From the Star Ledger:
A pair of bills sponsored by Senate Economic Growth Committee Chairman Raymond J. Lesniak which would begin to address New Jersey’s foreclosure crisis by creating an expedited process for foreclosure on abandoned, dilapidated properties, and by creating a mechanism to transform abandoned properties to affordable and market-rate housing was approved by the committee yesterday.
The bills represent different aspects of S-1566, legislation Senator Lesniak introduced earlier this year which was vetoed by Governor Christie.
“I believe the governor should reconsider this important legislation and have streamlined the process to hopefully address his concerns,” said Senator Lesniak, D-Union. “The foreclosure crisis in New Jersey is driving down residential property values, causing urban and suburban blight, contributing to increased crime rates, and exacerbating itself by making homes surrounding an abandoned, dilapidated property all but unsellable. We need to take action on this crisis, and begin to turn foreclosed, abandoned properties into affordable homes for New Jersey’s middle class.
The first bill, S-2156, which was approved by a vote of 5-0, would establish an expedited foreclosure procedure for abandoned residential properties which have fallen into disrepair.
The second bill in the package, S-2157, which was approved by a vote of 3-2, would require the New Jersey Housing and Mortgage Finance Agency (HMFA) to facilitate and finance the purchase of foreclosed residential properties from institutional lenders, and dedicate such properties as affordable housing units or market-rate housing. The agency would be able to use its bonding authority – without recourse to the state – federal funds and funds from the State Affordable Housing Trust Fund to finance the purchase of foreclosed homes by for-profit and not-for profit corporations.
Some properties could be deed-restricted with the consent of the affected municipality, to be used as affordable housing. The bill would also create incentives for municipalities to transition abandoned properties to affordable housing on their own, giving them a 2-to-1 match against their affordable housing obligation for affordable units created from foreclosed properties using funds from municipal affordable housing trusts. Under estimates from the original bill, Senator Lesniak said this bill could result in over 10,000 new affordable and market-rate units and over 10,000 less unoccupied, boarded-up properties.
“This bill is at the core of the effort to mitigate New Jersey’s foreclosure crisis,” said Senator Lesniak. “It would create a legitimate mechanism to boost the number of available affordable housing units, it would create new market-rate housing, and it would do it while cleaning up blighted, abandoned properties within our municipalities. It doesn’t get any better than that.”