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SUPERIOR COURT OF NEW JERSEY
LAW DIVISION, CIVIL PART
UNION COUNTY, NEW JERSEY
DOCKET NO. UNN-L-3759-08
A.D. NO.:___________________
CRANFORD DEVELOPMENT )
ASSOCIATES, LLC, et al )
)
) TRANSCRIPT
Plaintiffs )
vs. ) OF
)
TOWNSHIP OF CRANFORD and ) DECISION
PLANNING BOARD of the )
TOWNSHIP OF CRANFORD )
)
Defendants )
Place: Union County Courthouse
Two Broad Street
Elizabeth, New Jersey 07207
Date: July 29, 2011
BEFORE:
THE HONORABLE LISA F. CHRYSTAL, J.S.C.
TRANSCRIPT ORDERED BY:BRIAN H. FENLON, ESQ. (Carella, Byrne, Cecchi, Olstein,
Brody & Agnello, P.C.)
APPEARANCES:
STEPHEN M. EISDORFER, ESQ. (Hill, Wallack LLP)
Attorney for the Plaintiffs
BRIAN H. FENLON, ESQ. (Carella, Byrne, Cecchi, Olstein,
Brody & Agnello, P.C.)
Attorney for the Defendants
LYNNCOHEN-MOORE
UTOMATED TRANSCRIPTION SERVICES
P.O. Box 1582
Laurel Springs, New Jersey(856) 784-4276
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I N D E X
July 29, 2011
THE COURT PAGE
DECISION 3
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THE COURT: -- L-3579-08, Cranford1
Development Associates v. Township of Cranford, et al.2
Can I have the appearances of counsel, please?3
MR. EISDORFER: On behalf of plaintiff,4
Stephen Eisdorfer of the Firm of Hill, Wallack.5
MR. FENLON: Your Honor, on behalf of the6
defendant, Township of Cranford, Brian Fenlon of the7
Firm of Carella, Byrne. Daniel McCarthy, the Township8
Attorney is also in court today.9
THE COURT: Welcome to you. Good to see you10
all today.11
MR. FENLON: The same here.12
THE COURT: The court has provided notice in13
accordance with the New Jersey Court Rules that its14
prepared to render its decision in connection with this15
matter.16
In this Mount Laurel action, this court is17
called upon to decide the very difficult case of18
whether the plaintiffs, Cranford Development19
Associates, Samuel Hekemian, Peter Hekemian, Jeffrey20
Hekemian and Ann Krikorian as Trustee, hereinafter21
referred to as CDA, should be permitted to develop a22
15.8 acre property, owned by the company, located at23
215 and 235 Birchwood Avenue, Cranford, New Jersey, a24
property designated as Block 291, Lot 15.01 and Block25
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292, Lot 2, on Birchwood Avenue on Cranford Townships1
Tax Map. See testimony of Hekemian of August 3, 2010,2
Kennedy August 3, 2010 and Kennedy site suitability3
report, paragraph 5, exhibit P-33 in evidence.4
The site is currently developed with two5
office buildings and associated paved parking areas.6
The remainder of the site is mature woods, a mixture of7
evergreen and visidious vegetation and lawn.8
Casino Brook, a narrow stream that is9
attributory of the Rahway River, also known as State10
Water Body 10-24 forms the western edge of the site.11
The southeast corner of the site has another12
ditch, according to aerial photographs in evidence13
P-20A and the testimony of Michael Dipple of August 2,14
2010.15
Plaintiffs propose to develop the site with16
two residential buildings, a garage structure together17
with surface parking, walkways, lawns, open spaces,18
preserved woods, wetlands, wetland buffers and19
recreational amenities.20
Plaintiffs propose a total of 419 dwelling21
units with a standard 15 percent rental set aside of22
affordable housing of 63 units to be marketed23
affirmatively and rented in accordance with applicable24
Council on Affordable Housing rules, hereinafter25
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referred to as COAH. See the testimony of August 3 of1
Hekemian, of Kinsey of August 3, and Kinsey site2
suitability report, exhibit P-33, testimony of Michael3
Dipple of August 3, and revised concept plan, P-63A in4
evidence.5
Defendants, Township of Cranford and the6
Council of Township of Cranford and the Planning Board7
of Township of Cranford, hereinafter referred to as8
Cranford strenuously oppose the development9
completely.10
Defendants argue that plaintiffs are not11
seeking to vindicate the Constitutional interest of12
marginalized low and moderate income residence.13
Rather, defendants argue that plaintiffs are14
sophisticated for profit developers who have approached15
the Township with a demand that it grant the developers16
approval for the rezoning or the rezoning of this site17
to allow for a ridiculous density thereon which18
defendants argue involve substantial environmental and19
flooding conditions and concerns and does not have the20
infrastructure to support such a project. Essentially21
the defendants argue that the court should deny22
plaintiffs request for site suitability reasons.23
Defendants have attacked the proposal of24
developer completely but has never offered this court25
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another viable, feasible alternative. Defendants1
contend that plaintiffs are not entitled to a builders2
remedy of any sort for the following reasons:3
A) Cranford Development Associates did not4
negotiate in good faith or seek to avoid litigation5
prior to suit.6
B) CDA did not serve as the catalyst in7
vindicating the Mount Laurel mandate but rather rode8
the coattails of an older filed builders remedy.9
C) CDAs proposed development does not10
contain a substantial amount of low and moderate income11
housing as it only proposes that 15 percent set aside12
and contains no very low income component.13
D) The site does not comport with sound14
planning and zoning because it suffers from severe15
flooding, parking issue and lacks the infrastructure16
necessary to support the project.17
E) The court must first determine Cranfords18
fair share obligation before any potential remedy is19
considered.20
F) Determination of Cranfords remaining fair21
share obligation should be undertaken using the more22
flexible standards governing Mount Laurel litigation.23
G) This court must disregard CDAs late filed24
expert reports.25
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H) The American rule precludes fee shifting1
here because such relief is not authorized by contract,2
R. 4:42-9 or other enabling Legislation.3
As a note, the court has already ruled on the4
experts report, defendants argument G. This court5
does not see need in this decision to revisit this6
issue.7
These reports went to the very heart of this8
case and were essential in the interest of justice.9
They provided this court insight into many of site10
suitability and environmental concerns and for that11
reason their submission was important to the court12
despite procedural concerns raised by the defendant in13
this regard.14
The court relies on its ruling issued on the15
record September 27, 2010 that these expert reports are16
admissible. See trial transcript from December 27 at17
page 12 through 15.18
Plaintiff on the other hand argue in summary19
that:20
A) an award of a site specific builders21
remedy is not a rare and extraordinary form of relief22
but under Mount Laurel II a form of relief to be23
granted routinely and normatively to successful24
builder/plaintiffs in exclusionary zoning litigation.25
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B) Plaintiffs are entitled to a site specific1
builders remedy.2
C) Plaintiffs have demonstrated that Cranford3
was not in compliance with its Constitutional fair4
share housing obligation as of the date this litigation5
was filed.6
D) Plaintiffs have proposed a development7
that makes some substantial contribution to meeting the8
Municipalitys fair share obligation.9
E) Where the Municipality contends that a10
successful plaintiff should be denied a site-specific11
remedy because of planning or environmental reasons, it12
bears the burden of proof.13
F) The court cannot deny a builders remedy14
on the basis of contentions either that the project is15
not financial feasible or that it is excessively16
profitable.17
G) None of the planning or environmental18
considerations asserted by defendants meet their heavy19
burden to divest plaintiffs of entitlement to a20
builder's remedy.21
On March 20, 2009, this court granted22
plaintiffs motion for partial summary judgment holding23
that defendants were in violation of their24
Constitutional fair share housing obligations. By25
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prevailing on that motion, plaintiff here argue that1
they have per se satisfied the first requirement for2
entitlement to a builder's remedy, establishing3
defendant Township of Cranfords noncompliance with its4
fair share housing obligation. See Alidean Corporation5
v. Bedminster Township 205 N.J. Super 87 (138) (Law6
Division, 1985). See also plaintiffs trial brief at7
page 5.8
Plaintiffs argue that they have proposed a9
site-specific builder's remedy that proposes to make a10
substantial contribution to Cranfords fair share11
housing obligation as required by Mount Laurel II. See12
Southern Burlington County NAACP v. Mount Laurel13
Township, 92 N.J. 158 (279), a 1983 case referred to14
hereinafter as Mount Laurel II.15
This matter was tried before this court on16
August 2, 3, 5, 9, 10, 11, 12, 13, 16, 17, 18, 2010 as17
well as September 27, 28, 29, 2010. The court heard18
testimony on behalf of plaintiff by Michael Dipple,19
Engineer, Peter Hekemian, owner of the Hekemian and S.20
Hekemian Group (phonetic), David Kinsey, Partner in21
Kinsey & Hand, an urban planner, and Elizabeth Dolan,22
traffic engineer.23
Witnesses on behalf of defendant were John24
Hrebin, a Cranford citizen, Stanley Slachetka, Planning25
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Group Manager from T&M Planning, Richard Marsden,1
Professional Engineer with J&M Engineering, and2
Director of Public Works and Engineering for Cranford,3
and Lee D. Klein, traffic manager at T&M.4
The court conducted a site inspection with5
the attorneys and engineers on August 10, 2011 (sic).6
The parties submitted trial briefs, written summations7
and proposed findings of facts and conclusions of law8
and indeed delivered oral summations on December 13,9
2010.10
Elizabeth C. McKenzie, PPPA, Community11
Planner and Special Master, appointed to this case by12
the Honorable Marianne Espinosa rendered two special13
master reports and answered questions for the attorneys14
and the court.15
Ms. McKenzie, AICP certified and an16
experienced professional planning consultant has been17
involved in litigation in over 200 Municipalities in18
the state of New Jersey. She submitted a letter of19
support on July 19, 2010, a report to the court on20
January 4, 2010, and a supplementary report on December21
1, 2010. She also testified at the conclusion of the22
trial with specific clarity on September 29, 2010.23
Point 1. History of Mount Laurel decision.24
In its 1975 opinion, in Southern Burlington County25
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NAACP v. Mount Laurel Township, 67 N.J. 151, cert.1
dend 423 U.S. 808 (1975), Mount Laurel I, the Supreme2
Court of New Jersey held that developing Municipalities3
are obligated under our State Constitution to provide a4
realistic opportunity for the development of low and5
moderate income housing.6
Two years later in 1977, the court created7
the builder's remedy as an incentive for the8
institution of socially beneficial but costly9
litigation such as Mount Laurel. See Toll Brothers v.10
West Windsor 173 N.J. 502 (561) 2002, citing Oakwood at11
Madison v. Township of Madison 72 N.J. 481 (550-551)12
(1977).13
The builder's remedy permitted builders to14
seek court approval for construction of the housing15
project they proposed to the Township prior to or16
during the pendency of the action pursuant to plans17
which they originally represented would guarantee the18
allocation of at least 20 percent of the units to low19
or moderate income families. See Toll Brothers v. West20
Windsor 173 N.J. 502 (561) (2002), citing Oakwood at21
Madison 27 N.J. 551.22
While the builder's remedy was originally23
conceived as a rare form of relief, the court soon24
after reconsidered this standard, ruling that builder's25
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remedies must be more readily available to achieve1
compliance with Mount Laurel. See Mount Laurel II 922
N.J. 279.3
A plaintiff in a builder's remedy action must4
first demonstrate that a Municipalitys Land Use5
Ordinances are unconstitutionally exclusionary, Mount6
Laurel I, 67 N.J. 151 Oakwood at Madison 72 N.J.7
550-551.8
Under the Mount Laurel doctrine,9
municipalities have both negative and affirmative10
duties. See Mount Laurel I, 67 N.J 179-180. For11
example, municipalities must not take action to thwart12
the provision of low or moderate income housing, Id13
180.14
They must also take positive actions to15
create a realistic opportunity for the creation of16
units, Id 179. Mount Laurel II 72 N.J. 260-262.17
Therefore, municipalities that fail to zone for18
affordable housing or that zone for less than their19
fair share are in violation of their Constitutional20
obligations, Mount Laurel II, 92 N.J. 216. Indeed this21
court has decided this issue by grant of summary22
judgment to plaintiff on March 20, 2009.23
The New Jersey Legislature implemented the24
Mount Laurel decisions by assigning the Council of25
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Affordable Housing, COAH, the responsibility to1
delineate housing regions, determining regional needs2
for low and moderate income housing and allocate that3
need to municipalities within the regions, N.J.S.A.4
52:27D-307, 311, 314, 315. Even if a municipality5
alleges that it has no vacant developable land to meet6
this fair share obligation, it must still attempt to7
comply. See Fair Share Housing Corporation v. Cherry8
Hill, 173 N.J. 393 (407-408) (2002).9
A municipality that asserts a lack of10
sufficient vacant developable land can request an11
adjustment of its obligations, N.J.A.C. 5:93-4.2. COAH12
then assesses how much low and moderate income housing13
may be constructed on the land and based on this14
assessment COAH determines the municipalitys realistic15
development potential, N.J.A.C. 59:93-4.2E.16
If the realistic developmental potential is17
lower than the fair share housing obligation, the18
municipality must still do more than attempt to satisfy19
the lower realistic developmental potential. The20
municipality must take steps to ensure that any21
development or redevelopment on its land results in22
affordable housing.23
These requirements apply to both the24
municipalitys unmet prior round obligations and its25
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unmet third round growth share obligations. See1
N.J.A.C. 5:97-5.3B, N.J.A.C. 5:97-5.7.2
Courts are required to evaluate the extent of3
a municipalitys fair share obligation as of the date4
of the filing of the litigation. See Toll Brothers v.5
West Windsor Township 303 N.J. Super. 518 (531) (Law6
Div., 1996) affirmed 334 N.J. Super 109 (App. Div.,7
2002), affirmed 173 N.J. 502 (519) (2002).8
If the trial court finds that the9
municipality has failed to meet its Constitutional10
obligations, the court must order the municipality to11
revise its Zoning Ordinance within a set time period to12
comply with the Constitutional mandate and if the13
municipality fails to adequately revise its Ordinance14
within that time, the court implements the remedies for15
noncompliance, Oceanport Holding, LLC v. Borough of16
Oceanport 396 N.J. Super. 622 (630) (App. Div., 2007).17
Where plaintiff succeeds in demonstrating18
that the municipality has not complied with its fair19
share obligation, two other elements must be met in20
order for a developer to obtain a builder's remedy.21
The plaintiff must show that the project proposal will22
provide a substantial amount of lower income housing,23
and the site must be suitable for the proposed24
development, Mount Laurel II, 92 N.J. 279, 280, holding25
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requirements necessary for a successful builder's1
remedy application and there is no indication of bad2
faith or use as a bargaining chip, the court may grant3
a builder's remedy conforming that remedy to principles4
of sound planning, sound municipality land use5
planning, In Re. Township of Denville 247 N.J. Super6
186 (198) (1991).7
However, the court has the discretion to8
soften the impact of construction by phasing a9
development over a period of years to avoid a radical10
transformation, J.W. Fields Company, Inc. 204 N.J.11
Super 445 (453) (1985) citing Mount Laurel II at 280,12
331 and 332.13
Through a builder's remedy and the14
requirements and restrictions that accompany it, the15
courts can ensure that they are complying with the16
Constitutional obligation of affording a realistic17
opportunity for the construction of low and moderate18
income housing, Mount Laurel II 92 N.J. 205.19
Point 2. Recent Appellate Division Ruling.20
This case filed on November 12, 2008 presents several21
complex legal issues, particularly given the current22
historical prospective and in light of the recent23
Appellate Division case, In Re: Adoption of N.J.A.C.24
5:96, Docket Number A-5382-07 T3, Appellate Division25
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October 8, 2010 which pertains to prior round and1
present need municipal housing obligations.2
The Appellate Court in In Re: Adoption of3
N.J.A.C. 5:96 concluded that COAHs revised third round4
rule suffered from many of the same deficiencies as the5
original third round rules unless substantial portions6
of these rules were invalidated and remanded to COAH.7
Se In Re: Adoption slip opinion at 6.8
Defendants argue that the decision in this9
case therefore should be stayed given the uncertainty10
of the municipalitys third round obligation going11
forward in light of that Appellate Division decision.12
Indeed, the court is mindful of the fact that the13
viability of COAH is current in question.14
Plaintiff CDA argues that the Appellate15
Division in In Re: Adoption made substantive rulings16
that potentially affect this courts decision and it17
urges that this court can decide Cranfords past and18
present unmet needs.19
Plaintiff has argued that the Appellate20
Division upheld COAHs determination of so-called prior21
round and present need components of municipal housing22
obligations. See plaintiffs October 15 letter brief,23
page 1, citing In Re: Adoption slip opinion at 50-56,24
66-68 and page 72.25
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For Cranford the prior round obligation as1
determined by COAH is 148 units according to2
plaintiffs argument. See also Report of the Special3
Master 12/1/10, thats December 1, 2010 at page 17.4
Based upon the last survey conducted by5
Cranford of physically substandard units occupied by6
low and moderate income houses which according to the7
testimony of Mr. Stanley Slachetka took place8
subsequent to all rehabilitation activities reported by9
defendant, the unmet present need is 53 units according10
to plaintiffs argument. See plaintiffs letter brief11
at page 2.12
Plaintiff addresses four aspects of the In13
Re: Adoption decision that support plaintiffs14
contentions in this case: prior rental bonus credits,15
speculative projects, maximum amount of housing to be16
set aside, and third round prospective need17
obligation.18
A. Prior rental bonus credits. Plaintiffs19
argue that regarding prior rental bonus credits, the20
Appellate Court struck down COAH regulations21
authorizing certain type of bonus credits.22
Specifically it struck down N.J.A.C. 5:97-3.5A, a23
regulation authorization extra bonus credits for rental24
projects that are designated to meet prior round25
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housing obligations but which have not yet been1
constructed. See Slip Opinion at 41-45 and Page 72, oh2
71.3
B. Speculative projects. Plaintiffs argue4
the Appellate Division struck down N.J.A.C. 5:97-3.2A45
a regulation allowing credit for speculative 1006
percent low and moderate income projects, i.e. projects7
that cannot now be developed whether because the8
municipality does not currently control the site, does9
not have sufficient funds to construct the project and10
has not identified an actual developer and operator or11
does not have a definite timetable for construction.12
See Adoption Slip Opinion at page 32-33. According to13
plaintiffs argument, the Appellate Court held that14
such proposals do not create realistic housing15
opportunities.16
C. Maximum amount of housing to be set17
aside. Plaintiffs submit that the Appellate Division18
also struck down N.J.A.C. 5:97-6.4B2 a regulation that19
sets the proportion of units in an inclusionary project20
that can be required to be set aside for sale to low21
and moderate income households at a maximum of 2522
percent. See In Re: Adoption Slip Opinion at 34-41.23
Plaintiffs argue that the Appellate Division24
held that inclusionary projects cannot be required to25
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set aside more than 20 percent of the units for sale to1
low and moderate income houses. Plaintiffs argue that2
the court held that requiring any higher set aside3
would fail to create realistic housing opportunities,4
Id 39-41.5
Plaintiffs argue that COAHs rules provide6
that the proportion of units in an exclusionary project7
that can be required to be set aside for low and8
moderate income households in a rental project is 59
percentage points below the set aside for projects10
incorporating sales units. See N.J.A.C. 9:, sorry,11
strike that, N.J.A.C. 5:97-6.4B6.12
Plaintiffs argue that the Appellate Division13
opinion did not invalidate that standard. Thus, if the14
maximum set aside for sales units is 20 percent, the15
maximum required set aside for rental units is 1516
percent.17
Plaintiffs contend that this is precisely18
what COAH's prior round regulations mandated. Those19
regulations set the maximum set aside that could be20
required for inclusionary projects providing for sale21
of units to low and moderate income households at 2022
percent and set the maximum required set aside for23
projects with rental units at 15 percent. See N.J.A.C.24
5:93-15.5C5.25
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Based on this standard, the Appellate1
Division has held that 15 percent is the appropriate2
set aside for builder's remedy for an inclusionary3
rental project. See Toll Brothers v. West Windsor4
Docket Number A-5897, Appellate Division, August 16,5
2000, which the Supreme Court affirmed. See also Toll6
Brothers v. West Windsor 173 N.J. 502 (561) (2002).7
Thus, plaintiffs assert that in light of the8
ruling in Re: Adoption the court should require that 159
percent of the units in the CDA project be set aside10
for low and moderate income households. See11
plaintiffs October 15 letter brief at page 3 to 4.12
Defendants argue on the contrary that CDAs13
15 percent set aside is insufficient according to14
COAHs third round rules. See defendants findings of15
fact and conclusions of law and summation at page 39.16
Defendants question plaintiffs reliance on17
the prior round rules and on the case that was decided18
when the prior round rules were in effect. Defendants19
further argue that a 15 percent set aside as opposed to20
the 20 percent set aside that they allege is proper in21
this case will overburden Cranford because it will then22
be required to make up for the gap this project will23
create.24
D. Third Round prospective need obligations.25
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trial evidence in this case prior to the Appellate1
Divisions October 8, 2010 decision, this court will2
not stay its decision even though the continued3
viability of COAH is admittedly questionable.4
The Special Master reviewed the Appellate5
Division decision and indeed modified her6
recommendations after consideration of that decision7
and after hearing the trial testimony of all witnesses8
and experts for both sides. See Report of Special9
Master of December 1, 2001 wherein Ms. McKenzie10
commented on the Appellate Division decision of October11
8, 2010 and noted, and I quote:12
The Appellate Courts October 8, 201013
decision invalidating large portions of COAHs third14
round rules addresses the question of incentives for15
the provision of Affordable Housing. The court stated16
as follows:17
We take judicial notice of the fact that a18
20 percent set aside requirement has been considered19
the norm in the administration of the Mount Laurel20
doctrine and that experts in the field have expressed21
skepticism whether developers will be motivated to22
construct residential developments with affordable23
housing set aside requirements any higher than 2024
percent.25
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Current economic conditions and regulatory1
requirements for new housing construction make it even2
more unlikely than in the past that municipal zoning3
requiring more than 20 percent of new residential units4
to be affordable to lower income households would5
provide a realistic opportunity for construction of a6
substantial number of such units. In Re: Adoption slip7
opinion at page 39.8
Based on the opinion expressed by the9
Appellate Court and considering that the previous10
standard for the provision of affordable housing both11
in the outcome of various Mount Laurel cases and in12
COAHs prior round rules have been a maximum set aside13
of 20 percent which was applicable to affordable units14
being sold and a maximum set aside of 15 percent in the15
case of affordable units being rented, there is even16
more support for the notion that the 15 percent17
affordable housing set aside recommended for the CDA18
site is a sufficient a reasonable set aside requirement19
under the circumstances. See Report of the Special20
Master 12/1/10 at page 17-18.21
Admittedly, Mount Laurel and the continued22
COAH viability are in a state of flux. However, since23
all the evidence has been submitte4d and all the briefs24
and arguments have been made, this court can find no25
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reason to stay a decision in this case.1
Point 3. Summary of Arguments. Plaintiffs2
have argued that Cranford is a historically3
exclusionary municipality. Since 1980 it has actively4
and successfully zoned for job creating non-residential5
development including zoning for a large office park6
near the Garden State Parkway.7
Plaintiffs contend that between 1990 and 20068
while the population of the municipality remained9
stable, the number of jobs within the municipality10
increased by almost 40 percent. During that same11
period, however, there was no low or moderate income12
housing available with the exception of housing13
restricted to the elderly or the handicapped.14
While the Township maintained ample zoning15
for non-residential uses, plaintiffs contend Cranford16
maintained that it lacked sufficient land to17
accommodate low or moderate income housing and that18
continues to be Cranfords position in its most recent19
housing plan.20
Plaintiff CDA proposes to construct two mid-21
sized luxury apartment buildings together with a22
parking structure on this site. Plaintiffs proposal23
is that these buildings would be comprised of 41924
residential units of which 63 or 15 percent would be25
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affordable to and reserved for low and moderate income1
households.2
Peter Hekemian and Michael Dipple described3
the project and the current concept plan during their4
testimony. See also exhibits P-63, P-63A and P-645
showing the proposed building A and building B and the6
proposed concept plan.7
Plaintiffs argue that the issue before this8
court is whether CDA is entitled to a site specific9
builder's remedy on this site and what the magnitude of10
the remedy should be. Defendants however argue that11
since fashioning the builder's remedy as a means of12
compelling municipalities compliance with the Mount13
Laurel mandate, the Supreme Court has warned of the14
danger of builder abuse. Trial courts have been15
repeatedly cautioned that they must ensure this16
remedial device is not used as a weapon to coerce17
municipalities into acceding to unrealistic builder18
demands.19
Defendants argue that although originally20
envisioned as a tool to stimulate affordable housing,21
Mount Laurel has evolved into more of a blank check for22
unreasonable development than a means of vindicating23
this beneficial interest.24
To temper the potential for abuse, the25
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Supreme Court imposed several hurdles a builder must1
mount to be considered for a remedy. Defendants2
contend the builder must negotiate in good faith and3
seek to avoid litigation prior to filing suit. Failure4
to do so forecloses any potential remedy.5
Next, defendants argue that the builder must6
be the catalyst driving the municipalitys compliance.7
Additionally, the builder must propose a substantial8
amount of affordable housing.9
Finally, no remedy can issue to a site that10
suffers from environmental or physical constraints or11
if the project would constitute bad zoning and planning12
according to defendants arguments. Each of these13
parties arguments will be addressed.14
In this case, defendants repeatedly argue15
that CDA and its representatives are not white16
knights seeking to vindicate the Constitutional17
interests of marginalized low and moderate income18
families. Rather, defendants argue they are for-profit19
developers who demanded Cranfords approval of an20
unreasonable project on a site that suffers from severe21
environmental and physical constraints and does not22
have the infrastructure to support it.23
Defendants argue simply that the entire24
project should be rejected because it represents bad25
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planning and is too environmentally constrained to1
permit the project to go forward. However, defendants2
have never offered a realistic, appropriate alternative3
plan that this court could consider.4
Indeed, the court is sensitive to the5
widespread opposition to the project in Cranford. See6
defendants findings of fact/conclusions of law and7
summation, page 60, paragraphs 34-35.8
Recently, this court has received several9
inappropriate non-evidential letters from citizens10
opposing the project. Since these letters are outside11
the scope of the evidence presented in court during12
trial, they simply cannot be considered by this13
court.14
The Special Master recommended a builder's15
remedy for CDA in her reports of January 4, 2010 and16
December 1, 2010. On January 4, 2010, she concluded,17
The site is in my opinion suitable for an18
exclusionary residential development of the magnitude19
proposed. See report of Special Master 1/4/10 at page20
31.21
She did, however, suggest certain specific22
caveats to address flooding, drainage, parking,23
environmental and set aside issues. See Special Master24
report of 1/4/10 at page 25-29.25
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In her December 1, 2010 report, the Special1
Master opined that nothing rose to the level of2
disqualifying the site from an award of a builder's3
remedy. This language in her report was consistent4
with her clear credible, well-reasoned and thoughtful5
testimony of September 29, 2010 at trial.6
She modified her recommendations, however,7
and concluded:8
As a result of both the testimony presented9
at trial and a careful reading of the Appellate Courts10
October 8, 2010 decision invalidating substantial11
portions of the COAH third round rules, I have modified12
the recommendations presented in the January 4, 201013
report of the Special Master in this case.14
The builder's remedy recommended for the CDA15
site is now for 360 units not 419 units and for 5416
affordable units, not 63 affordable units.17
A revised plan is recommended to be prepared18
for submission at the time of the site plan approval,19
showing an increased front yard setback, an additional20
buffer along the eastern lot line, compliance with an21
on site parking standard of at least 1.85 spaces per22
unit and the removal of one residential floor from23
building A.24
It is recommended that if the court sees fit25
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to approve a builder's remedy for the CDA site, a1
condition be included requiring the storm water2
management plan submitted to the NJDPEP must include an3
analysis of and measures to address the sites existing4
hydraulic conditions whether de facto or otherwise so5
that off site drainage and flooding impacts are not6
worsened as a result of the development of the CDA7
site. Further, the percentage of impervious service8
coverage on the site should not be increased over that9
which exists today, considering both of the lots10
comprising the CDA site.11
The court could elect to award the builder's12
remedy based solely on the Townships unsatisfied prior13
round and rehabilitation obligation or the court could14
invite the Township to submit a revised housing element15
and fair share plan now that would qualify Cranford for16
repose through the end of 2018. The latter alternative17
would not ordinarily be recommended in the absence of a18
calculation of the third round fair share obligation,19
number resolutions (phonetic) to the Constitutional20
fair share obligation have been eschewed by the court.21
In Cranfords case, however, the paucity of22
vacant developable land within the Township has already23
been demonstrated in the Townships existing housing24
element and fair share plan and it is clear that a25
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vacant land adjustment will be warranted irrespective1
of the magnitude of the third round obligation aside to2
Cranford. The township could calculate how much3
capacity it has to satisfy a third round obligation and4
the court could approve a plan addressing that5
capacity.6
The only uncertainty would be the extent of7
the unmet need remaining once a third round number has8
been assigned to the Township by COAH or successor9
agency. The Township already has excess senior housing10
units that could be applied to that unmet need once it11
is calculated.12
Regardless of which approach the court13
chooses to take in this matter, I do not believe that14
the number of affordable units to be generated by the15
recommended builder's remedy will be too many for16
Cranford. See report of the Special Master December 1,17
2010 at page 24-25.18
The court in this case has considered the19
credibility, incentives, bias and motivation of all20
witnesses who testified in this case. And in rendering21
its decision, I will comment on each of them in turn.22
A. Good faith negotiations. Under23
J.W. Fields Company v. Franklin 204 N.J. Super. 461 and24
Mount Laurel II 92 N.J. 342, Note 73, a builder must25
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negotiate in good faith and attempt to obtain relief1
without litigation to be considered for a site specific2
remedy. Mount Laurel should not be used as an3
untenable bargaining chip in a builders negotiation4
with the municipality, see Mount Laurel II 92 N.J.5
280. The threat of Mount Laurel litigation should not6
be invoked simply because the municipality approvals7
for projects containing no lower income housing are not8
forthcoming. Courts have held that proofs of such9
threat shall be sufficient to defeat Mount Laurel10
litigation by the developer.11
On June 23, 2010, this court granted partial12
summary judgment to CDA on the issue of good faith13
negotiations, holding that there is no evidence that14
CDA negotiated in bad faith. Nevertheless defendants15
have argued at great length in this trial that CDA did16
not negotiate in good faith or seek to avoid litigation17
prior to filing suit. They claim that additional18
evidence came to light during the trial that further19
demonstrates CDAs bad faith and requires the court to20
revisit its earlier holding. Defendants contend that21
despite Cranfords best efforts and willingness to work22
with CDA, in spite of coercive tactics and unreasonable23
demands, CDA filed this action in the hopes of24
obtaining court approval to build this grossly25
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unreasonable project.1
Defendants argue that this is precisely the2
misuse of a builder's remedy that the courts were3
concerned about when they created it. See Toll4
Brothers 173 N.J. 561 where the Supreme Court again5
acknowledges the controversy engendered by the remedy6
which it endorsed after much deliberation and with a7
great deal of concern and caution.8
Defendants contend that Mr. Kinsey testified9
that he was retained for purposes of litigation and not10
in connection with selecting and/or redesigning CDAs11
project as the site was selected, purchased and a12
concept plan prepared long beforehand. They argue that13
the evidence at trial demonstrate the unreasonable and14
indeed impossible request hoisted upon Cranford on15
October 7, 2008 where Cranford was asked to approve the16
project and rezone CDAs property by the October 2117
meeting or else.18
Off the record, one second.19
(Off the record. On the record)20
THE COURT: Defendants contend that the court21
should reconsider its earlier interlocutory ruling on22
bad faith as it is encouraged to do in its sound23
discretion and in the interest of justice, citing24
Lombardi v. Masso, Docket Number A-14209, June 29,25
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2010, slip opinion at page 11, citing R. 4:42-2 and see1
also Gonzalez v. Ideal Tile Importing Company2
371 N.J. Super 349 (356) (App Div., 2004) wherein3
judges are not obliged to slavishly follow an erroneous4
or uncertain interlocutory ruling, affirmed 84 N.J. 4155
(2005). See also Johnson v. Cyklop Strapping6
Corporation 220 N.J. Super 250 (264) (App. Div., 1987),7
holding that the power to revisit interlocutory orders8
prior to the entry of final judgment is endowed with an9
unmistakable substantive context by the common10
understanding which underlines our jurisprudence of11
what is fair, right and just in the circumstances,12
cert. denied 110 N.J. 196 (1988) Ford v. Weissman13
188 N.J. Super. 614 (619) (App. Div., 1983) holding14
that prior to entry of final judgment a judge has15
complete power over its interlocutory orders and may16
revise them when it would be consistent with the17
interest of justice to do so.18
Defendants maintain that here it is clear19
that CDA did not negotiate in good faith nor seek to20
avoid litigation prior to filing suit. It simply went21
through pretextual motions prior to doing so and never22
bargained at all. Instead it presented the Township23
with a Hobsons choice, approve in two weeks its24
massive and unreasonable development unlike any other25
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in the Township on a site located in a flood plane1
which suffers from a variety of zoning and planning2
issues, or subject itself to a second Mount Laurel3
suit.4
The court previously decided the good faith5
issue on June 23, 2010 and ruled and I cite to my6
decision, June 23, 2010, at page 12.7
In this case, there is no evidence that8
Cranford Development negotiated in bad faith. There is9
no evidence that they threatened litigation if10
settlement negotiations were not reached. Under an11
objective standard, there is no evidence including12
witness testimony for which a reasonable fact finder13
could find that the plaintiff filed the instant14
litigation prematurely in the absence of any litigation15
threats.16
On the contrary, Cranford Development17
presented evidence that it appeared at three regular18
Township Committee meetings and three workshop meetings19
over a period of eight weeks to request that the20
Township rezone the property. There is ample evidence21
that Cranford Development attempted to engage Mayor22
Puhak and the Township Committee in negotiations prior23
to the present litigation. Therefore, the motion for24
summary judgment to strike the Townships good faith25
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defense was granted.1
The court has considered these arguments2
again presented at trial and in defendants brief and3
despite the trial testimony and evidence elicited on4
this subject at trial, this court will not modify its5
earlier decision on this issue.6
At trial, Peter Hekemian testified about the7
background of the proposed project dating back to the8
spring of 2008 when the property was identified in9
September 2008 when title closed. He also outlined a10
similar project in Englewood, New Jersey and testified11
about the concept plan here. See P-63A. Specifically,12
he testified about attempts to obtain approval for the13
project.14
The court also heard detailed testimony from15
Stanley Slachetka on behalf of Cranford about16
Cranfords fair share housing analysis, exhibit D-66,17
the Planners report, D-96 and Slachetkas certification18
and chronology of this litigation and Cranfords19
affordable housing planning efforts, see D-80.20
Nothing in the testimony presented nor the21
exhibits persuaded this court that Cranford is entitled22
to a good faith defense to this exclusionary zoning23
litigation. See Mount Laurel II, 92 N.J. 220, 221.24
By prevailing on March 20, 2009, the motion25
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for partial summary judgment, plaintiffs have satisfied1
the first requirement for entitlement to a builder's2
remedy. See Allan-Dean Corp. v. Bedminster 205 N.J.3
Super 87 (138).4
B. Plaintiff as a catalyst to change.5
Defendants argue that CDA was not the catalyst in6
vindicating the Mount Laurel mandate with regard to7
Cranfords Constitutional fair share housing8
obligations. Relying on the opinion in the Allan-Dean9
Corp. v. Bedminster defendants claim that CDA merely10
rode the coattails of an earlier filed suit by Lehigh11
Acquisition Corporation hereinafter referred to a12
Lehigh and as a result should be denied a builder's13
remedy. See Allan-Dean, 205 N.J. Super. at 138.14
Defendants contend that since it was Lehighs15
suit that was the catalyst driving Cranfords16
compliance, CDA should not be able to take advantage of17
the builder's remedy.18
Plaintiffs argue that the Allan-Dean decision19
does not disqualify CDAs builder's remedy application20
because unlike in Allan-Dean this case involves a21
plaintiff who did participate in the litigation22
determining Cranfords compliance with fair share23
housing requirements, 205 N.J. Super 138, holding that24
a builder's remedy should be denied where a developer25
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enters the suit only after the portion of the trial1
invalidating the Townships Ordinance.2
Though Lehighs complaint was filed first,3
CDA participated in the litigation, finding the4
municipality in violation of its Constitutional fair5
share obligations. CDA, therefore, claims it should be6
not precluded from the award of the builder's7
remedy.8
In Allan-Dean Corp. v. Bedminster the9
builder's remedy is described as a way to bring about10
Mount Laurel compliance by inducing and rewarding11
litigation which starts the rezoning process,12
205 N.J. Super. 141. Once the process has begun, there13
is no need for further remedies, Id.14
Thus, Allan-Dean held that in order to15
qualify for a builder's remedy the developer must be a16
Mount Laurel plaintiff involved in compliance17
litigation and must bring about the process leading to18
Ordinance compliance, Id 138.19
The court has considered the arguments and20
finds that CDA did meet the qualifications for a21
builder's remedy outlined in Allan-Dean. Although CDA22
filed its claim subsequent to the filing of Lehighs23
claim, CDA was involved in the process of litigation24
and indeed the reasons for this courts March 20, 200925
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order granting partial consolidation of the CDA and1
Lehigh cases was because both cases required the court2
to determine whether Cranford was in violation of its3
fair share obligations.4
Moreover, although the Lehigh case was5
settled, CDA has fully litigated this case, including6
14 trial days, a site inspection, full briefing and7
submissions for the court. Indeed, Cranford cannot8
argue that CDA was not a catalyst for change simply9
because it settled with Lehigh the first filed lawsuit.10
For these reasons, the court rejects defendants11
argument that the plaintiffs builder's remedy should12
be denied on this basis.13
C. Substantial amounts of low and moderate14
income housing. As discussed earlier in the discussion15
of In Re: Adoption of N.J.A.C. 5:96 Supra., page 17-1916
of this decision, plaintiff argues that COAH rules17
provide that the proportion of units in an inclusionary18
project that can be required to be set aside for low19
and moderate income households in a rental project is 520
percentage points below the set aside for projects21
incorporating sales units. See N.J.A.C. 5:97-6.4B6.22
Plaintiffs further argue that the Appellate23
Division opinion in In Re Adoption did not invalidate24
this standard. Thus plaintiffs contend that if the25
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maximum required set aside for sales unit is 201
percent, the maximum set aside for rental units is 152
percent. The Special Master also endorsed this3
interpretation of the In Re Adoption opinion.4
Plaintiffs further contend that the Supreme5
Court and the Appellate Division have expressly held6
that a builders plaintiff who sets aside 15 percent of7
the units in a proposed inclusionary project to be8
rented to low and moderate income families and9
individuals satisfies the requirement that a10
builder/plaintiff made a substantial contribution11
towards meeting the municipalitys fair share housing12
obligation. See Toll Brothers v. Township of West13
Windsor 2000 N.J. Super. Lexis 333 at 12-13, Appellate14
Division, August 16, 2000 and Toll Brothers v. West15
Windsor 173 N.J. 502 (561) (2002).16
In Toll Brothers the defendant municipality17
appealed from the trial court decision granting a site18
specific builder's remedy for a project in which 1519
percent of the units would be low and moderate income20
rental units. The Appellate Division declared21
Defendants argue that the court should have22
required a 20 percent set aside, the standard set by23
the court in Mount Laurel II. We disagree.24
Extensively analyzing COAH regulations, the Master25
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concluded that a 15 percent set aside was appropriate.1
Judge Carchman agreed with the Masters analysis. It2
was his view that the proposed project with a 153
percent set aside of rental units would substantially4
benefit the Township.5
It is true that the court in Mount Laurel II6
observed that in a builder's remedy case, a 20 percent7
set aside appears to us to be a reasonable minimum.8
Mount Laurel II 92 N.J. 158, note 37. However, because9
of the profit developers need to generate on market10
units to subsidize affordable units, it soon became11
apparent that the building community viewed 20 percent12
as the maximum feasible set aside, J.W. Fields Company,13
Inc., 204 N.J. Super. at 467.14
If a set aside is too high, affordable15
housing will not be built, Allan-Dean 205 N.J. Super.16
116. Further, a 15 percent set aside conforms to COAH17
guidelines.18
Toll Brothers advances COAH policy by19
proposing to build a substantial number of family20
rental units but this requires a deeper subsidy from21
the developer. See Toll brothers v. Township of West22
Windsor 2000 N.J. Super. Lexis 333 at 12-13. See also23
Mount Laurel II 92 N.J. 158, note 37, holding that what24
is substantial in a particular case will be for the25
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trial court to decide.1
This determination should be made based on2
factors such as size of the project and the proportion3
of the municipalitys fair share that the development4
will fulfill.5
The Supreme Court specifically affirmed this6
holding in Toll Brothers v. West Windsor 173 N.J. 561.7
This is consistent with maximum permissible required8
set asides authorized in COAHs first and second round9
regulations which set the maximum at 20 percent for10
sales housing and 15 percent for rental housing.11
N.J.A.C. 5:93-15.5C5.12
Although COAHs third round regulations13
purported to authorize maximum permissible required set14
asides at a higher level, N.J.A.C. 5:97-6.4B6, these15
regulations were invalidated by the Appellate Division16
in Re Adoption of N.J.A.C. at page 34-41.17
The Appellate Division struck down those18
regulations on the grounds that the higher maximum set19
aside failed to create realistic opportunities for the20
construction of affordable housing, id at 39-41. In21
light of that decision, the holding of the Appellate22
Division and the Supreme Court are binding upon this23
court. Therefore, according to plaintiffs, the 1524
percent set aside for this project would constitute a25
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substantial amount of low and moderate income housing1
under COAHs rules.2
Defendants argue that this percentage is not3
sufficient, stating that plaintiffs are mistaken in4
relying on prior round rules and Toll Brothers decision5
made while the prior round rules were in effect in6
making this determination. They further contend that a7
15 percent set aside would prove to be a burden on8
Cranford because they would be forced to make up for9
this gap.10
The Special Master, however, was satisfied11
with the 15 percent set aside. She opined based on the12
opinion expressed by the Appellate Court in In Re13
Adoption and considering the previous standard for14
provision of affordable housing both in the outcome of15
various Mount Laurel cases and in COAHs prior round16
rules having a maximum set aside of 20 percent which17
was applicable to affordable units being sold and a18
maximum set aside of 15 percent in the case of19
affordable units being rented, there is now even more20
support for the notion that the 15 percent affordable21
housing set aside recommended for the CDA site is a22
sufficient and reasonable set aside requirement under23
the circumstances. See Special Master report 12/1/1024
at page 18.25
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Upon careful consideration of the arguments1
of both parties, the opinion of the Special Master and2
the In Re Adoption opinion, this court is satisfied3
that the 15 percent set aside is sufficient in this4
case where rental units are proposed constituting a5
substantial amount of low and moderate income housing6
and will not unduly burden Cranford and will7
substantially benefit the town similar to the findings8
of Judge Carchman in Toll Brothers v. West Windsor 3039
N.J. Super. 518.10
Number 4. Site suitability. A. Flooding11
and storm water management. Cranford argues that the12
site suffers from severe flooding, is encumbered by13
wetlands and has a net buildable area of roughly 614
acres of the 15.8 acre site. The court notes that15
there is a discrepancy between the parties as to16
whether the land is 15.8 or 15.9 acres in size. The17
court will rely on the calculation of the Special18
Master which found 15.8 acres.19
Defendants argue that these substantial20
environmental concerns have not been and cannot be21
adequately addressed by plaintiffs experts. As a22
result, defendants argue that CDA has not established23
that it will be able to obtain necessary flood hazard24
area storm water management and fresh water wetlands25
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permits hereinafter referred to as FHA permits and1
approvals from the New Jersey Department of2
Environmental Protection hereinafter referred to as3
NJDEP.4
Moreover, defendants contend that this site5
is currently zoned 01 which permits the construction of6
low density office buildings. It is roughly 15.8 acres7
in size with a topography that is considerably flat,8
only 6 acres of which is constrained and reasonably9
developable.10
Nevertheless CDA proposes construction of 41911
units in two buildings A and B which will house 88 and12
331 units respectively. See testimony of August 3,13
2010 transcript at page 15, 21, 53-54.14
The flooding and storm water management15
issues were the subject of substantial and significant16
trial testimony.17
By memo dated October 20, 2008 as part of18
Cranfords review of the September 2008 concept plan,19
Township engineer Richard Marsden advised the Township20
Committee that Casino Brook was a very sensitive area21
and prone to regular flooding and that care be taken to22
ensure that existing conditions were not worsened by23
this project which would require an FHA permit from the24
NJ-DEP. See testimony of August 12, 2008 and exhibit25
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D-55.1
Richard Marsden also testified at trial on2
August 12, 2010. His credible testimony regarding the3
severe flooding and serious flood impact on Cranford4
are of great concern to this court and were considered5
together with the testimony on this topic by the6
Special Master.7
Mr. Marsden outlined the history of flooding8
in the Birchwood area through his detailed specific9
testimony and review of exhibits D-37, D-45, D-48, -49,10
D-50, D-113, D-170, D-98. This court took his concerns11
about sanitary sewer issues, water storage, impervious12
coverage and flooding very seriously. Indeed these are13
very substantial in this courts determination as to14
whether there are environmental constraints that render15
the site unsuitable for a builder's remedy.16
On October 14, 2009 Cranfords consulting17
engineer, Thomas Creeland, in his first report18
concluded that the project would require an FHA permit19
from NJ-DEP and that the 100 year flood plane floodway20
and encroachment lines would need to be determined,21
that CDA would have to demonstrate that the proposed22
development would not increase upstream or downstream23
flooding.24
Regarding storm water management, he noted25
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the presence of an existing on-site storm water1
detention system. See exhibits D-94, trial testimony2
August 2, 2010.3
Plaintiffs engineering expert, Michael4
Dipple, in an October 29, 2009 report and in his clear5
testimony on August 2, 2010, and again on September 27,6
2010 opined that the FHA was properly depicted on the7
flood emergency management agency, hereinafter FIMA,8
flood insurance maps. See exhibits P-39, P-39A.9
Mr. Dipples testimony on this point was10
based on models of the amount of flood water that can11
be stored on the site. He prepared a conceptual flood12
hazard grading plan showing how the property could be13
regarded to create additional flood storage under14
buildings A and B as permitted by NJ-DEP regulations,15
citing to N.J.A.C. 7:13-10.5M, also exhibit P-82 in16
evidence.17
At trial CDA relied upon the testimony of Mr.18
Dipple who opined that the necessary permits could19
absolutely be obtained for this project. His site20
investigation report of May 28, 2008, exhibit D-43,21
which was submitted to CDA as part of its due diligence22
in acquiring the property indicted that the sites only23
environmental constraint was the large area of fresh24
water wetlands and drainage dishes along the northern25
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and eastern portions of the site. See trial testimony1
August 2, 2010.2
CDA later submitted a revised plan based upon3
the FHA study performed by Dipple confirming that the4
entire footprint of building A was located in the flood5
plane. See August 2 trial testimony.6
CDA thus relocated building A after Dipple7
conceded that a substantial portion of the site was8
located in the floodway and could not be developed.9
Building A in its reconfigured state is proposed to be10
built on stilts because it is located partly in the11
flood hazard area. See transcript of testimony,12
August 3, 2010.13
Some units were shifted to building B but14
there was no reduction in units. See Dipple testimony15
August 2, 2010.16
Mr. Dipples testimony was extensive about17
his flood hazard studies and whether the project meets18
NJ-DEP storage requirements. Testifying about P-39,19
P-39A and P-63, he thoroughly outlined storm water20
analysis. See also P-82, P-87, P-88, P-89, P-90, P-9121
and P-93, P-92 rather, drainage area maps and Mr.22
Dipple testified clearly that NJ-DEP permits were23
absolutely feasible.24
Indeed Ms. McKenzies testimony was clear25
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that sound planning requires balancing the good of1
Mount Laurel housing against the adverse environmental2
impact. Defendants have not proven the contrary of3
Dipples testimony and his flood storage models4
outlined during his testimony.5
Defendants argue that the evidence adduced at6
trial revealed Cranfords concern regarding flooding on7
this site to be well founded as exhibited by the8
sincere testimony and photography of Mr. John Hrebin.9
Mr. Hrebin has resided in Cranford for the past 3410
years near the Birchwood site and has witnessed11
Birchwood in a flooded condition on many occasions.12
He photographed one of these flooding events13
on April 15, 2007. See trial transcript of August 9,14
2010 and exhibit D-25A through D and 25N.15
This photographic evidence was very moving16
and of concern to this court and Mr. Hrebin indeed17
presented a heartfelt picture of significant flood18
water management issues heretofore unaddressed by19
Cranford for many years.20
CDAs expert, Dipple, did admit that the21
flooding is extensive and testified candidly that there22
is no doubt in his mind that the site has a significant23
flooding problem which was confirmed by his FHA study.24
See trial testimony of August 3, 2010.25
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Defendants further argue that flooding not1
only affects the location and density of residential2
dwellings but also the location of onsite parking.3
NJ-DEP regulations requires residential parking to be4
elevated at least one foot above the FHA elevation.5
The reason for this is simple, in case of emergency,6
ingress and egress must be provided for emergency7
vehicles.8
The testimony was also concerning and the9
court was persuaded that ingress and egress proposed by10
plaintiff for emergency vehicles was not sufficient11
given the density proposed. Plaintiff contends however12
that these plans can be modified to comply with NJ-DEP13
regulations and indeed CDA and Cranfords experts all14
acknowledge that any builder's remedy will be15
contingent upon the receipt of necessary DEP16
permits.17
Plaintiffs for example point out that18
development in flood hazard areas of regulated waters19
is governed by regulations issued by the NJ-DEP,20
N.J.A.C. 7:13-1 et seq. pursuant to the Flood Hazard21
Area Control Act, N.J.S.A. 58:16A-50 et seq. The flood22
hazard area consists of the floodway in the flood23
fringe, N.J.A.C. 7:13-1.2.24
The floodway consists of the stream channel25
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and the adjacent areas. It includes the area necessary1
to carry the volume of water that the stream would2
carry during a 100-year flood event. The flood fringe3
is the remainder of the flood hazard area. See4
N.J.A.C. 7:13-2.3, figure A. See P-39 and 39A in5
evidence.6
As shown by the flood hazard area map7
prepared by Michael Dipple, a portion of the site is8
within the flood hazard area of Branch 10-24 of the9
Rahway River, a stream locally known as Casino Brook.10
See exhibit P-39 and P-39A.11
There is no dispute as to the accuracy of12
this map. The location and boundaries of the flood13
hazard area were corroborated by the photographs14
offered by defendants through Mr. Hrebins testimony15
which showed that the flooding during the 100-year16
storm is located within the floodway and flood fringe17
as delineated on the flood hazard area map, exhibits18
D-25 and P-39A.19
Construction within the flood fringe is20
permissible assuming the developer secures an21
appropriate permit from the DEP. In particular, an22
applicant may construct in accordance with the permit23
issued pursuant to N.J.A.C. 7:13-9.1 et seq. provided24
that he demonstrates that the project will satisfy the25
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permit requirement set forth in N.J.A.C. 7:13-10 and1
11. See also N.J.A.C. 7:13-9.1A. Thus, all2
development on this project would obviously be subject3
to NJ-DEP approval and that issue is not before this4
court. Moreover, even Cranfords experts conceded that5
if the DEP issued the necessary permits the developer6
could comply.7
For a residential structure, such as proposed8
by CDA, the permit requirement is that the construction9
involve no net fill within the flood fringe area, see10
N.J.A.C. 7:13-10.4. This standard requires that the11
development not reduce the floor storage capacity12
within the flood fringe area. To show that these13
standards can be met, CDA's engineer, Dipple,14
convincingly modeled the amount of flood waters that15
can be temporarily stored on this site and prepared a16
conceptual flood hazard grading plan.17
To satisfy DEP standards, the development18
must not reduce the flood storage capacity within the19
flood fringe area. Mr. Dipples plan showing how the20
property could be re-graded to create additional flood21
storage to offset the flood storage that would be lost22
through construction includes flood storage underneath23
buildings A and B as permitted by NJ-DEP regulations.24
See N.J.A.C. 7:13-10.5M. See conceptual proposed flood25
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fringe modification plan, exhibit P-82 and P-83, flood1
hazard area sections.2
This plan preserves the existing flood3
storage capacity and actually creates an additional4
27,000 cubit feet of flood storage capacity, an5
increase of 10 percent which was candidly acknowledged6
by defendants engineer at trial.7
The court found Dipples plan a creative way8
to address the current flood storage problems in9
Cranford which may actually improve flood water storage10
in the area in a way that is not currently possible and11
that has not heretofore been addressed by Cranford.12
The principal additional permit requirements13
are lowest finished floor and must be at least one foot14
above the flood hazard elevation, N.J.A.C. 7:13-11.5I15
and K as reflected in the conceptual proposed flood16
fringe modification plan P-82 and P-83, showing that17
CDA can satisfy this requirement by elevating the18
lowest floor of the building.19
The parking must to the extent feasible be20
elevated at least one foot above the flood hazard21
elevation, N.J.A.C. 7:13-11.6e. Through the conceptual22
design as reflected in P-82, flood hazard area sections23
P-83, plaintiffs argue that the vast majority of the24
parking can be provided outside the flood fringe. The25
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parking under building A can be elevated at least one1
foot above the flood hazard level and the smaller2
number of remaining surface parking spaces can be3
elevated above the flood hazard level.4
At least one access driveway must be5
maintained which is elevated at least one foot above6
the flood hazard elevation. See N.J.A.C. 7:13-116d-2.7
The conceptual plan as reflected in the proposed flood8
fringe modification plan P-82 and P-83 show that an9
existing access driveway can be maintained that is10
outside the flood hazard area.11
Plaintiffs maintain that the evidence show12
that the project can be designed and engineered to13
comply with all of these standards. Defendants have14
questioned the details of the conceptual modeling but15
have not proven to the contrary. Nor have defendants16
provided this court with a viable alternative model.17
A strong argument has been advanced that this18
plan actually improves flood control in Cranford. It19
removes the existing buildings at 215 Birchwood Avenue20
from the floodway, thus keeping flood waters closer to21
the channel of the stream. It increases the flood22
storage capacity of the site, thus lowering the peak23
flood levels in the homes downstream.24
Given that no recent upgrades to flood25
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control in Cranford were presented from the point of1
view of flood control, the court notes that this2
project potentially has the promise to improve3
Cranfords overall ongoing flood problems. That no4
development improvement nor storm water management has5
been done at this site in recent years was obvious6
during the courts site inspection.7
The court, the experts and the Special Master8
observed the property, the Canoe Brook (sic) stream,9
the Casino Brook stream and the wetlands. Drainage10
appeared nonfunctioning. Indeed the area appeared in11
great need of improvement an presents an opportunity to12
the town to address flooding and storm water management13
in the general area which will be undertaken by CDA in14
this project.15
Indeed the Special Master testified at trial16
credibly and consistent with her report on this issue17
and I quote,18
Up until the time of the report of the19
Special Master was prepared, the Townships engineering20
professionals have asserted that the site was in a21
flood plane but no documentation had been submitted in22
support of that allegation. There were no maps23
presented that confirmed that the site was or was not24
in a flood plane although it seemed obvious that at25
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I also paid close attention to the testimony1
presented by both sides regarding storm water2
management and drainage issues because it has become3
evident to me that another characteristic of this site4
beside the fact that it is partially in a flood plane5
is that it functions as a kind of detention basin.6
Even the portions of the site that are located outside7
of the flood plane hold water during storm events.8
Thus a potentially adverse consequence of development9
might be that the grading changes caused by the10
redevelopment of this site might actually increase11
flooding during storm events on other properties in the12
neighborhood and downstream.13
I have spoken openly to both parties during14
the course of the trial about what we were learning15
about the site and the issues surrounding its16
development and I had made it clear to both sides that17
I was not entirely satisfied with the information18
initially presented by the plaintiffs expert with19
respect to storm water management.20
I indicated that I was no longer concerned21
about the flood plane delineation. The engineers for22
both parties seem to agree about the extensive flooding23
on the site and where the line separating the floodway24
from the flood hazard area lied.25
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Consequently the only remaining flood plane1
issue was the developers ability to satisfy the NJ-DEP2
zero net fill requirement within the flood hazard area.3
This is ultimately a matter to be determined by the4
NJ-DEP.5
The testimony of the plaintiffs engineer has6
demonstrated the likelihood that NJ-DEP regulations7
will be able to be satisfied.8
The Special Master concluded,9
As I indicated previously in this report, I10
am now satisfied based on the testimony presented at11
trial that we know where the flood hazard area and12
floodway are located on the site and we have a pretty13
clear picture of how the extent of the flood plane will14
affect its development.15
The developer has estimated the amount of16
additional flood storage that would need to be created17
on the site in order to obtain the NJ-DEP zero net fill18
standard within the flood hazard area and has expressed19
its confidence that such storage can be accommodated in20
a reasonable way and that the CDA site can be developed21
as currently proposed in accordance with all applicable22
NJ-DEP requirements. I am comfortable that this is the23
case.24
Moreover, I am not convinced that even if I25
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am wrong and this is not the case nothing will be1
undertaken at this site that is not approved by the NJ-2
DEP. No matter how many units the court approves for3
this site, NJ-DEP will be reviewing all of the4
requisite permit applications for the development of5
the CDA site and may as a result of such reviews,6
require additional measures to be taken in the sites7
development.8
If this should result in a modification to9
CDAs proposed layout or even a downward adjustment to10
the total number of units that can be built on the CDA11
site, so be it.12
As previously noted, the plaintiff has known13
all along that it will have to deal with the14
requirements of the NJ-DEP in development of this site15
regardless of what is approved by the court.16
Although permit applications have not as yet17
been submitted to the NJ-DEP, the filing of such18
applications is not a prerequisite to securing a19
builder's remedy. In fact the filing of a permit20
application to the NJ-DEP is not even required prior to21
obtaining preliminary site plan approval. It is22
however a required condition of any site plan approval23
and a prerequisite for obtaining a construction24
permit.25
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What is important here is the likelihood1
demonstrated by the testimony that the developer can2
obtain the site approvals and permits and that the site3
can be developed along the lines proposed. See report4
of Special Master 12/1/10 at page 11-12.5
Thus the Special Master testified that she6
took the flooding issues seriously in Cranford and she7
credibly, carefully and thoughtfully recommended the8
court grant the builder's remedy since permits are a9
condition of site plan approval. However, she could10
not recommend the entire 419 units based on the11
testimony offered.12
The issue of storm water management was also13
the subject of much testimony and evidence and Ms.14
McKenzie obviously expressed her concern but was15
obviously satisfied. See Special Master report 12/1/1016
at page 2 to 3. She acknowledged in her testimony that17
NJ-DEP would be required to review the plans and may18
require changes.19
She clearly and convincingly testified that20
the site has a drainage function and presents an21
opportunity for storm water management for the Township22
of Cranford.23
Moreover, Richard Marsden, Director of Public24
Works, an engineer for Cranford, credibly delineated25
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the detention potential on the site.1
The court was impressed with his candid2
testimony but notes that neither defendants planner3
nor engineer offered any feasible alternatives to this4
plan. Moreover, their testimony was persuaded by the5
general consensus of the unpopularity of this site in6
Cranford.7
Defendants argued and the court is satisfied8
that storm water management has been and remains a9
critical issue in Cranford. In September 2008,10
Cranford passed its own DEP model storm water11
management Ordinance, see D-169.12
Cranford has constructed numerous flood13
control projects to address this issue but has taken no14
significant action to address flood control in the15
Birchwood area of this project.16
Plaintiffs argue that NJ-DEP regulates storm17
water management in developments such as this one. See18
N.J.A.C. 7:8-1 et seq. Regulations govern the amount19
and rate of runoff, see N.J.A.C. 7:8-5.4; the quality20
of runoff, 7:8-5.5, and the extent of groundwater21
recharge.22
Under N.J.A.C. 7:8-5.5 developments which do23
not increase the existing impervious surface by a24
quarter acre or more are exempt from the runoff quality25
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standards. For purposes of this standard, impervious1
surface is defined as a surface that has been covered2
with a layer of material so that it is highly resistant3
to infiltration by water. See 7:8-1.2.4
Because the proposed project will reduce the5
area of impervious surfaces by approximately 12,0006
square feet, it may be exempt from this requirement.7
Developments in urban redevelopment areas are exempt8
from ground water recharge standards, see N.J.A.C.9
7:8-5.4A2ii. For purposes of this standard, urban10
development areas are defined as previously developed11
portions of areas delineated on the site plan policy12
map as the metropolitan planning area designated13
centers (indiscernible). See N.J.A.C. 7:8-1.2.14
Because the property has previously been developed and15
lies within the metropolitan planning area, the16
development may be exempt from this standard.17
The developer may elect to satisfy any one of18
a variety of standards promulgated by NJ-DEP governing19
the amount and rate of runoff under a number of20
different standards. See N.J.A.C. 7:8-5.4A3,21
7:8-5.4A3I.22
They may comply by showing through hydraulic23
analysis that for storm water leaving the site post24
construction runoff hydrographs for the Q10 100-year25
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storm events do not exceed at any point the1
preconstruction runoff hydrographs for the stated storm2
events.3
Plaintiffs prepared conceptual models of4
preconstruction and post construction storm water and5
prepared a plan for detaining storm water to comply6
with the regulatory standard.7
Defendan