West Windsor redevelopment has been discussed for about three years, and the only thing it seems to have produced is controversy. And now within a five-day period, the project has generated a maelstrom — a lawsuit by InterCap Holdings and the beginning of what is looking to be a heated mayoral campaign.
Township Council President Charles Morgan announced he will be running for mayor (see page 12) against current Mayor Shing-Fu Hsueh on December 18, less than a week after InterCap went public about a lawsuit it is bringing against the township.
And that lawsuit came just a week after the West Windsor Township Council voted to send its draft redevelopment plan for the 350-acre Princeton Junction train station area to the Planning Board for review. The lawsuit alleges that the township has violated Mount Laurel affordable housing regulations and that it discriminates against families with school-aged children.
If InterCap, the company that owns 25 acres in the redevelopment area, is successful, the court case could well become a landmark decision, since a case has never been won in New Jersey on the basis of discrimination of familial status using the Federal Fair Housing Act, as InterCap is doing.
However, township officials and at least one other legal expert are calling the builder’s remedy lawsuit “premature.” Meanwhile, an attorney for InterCap is saying that the lawsuit is not based on any redevelopment plan or fair share plan, but rather that the township has allegedly refused to rezone the InterCap property to fall in line with state smart growth and affordable housing principles.
Experts are also saying it will be hard for InterCap to win based on the discrimination charge, but Carl S. Bisgaier, the InterCap attorney, says: “We think we have substantial fact to substantiate the claim.”
When asked whether he thought he had a good case against the township, InterCap principal Steve Goldin said he could not comment because the matter is in litigation, but said: “There’s a reason why we hired the attorney who successfully represented Toll Brothers against West Windsor.”
InterCap had hinted at the possibility of a lawsuit before the council voted on the plan, when it appeared that the council was not going to send a plan to the board that included Goldin’s proposal for 935 housing units on the company’s 25 acres on Washington Road. Goldin had spent millions of his own money on public outreach, specifically over the past year, to try to gain residents’ support for a transit village.
Earlier this fall, Goldin sat down with township officials and presented his proposal during a council workshop meeting and explained that it would come in two phases — in the first phase, 528 market units would be built, along with 132 affordable housing units to take care of his own obligation, for a total of 660 units. In Phase II, 172 market rate units would be built, along with his own 43 affordable unit obligation and the township’s 60 affordable unit obligation generated as a result of office and retail development on New Jersey Transit property.
Prior to that, Goldin had submitted a plan to the Planning Board for a multi-use development on his property that requests rezoning for 1,”440 condominiums and 88,”000 square feet of office and retail space, along with a letter implying possible litigation. That mixed-use transit-oriented village plan also included office buildings, more than 2,”500 parking spaces, a clubhouse, a village green, and restaurant space, but no amenities for West Windsor residents. The InterCap property is currently zoned for research, office, and manufacturing, but not for any housing, and would require a rezoning.
After working on the draft throughout the fall and weighing Council on Affordable Housing obligations as well as the threat of litigation, the council voted (see story below) on December 8 to send a draft of the redevelopment plan to the Planning Board. That plan could allow up to 524 total housing units — 307 of which are market-rate and 217 of which are affordable — for the entire redevelopment area, excluding the 47 affordable units generated by development on state-owned property, which township officials are assuming will be waived by COAH. All together, the redevelopment area is projected to have 220,”287 square feet of retail space and 840,”538 square feet of office floor area, as well as 200,”000 square feet of parking and other uses.
Under the draft plan, the InterCap property would hold a base of 350 units, with the possibility of more housing to come based on negotiations in exchange for providing township amenities, which would come to fruition through a developer’s agreement. But under the draft plan, InterCap would also have the option to instead develop the property under current zoning.
The lawsuit, filed on December 12 by Carl S. Bisgaier and Richard J. Hoff, of the Cherry Hill-based law firm Flaster/Greenberg, alleges several counts against the township.
The suit charges that the township’s zoning designation for the property is unconstitutional “as contrary to general welfare” of not just the municipal residents, but regional and state residents as well. Citing state smart growth and affordable housing policies, the lawsuit alleges the township is not fulfilling state objectives of providing transit-oriented development to residents in need. The counts state that the township is in violation of the Mount Laurel Doctrine for failure to address affordable housing needs of cost-burdened households; that it failed to address unmet need as well as the need for workforce housing; and that it is in violation of the Federal Fair Housing Act.
The lawsuit also alleges that one of the main reasons the township rejected InterCap’s proposals for the development of its 25 acres was “to prohibit the influx of school age children within the township,” which InterCap alleges is a violation of state and federal law against discrimination. The lawsuit also alleges that the zoning designation for the property is arbitrary, capricious, and unreasonable.
According to the lawsuit, InterCap “has attempted, over the course of the last two years, to present zoning and redevelopment concepts for the property that would allow for a significant mixed-use, transit-oriented development with a substantial amount of residential development affordable to a wide variety of income classes.”
InterCap also points out in the lawsuit that the concern relative to the potential for school age children to come from the residential development on the property was so great that at one point, InterCap “was presented with a development counter-proposal by the township that would allow for increasing residential densities for the property over a period of time, so long as plaintiff (InterCap) was able to demonstrate that the level of school-age children remained below a certain threshold.”
InterCap is alleging that this violates state law as well as the Federal Fair Housing Act that prohibits discrimination based on familial status. The lawsuit states that “the township maintenance of the current zoning designation for the property and the prohibition of a predominantly residential development that would allow for a walkable, transit-oriented development are a collective abuse of the township’s delegated authorities under the New Jersey Constitution as such zoning controls are contrary to the general welfare of the people of the region and state.”
InterCap also alleges that the zoning as called for in the redevelopment plan is undermining housing opportunities created by developers for cost-burdened households.
However, one legal expert, David Frizell, of the Metuchen law firm Frizell & Samuels, which specializes in law dealing with the real estate development industry, says that InterCap’s allegation that the township is discriminating on familial status will be a tough count to prove.
“That particular case has been brought in the past,” he said. “It has not yet succeeded.” Frizell, who has not seen the specifics of the lawsuit, says, though, that “it’s not to say that it doesn’t have some degree of legal merit.”
In addition, Frizell says that it sounds like the lawsuit is premature, since municipalities are protected by COAH so long as they have filed their fair share plans for the third round COAH regulations. All municipalities in the state must endorse plans by December 31 to send to COAH that deal with their obligations under the new third-round regulations, or risk being sued by developers, as well as falling out from under COAH’s jurisdiction and having its affordable housing trust fund money taken away. Municipalities are protected so long as they file their plans. The West Windsor Township Council endorsed its plan on December 8, and voted to send it to COAH for review.
“West Windsor does not have the best track record in defending affordable housing litigation, but they do have a record of extending the process,” says Frizell. “Their plan may or may not have complied with COAH regulations, and InterCap may ultimately proceed.”
But, “I don’t think he has a high probability of winning on fair housing because it hasn’t been successful in the past, and it sounds like a builder’s remedy case may be a little premature in his filing.”
West Windsor Planning Board Attorney Gerald Muller echoed the sentiment, saying that he and Township Attorney Michael Herbert will be working aggressively on the case. “Certainly our view is that we are within COAH jurisdiction, and we are protected.”
With regard to the issue of discriminating based on school children, Muller says the basic law in New Jersey is that “you can’t defend zoning on the basis of the fiscal aspects of school-aged children, but to consider that, is not a violation either. What it all comes down to is whether it’s reasonable from a planning point of view. At the end of the day, it is irrelevant to the judgment.”
“One of the separate issues that is going to be raised, I think, is the timing of this litigation,” Muller says. “The litigation doesn’t directly challenge the draft redevelopment plan — it’s not even mentioned. It seems to us we’re going through a process of trying to craft an alternative land use scheme for that site, and we’re not finished with the process. It just seems to me to be premature. We haven’t even gone through the Planning Board yet.”
Bisgaier emphasized, though, that InterCap is not seeking approval of any particular redevelopment plan, and that it is simply seeking a rezoning. “We offered to meet with the town to discuss our proposal, and they established preconditions to the meeting that are unacceptable to us,” Bisgaier said.
Goldin’s claims that township officials have refused to meet with him, as first reported in the News’ December 5 issue, came under fire shortly after. Planning board officials have said since the article ran that InterCap CEO Steve Goldin’s comments that officials were not communicating with InterCap was inaccurate.
Planning Board Chairman Marvin Gardner said that written communication, in the form of E-mails and letters, have been sent back and forth between Muller and InterCap counsel. Gardner also explained that the board is not obligated to do anything with respect to a rezoning. However, under township ordinance, a procedure is outlined for any developer wishing to have discussions with board officials in which the developer must pay $2,”500 application fee and place $10,”000 into an escrow account to cover the township’s costs in having its professionals — planners, attorneys, and traffic consultants included — look at the request.
Still, even that does not guarantee or ensure that the application would receive favorable action in terms of the request, Gardner said.
InterCap, however, does not want to pay those fees, Gardner said. “They want to talk without putting money down,” he said. “We treat every developer equally. We follow the ordinance.”
In addition, Bisgaier emphasized that the lawsuit “doesn’t relate to the township’s fair share plan.”
“We’re not seeking approval of any particular redevelopment plan. The reason for the lawsuit is that we’ve been unable to sit down with them, and they have been unwilling to rezone their property. We think that the current zoning of the property is illegal. The litigation has nothing to do with their compliance plan with COAH regulations, and it’s not been filed pursuant to their COAH plan.”
But Bisgaier also clarified that the lawsuit is not a builder’s remedy suit pursuant to the COAH obligation. “The allegations regarding affordable housing do not relate to the COAH need assessment or the COAH allocation of need to West Windsor.”
When asked to clarify what the builder’s remedy is pursuant to, Bisgaier said he didn’t want to characterize the allegations in the complaint because it would be inappropriate. “The complaint speaks for itself,” he said.
Mayor Shing-Fu Hsueh said he did not want to comment on the lawsuit other than to refer the matter to the township attorney. He did say, though, that “I will do whatever it takes to protect the best interests of West Windsor taxpayers.”
Bisgaier’s firm represented developer Toll Brothers in the 1990s. The Estates at Princeton Junction, the most massive development to be built in West Windsor in more than a decade, is the result of affordable housing litigation filed against the township in the early 1990s. In 1996, a state Superior Court judge ruled that West Windsor had not provided for required amount of mandated affordable housing and authorized Toll to build the Estates at Princeton Junction because it includes low and moderate-income apartment units.
The decision was upheld by an appellate court in 2000, and the New Jersey Supreme Court in 2002. Several matters of outstanding litigation over environmental issues further delayed the development until a settlement was reached at the end of 2004.
InterCap’s lawsuit is seeking declaration that the zoning designation for the property is unlawful, invalid, and void, and that a special master, at the expense of the township, be appointed to assist the court in determining the highest and best use of the property in accord with sound planning and Smart Growth principles. It is also seeking the court to direct the township and Planning Board, under this special master, to plan for and adopt a zoning or redevelopment plan that provides for a predominantly residential development.
