New Jersey’s updated affordable housing law will proceed, following a Superior Court ruling issued at the start the new year.

Mercer County Judge Robert Lougy rejected a motion to stay implementation of the update “on numerous grounds” in an opinion released Jan. 2. Fair Share Housing Center, a defendant in the case, announced the ruling Thursday.

Led by Montvale, several municipalities filed suit in the fall to challenge the legislative overhaul of New Jersey’s affordable housing obligations. Under the state’s landmark Mount Laurel Doctrine, municipalities’ constitutional obligations for providing a fair share of affordable homes are updated every 10 years. The fourth round of obligations, starting in 2025, mark the first under the updated law.

The court will hear oral arguments Jan. 31 on whether to dismiss the complaint entirely.

The New Jersey Department of Community Affairs released non-binding calculations for Round 4 commitments in October. Those figures put the statewide need for affordable housing at approximately 150,000 units. About six months earlier, Gov. Phil Murphy enacted legislation to revamp the state’s affordable housing rules. In his order, Lougy highlighted that intent as crucial to the legislation, the arguments in this case, and the Court’s decision.

“The Court cannot lightly enjoin a legislative enactment where Plaintiffs fail to meet their burden,” he wrote. “The Court finds it incongruous with all principles of equity to leave the State’s low- and moderate-income households in worse shape than before the Legislature’s comprehensive reshaping of the field.”

In its analysis, first shared by Real Estate NJ, the order found that the plaintiffs fail to demonstrate that they would suffer irreparable harm or that that they would likely succeed on the merits.

Throughout, the judge noted that while there may be adverse affects for opting out, participating in the process is voluntary under state law.

“The Legislature did not restrain the political leaders of Plaintiff municipalities, and all other municipalities, from making the local decision of (a) participating in the administrative processes established by the Act, (b) seeking declaratory judgment through the courts, or (c) doing nothing unless called upon to defend exclusionary zoning litigation. There are consequences to each of those options, but those options and consequences are not new; rather they flow from the Mount Laurel obligation itself,” according to Lougy’s opinion.

“But Plaintiffs have no entitlement to deprive other municipalities of those same choices, and the Court notes that Plaintiffs are just a small fraction of this State’s municipalities.”

Timeline

Localities have until Jan. 31, 2025, to adopt the DCA guidance or provide their own calculations, consistent with state law. Municipalities then have until June 30, 2025, to submit specific plans to hit their figures.

Municipalities must adopt ordinances and resolutions for the program by March, 15, 2026.

“We’re thankful Judge Lougy recognized there’s clearly not enough evidence to put New Jersey’s landmark new affordable housing law on hold,” commented Fair Share Housing Center Executive Director Adam Gordon, who presented arguments at a Dec. 20 hearing. “A delay in building affordable housing, as the lawsuit seeks, would be devastating for working families, people with disabilities, and seniors struggling with record-high housing costs.”

“For decades, New Jersey’s Judiciary has been asking the Legislative and Executive branches to institutionalize the Mount Laurel Doctrine, which they finally did in 2024,” he added. “This lawsuit is a thinly veiled political statement attempting to revisit arguments that failed in the legislative process.”