Holmdel Builders Association v. Township of Holmdel

In 1975, the New Jersey Supreme Court in Southern Burlington County NAACP v. Mount Laurel Township, 336 A.2d 713 (N.J. 1975) (Mt. Laurel I) held that developing municipalities are constitutionally required to provide necessary and realistic opportunities to develop low- and moderate-income housing and in 1983 reaffirmed the constitutional mandate by imposing an affirmative obligation on every municipality to provide adequate affordable housing in Southern Burlington County NAACP v. Mount Laurel Township, 456 A.2d 390 (N.J. 1983) (Mt. Laurel II). The legislature codified the Mt. Laurel doctrine in the enactment of the Fair Housing Act (FHA). Several municipalities (defendants) attempted to comply with their constitutional obligation to provide a realistic opportunity for the construction of affordable housing by enacting ordinances that imposed fees on developers as a condition for new-development approval. The fees were dedicated to an affordable-housing trust fund. Developers from the municipalities (plaintiffs) brought suit in district court against the municipal governments and argued that the municipal governments did not have statutory authority to impose development fees. The district court found in favor of the municipalities, and the developers appealed. The appellate court found that the municipalities had the authority to impose affordable-housing development fees.