Jul 12, 2021

Recent Decision is a Warning for Real Estate Developers

By James E. Polles, Esq.

Judge Shanahan’s decision on June 7, 2021, in In re Township of Hillsborough can initially be read as a clear warning to municipalities: violate (however well-meaning) the terms of court-approved settlement agreements with intervenors/developers and the Fair Share Housing Center at your own risk with potential exposure to attorneys’ fees and professionals’ fees. But what does the decision tell developers about dealing with requests from a Board for professional reports and testimony on issues beyond the agreed upon settlement or request that otherwise not relevant or inappropriate? 

The project is a 96-unit residential development including 23 affordable housing units. A settlement agreement between the developer and the Township required the Township to amend its Zoning Ordinance, but allowed for application for minor waivers, bulk variance requests, and other minor relief. Here, the Township Planning Board denied the application for the residential development. Among other reasons for the denial, (1) the Township’s Stream Corridor Ordinance required a 150-foot buffer from the project, as opposed to a 50-foot buffer proposed by the developer, and (2) a downstream drainage analysis was not done to determine the ability of a 42-inch pipe to handle proposed additional flows from the property. 

When faced with the decision whether to accede to the requests from a Planning or Zoning Board of Adjustment to provide professional reports or to move forward and address those concerns through testimony or some other measure, what choice does a developer have? Some may read In re Township of Hillsborough as supporting the position that a downstream drainage analysis was not required (which the developer did not provide and to which the Court agreed). By comparison, the Stream Corridor Ordinance was simply addressed by professional testimony concerning the appropriateness of the 50-foot buffer (to which, again, the Court agreed). But other applicants may not have the benefit of a court-approved settlement agreement with language directing a municipality to change its zoning ordinances, in the event a board does not approve a project based on the sufficiency of professional reports and/or testimony. A developer faces substantial risk of delay and increased costs by choosing to forego a request to provide such professional reports and testimony, both in terms of the potential for an application to be denied, and the subsequent pursuit of litigation to appeal the denial.             

From the outset, it is imperative to identify the key issue(s) impacting development and the key professional(s) who will contribute the required study, reporting and testimony in support of any development application. Hiring competent counsel is always a good first step to help navigate critical issues that, if not properly addressed at the outset of a project, will contribute to significant delays, and ultimately costs, to a project’s development.   

DISCLAIMER: This Alert is designed to keep you aware of recent developments in the law.  It is not intended to be legal advice, which can only be given after the attorney understands the facts of a particular matter and the goals of the client.