Judge won't vacate Madison affordable housing settlement over Drew lawsuit
The court will not vacate Madison's 2020 affordable housing settlement with the Fair Share Housing Center (FSHC).
Superior Court Judge Stephan Hansbury, during a hearing on Friday, Aug. 19 on the lawsuit filed by Drew University against the borough at the Morris County Courthouse in Morristown, said while he needed more time to reach a final decision, vacating the settlement is officially off the table.
"I don't want to do anything that would injure the implementation of the (affordable housing) plan as it is," Hansbury said in his reasoning. "Whether I permit an addition to it is a different issue."
Drew filed the lawsuit in June calling on the court to have Madison's 2020 affordable housing settlement vacated or revised to include 63 acres of land located on the western end of the campus - including the 53-acre Drew Forest - in its calculations. It alleges the borough purposely omitted the land during settlement negotiations, which the borough denies.
The Fair Share Housing Center agrees with Drew that the acreage should be added to the calculations for the amount of affordable homes in the plan, but does not argue that Madison should be made to rezone the Drew land in particular. Depending on how much the 63 acres can be developed, the advocacy group argues that Madison should be made to accommodate a corresponding amount of new affordable housing somewhere in town, but not necessarily at Drew.
The borough, on the other hand, contends Drew had not made its interest in developing the 63 acres of land known until last year after the settlement was reached, and that the university's campus was discussed during settlement agreement talks with FSHC and court officials.
Madison has rejected Drew's attempts to develop portions of the Drew Forest for multi-family housing, and says if Drew wants to insert itself into the Fair Share process, it can wait until the next round of state affordable housing mandates come due in 2025. The university is seeking to have the land rezoned and sold to a housing developer amid ongoing financial struggles.
'Let's Be Serious'
The courtroom Friday was filled with nearly 30 members of the public, most of them clad in "Save the Drew Forest" T-shirts. Hansbury heard arguments by attorneys representing Drew, Madison, the Friends of the Drew Forest advocacy group and FSHC for more than an hour and-a-half.
The topic of Madison's immunity from such lawsuits was brought up several times throughout the proceedings, as Hansbury questioned Drew's motivations.
He wondered why the university had waited to make this claim until just three years before the fourth round of state affordable housing obligations are due, and why it had not not come forward offering the 63 acres for development before the current settlement had been reached.
Municipalities, he said, are granted 10 years of immunity from builder's remedy lawsuits and lawsuits from other outside parties based on their judgment of compliance before the court.
"What's the point of immunity if it's not immunity?" Hansbury asked.
John Inglesino, the attorney representing Drew, argued the university is not seeking a builder's remedy lawsuit. What it wants is for Madison to correct its "big error" in not including the land in its realistic development potential (RDP) during settlement negotiations.
He also said the university had "no obligation" to come forward at any particular time during the compliance process.
Hansbury countered that if he were to vacate the settlement agreement, the Drew Forest, which includes environmentally sensitive land, would likely be developed.
"Let's be serious," he said.
Later in the hearing, Rachel Lokken, representing FSHC, stated state affordable housing regulations "clearly provide for the amendment of RDP" after a court settlement has been reached.
She said any party, under those regulations, could pressure the municipality to recalculate its realistic development potential.
Hansbury again asked what the point of granting a 10-year period of immunity is if it does not actually mean immunity.
Lokken said FSHC has never granted "absolute" immunity, particularly as it pertains to a municipality's unmet need of affordable housing.
"The most important provision in determining a municipality's obligation is providing for affordable housing as land becomes available," she said. "Municipalities shouldn't have this belief that their immunity is absolute beyond the ability to satisfy their deficit."
Hansbury asked her whether it was bothersome that Drew waited to come forward to offer its land until now. She replied by saying it was "better late than never" to come up with "significant" available land.
Borough Responds To Concealment Claim
Madison attorney Greg Castano Jr. said immediately that Drew's claim that the borough omitted or withheld the 63 acres of university land from FSHC and the court during its compliance hearings is false.
He said any insinuation that the borough did anything improper during its entire settlement process is "malarkey."
He spoke about how the borough tried to acquire the 53-acre Drew Forest through a conservation easement in 2018 in order to prevent development on that part of the parcel, referring to a number of email conversations between representatives from the university and Borough Administrator Ray Codey.
Drew would have retained use and ownership of the forest under the provisions of the easement, but an agreement was never reached, he said.
"I have no idea how I'm supposed to understand the allegation that the borough somehow concealed its efforts to acquire a conservation easement," Castano Jr. said.
Lokken said this was the first time FSHC had heard there were ever talks of a conservation easement between Drew and Madison.
Castano Jr. said while the conservation easement talks were going on, the borough was also in the process of finding a spot in town for the 44-unit, all-affordable development now set to be constructed on Walnut Street and Community Place.
The borough offered to purchase a 9.6-acre portion of Drew's land in 2020, but it was rejected because the university felt the $3 million price proposed was too low, he said.
He said the borough reached out again to Drew with an offer of $4.6 million, after having the land appraised, but received no response from the university.
Castano Jr. said the attempts to purchase this land were brought up to Superior Court Judge Michael Gaus during the borough's settlement proceedings.
"There's nothing in this process that was concealed," he stated.
Lokken said while the matter had been brought to Gaus' attention, FSHC "didn't know" anything about it.
"What's interesting about that fact is that that 9.6 acres that the borough is referring to is within the 53-acre conservation easement that was proposed," she noted.
She said any part of that land that can be developed should factor into a recalculation of Madison's RDP figure.
Potential For New Homes
Hansbury said one of the points he will consider while making his decision is the impact recalculating the RDP would have on Madison's affordable housing obligation.
He said even adding the 9.6 acres of developable land the borough attempted to purchase from Drew could translate to 80 more units required for that site.
"That's quite a shock to a municipality that thought it had immunity," he noted.
Lokken argued that would only happen if the borough were to rezone the land to allow for housing. Hansbury replied Madison would still have to find somewhere to put those units, even if they did not rezone that particular parcel.
Inglesino said the fact of the matter is Madison made a "mistake" in not including Drew's land in its RDP and that, at least, needs to be rectified.
Hansbury said there are "very powerful public policy issues" on both sides of the argument, which he said is the main reason he would be unable to make a final decision just yet.
"I'm very troubled by the fact that there is a potential increase of significant size to Madison's Fair Share obligation, and obviously, that's an important policy issue," he said, "but I'm also very troubled by the whole immunity issue."
He said there is also the potential to allow for additional oral arguments to be made in the case in the future, and would keep all parties apprised.
Following the proceedings, Mayor Robert Conley said, in his opinion, it was "clear the judge understands the case." He also said he hopes the borough can help Drew through its current financial struggles.
