement. There is no agreement with any developer.
A redevelopment plan is a zoning tool used to define and implement a vision and regulate the land use of an investigated area in a municipality. It is a plan adopted by the governing body of a municipality for the redevelopment or rehabilitation of all or any part of a redevelopment area. This plan identifies its relationship to key municipal objectives, public transportation and utilities, recreational and municipal facilities and other public improvements, and also identifies diverse and appropriate land uses and building requirements for those uses in the redevelopment area.
Whereas A developer’s agreement is a voluntary contract between a municipality and a person who either owns or controls property within a designated redevelopment area. A developer’s agreement details the obligations of both parties and specifies the standards and conditions that will govern specific development of the subject property and must comply with all the requirements set forth in the existing redevelopment plan. Property owners in a designated redevelopment area can redevelop their own properties, but usually enter an agreement with a third-party, who is usually a developer or other investor with a development background. This agreement is usually a purchase sale agreement or joint venture agreement of some kind. No third-party has authority to negotiate with a municipality, without first negotiating with the identified property’s owner for control over the identified property.
If you have any questions please do not hesitate to contact me.
Regards,
Council-Member Frank Pizzella
Chair of the Economic Growth and Business Affairs Committee