WAYNE, NJ – Every city and town in New Jersey is obligated by law to provide their share of affordable housing. Wayne is no exception and this obligation is in perpetuity. The law sets time periods that are called rounds. Wayne has already fulfilled its obligation for round one and round two and finds itself at the tail end of the third round which began in 1999 and will end in 2024. The fourth round will begin in 2025.
To learn more about this obligation and Wayne’s history, there are several articles written on the subject that you can find here, here and here. The township’s affordabel housing website also provides a wealth of information.
For round three, there were so many issues with the state’s affordable housing policy that the New Jersey state Supreme Court took the matter and placed it into the court’s hands in 2015. Eventually, Judge Mary Jacobson came up with a calculation that is now widely used to determine a town’s affordable housing obligation for round three. Wayne’s third round obligation is to provide 2,271 affordable housing units.
There are two main strategies that Wayne township could’ve used to meet this obligation. The first method was for Wayne to buy land in town and build its own public housing units. The second method was to use private developers to build the affordable units for Wayne.
Using private developers to build affordable housing was established during round two, and it allowed these developers to build four market-rate units for each affordable housing unit. By utilizing this method, Wayne’s 2,271 obligation would lead to over 11,000 new residential units being built in Wayne.
Under the leadership of Wayne Mayor, Chris Vergano, the township has chosen to address the issue using the latter strategy, along with a strategy of trying to reduce their obligated number. Wayne’s affordable housing team consists of three attorneys and three town planners, and they have been arguing in multiple court cases that Wayne does not have enough vacant land to build all these units. What is hoped, is that the courts will provide a ‘Vacant Land Adjustment’ to their obligation and reduce the number to a ‘Realistic Development Potential’ (RDP).
The Mayor has stated that he believes Wayne’s RDP, determined by the court, is anticipated to be “significantly lower than 1,000.”
Whatever the final number becomes, it still means that five times that number of housing units will be built in order to meet the obligation.
Fifth Ward Wayne Councilwoman, Fran Ritter opposes the Mayor’s strategy which she says, “allows private developers to dictate our zoning ordinances and overcrowd our community. She also said that she supports affordable housing “where the town is making its own plans and setting its own terms.”
She spoke about this at the last Town Council meeting and used a hypothetical approach to round three. Ritter believes the focus of the argument against Wayne building its own affordable housing development has been about cost, while the revenue side has been ignored.
“I'm going to throw some figures out for your consideration,” she said. Her figures used the 1,000 affordable housing unit obligation that was discussed during the September 9 public information session on Wayne’s affordable housing obligation.
Ritter described building 2,000 units, of which 1,000 were affordable housing units and 1,000 were market-rate units. These units would be Wayne Township owned and managed properties. She used a cost of $200,000 per unit in her example.
The cost, according to Ritter, to buy the land and build 2,000 units would be about $400 million. If Wayne were to bond this out over 30 years, the yearly debt service that Ritter predicted would be about $16 million.
Next the Fifth Ward Councilwoman used rental income of $1,000 per month for each affordable unit and $3,000 per month for each market-rate unit. If all of these units were rented 100% of the time, the revenue that Ritter predicts would be $48 million per year.
“This would render a $32 million, give-or-take profit,” she said. “That's twice the mortgage costs from the maintenance. It seems like a very good opportunity for the town. Whether you like it or not, this is something that we need to throw out there as an option to think about. Whether we do it or not, is a whole other matter. But let's not just think about the cost side of the equation, we have to think of the potential revenue upside of the equation.”
Mayor Chris Vergano addressed this at the same meeting, saying: “I don't think the Township of Wayne wants to get into public housing sector and have a housing utility or a housing authority. I don't know how we would ever control the situation and that's not the way when you're going for a vacant land adjustment.”
“As I said to you before,” continued Vergano. “Our number is 2,271. We believe our [Realistic Development Potential] will be significantly below 1,000 and then once we add all the bonus credits that we're going to get from the prior round and from units that we're getting this year the number will be lower.”
TAPinto reached out to the Mayor and asked him about Ritter’s idea to have Wayne build its own housing units.
“Doing it that way, actually works against us because this would affectively throw the vacant land adjustment out the window,” he said.
“We estimated based on actual other projects, the cost to build each unit is $250,000 per unit at a minimum,” Vergano said. “The concept is that we would have to bond a half-a-Billion dollars to build these units and create a humongous housing authority. When we think of towns with housing authorities, we think of Camden, we think of Newark. Wayne is not like those communities. Wayne is a smaller community and I don’t think we need bigger government. I’m actually a proponent of less government. I just don’t think that this is a concept that will work for Wayne, and I believe it will begin to change the face of Wayne.”
“It’s a very complicated puzzle and every piece is very important to it,” Vergano added. "It has to be done right, and it has to be done carefully.”
Ritter talked with TAPinto and she believes that Vergano’s plan to use for-profit private developers would mean a much larger increase in the township population. This is based on the four-to-one ratio of market rate units that must be developed for each affordable housing unit. This increase in population will have a profound effect on Wayne’s future.
Ritter believes that a 1,000 RDP will lead to 5,000 units built in Wayne, which would mean an increase of 15,000 residents to the town.
She brought up the increased cost of education: “15,000 residents will bring in 2,500 additional students at $15,000 each, this leads to an additional $37.5 million annually for the school district,” she said.
“On average an individual in Wayne disposes of 1,646 pounds of solid waste garbage annually,” she said. “The increased population will add 12,345 additional tons of solid waste to dispose of annually."
“Ambulance and fire services will also become strained,” she said. “Our ambulance squad averages 5,000 calls per year which breaks down to approximately .09 calls per resident. 15,000 additional residents times .09 equals 1,350 additional ambulance calls. That is a 27 percent increase in call volume.”
Ritter sees the revenue side of her plan as a way to pay for the added cost of a significantly increased population.
“Letting developers have their way with our zoning laws impacts every municipal service the Township provides,” Ritter added. “From the strain on our water supply (our well aquifers do not have unlimited capacity), to sewage treatment costs, to road paving, plowing and salting, to fire calls and police response, to increased traffic, to the strain on our recreation fields. None of this is represented on the ledger carried by the Mayor, lawyers and the developers who want to profit at the expense of we, the taxpayer and our quality of life. We can't afford Mayor Vergano's idea of affordable housing.”
Vergano believes that Ritter’s numbers are not accurate and that the final RDP number will be "significantly lower than 1,000," and that credits will be used to reduce this number further. He agrees with Ritter that the increased population will create a deleterious effect on the town, but he also believes that the strategy the town is currently employing will ultimately have the least impact.
“Our goal has been, all along to minimize the impact to our community,” said Vergano. “To keep densities close to what we currently have. For example, the GAF property is 4.4 units per acre. That’s close to every other residential density, we have in Wayne. The apartments are coming in at 15 units per acre, and that’s what we have in Wayne. We’re trying to maintain the community that we have.”
At the last town council meeting, Vergano said: “For now, this is the way that most communities in the state of New Jersey are [addressing their affordable housing obligation]. Even though it sounds different that we're negotiating with developers, this is the process.”
About a Wayne housing authority, Vergano said: “For Wayne to do that just doesn't make sense. We’ve looked at this, and we looked at it starting five years ago. So for now, this is where we are and this is the only way that we see that we can get through this without facing builder remedy lawsuits.”
Would the Mayor consider a plan like Ritter’s for future rounds? “We will look forward to exploring every other option," he said. "Hopefully, our number in round four will be a hell of a lot smaller than 2,271, because, quite frankly there's no land left. That's why we're going to be successful with our vacant land adjustment because the number of acres Wayne has left is very small. So, I'm hoping their number in round four will be a lot smaller and then perhaps we can do something with a third party that would be financially stable for the rest of the community.”
Ritter concluded her remarks by saying: “The Mayor and his handpicked Mt. Laurel Committee are quick to condemn taking control from private developers. It’s remarkable that a plan that reduces new development from 11,000 to 2,000 units, or lower would meet with such disdain. They appear willfully ignorant to the fact that adding thousands of homes to this Community will, in perpetuity, bury us in traffic, trash and taxes.”