The Rise of Cities in NJ: Part 1

By Danny Restivo (posted 10/30/17)

New York City’s cost of living is 120 percent higher than the rest of the country. With 8.3 million people and an average home price of $501,000 (average home price in United States is roughly $181,000), prices have begun to push city dwellers from Brooklyn and Manhattan into less-expensive areas that remain within close proximity to the city. As a result, portions of New Jersey—specifically North Jersey—have turned into prime real estate markets.

Many of these locations have transformed from working class neighborhoods to destinations for young professionals. Economic realities and shifting demographics have fueled this migration. Millennials, with an interest in keeping their living space, work space, and social lives in close vicinity to one another, have rebooted places like Hoboken, Newark, and Jersey City. However, the conflict between urban pioneers moving-in, and long-time residence seeking affordability, has pushed affordable housing into the 2017 gubernatorial debate.

Democratic candidate Phil Murphy has proposed using hundreds of millions of dollars from the Department of Justice’s Residential Mortgage-backed Securities (a multi-billion dollar reparations account funded by Wall Street fines) to pay off the state’s housing loans, and then turning those newly paid-off homes into affordable housing. Republican candidate Kim Guadagno has pledged to cut property taxes in the Garden State, which has one of the highest in the country. Guadagno’s property tax ‘Circuit Breaker’ would cap the school portion of a homeowner’s tax bill at 5-percent of their household income.

It seems neither plan will stymie development in North Jersey. Although many have welcomed the change, some local officials have begun pushing back on plans to develop portions of North Jersey. Michael McPartland, the Mayor of Edgewater, a 3.5-mile stretch of land along the Hudson River, stopped a 2014 plan to develop 1,863 apartments in five high-rise buildings. McPartland said the proposal was far too big, and would increase congestion while also straining the community’s limited infrastructure. Since 1990, Edgewater’s population has nearly tripled from 5,000 to 13,000, with most residents coming from newly developed regions in Northern New Jersey, like Hoboken and Newark. The developers have now taken the city of Edgewater to court.

With prices in New York City continuing to rise, many Manhattan and Brooklyn residents continue to seek more for less in North Jersey. Here are some cities in New Jersey harnessing real estate interest to improve their respective communities, while also protecting middle and working class residents from increased property taxes and rents.

Jersey City

In early 2017, the New York real estate blog Curbed voted Jersey City as the best neighborhood of the year. From 2010 to 2014, Jersey City experienced a 6-percent population increase, reaching 262,000. Many of these newcomers include millennials.

Mayor Steve Fulop claims 650 small businesses have opened over the past three years (many of them include bars and restaurants); and it makes sense: It’s a 10-minute train ride to the World Trade Center Transportation Hub in Manhattan, fueling Jersey City’s appeal among city workers. In 2016 there were more than 7,000 units of housing under construction with more than 19,000 already approved, more than any other city in New Jersey.

According to Trulia, an online real estate website, median rent for one-bedroom apartments in the city’s four largest zip codes rose from $1,395 in October 2014, to $1,590 in September 2017. Jersey City’s housing affordability has emerged as a key issue in the 2017 mayoral race. Mayor Fulop has said the city will not support tax abatements for development projects that do not include affordable housing. Fulop had tried to include an ordinance requiring 20 percent affordable housing for any development receiving tax abatements, but many developers pushed back forcing the measure to stall.

Former City Attorney Bill Matsikoudis, Fulop’s mayoral challenger, has written a policy paper outlining affordable housing plans in Jersey City. His policy would require that all development plans include affordable housing, while also revising rent control laws for buildings with fewer than five units. Matsikoudis also wants to open a city office for affordable housing to help connect residents with vacant units.

Hoboken

Hoboken’s revitalization began in the late 1970s and early 1980s when the working class area used state funds to refurbish historic brownstone homes to improve housing options.  With one of the shortest commutes into Manhattan, and one of the smallest towns by area at 1.275 square miles, Hoboken has turned into a destination for Manhattan families seeking more space for their dollar. In 2016, the median value of a home cost more than $747,000, a 12-percent jump from 2015 to 2016.  Since 2000, Hoboken’s population has increased 28 percent with roughly 15,000 newcomers in the past 16 years. Hoboken’s growth stems from corporations like Goldman Sachs and Ernst Young moving across the Hudson River to take advantage of lucrative Garden State tax credits.

 

To keep Hoboken a mixed income community, city officials announced plans to create 115 affordable housing units in February 2017. Affordability requirements are based on income and household size. The announcement was born from an ordinance that requires 10 percent affordable housing for resident construction projects with over 10 units when an increase in density is provided. Hoboken has also adopted the Affirmative Fair Housing Marketing Plan and a guidebook for policies and procedures that placed eligible families into housings units.

“Dozens of new affordable housing units under construction throughout our city will help to ensure that Hoboken remains a vibrant mixed income community,” Hoboken Mayor Dawn Zimmer said after the affordability requirements were announced. “We have created procedures to make sure that these affordable housing units are available to those who need it most through a fair and open process.”

Newark

Once a symbol of urban decay, crime, and poverty throughout the 1980s and 1990s, New Jersey’s most populous city has turned into a vibrant metropolitan area.

In 2016, there were $2 billion in commercial and residential development with 1,500 units of housing under construction and another 4,000 in planning. After more than 60 years of population decline Newark finally had a 1.7 percent increase in population in 2010, with subsequent increases the following years (Newark’s peak hit 438,000 in 1950, but dipped significantly in 1970 and 1980). Part of the revitalization stems from business investments by Prudential Financial and Goldman Sachs, which have invested $368 million and $500 million into the city, respectively.

Vacant lots across the city have now turned into real estate projects, including a $94-million mixed use facility that houses a grocery store, retail shops and residential space. A large scale department store built in 1901, which sat vacant for nearly 30 years, became a 160-room-luxury apartment space and home to Newark’s first Whole Foods after a $174 million investment. A few blocks away, a developer has partnered with Prudential to restore a 20-story tower built in 1929 for the New Jersey Bell Telephone Company. The building will now serve as a 260-unit rental apartment building.

While some city leaders have lauded the turnaround and future potential, Newark Mayor Ras Baraka has introduced policies to keep a city with one of the highest poverty rates in the country affordable.  Baraka’s plan, titled Newark 2020, aims to hire 2,020 unemployed residents at full-time jobs with living wages over the next three years. The city has partnered with Prudential, RWJBarnabas Health, United Airlines and Audible. In early October, The Newark City Council, with the Mayor’s support, approved an ordinance that ensures new projects with 30 or more residential units maintain 20 percent affordable housing.

“This is a groundbreaking step in housing development in Newark and a pioneering step for all of America’s cities,” Baraka said after the vote. “Once again, Newark is leading the way, defining to the nation how a city cares for its residents, and what a city should be.”

Weehawken

 At 1.4 square miles and bordering Hoboken to the North, Weehawken has experienced a 25 percent increase in median home values over the past year, the largest increase in the Garden State. Like many other North Jersey communities along the Hudson River, Weehawken’s growth stems from home buyers priced out of markets in New York City, as well as Jersey City and Hoboken. The explosive growth along the city’s waterfront includes construction of a 589-rental unit building, 177 condominiums and two apartment buildings with more than 500 units. Subsequently, home values have reached a median cost of $757,000, compared to $488,000 in 2012. Real estate website Zillow projects that number to reach $809,000 by 2018. Historically, Weehawken’s residential communities were atop the 180-foot high cliffs known as the palisades, but development below along the Hudson River waterfront has created a viable living space for those commuting into New York City via ferry or the Lincoln Tunnel.

The development has also lead to an increase in taxes for a community that has the highest bill in Hudson County. Moreover, a state judge ordered Weehawken to complete a new tax map in 2015. The suit says a failure to conduct a revaluation on older properties, while assessing new ones at market value has created an unfair tax burden on waterfront property owners.  With a judge’s order, older residents could see their property taxes increase starkly, making affordable housing in Weehawken a looming issue.

Future Housing Trends in New Jersey

 

According to a 2017 report released by research advocates New Jersey Future, while the Garden State’s millennial population is declining, the 22-34 old demographic has fueled much of the real estate growth in places like Hoboken, Newark, and Jersey City. However, due to the cost increases, the report has indicated a potential for those areas to lose more millennials in the future. The report, and many others like it, finds millennials are more inclined to live in walkable, compact urban areas, compared to previous generations that settled for more suburban, car-focused locations.  The NJ Future report urges the state to encourage more development of housing in compact or urban regions in an effort to retain younger people. Fortunately, The Garden State has many comparable locations that could support such housing. This shifting focus raises questions on what happens to regions with older residents where millennials aren’t interested in home buying. Some believe older residents could ultimately move into more compact areas with amenities or services. In any event, New Jersey’s urban and suburban landscapes could look drastically different in the coming years.

Note- This is the first in a multi-part series on the rise of Cities in NJ. Next time, we’re going to take a deep dive into Camden.

Primary Preview: New Jersey and Virginia Gubernatorial Elections

By- Danny Restivo (Posted 6/2/17)

New Jersey- June 6th, 2017

On June 6, New Jersey Democrats and Republicans will cast a vote for their respective party’s gubernatorial nominee in the 2017 election. In May, a Quinnipiac University poll showed Democrat Phil Murphy, former ambassador to Germany, and Republican Kim Guadagno, lieutenant governor, as clear favorites to succeed Chris Christie. While Guadagno and Murphy have taken the lead, 57 percent of Garden State voters remain undecided, according to Quinnipiac. A Stockton University survey released on May 25 showed 34 percent of Democratic voters remain undecided, while 31 percent of Republican voters had not supported a candidate. Here are the top candidates seeking their party’s nomination.

Democrats

philip_d-_murphy Phil Murphy is the former ambassador to Germany under President Barack Obama from 2009 to 2013. Prior to his ambassadorship, the Boston-born and Harvard-educated Murphy worked at Goldman Sachs and headed the Frankfurt office from 1993 to 1997. In 2014 he served as a principal of Murphy Endeavors, a business management consulting company located in Red Bank. Meanwhile, he started his own progressive nonprofit advocacy group. Murphy has $15 million of his own funds to help fuel statewide campaign efforts, tripling his competitor’s. His progressive campaign message includes the establishment of a public bank of New Jersey to help spur investment in small business and infrastructure. As the favorite to win the party nominee, Murphy has 21 county endorsements, near unanimous support from Unions, and a campaign staff that includes a number of high level political operatives. According to Quinnipiac, Murphy has drawn 26 percent of Democratic voters, while Stockton has placed his total at 34 percent.

Jim Johnson- Although he’s polled at 7 percent, according to Quinnipiac (10 percent jimjohnsonaccording to Stockton), Johnson may serve as the biggest threat to Murphy’s candidacy. He’s centered his campaign rhetoric on ethics reform, while promoting himself as an outsider in New Jersey’s political system. Johnson served as a Treasury Department Official in Bill Clinton’s Presidential administration, before practicing corporate law in New York City. During that time, he also served as Chairman of the Brennan Center of Justice at New York University, where he worked on Civil Rights, law enforcement and gun control issues. Johnson has pledged to maintain benefits and pension plans for government employees and retirees. Additionally, he’s also pushing a $15 minimum wage hike (Murphy has also signaled support for a $15 minimum wage), while vowing to reduce residential property taxes and increasing affordable housing. Johnson also advocates free community college tuition for students who come from families with incomes under $90,000. Under Johnson, tuition assistance grants for college would expand.

John Wisniewski As a 19-year assemblyman from Middlesex County, and Chairman of wisniewskithe Bernie Sanders Campaign in New Jersey, Wisniewski is the most progressive candidate in the 2017 Democratic primary. Unfortunately, Hillary Clinton won New Jersey Democrats by a 2-to-1 ratio.  Like Sanders, he’s advocated for tuition free college, as well as a single-payer healthcare system. Wisniewski was also a driving force behind the investigation of the Bridgegate Scandal. As the Chair of the Transportation and Independent Authorities Committee since 2002, Wisniewski has championed funding for a number of statewide transportation projects, sponsored legislation for minimum wage increases, property tax relief and helped to pass the Garden State Manufacturing Act. According to Quinnipiac, Wisniewski has received 5 percent support among Democratic supporters.

raymond_j-_lesniakRaymond Lesniak- . Senator Lesniak is one of the longest-serving politicians in New Jersey history with 39 years of experience. Lesniak has been a fierce advocate of progressive causes like the abolition of the death penalty, animal rights, marriage equality, environmental initiatives and the expansion of drug treatment centers. His path to the Governor’s seat remains the most difficult with small funding and a miniscule staff. Moreover, his announcement to run came after he said he wasn’t running.  The Elizabeth native currently has 4 percent support among Democrats, according to Quinnipiac.

Republicans

Kim Guadagno- Governor Chris Christie’s Lieutenant Governor Kim Guadagno remains 2016_lg_officialthe favorite to win the Republican nomination with 23 percent of Republican support, while Stockton’s survey places her party support at 34 percent. However, with support for Governor Chris Christie at an all-time low, Guadagno has made attempts to distance herself from the current Governor. She rejected his support for Trump, and said she’d reverse Christie’s decision to take New Jersey out of a regional compact to combat air pollution. When Governor Christie signed a legislation increasing the gas tax, she opposed the move. In a debate with her opponent, Jack Ciattarelli, she received repeated criticism for working with Christie. Guadagno has pledged to audit the state government in attempt to eliminate waste while addressing property taxes. She’s also stated plans to increase funding for transportation projects as well as repairs for the State House. Guadagno has a significant level of State level executive experience which her competitors lack. While Christie stumped for himself and Donald Trump on the campaign, Guadagno served as the state’s active Governor for more than 500 days. New Jersey law stipulates that anytime the governor is out of state, the Lieutenant will serve as the acting executive.

Jack Ciattarelli— The six-year assemblyman represents residents in Somerset, Hunterdon, Middlesex and Mercer counties. Additionally, Ciattarelli owns and operates Galen Publishing, a medical publishing company. Like Guadagno, Ciattarelli aims to ciattarelli2jpg-2a48ab720635c81ecorrect the price of property taxes in New Jersey, but unlike Guadagno, he wants to alter the way public schools are funded. Ciattarelli has long-chided Christie and continues to tie Guadagno to her old boss. He’s received seven county line endorsements, but his support remains in rural areas with a comparatively small number of registered Republicans. To defeat Guadagno, Ciattarelli will have to chip in to her support base, which consists of a number of Christie supporters.

Virginia- June 13th, 2017

Along with New Jersey, residents of the Old Dominion will cast their vote for a new Governor in November 2017. Five candidates—two Democrats and three Republicans—are vying for their respective party’s nomination on June 13. Ralph Northam, Lieutenant Governor, will square off with former congressman Tom Perriello for the Democratic nomination. According to a recent Washington Post-Schar School Poll, 40 percent of Democrats support Perriello while 38 percent support Northam. The two-point difference is well within the poll’s 10-point margin of error. On the Republican side, former National GOP Chair Ed Gillespie has clear path to the nomination with double digit leads over his opponents, State Senator Frank Wagner and Corey Stewart, chairman of the Prince William County Board of Supervisors. However, even if Gillespie clinches the nomination, his path to the Governor’s seat remains challenging. According to the Washington Post-Schar School Poll, Gillespie significantly trails both Perriello and Northam in a head to head match (Tom Perriello by 50 percent to 37 percent, and Ralph Northam by 49 percent to 38 percent). Trump’s low approval rating may give the Democratic nominee a boost, but the new Governor will most likely inherit and state legislature dominated by the GOP. In any event, Virginia remains a state with strong bi-partisan streak when it comes to the state’s top executive.

Democratic Primary

xirzugki_400x400Ralph Northam- As Lieutenant Governor to Governor Terry McAuliffe, Northam usurped the role of heir apparent until Perriello announced his candidacy in January. Many of dubbed the race as an extension of the Clinton-Sanders fight in Virginian. Northam has received endorsements from state party leaders like McAuliffe, and Democratic Senators Tim Kaine and Mark Warner.  Additionally, every Democrat in the state legislature has backed Northam and every Democratic congressman except one has supported him. While his opponent rides a wave of anti-Trump sentiment, Northam remains a centrist Democrat who admitted supporting George W. Bush in 2000 and 2004. However, the former U.S. Army doctor has shuffled further to the left since becoming state senator in a rural district in 2007. As a Virginia legislator and a lieutenant governor, he helped ban smoking in restaurants, worked with victim’s families of the Virginia Tech shooting to curb gun control and helped legalize cannabis oils. As Governor, Northam said he wants to offer tax credits to businesses with paid family leave. He also wants to revise the state’s grocery tax, which he says would cost $67 million. He’s also suggested decriminalizing possession of marijuana. During a debate with Perriello, Northam touted his relationship with Republican legislator saying “I look forward to the relationships I already have in Richmond and continuing that process in the upcoming four years.” As of March 31, Northam had $3.3 million in campaign funds.

Tom Perriello- The former congressman was elected to represent Virginia’s fifth 220px-perriello_official_portrait_28cropped29congressional district in 2008. However, his support for the Affordable Care Act cost him his seat two years later. Following his term, he worked for a progressive nonprofit before heading to the State Department in 2014. After announcing his candidacy in January, he quickly aligned himself with the party’s liberal messaging. Perriello has positioned himself as a policy-oriented progressive who supports free community college, paid family leave and universal pre-kindergarten. He’s also railed against a gas pipeline through Virginia. Meanwhile, Perriello has received outside support from Senator Elizabeth Warren (Mass-D), Senator Bernie Sanders (Vt-I) and several Obama aides. Their support comes in a state where Hillary Clinton won nearly two-thirds of the Democratic electorate against Sanders in 2016. Furthermore, more than half of Perriello’s $2.2 million in campaign funding has come from massive donors outside the state, including contributions from George Soros. While Perriello has championed progressive causes, his voting record on abortion issues and gun rights while in congress has come under fire.

Northam has outspent Perriello on television advertisements in Northern Virginia by $720,000 to $410,000. While 40 percent of the electorate lives in this area, support is split with 36 percent undecided. While Perriello leads Northam among Democratic voters ages 18 to 39 by 20 percent, the Lieutenant Governor leads by 16 points among those ages 65 and older. They run evenly among voters in between, but the older crowd fits the profile of likely voters, giving Northam a qualitative advantage on primary day.

Republican Primary

Ed GillespieEd Gillespie- The former counselor to George W. Bush and Chairman of the Republican National Committee ran against Senator Mark Warner in 2014. Gillespie’s performance surprised many (he lost by less than one percentage point). Prior to his run, he was a lobbyist in Washington, D.C., and provide government affairs service for Tyson Foods. His critics from the right have said he helped push legislation friendly to illegal immigrants. As part of his platform, Gillespie aims to cut income taxes by 10 percent over three years, improve government efficiency and ethics oversight, ban personal use of campaign funds, while strengthening second amendment rights and abortion restrictions. According to a May poll by Washington Post-Schar School, Gillespie has strong support among all registered Republicans. With $3.3 million in campaign funding, the former RNC chair has 38 percent support while a quarter remain undecided.

2012 Official Portrait Chairman StewartCorey Stewart- Known more for his pro-Confederate antics rather than his policy chops, the chairman of the Prince William Board of County Supervisors promises to crack down on illegal immigration while protecting Virginia’s Confederate symbols. As Chair of President Trump’s Campaign in Virginia, Stewart was fired for staging a protest at the State’s GOP headquarters. The anti-establishment Stewart wants to phase out the income tax, outlaw abortion without exception and slash state spending. The firebrand Stewart has attacked Gillespie repeatedly for receiving more than $1 million to lobby for Tyson Foods when allegations of smuggling illegal immigrants to arose. With slightly more than $400,000 in campaign funding, Stewart has 18 percent support among Virginia Republicans.

Jack Wagner – Originally elected to the Virginia House in 1992, then to the State Senate in 2000, Wagner has a significant level of experience in Virginia politics. As a Virginia Beach resident representing the 7th district, he sits on the Commerce and Labor, General Laws and Technology, Rehabilitation and Social Services, and Transportation committees. While Stewart and Gillespie want to cut state spending, Wagner maintains the budget is lean enough—citing a $1.2 billion shortfall in 2016. Wagner wants to increase the gasoline tax to subsidize infrastructure projects. He also wants to create accredited vocational programs in high schools that will support technical training for new jobs. Similar to his opponents, he opposes abortion in all instances except in the case of rape or if the mother’s life is endangered. With $178,000 in campaign funds, Wagner has 15 percent support among registered Republican voters.

NJ Legislative Alert: S2533 Contractors Registration Act

S2533 Contractors  Registration Act is a proposed piece of legislation concerning the requirements of residential general contractors and home renovators. This law aims to better protect the consumer while also updating regulations to ensure contractors are fully covered while completing jobs in a safe and legal manner.
S2533 seeks to:

  • Require contractors to carry a bond amounting to a minimum of 50,000 dollars to provide restitution in the event of a violation of “Contractor’s Registration Act”
  • Rewrite the contractor’s “notice to consumer” regarding the work agreed to be completed with the intention of allowing the consumer a better understanding of state regulation and easier avenue to cancel the work
  • Ensure contractors complete jobs by creating a series of fines of up to 20,000 dollars

Current Status: Referred to Senate Commerce Committee
For more information, please contact Brett Goldman with DMGS at 215-979-1326 or emailbjgoldman@dmgs.com

Billy Hoffer Contributed to this Alert

NJ Legislative Update- S2525 Concerning Fracking Liquid Waste

S2525 Concerning Fracking Liquid Waste

Overview: NJ S2525 supplementing P.L.1977, c. 74 (C.58:10A-1 et seq.):

S2525 is a bill supplementing P.L.1977, c. 74 (C.58:10A-1 et seq.), also known as the Water Pollution Control Act. The bill concerns wastewater, wastewater solids, sludge, drill cuttings and other byproducts from certain drilling techniques.

S2525 seeks to:

  • Declare fracking waste liquids unsafe and dangerous to the environment;
  • Prohibit fracking waste liquids from entering wastewater treatment facilitites in New Jersey due to the potential disruption of their processes and contamination of the facility’s biosolids;
  • Prohibit fracking waste liquid high in salt content from being used to treat roads during winter in New Jersey;
  • Prohibit fracking waste liquid from being stored in New Jersey landfills;

As mentioned in S2525, New Jersey is a highly populated state that depends on surface waters to supply  drinking water. Release of relatively unknown and highly toxic fracking byproducts into the environment would be disruptive to New Jersey’s ecosystem.

Status:  S2525 has been referred to the Senate Environment and Energy Committee for further review.
Billy Hoffer, DMGS Fall Intern-PHILA contributed to this report.