Former redeveloper Blackridge Realty, Inc. ("Blackridge") challenged the legality of an amendment ("Plan Amendment") to the City of Long Branch's ("City") Redevelopment Plan and a two-million-dollar payment made by redeveloper 290 Ocean, LLC to the City as part of its redevelopment agreement.
290 Ocean proposed a redevelopment project to the City that would require an amendment to the Redevelopment Plan. The resulting Plan Amendment relaxed several previous restrictions contained within the original Redevelopment Plan that had applied to Blackridge's redevelopment project. The City's planner, City council, and mayor all approved the Plan Amendment, finding it consistent with the City's Master Plan and in the City's best interest. The City and 290 Ocean negotiated a redeveloper agreement, which included a provision requiring 290 Ocean to pay a two-million-dollar fee to the City to be used to partially off-set the cost to construct a senior center.
Soon after the Plan Amendment was adopted and 290 Ocean's redeveloper agreement with the City was finalized, Blackridge filed a Complaint in Lieu of Prerogative Writs challenging the Plan Amendment's legality and the payment. The trial court granted summary judgment to the City and 290 Ocean.
The court concludes 290 Ocean's two-million-dollar payment was a lawful, negotiated fee intended to defray the City's costs as authorized in N.J.S.A. 40A:12A-8(f) of the Local Redevelopment and Housing Law ("LRHL"). It determines the LRHL does not impose any restrictions limiting payments to the recovery of costs the municipality will incur as a direct result of the redevelopment project, as long as the fee is negotiated at arm's length and collected to effectuate the purposes of the LRHL and the City's Master Plan. Unlike the Municipal Land Use Law ("MLUL"), N.J.S.A. 40:55D-42, the LRHL contains no explicit nexus requirement regarding the amount of payment a municipality may charge a redeveloper to defray its costs associated with redevelopment. The LRHL instead empowers a municipality to "negotiate and collect revenue from a redeveloper to defray the costs of the redevelopment entity" in order "to carry out and effectuate the purposes of [the LRHL] and the terms of the [municipality's] redevelopment plan." N.J.S.A. 40A:12A-8(f). The statute's plain terms permit a municipality to "negotiate" any payment amount from a redeveloper without requiring a causal connection between the payment and the redeveloper's proposed project, as long as the municipality demonstrates the payment will defray costs to the municipality associated generally with redevelopment. The language authorizing a municipality to "negotiate and collect revenue from a redeveloper to defray the costs of the redevelopment entity" is plain, unambiguous, and markedly different from the language set forth in the MLUL payment provision. Compare N.J.S.A. 40A:12A-8(f) with N.J.S.A. 40:55D-42.
The Court cautions, regardless of which statute applies, the need for transparency with respect to any municipality's negotiated payment from a redeveloper remains. Transparency avoids the appearance that "'[a]pprovals would be granted or withheld depending upon the board members' arbitrary sense of how much an applicant should pay.'" See Pond Run Watershed Ass'n v. Twp. of Hamilton Zoning Bd. of Adjustment, 397 N.J. Super. 335, 359 (App. Div. 2008) (quoting Nunziato v. Plan. Bd. of Edgewater, 225 N.J. Super. 124, 134 (App. Div. 1988)). It notes transparency is critically important when a municipality provides a benefit to a redeveloper, so the public is assured the negotiations proceeded at arms-length. Transparency is fundamental to maintain public trust, to ensure accountability, and to prevent the appearance of favoritism or impropriety in government decision-making. See Jersey Pub. Co. v. N.J. Expressway Auth., 124 N.J. 478, 492 (1991) (emphasizing the necessity of transparency to uphold public trust and confidence in governmental processes). The court concludes the City had been transparent in its negotiation of payment with 290 Ocean and its intended use of the funds.
The court also concludes the Plan Amendment was a lawfully-enacted alteration to the Redevelopment Plan that did not amount to impermissible spot zoning, and Blackridge did not have designated developer status that would allow it to veto the Plan Amendment. Therefore, it affirms the decision of the trial court.