New Jersey Future Blog
A New Housing Model for New Jersey
May 4th, 2021 by Guest Author
By Joshua Zinder, AIA, NCARB, LEED AP
2021 President, AIA New Jersey Chapter
Managing Partner, JZA+D
Living and working in Princeton, it’s easy to see what makes our town special. My architectural work here reflects our community’s desire to retain its unique character. But Princeton – like many municipalities across the state – needs to grow to stay economically viable, which ideally means adding density instead of sprawling outward. The word “density” often makes my neighbors worry, because they want to preserve the character of our tree-lined streets with detached single-family homes. Also, there is a pervasive fear that the arrival of lower-income residents could reduce property values – a fear arising in part from misconceptions about affordable housing.
Market-rate options are unattainable statewide for large swaths of the population, with teachers, first responders and other essential members of our communities priced out. What neighborhoods like mine need, and what architects are trying to identify and promote, is a new model for housing that addresses this “missing middle housing” gap. In brief, this term coined by urban planner Daniel Parolek refers to “house-scale buildings with multiple units in walkable neighborhoods.”
Growth is inevitable, and the alternative for most of our municipalities is economic and cultural stagnation. The desire to keep a developer from putting up a large, ungainly apartment complex on a quiet residential corridor is entirely understandable, but the most common alternative is locating such developments in areas far from town centers, which fails to achieve the goal: walkable, sustainable, affordable, and diverse communities that can sustain economic growth. These apartment complexes are often the only entry-level option for low-to-moderate income renters moving to take essential jobs in places like Princeton. Ironically, even these commonly face opposition to approvals, thanks in part to high court rulings.
These qualities – walkable, sustainable, diverse – are typically associated with the best of urban living. City dwellers, especially younger ones, appreciate the socially dynamic and vibrant qualities of the urban lifestyle and seek some measure of them when they move to a smaller town. And residents of smaller towns appreciate those qualities, too. Who doesn’t like having a greater variety in options for dining, shopping, and entertainment? These folks, our neighbors, just need reasons to stop resisting growth.
As proponents of addressing missing middle housing, many of my colleagues in New Jersey’s architecture profession are looking for opportunities to devise creative, attractive solutions for promoting density and affordability. As 2021 President of AIA-New Jersey, our statewide professional organization, I have made promoting this effort a priority. Our goal is to identify and promote strategies for adding attainable housing units, weaving them into the fabric of our neighborhoods and leaving no tool left unused in the toolbox.
Here in Princeton several solutions have emerged – many of them approved and moving forward or completed – each carefully conceived to retain or even enhance the existing neighborhood character and offering a view of Princeton’s sustainable future. A ten-unit mixed-income development has opened in a former Masonic meeting house, the interior completely transformed while the historic façade was restored and the visual impact on the block minimized. Nearby a six-unit residence will add several floors to a one-story commercial structure, with a profile that steps back from the street as it rises and a new restaurant or retail amenity on the first floor, adding social dynamism as well as much-needed residential units.
Other strategies include redeveloping existing properties to add accessory dwellings or multi-unit structures on the rear of lots, retaining the familiar neighborhood feel. Downtown Princeton has seen recent activity in mixed-use corridors to redevelop residential units above street-level shops, activating our most walkable neighborhood.
And just a few blocks away plans are under way for a major municipally oriented development that will combine a variety of building heights and architectural styles. This optimal missing-middle housing mix will sit within a campus that will be open and permeable to pedestrian traffic, with publicly accessible spaces around the buildings offering community value. This campus will create a bridge between a neighborhood of single-family detached homes on one side and the historic Witherspoon-Jackson district (largely two-family houses) on the other, adding energy and walkability to a large swath of the town center while reflecting the area’s history and culture.
In the meantime, architects and professionals in related fields are working on ways to streamline how these solutions get implemented. Outdated zoning processes should be replaced with more responsive and nimble alternatives, allowing development to move more quickly and to everyone’s advantage.
The existing fabric of our cities and towns can and should fill the missing middle, rather than building midrise developments that lack any sense of scale or context or are located outside of municipal centers. The latter has served us poorly so far, while the former is a path to sustainable, successful economic growth throughout New Jersey.
Joshua Zinder, AIA, NCARB, LEED AP BD+C is managing partner of design firm JZA+D in Princeton and 2021 AIA-New Jersey president. Architects are creative professionals, educated, trained, and experienced in the art and science of building design, and licensed to practice architecture. Their designs respond to client needs, wants and vision, protect public safety, provide economic value, are innovative, inspire and contribute positively to the community and the environment. Founded in 1857, the American Institute of Architects (AIA) consistently works to create more valuable, healthy, secure, and sustainable buildings, neighborhoods, and communities. Through a dynamic network of more than 250 chapters and more than 95,000 member architects and design professionals, the AIA advocates for public policies that promote economic vitality and public wellbeing. Members adhere to a code of ethics and conduct to ensure the highest professional standards. The AIA provides members with tools and resources to assist them in their careers and business as well as engaging civic and government leaders and the public to find solutions to pressing issues facing our communities, institutions, nation, and world. The organization’s local chapter, AIA New Jersey, has served as the voice of the architectural profession in the Garden State since 1900. Based in Trenton, AIA New Jersey has over 2,000 members across six sections. For more information, please visit http://www.aia-nj.org
New Jersey Future Urges Congressional Delegation to Secure Funding for Lead Service Line Replacement
April 30th, 2021 by Gary Brune
New Jersey Future sent the following letter on April 27, 2021 to New Jersey’s Congressional Delegation recommending a federal funding allocation to support lead service line replacement programs:
As Congress debates various proposals to increase federal aid to address the problem of lead-contaminated drinking water, it is important to consider potential allocation formulas, as different choices may drastically alter New Jersey’s share.
New Jersey is estimated to have 350,000 lead service lines (LSLs), the fifth highest total in the country, which would cost an estimated $2.3 billion to replace. These figures are based on a 2016 analysis sponsored by the American Water Works Association (AWWA) and assume an average cost of $6,700 per LSL replacement. Federal aid to offset these costs is vital, particularly for fiscally distressed cities with a high incidence of lead contamination.
Given the $45 billion recommended in the American Jobs Plan, President Biden’s infrastructure investment proposal, listed below are three examples of how this aid might be distributed:
- Drinking Water State Revolving Fund (SRF)
Based on New Jersey’s 1.7% share of federal SRF grants for drinking water projects, distribution of LSL replacement funds through this program would yield $765 million to the state. (As noted in the Jersey Water Works blog post, the state’s share of federal drinking water grants has declined over time and is significantly smaller than it should be.)
- Population
New Jersey accounts for 2.7% of the national population, which would result in $1.2 billion of federal aid.
- Share of Lead Service Lines
Based on AWWA’s estimate of a total of 6.1 million LSLs across the country, New Jersey’s estimated portion (350,000 LSLs) represents 5.7% of the national total, which would result in $2.6 billion of federal aid.
New Jersey would obviously benefit from a formula that emphasizes the number of known and suspected LSLs in each state. Additionally, cities such as Newark, which recently invested local and state funds to completely remove LSLs as a public health measure, should be eligible for reimbursement from the federal aid provided.
As Congress deliberates this issue, your influence and voice will be critical to ensuring that New Jersey children and residents are adequately protected.
NJDEP Releases Guidance on Stormwater Utilities, a Tool for Equitable Stormwater Management
April 12th, 2021 by Brianne Callahan
The New Jersey Department of Environmental Protection (NJDEP) recently released guidance on the creation of stormwater utilities, a tool newly available to New Jersey communities to help mitigate flooding and pollution problems. Stormwater utilities are widely considered to be the most equitable way to address stormwater throughout the nation. To learn more about the guidance, and stormwater utilities in general, check out the New Jersey Stormwater Resource Center. The resource center, created by New Jersey Future, is a one-stop-shop, housing technical legal and financial information, case studies, and helpful guidance on stormwater solutions, community process, and public engagement. Sign up to receive regular stormwater utility updates.
Why a stormwater utility?
Climate change and increased development continue to plague New Jersey residents. Increased rainfall has resulted in additional stormwater runoff, leading to more frequent flash flooding, street closings, property damage, and infrastructure failure. Thankfully, solutions like green infrastructure and upgrades to aging and inadequate gray infrastructure can prevent these negative effects. Unfortunately, these measures can be expensive, and without a dedicated funding mechanism, these solutions are often left untapped. One way to fund these solutions is through a stormwater utility. A stormwater utility is a dedicated funding mechanism, specifically enacted to address stormwater issues. It is similar to a water or sewer utility, and fees are collected based on the amount of stormwater a property generates, which is typically a function of how much hard or impervious surfaces are on a property. Throughout the United States, nearly 2000 communities have turned to stormwater utilities to address their flooding and water quality issues.
In 2019, Governor Murphy signed into law the Clean Stormwater and Flood Reduction Act, which enables New Jersey localities to implement stormwater utilities. The act is permissive in nature, allowing but not requiring local governments to act. It requires the NJDEP to provide non-binding technical advice through guidance housed on its website. In reviewing the guidance, we’d like to share four important takeaways:
- Fee Calculations—Fee calculations can be tailored to your community’s needs, and there are many different options that are available under the statute as long as they are based on the amount of impervious surfaces on a property.
- Credits—Credits can be issued if a property owner decreases their generation of stormwater through installation of rain gardens, pervious pavement, green roofs, etc. A locality can structure its credits as it sees fit.
- Allowable Costs—The guidance lists costs that are eligible to be funded through a stormwater utility. Check this section of the site when determining your level of service needs.
- Asset Management—Many costs associated with developing an asset management plan may be financed through the New Jersey Water Bank, which provides low-cost financing for environmental infrastructure projects.
More information about NJDEP’s Stormwater Utility Guidance can be found on its website.
Don’t miss out on learning about this important tool for equitable, dedicated, flexible and stable stormwater funding! Sign up on the New Jersey Stormwater Resource Center to stay informed about developments in stormwater utilities, including key policy updates. Development of the resource center was guided by local engineers, utilities, attorneys, government officials, New Jersey Department of Environmental Protection staff, and the Flood Defense Coalition, to ensure that it addresses local needs.
For any questions about the resource center, or stormwater utilities in general, please feel free to contact Brianne Callahan (bcallahan
njfuture
org) .
Single-Family Zoning: An Idea Whose Time Has Passed?
April 12th, 2021 by Tim Evans
New Jersey is a home-rule state. Decision-making authority about land use and development—what kinds of buildings are allowed to be built where—rests with municipal governments, as long as they abide by environmental regulations and road safety standards that are set by state agencies. In particular, municipalities have the power to enact zoning codes that define the parts of town in which residential, commercial, industrial, and other land-use types will be permitted or prohibited.
While zoning initially arose as a way to keep noxious land uses (factories and other businesses that create noise, odors, or pollution) away from neighborhoods where people live, it has evolved to include much more prescriptive rules as to what types of housing are permitted in what types of buildings and whether homes and non-polluting businesses are allowed to locate in the same neighborhood.
Fiscal zoning
In a practice known as fiscal zoning, municipalities often try to use their zoning power to favorably affect their balance sheet. Since school costs are typically the largest component of local government expenditures, and since most homes don’t come anywhere close to generating enough property tax revenue to offset the costs of educating whatever school-age children might live in them, many local leaders have concluded that the secret to keeping property taxes down is to limit the amount of residential development that happens in town. Instead, they seek to attract office parks, regional shopping centers, warehouses, hotels, and other land-use types that pay big property tax bills but don’t generate school kids. These incentives are sharpened by the fact that the units of competition (i.e. school districts) for the finite number of large revenue-generating land uses are so small; there are simply not enough malls and office parks for each of New Jersey’s nearly 600 school districts to host enough of them. Since the odds of scoring one of these property-tax cash cows are low, keeping out housing becomes the next best strategy for avoiding property tax hikes.
Single-family homes dominate
While municipalities cannot legally zone out residential development altogether, they have considerable leverage in laying out what types of housing they would like to see developed. This often means single-family detached homes, preferably on large lots. Zoning for this type of housing has two advantages from a fiscal standpoint:
- It minimizes the total number of housing units that can be built on a piece of land of a given size, and hence limits the number of potential new school children who might end up living on that land once it is developed.
- It ensures that the artificially-restricted number of homes that get built on that land will be expensive, as homebuilders seek to maximize their profit per unit, having been denied the option of earning less profit per unit but making it up in volume. More expensive homes work to the advantage of the municipality because their property tax bills will come closer to paying for any school children who live in the house than is the case for lower-valued units, especially attached housing like townhouses and apartment buildings.
Having made these calculations, many municipalities do their best to discourage multi-family housing, and the results show up in statewide data about housing variety. Nationally, 61% of all housing units are single-family detached. New Jersey’s rate is actually somewhat lower, at 53%, thanks to many parts of the state (the cities and older towns) having been built before the age of the automobile, when rowhouses and apartment buildings were much more common. But single-family detached is the default housing type even in most of New Jersey. The SF-detached percentage exceeds 80% in a full one-third of New Jersey’s municipalities (188 out of 565), and it exceeds the national percentage in 361 municipalities. In only 124 municipalities is more than half the housing stock something other than single-family detached.
Exclusionary zoning
A housing, taxation, and public education ecosystem that incentivizes the underproduction of housing in general, and that tends to produce mostly single-family detached housing when it does produce new units, will tend to put upward pressure on both home prices and rents, as supply fails to keep pace with demand. New Jersey’s median home value of $348,8001 is the seventh-highest in the nation, behind other notoriously expensive states Hawaii, California, Massachusetts, Colorado, Washington, and Oregon, and is nearly half again as high as the national median of $240,500. For renters, New Jersey is the fourth most expensive state; its median rent of $1,376 trails only Hawaii, California, and Maryland.
High-priced housing prevents households of modest means from being able to live in large swaths of the state. They are effectively excluded from towns with good schools and convenient access to job centers, which is why this practice is often referred to as “exclusionary zoning.” The failure to provide a variety of housing options that are affordable to a range of households amounts to de facto discrimination by income. Lower-income households are increasingly confined to the handful of cities and towns with older housing stocks that feature higher-density housing options. Concentrated poverty is on the rise in New Jersey over the last two decades, despite concerns about “gentrification” in some urban neighborhoods.
Whether incidental or intentional, geographic stratification by income often also results in segregation by race, since non-white households tend to have lower incomes than white households. In New Jersey, median household income for white households is $85,423; for Black households, it is $51,309; for Hispanic households, $54,160. New Jersey is one of the most segregated states in the country, despite being one of the most diverse states as measured by state-level statistics. Our reluctance to produce a wider variety of housing options in a wider variety of places ensures that the effects of past discriminatory housing practices, even though those practices have since been outlawed, continue to define the complexion of our residential landscape today.
Young adults priced out
In addition to inhibiting upward mobility for many non-white and lower-income households, exclusionary zoning also imperils the future of New Jersey’s economy by making the state prohibitively expensive for young adults entering the workforce and seeking to move out on their own. New Jersey has the highest rate among the 50 states of people aged 18 to 34 living with their parents—45%, well above the national rate of 34%. This situation is untenable; eventually, young people tire of bunking with parents, and if they can’t afford their own place in New Jersey, some will look elsewhere. This is likely a major reason that New Jersey has been losing so many Millennials (those born between 1981 and 2000, roughly) to other states. The fact that out-migrating Millennials have been gravitating to other metro areas that offer the kind of mixed-use, walkable communities they favor—something New Jersey also offers—suggests that many of them would seek these live-work-play communities closer to home if they weren’t so expensive.
Zoning reform
New Jersey is not the only place suffering from a housing market that can’t produce enough supply to meet demand—look again at the lists of states with higher home values or rents than New Jersey. But some of those places are now confronting the problem head-on. A growing number of states and cities are considering the possibility of abolishing residential zoning that permits nothing other than single-family detached housing, and a few individual places have actually taken the leap.
Strong Towns recently undertook an excellent review of where this movement is meeting with some success (“Will 2021 Be the Year Zoning Reform Reaches Critical Mass?”). The list includes some surprising places: City-level plans are addressing the issue in Atlanta and Charlotte (two Southern cities with histories of legally-enshrined segregation), and state-level legislation aimed at requiring local government to allow for greater diversity of housing options has been introduced in Utah, Connecticut, and New Hampshire, the latter two of which are similar to New Jersey in being carved up into many small fiefdoms that jealously guard their authority over land-use decisions.
In California, a state-level effort at requiring cities to allow higher housing density near transit stations failed last year, but legislators continue to advance various efforts to encourage more housing development by placing new restrictions or requirements on local governments’ zoning powers. A few individual California cities have pressed ahead with zoning reform on their own, including San Jose, Sacramento, and Berkeley. Tying single-family zoning back to residential segregation, the Strong Towns article cites Berkeley as a particularly noteworthy addition to the list of places that are rolling it back, given that the city was the first in the United States to adopt it, back in 1916. And while California has thus far failed to tackle single-family zoning statewide, it has loosened housing restrictions in a different way by relaxing rules around the creation of accessory dwelling units (ADUs), setting off what CityLab calls “a backyard apartment boom.”
Minneapolis went all the way in 2018 and abolished single-family zoning citywide, along with a few other changes designed to allow increased housing density. At the state level, the only clear success so far is Oregon (which ranks one slot above New Jersey among the states with the highest median home values). In 2019, Oregon passed a law that requires all cities of at least 25,000 population to allow two-, three-, and four-unit structures, as well as townhouses (“single-family attached” in Census Bureau parlance), in any neighborhood previously zoned only for single-family detached homes.
If the cumulative effects of New Jersey’s 565 individual municipalities making development decisions, many of which involve suppressing new residential development, are adding up to a suboptimal situation at the state level—namely, high housing prices and a shortage of the right kind of housing units in the right places—then perhaps the state government needs to take action in the interest of the economic health of the state as a whole. Ultimately, local governments’ power to regulate land development is delegated to them by the state, and the state has the power to reel some of that power back in if it is being used irresponsibly or in a way that is harming the state’s interests at the macro level. Oregon has pointed to what such action might look like, and although California’s failure (for now, at least) at the state level illustrates the difficulty involved, it was enough to start the conversation and to spur some individual cities to take action on their own. New Jersey should follow Oregon’s and California’s lead and take advantage of the growing national momentum toward zoning reform, to at least begin a discussion about how such reforms might work in New Jersey. Otherwise, high home prices and rents will likely continue to chase people out of the state.
1 As of the 2019 1-year American Community Survey
School District Consolidation Is More Than Just a Cost-Saving Measure
April 12th, 2021 by Tim Evans
Regionalizing school districts could also help increase housing options and make New Jersey a less segregated state.
Sen. Sweeney’s school district regionalization bill is aimed at consolidating school districts that are currently already engaged in some sort of sharing arrangement (as when multiple K-8 districts all send to a regional high school with its own district). The bill sees consolidation primarily as a cost-saving measure and, in addition to cutting down on administrative overhead by streamlining the number of superintendents and support staff, increasing the geographic size of school districts could indeed also produce some economies of scale. As population growth patterns change, students in a larger district could be reallocated to classroom space across different schools within the district in a more efficient way than is possible for smaller districts, which might otherwise need to construct new buildings while a building in a neighboring district sits half empty. Larger districts would also be able to purchase vehicles, equipment, and supplies in larger quantities and allocate them to individual schools more efficiently than if a group of smaller districts had to make these decisions separately. Basically, by reducing the duplication of costs, regional consolidations would result in lower education costs, helping to rein in New Jersey’s highest-in-the-nation property taxes.
Resistance to Housing
But cost savings are not the only reason to support this bill. New Jersey’s fragmented system of school districts does more than just make property taxes higher than they need to be. It also results in the unhealthy local practice of “fiscal zoning,” in which municipalities compete for large property-tax revenue-generating land uses like office parks and regional malls while doing their best to minimize residential development and the school-age children who might move into it, in the hopes of keeping property taxes low (school costs are by far the biggest component of local government expenditures). When every municipality individually has an incentive to court commercial and industrial development while discouraging housing, the cumulative result is a statewide housing market that fails to produce enough supply to meet demand, pushing home prices upward.
The fact that the units of competition—the school districts—in this “ratables chase” are so small means that there are nowhere near enough office parks and malls to go around, so the divergence in fortunes between the “winners” and the “losers” in this scramble for commercial tax base can be quite stark. The quality of a child’s education should not depend so dramatically on whether they live on the same side of the municipal border as the nearest mall. Enlarging the geographic scope of individual districts through regionalization would distribute the finite supply of big commercial tax revenue generators more fairly among districts and would mitigate the resistance to residential development on the part of individual districts by spreading the costs of residential development over a broader area.
Advancing Regional Equity
Alleviating municipal resistance to housing would also further Governor Murphy’s goal of making New Jersey a more equitable state. New Jersey Future recently compared residential segregation by race (as measured by the percent of racial minorities who live in neighborhoods that are dominated by that minority group) and by income among counties in New Jersey and in nearby states and found that concentrated poverty is more prevalent among counties with more fragmented public education systems, as in New Jersey, than in states where school districts are county-wide or at least tend to be shared by larger numbers of municipalities per district. And because segregation by income and segregation by race often go hand in hand, counties with less fragmented school systems also tend to have much lower degrees of segregation for Black and Hispanic residents. When individual towns don’t have to fret as much over school costs, they tend to become less resistant to housing, which in turn tends to increase the racial and financial diversity of the people who are able to live there.
Will school district consolidation save New Jersey taxpayers money? There is a strong case to be made that it will. But equally importantly, it might lead to better land-use decisions that provide a broader array of housing options to a broader range of people. New Jersey not only has the highest property taxes in the nation, it is also one of the most residentially segregated states. Regionalizing school districts has the potential to address both of these pressing issues.
Can the Reduction in Travel Prompted by COVID-19 Be Sustained?
March 15th, 2021 by Tim Evans
The Atlantic’s environmentally-themed “Weekly Planet” newsletter made an important observation at the beginning of 2021 about one salutary side effect of the COVID-19 pandemic’s effects on energy use: “Experts expected that emissions would decline—the pandemic brought the world to a standstill for weeks and then months—but it wasn’t clear just how much they would fall. Turns out: pretty far. In 2020, American greenhouse-gas pollution fell 10.3 percent, a staggering decline and the largest year-over-year drop since World War II.”
Further: “Last year, U.S. emissions fell to about 21 percent below their 2005 level and—for the first time this century—below their 1990 level.”
A global pandemic is no one’s idea of a good way to reduce greenhouse gas (GHG) emissions. Emissions decreased because the entire economy slowed down, causing financial hardship to untold numbers of households and businesses. Stay-at-home orders and restrictions on indoor gatherings meant that many people in public-facing businesses couldn’t work, and many others curtailed shopping and leisure trips that ordinarily inject money into the economy—and that are ordinarily enjoyable activities for people. Giving up these activities is neither practical nor desirable as a long-term outcome.
But what if some of the reduction in emissions doesn’t have to be temporary? The article notes that the drop in CO2 emissions did not come from the energy sector—people still used the same amount of heat and electricity, they just used it at home rather than at the office. Instead, the reduction came from the transportation sector as people scaled back their travel.
Travel for shopping and recreational purposes will inevitably come back when medical professionals give the all-clear to return to pre-pandemic behavior. In fact, INRIX, one of the transportation data companies that documented the initial stark decline in driving (New Jersey Future highlighted their findings back in April of last year) found in June that travel had already bounced back to above pre-COVID levels in much of the country, though mostly not in the bigger metropolitan areas where the virus was still most prevalent at that point. (Some of this may also have been temporary, with people increasing their leisure travel above normal levels as the first wave of the pandemic subsided in the summer.)
Commuting to work, however, is a different story. Many employers are realizing they don’t really need to have all their employees in the office every day and are contemplating adopting more formal remote work options that will outlast the pandemic. One study, by KPMG, is optimistic that a permanent reduction in vehicle-miles traveled of as large as 10% is possible, based on both employees and employers’ desire to have staff continue to work from home on at least a part-time basis. This would represent a reduction of the transportation sector’s GHG emissions equivalent to electrifying 10% of the vehicle fleet (which would amount to 600,000 cars and trucks in New Jersey), practically overnight.
The larger lesson is that when people drive less, GHG emissions go down. There are many ways to help people drive less—working from home is one of them, but we can also reduce the need to travel by car by building things closer together, reducing the distances between people’s desired destinations. This results not only in some trips now being feasible to take on foot, it also reduces driving distances for the majority of trips that are still taken by car. If we want to help sustain the reductions in VMT that the pandemic has unexpectedly inspired, we should start thinking more about the downstream transportation effects of where we build things, and build so not every trip needs to be taken by car.
Warehouse Sprawl: Plan Now or Suffer the Consequences
March 15th, 2021 by Tim Evans
Warehousing is big business in New Jersey
The movement and storage of stuff is big business in New Jersey, thanks mainly to the presence of the Port of New York and New Jersey, which is now the second-busiest port in the country. This translates to a lot of economic activity; nearly one of every eight employed New Jerseyans (12.2% of all employees) is employed in the wholesale trade (NAICS code 42) or transportation and warehousing (NAICS code 48) sectors of the economy, those that are devoted primarily to the storage and distribution of goods. This is the highest share among the 50 states. These sectors together are responsible for 15.7% of New Jersey’s total payroll, also the highest in the country (and more than half again as big as the national average of 10.0%). And traffic at the port is growing, thanks to shifting international trade patterns that are resulting in more goods coming into the United States across the Atlantic Ocean. All of this stuff coming into New Jersey from other countries has to be distributed to its final customers all over the eastern half of the country and beyond, and that means lots of warehouse space in which to store it and sort it after it is taken off the ship.
Superimposed over shifting patterns of international trade is the growth in online shopping, which is fueling greater demand for warehousing all over the country. Amazon, the e-commerce giant, is now New Jersey’s largest employer, adding nearly 7,000 new jobs in 2020 alone and employing 40,000 people in the state.
Warehousing uses a lot of land
Warehousing is a land-hungry business; storing all that stuff takes up a lot of acreage. Luckily in New Jersey, most of the new warehouse development has taken place on already-developed land that was previously used for something else. But just across the Delaware River along I-78, the Lehigh Valley in eastern Pennsylvania provides a warning of what could happen in New Jersey if the goods movement industry starts to run low on redevelopment areas to reuse; since 1997, Lehigh and Northampton counties have lost about 25% of their farmland. The warehouse development that has been steadily spreading south into farm fields along the New Jersey Turnpike might be a preview of things to come if we fail to plan for the growth in the movement and storage of stuff.
Plan now before it’s too late
See the full report for details about where warehouse growth has been most visible in New Jersey, why a regional perspective is needed, and how some of the same techniques for heading off residential sprawl could also work for warehousing.
New Stormwater Rules Require New Developments to Include Green Infrastructure
March 5th, 2021 by Kandyce Perry
Stormwater runoff is a serious problem, made increasingly worse by climate change. Stormwater causes flooding and pollutes the streams, rivers, and lakes that provide drinking water and places for recreation. By most estimates, over 90% of New Jersey’s waterways are polluted, much of which is due to stormwater runoff. To better address stormwater runoff issues, new public and private sector developments in New Jersey must now include the use of green infrastructure as a stormwater management technique starting March 2, 2021 as a result of the New Jersey Department of Environmental Protection’s (NJDEP) newly amended Stormwater Management Rules (NJAC 7:8).
“These new rules demonstrate the New Jersey Department of Environmental Protection’s commitment to improving water quality and reducing flood risk by prioritizing green infrastructure. Across the country, there are robust municipal stormwater programs that deliver compelling environmental, economic, and societal results locally. New Jersey’s rule change provides a national example of a statewide stormwater approach with buy-in from the environmental and development communities,” said New Jersey Future Executive Director Peter Kasabach.
This rule change requiring public and private developments to include green infrastructure—a set of stormwater management practices that use or mimic the natural water cycle to capture, filter, absorb, and/or reuse stormwater—is the result of a paradigm shift in New Jersey stormwater management. The new rules replace a subjective performance standard asking developments to use green strategies to sustainably manage stormwater to the “maximum extent practicable” with an objective and mathematically-based requirement for green infrastructure practices to be distributed around a site rather than centralized in one oversized basin. Distributed green infrastructure enhances the reliability and effectiveness of stormwater management and maximizes developable area on a site, and developers will now receive credit for its use toward their stormwater management requirements.
The rule change provides objectivity and predictability in the stormwater review process, saving developers time and money. “Our customers and our neighbors want to see green infrastructure. The market is demanding it. And that, combined with predictability, is what aligns this new green infrastructure requirement with our bottom line. We know it will be good for the environment, and we believe it’ll be good for business, too,” said George Vallone, president of Hoboken Brownstone Company, 2015 president New Jersey Builders Association (NJBA), and co-chair of New Jersey Future and NJBA’s joint Developers Green Infrastructure Task Force with Peter Kasabach.
“We recognize the new requirements will require learning and adaptation by municipalities, developers, and their engineers who are less familiar with green infrastructure. New Jersey Future’s stormwater tools are helping these groups take advantage of the opportunity to improve the quality of life for residents and clients and maximize returns on investments. In many cases, green infrastructure costs less than grey infrastructure or is cost-neutral when managing the same amount of runoff,” said New Jersey Future Director of Stormwater Kandyce Perry.
While the newly amended rule does not change underlying requirements for water quality, it will result in more stormwater soaking into the earth instead of running off from new developments. However, more can and should be done to prevent pollution, reduce flooding, and get ahead of climate change. New Jersey Future looks forward to working with NJDEP and other stakeholders to formulate additional rule changes aimed at strengthening standards for water quality and stormwater volume control and addressing how redeveloped sites manage stormwater.
New Jersey Future has three resources to help municipalities and developers learn more about green infrastructure and the newly amended rules:
Green Infrastructure Municipal Toolkit: One-stop green infrastructure resource designed to help municipal leaders and advocates address the related problems of nuisance flooding and polluted waterways. The toolkit includes detailed information and a variety of tools that cities and towns can use to plan, implement, and sustain green infrastructure in public- and private-sector development projects.
Enhanced Model Stormwater Ordinance for Municipalities: Municipal stormwater ordinances enact the state’s stormwater rules at the local level. Municipalities may adopt stormwater ordinances that are stronger than the state’s minimum requirements to further increase green infrastructure and reduce flood risk. This tool provides guidance for municipalities who are determining how they should enhance their ordinance and includes a side-by-side table to compare NJDEP’s requirements and New Jersey Future’s recommended enhancements.
Developers Green Infrastructure Guide 2.0: Practical guide that breaks down New Jersey’s Stormwater Rule amendments and helps developers and decision-makers understand green infrastructure options (even for challenging sites), advantages, costs, and benefits.
To learn more, visit New Jersey Future’s Mainstreaming Green Infrastructure program aimed at making green infrastructure the first choice for stormwater management in New Jersey.
Where Do New Jersey’s Property Tax Bills Hit the Hardest?
February 15th, 2021 by Tim Evans
Recently-released property tax data from the Department of Community Affairs have reminded us once again that New Jerseyans pay a lot in property taxes. Indeed, New Jersey residents pay the highest property tax bills in the country—a median of $8,432 as of the 2019 American Community Survey1. No other state comes close; second-place Connecticut’s median real estate tax bill is $6,004, more than 25% lower than New Jersey’s. In general, the other states near the top of the list (New Hampshire, New York, and Massachusetts round out the top 5) are other Northeastern states that are heavily reliant on property taxes for generating government revenue.
It’s Not the Size of the Bill
Most media coverage tends to misdiagnose where property taxes inflict the most pain, focusing on the absolute amount of the bill. Property tax bills, unsurprisingly, tend to be highest where property values are highest (see Figure 1). Among the top 10 municipalities with the highest average tax bills—Tavistock, Millburn, Mountain Lakes, Tenafly, Demarest, Glen Ridge, Rumson, Alpine, Essex Fells, and Princeton—all have average residential values of more than $600,000 (compared to the statewide average of $330,578), and in half of them the average home value is more than $1 million. Four of them2 are also in the top 10 municipalities with the highest median household incomes. Property tax bills are high in communities with high property wealth because such places value high-quality government services and are willing and able to pay for them. High property tax bills that result from high home values thus do not necessarily constitute a problem.
High Values, Low Rates
The picture changes with a different perspective on what it means to pay “a lot” for property taxes. Specifically, where are property tax rates the highest? Not in the places with the biggest average tax bills, or the places with the most expensive homes. Among the 50 municipalities with the highest average tax bills, the median property tax rate is 2.163%, compared to a median rate of 2.614% over all other municipalities. Of the 50 municipalities with the highest average home values, more than half (26) are among the bottom 50 with the lowest tax rates. When a town’s homes are expensive, it doesn’t have to tax at a very high rate to raise a lot of money to pay for government services.
Highest Rates in Low Income Communities
Instead, high property tax rates are found most consistently among municipalities where incomes are lower. The list of the 10 municipalities3 with the highest tax rates—Woodlynne, Salem, Penns Grove, Hi-Nella, Trenton, Egg Harbor City, Pleasantville, Irvington, Lindenwold, and Laurel Springs—differs dramatically from the earlier list where the tax bills are highest (and where tax rates tend to be among the lowest). All but one of these places rank in the bottom 50 municipalities with the lowest median household incomes, and four of them have median incomes that are less than half the statewide median. Among the 50 municipalities with the lowest median household incomes (all less than $57,000, compared to a statewide median of $82,545), the median tax rate is 3.185%, substantially higher than the median of 2.523 percent over the rest of the state’s municipalities. The places with high property tax rates—where property tax bills take a bigger bite, proportionally speaking—are not, by and large, wealthy places.
New Jersey does indeed have a property tax problem, but it’s a much bigger problem for low-wealth communities than for wealthy ones. In the mostly lower-income places where tax rates are highest, property taxes place a huge burden on the households and businesses that are located there and discourage new residents and businesses from moving in. Similarly, it makes it more difficult to jumpstart new redevelopment and revitalization efforts since the newly constructed projects will carry an outsized property tax bill. These places ought to be part of the discussion and are the places on which any effort at tax reform should be focused.
1 Data from the American Community Survey are derived from a sample, so values will not match up precisely with data from the NJ Department of Community Affairs, which collects full property tax data from every municipal government in the state. The ACS is useful for comparing states to one another, however.
2 For confidentiality reasons, the Census Bureau does not publish median household income data for Tavistock, which has a total population of only 5 people.
3Excluding Winfield and Audubon Park, where historical non-standard homeownership models make statistics on home values and tax rates not directly comparable to other municipalities.
