West Orange Township_Fourth Round HEFSP_Final Draft

r share of any municipality through the AMG formula, culminated in the enactment of the New Jersey Fair Housing Act in 1985. The Fair Housing Act (FHA) is found at N.J.S.A. 52:270-301, et seq. The FHA established the Council on Affordable Housing (COAH) as an administrative alternative to builder’s remedy lawsuits and the concomitant jurisdiction of the courts. COAH was given the responsibility of dividing the state into housing regions, determining regional and municipal fair share affordable housing obligations, and adopting regulations that would establish the guidelines and approaches that municipalities may use in addressing their affordable housing need. In 2008, the Legislature amended the FHA to add requirements for very low-income housing. Very lowincome households are those in which the gross household income is 30% or less than the region’s median household income. Low-income households are those with incomes no greater than 50% of the region’s median household income. Moderate-income households are those with incomes no greater than 80% and 8

Township of West Orange August 2025 Essex County, New Jersey Draft Housing Element and Fair Share Plan ------------------------------------------------------------------------------------------------------------------------------------------------------------- no less than 50% of the region’s median household income. Each is adjusted for household size and is in relation to the median gross income of the housing region in which the municipality is located. First and Second Rounds The First and Second Rounds under COAH are collectively referred to as the “Prior Round.” The Prior Round obligation is the cumulative 1987-1999 fair share obligation. The First Round consists of the six-year period between 1987 and 1993 for which COAH first established a formula for determining municipal affordable housing obligations (N.J.A.C. 5:92-1 et seq.). Then in 1994, COAH established amended regulations (N.J.A.C. 5:93-1.1 et seq.) and produced additional municipal affordable housing obligations for the years 1993 to 1999. This second round of obligations is known as the Second Round. When COAH adopted regulations for Round 2, it made the Round 1 and 2 obligations cumulative for both periods. Third Round Housing rounds were originally established by the Fair Housing Act as six-year periods, but in 2001 the Legislature extended the rounds to 10-year periods. This should have meant that the Third Round ran from 1999 to 2009. However, COAH didn’t establish new rules for the Third Round until the end of 2004 (N.J.A.C. 5:94-1 and 95-1 et seq.). The Third Round time period was therefore extended to 2014. The Third Round rules established a new method for calculating a municipality’s affordable housing obligation, known as “growth share.” This method required municipalities to project future residential and non-residential development and then derive their obligation from that growth. After the New Jersey Appellate Court invalidated several components of the Third Round rules, COAH released revised rules in 2008. The Third Round was once again extended to 2018 to provide municipalities with the time to apply the amended rules and establish mechanisms to meet their obligations. The revised third round rules, like the initial third round rules, established the obligations based on a growth share approach. On October 8, 2010, in response to numerous legal challenges to the second

revised third round rules, like the initial third round rules, established the obligations based on a growth share approach. On October 8, 2010, in response to numerous legal challenges to the second iteration of COAH’s Third Round regulations, the Appellate Division ruled that COAH could not allocate obligations through a “growth share” formula and directed COAH to use similar methods to those used in the First and Second Rounds. COAH proposed Third Round regulations a third time in 2014 using a formula similar to the ones it had used in the First and Second Rounds. However, when COAH held a meeting to consider adopting these rules on October 20, 2014, the COAH Board deadlocked its vote and then failed to make any efforts to break the deadlock. On March 10, 2015, the New Jersey Supreme Court decided In re Adoption of N.J.A.C. 5:96 & 5:97 by the N.J. Council on Affordable Housing, 221 N.J. 1 (2015) (Mount Laurel IV), wherein it responded to COAH’s 9

Township of West Orange August 2025 Essex County, New Jersey Draft Housing Element and Fair Share Plan ------------------------------------------------------------------------------------------------------------------------------------------------------------- failure to adopt defensible rules for Round 3. This decision changed the landscape by which municipalities are required to comply with their constitutional obligation to provide their fair share of affordable housing. The Supreme Court held that since COAH was no longer functioning, trial courts were to resume their role as the forum of first instance for evaluating municipal compliance with Mount Laurel obligations. The decision also established a transitional process for municipalities to seek temporary immunity and ultimately a Judgment of Compliance and Repose (“JOR”) from a court, which was the “judicial equivalent” of Substantive Certification from COAH. On January 18, 2017, the Supreme Court decided In Re Declaratory Judgment Actions Filed by Various Municipalities, County of Ocean, Pursuant To The Supreme Court’s Decision In In re Adoption of N.J.A.C. 5:96, 221 N.J. 1 (2015) (“Mount Laurel V”), which held that need having accrued during the Gap Period (1999-2015) had to be addressed and was part of the Present Need. The Supreme Court held that there is an obligation with respect to that period for households that came into existence during that gap period that are eligible for affordable housing, that are presently (as of 2015) in need of affordable housing, and that are not already counted in the traditional Present Need. As the methodology and obligations from the Gap and Prospective Need had not been fully adjudicated at that time, various trial judges issued opinions on the appropriate methodology and 354 municipalities reportedly settled with Fair Share Housing Center wherein they negotiated the obligations for Round 3. Municipal obligations were therefore broken down in Round Three Housing Element and Fair Share Plans as Present Need/Rehabilitation, Prior Round (1987-1999), and Third Round and Gap Period (1999-2015). Municipalities that received their Final Judgement of Compliance and Repose had immunity from builders’ remedy lawsuits through the end of the Third Round, June 30, 2025. Fourth Round On March 18, 2024, the affordable housing legislation known jointly as Senate Bill S50 and

e had immunity from builders’ remedy lawsuits through the end of the Third Round, June 30, 2025. Fourth Round On March 18, 2024, the affordable housing legislation known jointly as Senate Bill S50 and Assembly Bill A4 passed both houses of the legislature. Governor Murphy signed the bill (P.L.2024, c.2) into law on March 20, 2024, establishing a new methodology for determining municipalities’ affordable housing obligations for the Fourth Round and beyond. The new legislation, which comprehensively amends the FHA, overhauled the process that municipalities undertake to establish and plan for their constitutionally mandated affordable housing obligation. Most notably, this legislation formally abolished COAH while transferring some of its functions to the New Jersey Department of Community Affairs (DCA) and Housing Mortgage and Finance Agency (HMFA). The legislation also created a new entity known as the Affordable Housing Dispute Resolution Program or simply the Program, which consists of retired Mount Laurel judges as well as Special Adjudicators (formerly known as Court Masters), to assist with mediations and to review and approve municipal Fourth Round Housing Elements and Fair Share Plans. 10

Township of West Orange August 2025 Essex County, New Jersey Draft Housing Element and Fair Share Plan ------------------------------------------------------------------------------------------------------------------------------------------------------------- The amended FHA called on the DCA to issue a non-binding report on the new Present Need Obligation (commonly referred to as the rehabilitation obligation) and the Prospective Need for Round 4 and subsequent rounds. The amended FHA required the DCA to base its analysis of the obligations for each municipality based upon the standards set forth in the amended FHA. Accordingly, on October 18, 2024, the DCA released a report outlining the Fourth Round (2025-2035) Fair Share methodology and its calculations of low- and moderate-income obligations for each of the State’s municipalities. The amended FHA gave municipalities until January 31, 2025, to review the obligation reported by the DCA and perform their own analysis of their obligation based on the methodology in the legislation and previously established by the Courts. If any municipality wished to commit to an obligation different from the one reported by the DCA, the amended FHA required the municipality to adopt a resolution by January 31, 2025, committing to the number that it contended was the appropriate obligation. If a municipality wished to commit to the numbers that the DCA reported, the amended FHA required the municipality to adopt a resolution committing to the DCA numbers. The amended FHA required any municipality that wished to participate in the new process that the Act created to file a declaratory relief action within 48 hours of adopting the resolution committing to the numbers the municipality deemed appropriate. The amended FHA gave any interested party who wished to oppose the numbers to which any municipality committed to file an Answer by February 28, 2025, which included a specific objection to the numbers to which the municipality committed. The amended FHA gave the Program until March 31, 2025, to try to resolve any disputes over the fair share numbers to which a municipality committed. The amended FHA gives municipalities until June 30, 2025, to file a Fourth Round Housing Element and Fair Share Plan and related documents showing how the municipality will comply with its obligations. The Fourth Round Plans will follow the

il June 30, 2025, to file a Fourth Round Housing Element and Fair Share Plan and related documents showing how the municipality will comply with its obligations. The Fourth Round Plans will follow the same general format as they have with certain updates to their requirements dealing with various types of housing and the bonus credit calculation system. Notably, HE/FSPs are required to be consistent with the State Development and Redevelopment Plan (SDRP), which has yet to be adopted. (A draft SDRP was released in late 2024). As part of the HE/FSP, municipalities shall include an assessment of the degree to which the municipality has met its fair share obligation from the prior rounds of affordable housing (i.e. First, Second, and Third Rounds). 11

Township of West Orange August 2025 Essex County, New Jersey Draft Housing Element and Fair Share Plan ------------------------------------------------------------------------------------------------------------------------------------------------------------- TOWNSHIP OF WEST ORANGE’S HISTORY OF AFFORDABLE HOUSING The Township of West Orange has a history of participation and compliance with COAH. The Township participated in the Second Round and received their substantive certification on October 11, 1995, with an extended certification date of December 20, 2005. The Township’s Second Round certification expired on December 20, 2005. Subsequently, the Planning Board of West Orange Township adopted a Housing Element and Fair Share Plan on November 5, 2008. The Township received Third Round substantive certification from COAH on December 9, 2009. However, a large majority of COAH’s third round regulations were invalidated by the Appellate Division on October 10, 2010. Further, in response to Mount Laurel IV, the Township filed its complaint for a Declaratory Judgement on July 7, 2015 (Docket No. ESX-L-4697-15). West Orange subsequently adopted an amended Fair Share Plan on April 4, 2017. A settlement agreement with the Fair Share Housing Center (“FSHC”) and Redwood, LLC. (“Redwood”) was executed on April 6, 2020 (“FSHC Settlement Agreement”, see Appendix A). Also in 2020, a builder’s remedy litigation was initiated by WEHI and the Association. A second settlement agreement with the Township, WEHI, and the Association was executed on April 23, 2020 (“WEHI Settlement Agreement”, see Appendix B). A Fairness Hearing was held on July 10, 2020, and in an Order dated August 3, 2020, the Court approved both settlement agreements and deemed the agreements fair and reasonable and that they adequately protect the interest of low- and moderate-income households (Appendix C). The Township adopted a Housing Element and Fair Share Plan on November 17, 2020, effectuating the Court-approved settlement agreements. After a further hearing on February 18, 2021, West Orange Township was granted a Final Order of Judgement of Compliance on March 17, 2021 (Appendix D). West Orange Township continues to take steps to satisfy its affordable housing obligation. On January 28, 2025, in accordance with the standards established by the amended FHA and described above, the Township

ge Township continues to take steps to satisfy its affordable housing obligation. On January 28, 2025, in accordance with the standards established by the amended FHA and described above, the Township adopted Resolution #67-25. This resolution accepted the DCA-generated obligation, to establish its Fourth Round housing obligation, and thus guaranteed protection from builders’ remedy suits (Appendix E). This Fourth Round HE/FSP sets forth mechanisms in order to address the Township’s affordable housing obligations and has been prepared in accordance with the Fair Housing Act as most recently amended (P.L.2024, c.2). 12

Township of West Orange August 2025 Essex County, New Jersey Draft Housing Element and Fair Share Plan ------------------------------------------------------------------------------------------------------------------------------------------------------------- PLANNING FOR AFFORDABLE HOUSING Pursuant to both the FHA (N.J.S.A. 52:27D-310, et seq.) and the Municipal Land Use Law (MLUL) (N.J.S.A. 40:55D-28), municipalities in New Jersey are required to include a Housing Element/Fair Share Plan in their master plans. The principal purpose of the housing element is to describe the specific, intended methods that a municipality plans to use in order to meet its low- and moderate-income housing needs. Further, the housing element is meant to demonstrate the existing zoning or planned zoning changes that will allow for the provision of adequate capacity to accommodate household and employment growth projections, to achieve the goal of access to affordable housing for present and future populations. The statutorily required contents of the housing element are: a. An inventory of the municipality's housing stock by age, condition, purchase or rental value, occupancy characteristics, and type, including the number of units affordable to low and moderateincome households and substandard housing capable of being rehabilitated; b. A projection of the municipality's housing stock, including the probable future construction of lowand moderate-income housing, for the next ten years, taking into account, but not necessarily limited to, construction permits issued, approvals of applications for development and probable residential development of lands; c. An analysis of the municipality's demographic characteristics, including but not necessarily limited to, household size, income level and age; d. An analysis of the existing and probable future employment characteristics of the municipality; e. A determination of the municipality's present and prospective fair share for low- and moderateincome housing and its capacity to accommodate its present and prospective housing needs, including its fair share for low- and moderate-income housing, as established pursuant to section 3 of P.L.2024, c.2 (C.52:27D-304.1); f. A consideration of the lands that are most appropriate for construction of low- and moderateincome housing and of the existing structures most appropriate for