A New Jersey mayor hopes to overturn a long-standing rule that exempts the state’s urban and low-income communities from the same affordable housing requirements as suburban towns, and said officials in 100 towns have given “verbal” commitments to join him.
Montvale Mayor Mike Ghassali said he’s preparing to challenge several aspects of New Jersey affordable housing law in federal court, including recent amendments that will affect how much housing towns must build over the next 10 years. Earlier this month, Ghassali began circulating a letter asking town officials to commit to contributing $20,000 in taxpayer money over two years to pay for legal representation, which he says will cost about $1.5 million.
If Ghassali succeeds, his lawsuit would reshape one of the basic tenets of housing law in New Jersey. Nearly every town is required to contribute a “fair share” to an estimated need for hundreds of thousands of affordable homes, but this doesn’t apply to some of the state’s most densely packed cities, like Jersey City and Paterson.
Some elected officials and housing advocates doubt Ghassali’s ambitions are realistic and have dismissed them as a stalling tactic to avoid building affordable housing in his own community.
Ghassali said his main goal is to use litigation to force the state to change the rules so that “urban aid municipalities” — a designation that qualifies towns for certain grants and assistance — receive the same affordable housing mandates as suburban towns.
The mayor said his lawsuit would aim to force the state Legislature to “tweak” a new affordable housing law to push back some of the deadlines it imposes on towns. Specifically, he said, the expectation for towns to deliver plans by next summer showing what affordable housing they plan to deliver for the next 10 years is not practical.
Ghassali said he will seek to delay the process by three years — an idea he has previously floated — to give towns time to complete current affordable housing developments and assess their impacts.
“The main purpose is just for us to get our fair share of the obligation and for us to build affordable housing in ways where it’s good for everyone,” he said.
The 62 municipalities around the state that qualify as urban aid municipalities include Jersey City, Hoboken, Paterson and Newark. These municipalities qualify for the designation based on characteristics such as an unemployment rate higher than the state average, a lower than average per capita income, or their population density.
“An urban aid community is a community that historically met the qualifications of building affordable housing just because of their poverty rate within the municipality,” said Jersey City’s Mayor Steven Fulop.
Fulop added that cities like his don’t need to be convinced to develop more affordable housing, noting, “You’d be hard-pressed to argue that Jersey City hasn’t taken it seriously.”
He said Ghassali’s idea to change the urban aid municipality rules through a lawsuit is “not rooted in reality,” and that he thinks the Montvale mayor is “doing his best to procrastinate” to avoid building new affordable housing.
Fulop testified to the Legislature last year that places like Jersey City should not be exempt from affordable housing obligations. He said that while it made sense years ago to exclude urban areas from housing obligations, some exempt municipalities, including Jersey City, still face a shortage of affordable housing that puts more pressure on other New Jersey towns.
Fulop, who is running for governor in the 2025 election, has also made this part of his proposed housing plan for the state.
“If the mayor of Montvale was informed at all about the process, he would know that there’s actually very little opposition [from Jersey City] to what he’s recommending via lawsuit,” he said.
Despite the exemption under the law, urban aid municipalities like Jersey City have in recent years built or begun the process of bringing online a significant amount of affordable housing. Fulop highlighted the 8,000-unit Bayfront project, where 35% of the units are slated to be priced as affordable housing.
Hoboken Mayor Ravi Bhalla said that since he took office in 2017, his city has created more than 3,500 housing units through redevelopment projects alone, with between 10% and 20% set aside as affordable for each project.
Bhalla’s director of community development, Christopher Brown, said Hoboken has added about 400 units of affordable housing during the mayor’s term. Bhalla also highlighted the upcoming Hoboken Connect project, which he said is planning to generate 80 affordable units.
In Paterson, another urban aid municipality, Mayor Andre Sayegh said that when the city restored Hinchliffe Stadium — one of only a few former Negro League baseball stadiums currently operating in the country — the city also incorporated 76 units of affordable housing in its redevelopment, most of which were earmarked for older adults. He added that during his tenure, the Paterson Housing Authority’s number of affordable units has increased by more than 250 with help from federal aid.
“We’ve been meeting the need, irrespective of any obligation,” said Sayegh.
Bhalla declined to comment on whether the rules for urban aid municipalities should be changed but said that fixing the state’s affordable housing crisis will require a “holistic approach” involving cities and towns.
Along with the letter, Ghassali has provided other towns’ officials with a draft resolution that, if adopted, would declare their commitment to his cause and pledge the $20,000 that he’s asking each municipality to contribute. He said he expects the Montvale Borough Council to introduce and pass the resolution at its next meeting later this month.
“My real hope is for [the state Legislature] to say, hold on, ‘Why are all these towns all of a sudden banding together? What have we missed?’” he said.
Assemblymember Yvonne Lopez, a Democrat from Perth Amboy and one of the architects of the latest affordable housing bill, said she was aware of Ghassali’s concerns but was confident that municipalities will be able to meet their affordable housing obligations in the system laid out by the Legislature.
“The input of our municipalities in the development of [the bill] was critical and I am proud of the many hours spent vetting the bill with our municipal leaders and ultimately securing the support of many municipal actors,” she said.
A spokesperson for Gov. Phil Murphy declined to answer questions about Ghassali’s effort but said Murphy “proudly” signed the bill into law this year “because he believes every family deserves a safe, dignified and affordable place to call home.”
Adam Gordon, director of nonprofit Fair Share Housing Center, which for years has negotiated affordable housing obligations with towns on the court system’s behalf, said Ghassali’s effort was “misguided” and an “attempt to obstruct” the development of affordable housing in his community.
“New Jerseyans need affordable housing now,” said Gordon. “There is no time to delay. It’s time for mayors to come up with real solutions instead of just making noise.”
Ghassali said he was talking with a half-dozen attorneys about how to proceed in court. “As soon as we have the attorney hired, we’ll have a much more formal plan on how to go about this,” he said.
But Jersey City’s Mayor Fulop said he thought Ghassali’s effort will backfire and lead the courts to come down hard on Montvale if he attempts to delay their affordable housing obligations.
“He’s taking a political posture that will ultimately result in an aggressive judiciary response,” Fulop said.