F & W Associates v. County of Somerset

• Decision Date: 17 October 1994
• Citation: 648 A.2d 482,276 N.J.Super. 519
• Parties: F & W ASSOCIATES, a Partnership, Ferruggia Associates, a Partnership, and Chasbob, Inc., a corporation of the State of New Jersey, Plaintiffs-Appellants, v. The COUNTY OF SOMERSET, Somerset County Planning Board, The Township of Warren, and Warren Township Planning Board, Defendants-Respondents.
• Court: New Jersey Superior Court — Appellate Division

Page 519

276 N.J.Super. 519

648 A.2d 482

F & W ASSOCIATES, a Partnership, Ferruggia Associates, a Partnership, and Chasbob, Inc., a corporation of the State of New Jersey, Plaintiffs-Appellants, v. The COUNTY OF SOMERSET, Somerset County Planning Board, The Township of Warren, and Warren Township Planning Board, Defendants-Respondents.

Superior Court of New Jersey Appellate Division.

Submitted Sept. 19, 1994.

Decided Oct. 17, 1994.

Erwin C. Schnitzer, Warren, for appellants (Mr. Schnitzer, on the brief).

Welaj, Miller & Robertson, Somerville, for respondent County of Somerset (Thomas C. Miller, on the brief).

DeMarco & Lore, Dunellen, for respondent Somerset County Planning Bd. (John M. Lore, on the brief).

Bivona, Cohen, Kunzman, Coley, Yospin, Bernstein & DiFrancesco, P.A., Warren, for respondents Tp. of Warren and Warren Tp. Planning Bd. (John E. Coley, Jr., of counsel, Margaret M. Monaco and Judith A. Babinski, on the brief).

Before Judges PETRELLA, HAVEY and CUFF.

The opinion of the court was delivered by

HAVEY, J.A.D.

In this zoning case, plaintiffs challenge a traffic impact fee assessed by defendants Somerset County Planning Board, the Township of Warren and Warren Township Planning Board as a condition to plaintiffs' subdivision and site-plan approvals. Plaintiffs argue that: (1) under the County Planning Act, N.J.S.A. 40:27-1 to -8, the County Planning Board had no authority to assess the impact fees; (2) the New Jersey Transportation Development District Act (TDDA), N.J.S.A. 27:1C-1 to -18, is the exclusive means by which traffic impact fees can be assessed against developers; and (3) the assessment against plaintiffs fails to meet "established standards of constitutionality for the imposition and allocation of impact fees" as defined by our Supreme Court. We affirm.

Plaintiffs own a 40.4 acre tract of land in Warren Township. Along its southerly boarder, the tract abuts Mountain Boulevard, a county road. In the 1980's, the property was subdivided into two separate tracts. On the parcel fronting Mountain Boulevard plaintiffs proposed an office condominium complex. On the rear portion, known as the Windermere Development, plaintiffs proposed a subdivision of 117 single-family homes and 60 "Mount Laurel" ¹ rental units. The subdivision provided for two access roads from the residential development to Mountain Boulevard.

On June 13, 1988, defendant Township of Warren Planning Board granted preliminary major subdivision approval for the Windermere development. The approving resolution "specifically reserved" several issues, including the "necessity for off tract traffic improvements" as well as the computation of plaintiffs' "fair share contribution for future traffic improvements on Mountain Boulevard[.]" The approval was also conditioned upon plaintiffs obtaining approval from the County Planning Board.

On June 28, 1988, plaintiffs, together with other developers having proposed developments, met with representatives of the Township and County Planning Boards to discuss the traffic and storm water implications of their proposed developments. The applicants, including plaintiffs, agreed to pay for a "joint traffic study." Garmen Associates was hired to conduct the study.

The Garmen study recommended that the Township of Warren establish a Transportation Improvement District (TID) in order to fund roadway improvements on a unified basis. The study also devised a formula for calculating each development's pro-rata share of the cost of the improvements; the formula was based on the number of "trips" generated by that development.

The Garmen study was adopted by the Warren Township Planning Board as part of the Township's Master Plan. Also, in October 1990, Warren Township enacted an ordinance creating the recommended TID. The TID ordinance set forth a formula for computing each developer's "pro rata share of [development] impact fees," and required developers to enter into fee agreements with the Township (and with Somerset County to the extent that egress from or ingress upon a county road is implicated).

In February 1991, plaintiffs, the County and Township of Warren entered into an agreement under which the County Planning Board determined that plaintiffs' pro-rata contribution for off-tract improvements associated with the Windermere development was $244,774, less Mount Laurel credits. Pursuant to the agreement, but under protest, plaintiffs posted, by cash or letter of credit, approximately $137,000.

Plaintiffs also received site plan approval from the Township Planning Board for the construction of the office complex on the tract fronting on Mountain Boulevard. The approving resolution provides that plaintiffs shall enter into an agreement with the County regarding "improvements to be made on ... Mountain Boulevard." The County Planning Board approved the site plan on April 6, 1992, and determined, in accordance with the Township's TID ordinance, that the project's contribution to the Mountain Boulevard corridor study totalled $63,480. Plaintiffs also paid this assessment under protest.

I

Plaintiffs argue that under the County Planning Act, N.J.S.A. 40:27-1 to -8, the County Planning Board had no jurisdiction to impose the traffic impact fees. Plaintiffs point out, and correctly so, that there is no express authority under the Act for the County Planning Board to impose assessments for off-tract improvements. The County defendants counter this point by noting that in Squires Gate, Inc. v. County of Monmouth, 247 N.J.Super. 1, 588 A.2d 824 (App.Div.1991), the court held that despite the absence of express authority under the Act, the County Planning Board had the implied authority to assess for off-tract improvements for the reasons expressed in Divan Builders, Inc. v. Planning Bd., 66 N.J. 582, 334 A.2d 30 (1975), namely that it is "more fair for the developer to bear the expense of an improvement which benefits it directly rather than placing the burden on the community at large." Squires Gate, 247 N.J.Super. at 7, 334 A.2d 30.

We need not address the issue concerning the County Planning Board's statutory jurisdiction under the County Planning Act, nor do we express our agreement or disagreement with the Squires Gate holding that county planning boards have an inherent power to impose off-tract improvement assessments. ^{2 2} Here, despite the fact that the County Planning Board computed the assessment against plaintiffs, the assessment was made in accordance with the municipal TID ordinance. Further, the Warren Township Planning Board's subdivision approval was conditioned upon plaintiffs' payment of their "fair share contribution for future traffic improvements on Mountain Boulevard[.]" Moreover, the Township was a party to the joint agreement which fixed plaintiffs' pro-rata share based on its TID ordinance and the Garmen study. Therefore, the Township and its Planning Board had the independent power to impose the traffic fees in accordance with the Municipal Land Use Law (MLUL), N.J.S.A. 40:55D-1 to -136. That power is derived from N.J.S.A. 40:55D-42, which provides in pertinent part:

The governing body may by ordinance adopt regulations requiring a developer, as a condition for approval of a subdivision or site plan, to pay its pro-rata share of the cost of providing only reasonable and necessary street improvements and water, sewerage and drainage facilities, and easements therefor, located outside the property limits of the subdivision or development but necessitated or required by construction or improvements within such subdivision or development.

Warren Township's TID ordinance provides the requisite regulatory standards to impose the assessment as a condition to plaintiffs' approvals.

II

Alternatively, plaintiffs argue that, notwithstanding the Township's statutory power to assess for off-tract improvements under N.J.S.A. 40:55D-42, it may not do so by imposing traffic impact fees because the New Jersey Transportation Development District Act (TDDA), N.J.S.A. 27:1C-1 to -18, is the exclusive statutory authority for imposing such fees.

The TDDA permits counties to establish "transportation development districts" designed to assess fees against developers in order to pay for transportation improvements necessitated by increased development. N.J.S.A. 27:1C-2c; N.J.S.A. 27:1C-3. The Act provides a mechanism by which the county obtains approval from the Commissioner of the Department of Transportation to create a transportation development district. N.J.S.A. 27:1C-4 and -5. Upon the Commissioner's approval and the drafting of plans for the operation and financing of the district, the county may adopt a district transportation improvement plan, and assess and collect development fees on developments within the district. N.J.S.A. 27:2C-7a. The fees are to be "reasonably related to the added traffic growth attributable to the development," and the maximum fee "shall not exceed the property owner's 'fair share' of such improvement costs." N.J.S.A. 27:1C-7h. Finally, the governing body of a municipality may petition the county to initiate an application for the designation of a transportation development district under the Act. N.J.S.A. 27-1C-15. ³

Plaintiffs argued before Judge Coleman in the Law Division that the TDDA "preempt[s] the municipalities" from imposing such fees, because "you can't have all the municipalities in the State of New Jersey enacting their own small TID districts within the municipality to circumvent the [TDDA] law enacted by the State. That would be utter chaos."

Judge Coleman properly rejected plaintiffs' exclusivity argument. The TDDA must be read sensibly and, since the Act and the MLUL share a common purpose (control of traffic), they should be harmonized, not read in conflict. Miller v. Passaic Valley Water Comm'n, 259 N.J.Super. 1, 12, 611 A.2d 128 (App.Div.), certif. denied, 130 N.J. 601, 617 A.2d 1222 (1992); D.I.A.L., Inc. v....