R. Neumann & Co. v. City of Hoboken

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-2775-12T1

R. NEUMANN & CO.,

APPROVED FOR PUBLICATION

Plaintiff-Appellant, September 23, 2014

v. APPELLATE DIVISION

CITY OF HOBOKEN, CITY COUNCIL OF

THE CITY OF HOBOKEN, DAWN ZIMMER,

MAYOR OF THE CITY OF HOBOKEN, and

PLANNING BOARD OF THE CITY OF HOBOKEN,

Defendants-Respondents.

________________________________________

Argued December 4, 2013 - Decided September 23, 2014

Before Judges Grall, Nugent and Accurso.

On appeal from Superior Court of New Jersey,

Law Division, Hudson County, Docket No.

L-6146-11.

Peter D. Dickson argued the cause for

appellant (Potter and Dickson, attorneys; R.

William Potter and Mr. Dickson, on the

brief).

Ronald D. Cucchiaro argued the cause for

respondents (Weiner Lesniak, LLP, attorneys;

Mr. Cucchiaro, of counsel and on the brief;

Richard Brigliadoro, on the brief).

The opinion of the court was delivered by

GRALL, P.J.A.D.

This appeal concerns Resolution No. 1 of the City Council

of the City of Hoboken (Council) adopted pursuant to the Local

Redevelopment and Housing Law (LRHL), N.J.S.A. 40A:12A-1 to -49.

With that resolution, the Council delineated an "area in need of

rehabilitation" (AINreh), which "means any area determined to be

in need of rehabilitation pursuant to [N.J.S.A. 40A:12A-14]."

This AINreh includes public streets and private properties, some

of which are owned by plaintiff R. Neumann & Co. (Neumann) and

known as the "Neumann's Leathers" properties. The Council

adopted the resolution on October 19, 2011.

In delineating this AINreh, the Council relied on N.J.S.A.

40A:12A-14(a)(2)-(3) (recodified as N.J.S.A. 40A:12A-14(a)(6) by

L. 2013, c. 159 approved on Sept. 6, 2013). Those portions of

N.J.S.A. 40A:12A-14 permit a governing body to delineate an

AINreh if it determines that "a majority of the water and sewer

infrastructure in the delineated area is at least [fifty] years

old and is in need of repair or substantial maintenance" and

further determines that a "program of rehabilitation, as defined

in [N.J.S.A. 40A:12A-3], may be expected to prevent further

deterioration and promote the overall development of the

community." Ibid. (emphasis added). As defined in N.J.S.A.

40A:12A-3, "'[r]ehabilitation' means an undertaking, by means of

extensive repair, reconstruction or renovation of existing

2 A-2775-12T1

structures, with or without the introduction of new construction

or the enlargement of existing structures, in any area that has

been determined to be in need of rehabilitation or redevelopment

. . . ." (emphasis added). The rehabilitation must be

undertaken "to eliminate substandard structural or housing

conditions and arrest the deterioration of that area." Ibid.1

N.J.S.A. 40A:12A-14 also prescribes procedures a governing

body must follow prior to adopting a resolution delineating an

AINreh, and the Council followed them. The Council submitted

two draft resolutions to the City's Planning Board (Board) for

its consideration and recommendations as required by N.J.S.A.

40A:12A-14 — one in April and one in June 2011 that expanded the

1

The language emphasized is misquoted at page 46 of

Neumann's brief in an argument supporting its claim that the

trial court misapplied a provision of the LRHL. Neumann's

quotation omits the words "rehabilitation or."

It is important to stress that the LRHL distinguishes

between AINrehs and areas in need of redevelopment (AINreds).

"'Redevelopment area' or 'area in need of redevelopment' means

an area determined to be in need of redevelopment pursuant to

[N.J.S.A. 40A:12A-5 and 40A:12A-6] or [previously] determined .

. . to be a 'blighted area' pursuant to [L. 1949, c. 187,

N.J.S.A. 40:55-21.1 et al.] repealed by this act, both

determinations as made pursuant to the authority of Article

VIII, Section III, paragraph 1 of the Constitution, [which is

the Blighted Areas Clause]. . . ." N.J.S.A. 40A:12A-3. While

rehabilitation may be undertaken in both areas, the LRHL grants

a municipality authority to take or acquire property in an

AINred but expressly precludes exercise of eminent domain based

on delineation of an AINreh. See N.J.S.A. 40A:12A-15 (quoted in

footnote 8); N.J.S.A. 40A:12A-8(c).

3 A-2775-12T1

initial proposed area to include additional private properties

and the public streets that delineate the boundaries of the

area. The Council also directed the Board to conduct a public

hearing on the proposed resolution after giving notice by

publication and by mailing to the owners of record of properties

with 200 feet of the proposed delineated area, steps not

expressly required by N.J.S.A. 40A:12A-14.

On July 2, 2011, the Council passed a resolution extending

the forty-five-day statutory deadline for the Planning Board to

provide its recommendations, N.J.S.A. 40A:12A-14, and the Board

conducted a hearing and approved the draft resolution without

recommending any change on September 27, 2011.2 The Council

adopted Resolution No. 1 after accepting public comment at its

regular meeting.

This AINreh is a flag-shaped area in part of the

southwestern section of Hoboken that includes and is demarked by

2

The record provided on appeal includes a transcript of the

September 27, 2011 public hearing before the Board and the vote

of its members on a motion. Just prior to the vote, the Board's

attorney described the motion as follows: "[T]he Board will

recommend, that the study area be declared . . . an area in need

of rehabilitation based upon the findings of the Board and the

reports provided the Board's Planner and the Board's Engineer

which will be forwarded to the City Council . . . for their use

and that we're making that finding pursuant to the [LRHL]." The

record provided to us on appeal does not include a resolution or

correspondence transmitting its vote or the referenced materials

to the Council. But the Council's resolution indicates that the

reports were received.

4 A-2775-12T1

public streets. The flag's pole is Observer Highway from its

intersection with Jefferson Street easterly to its intersection

with Hudson Street. The triangular-shaped flag runs northerly

from and includes the intersection of Observer Highway's

intersection with Willow Avenue, and from that intersection

north to and including its intersection with Newark Street and

from that intersection along Newark Street in a southwesterly

direction to and including its intersection with Observer

Highway.

The private properties included in this AINreh are known as

Block 2, Lots 12 through and including Lot 26, and Block 2.1,

Lots 1 through and including Lot 10. The total area, including

the streets, is about 11.5 acres in area, only 3.3 of which are

private property.

The Neumann Leathers properties, which Neumann describes as

older industrial buildings, include all of the designated Lots

in Block 2 and Lots 1 through 4 plus Lots 9 and 10 in Block 2.1.

It does not include some private properties at the southwestern

tip of the triangle formed where Newark Street meets Observer

Highway. Neumann refers to the excluded properties as a "hole"

in the flag portion of the AINreh. According to defendants, the

shape is attributable to the exclusion of newer buildings and

prior designations of AINrehs and AINreds in the areas on the

5 A-2775-12T1

far side of the bordering streets. According to Neumann, the

shape is the consequence of the Council's true purpose —

protection of the artists, artisans and musicians that rent

space in Neumann's buildings and serve the City's interest in

cultural activities and retention of old industrial buildings

that have historical significance as reminders of the industry

that built the City. Those interests and concerns about the

sewer system are expressed in the City's 2004 Master Plan, its

2010 Reexamination Report and numerous press releases and public

statements from the mayor.

Following the adoption of Resolution No. 1 on October 19,

2011, Neumann filed a complaint naming as defendants the City of

Hoboken, the Council, the City's Mayor, Dawn Zimmer, and the

Board. The complaint asserts three claims in lieu of

prerogative writs, in which Neumann contends that Resolution No.

1 is not supported by adequate evidence, is motivated by a

pretextual purpose and is inconsistent with the LRHL. Neumann's

complaint also includes four counts seeking damages alleging

interference with its rights to property, free speech and equal

protection and asserting a "de facto taking" amounting to an

inverse condemnation. No testimony was taken in the trial

court, and the case was decided and the record developed before

6 A-2775-12T1

the Planning Board and Council, as supplemented by the motions

and motions for reconsideration in the trial court.

This appeal is from the trial court's order of January 11,

2013. With that order, the court denied Neumann's second motion

to reconsider a July 2, 2012 judgment dismissing the prerogative

writs claims with prejudice, and the court granted defendant's

summary judgment on the claims for damages.3 Because Neumann

presents no argument on appeal claiming error in the dismissal

of its claims for damages, any related error is deemed

abandoned. Muto v. Kemper Reinsurance Co., 189 N.J. Super. 417,

420-21 (App. Div. 1983).

On appeal, Neumann challenges the court's disposition of

the prerogative writ claims on six grounds: the court applied

the wrong standard of review; the water and sewer infrastructure

is not on the Neumann's Leathers property; the City does not own

the infrastructure and, therefore, a program of rehabilitation

cannot be expected to prevent further deterioration or promote

development of the community; the court misapplied Riggs v.

Township of Long Beach, 109 N.J. 601 (1998), in denying relief

based on pretextual motivation; the Legislature intended to

permit delineation of an AINreh based on the age and condition

3

Following the denial of its second motion for

reconsideration, Neumann filed a motion for leave to appeal,

which this court denied on October 5, 2012.

7 A-2775-12T1

of a majority of water and sewer infrastructure only if a

majority of the housing stock is also at least fifty years old;

and this AINreh violates the Blighted Areas Clause of the State

Constitution, N.J. Const. art. VIII, § 3, ¶ 1.

I

Where, as here, there is a challenge to a determination of

a municipal agency, "an appellate court is bound by the same

scope of review" as the trial court. Charlie Brown of Chatham,

Inc. v. Bd. of Adj. for Chatham Tp., 202 N.J. Super. 312, 321

(App. Div. 1985). Municipal action "bears with it a presumption

of regularity." Forbes v. Bd. of Tr. of Tp. of S. Orange Vill.,

312 N.J. Super. 519, 532 (App. Div.), certif. denied, 156 N.J.

411 (1998). Thus, "when reviewing a decision of a municipal

agency the trial court must recognize that the Legislature has

vested discretion in the municipal agency to make that

decision." Charlie Brown, supra, 202 N.J. Super. at 321; see

Booth v. Bd. of Adj., Rockaway Tp., 50 N.J. 302, 306 (1967).

"[B]ecause of their peculiar knowledge of local conditions,"

they "must be allowed wide latitude in the exercise of their

delegated discretion." Ibid. A panel of this court "need not

determine if [it] would have concurred in the designation but

8 A-2775-12T1

only if it is supported by substantial evidence." Forbes,

supra, 312 N.J. Super. at 532.4

The Supreme Court has recognized that "the extent to which

the various elements that informed persons say enter into the

blight decision-making process are present in any particular

area is largely a matter of practical judgment, common sense and

sound discretion." Lyons v. City of Camden, 52 N.J. 89, 98

(1968). In such circumstances, "courts realize that the

Legislature has conferred on the local authorities the power to

make the determination. If their decision is supported by

4

It is important to note that it is the governing body's, not

the planning board's, determination that a court reviews.

N.J.S.A. 40A:12A-14(a) vests the authority to delineate an

AINreh in the governing body not the planning board. The role

the Legislature has assigned to the planning board is advisory.

The governing body must submit a resolution to the municipal

planning board before adopting it, and give the planning board

forty-five days to submit "its recommendations regarding the

proposed resolution, including any modifications" it may

recommend. Ibid. But upon receipt of the recommendations, or

after forty-five days if none are received, the governing body

"may adopt the resolution, with or without modification." Ibid.

Thus, the Legislature has delegated the responsibility, power

and discretion to delineate an AINreh in conformity with the

statute to the governing body. To the extent the trial court

concluded that the planning board's action was under review, the

court erred. See Kane Prop., LLC v. City of Hoboken, 214 N.J.

199, 226-28 (2013) (concluding, in another context, that where

the governing body makes the final decision on a land use matter

— when the governing body has elected to entertain appeals from

a zoning board's grant of a use variance as authorized by

N.J.S.A. 40:55D-17 — the courts review the decision of the

governing body not the zoning board).

9 A-2775-12T1

substantial evidence, the fact that the question is debatable

does not justify substitution of the judicial judgment for that

of the local legislators." Ibid.; see also Gallenthin Realty

Development, Inc. v. Borough of Paulsboro, 191 N.J. 344, 372

(2007).5

Some determinations about conditions that qualify an area

as one in need of rehabilitation are similarly a matter of

practical judgment and sound discretion. In fact, in Bryant v.

City of Atlantic City, 309 N.J. Super. 596, 614-16 (App. Div.

1998), we rejected a challenge to a governing body's delineation

of an AINreh under an earlier iteration of N.J.S.A. 40A:12A-14.

In Bryant, the City adopted a resolution setting forth the

statutory criteria on which it relied. 309 N.J. at 615-16. We

concluded that "[t]he City sufficiently complied with the

5

Defendants have urged us to consider unpublished opinions of

this court that suggest consideration of the adequacy of the

support in the record is not required. In discussing arbitrary

decision making by a State officer, the Supreme Court noted that

parties "concede[d] that the arbitrary, capricious, or

unreasonable standard applicable in the review of administrative

agency decisions subsumes the need to find sufficient support in

the record to sustain the decision," and the Court went on to

state that the "point is beyond argument." In the Matter of

Proposed Quest Academy Charter School of Montclair Founders

Group, 216 N.J. 370, 386 (2013). To the extent the unpublished

opinions of this court addressing delineations of AINrehs

suggest otherwise, we would not follow them. Bryant v. City of

Atlantic City, 309 N.J. Super. 596, 616 (App. Div. 1998) (noting

that there was "more than sufficient evidence to support the

City's" determination and discussing the evidence).

10 A-2775-12T1

requirements of N.J.S.A. 40A:12A-14, which, by its plain

language, requires only that the City determine by resolution

that the conditions exist before an area can be designated as

one in need of rehabilitation." Id. at 616. And, we noted our

agreement with the trial court's "conclusion that there was more

than sufficient evidence to support the City's conclusion in

this respect." Ibid.

We cannot take the approach adopted in Bryant in this case,

because it is not at all clear that the Council applied the

statutory criteria and because aspects of the criteria upon

which the Council relied are quite specific and leave little

room for discretion. Governing bodies of municipalities are

"creations of the State" and as such are "capable of exercising

only those powers of government granted to them by the

Legislature." Wagner v. Mayor & Mun. Council of City of Newark,

24 N.J. 467, 474 (1957). Thus, substantial evidence supporting

municipal action prevents judicial interference, but only "so

long as the power exists to do the act complained of." Kramer

v. Bd. of Adj., Sea Girt, 45 N.J. 268, 296 (1965).

To the extent Resolution No. 1 addresses the basis for the

delineation of the AINreh, it misstates the statutory standard

upon which the Council relied. Resolution No. 1 includes

"WHEREAS" clauses citing the Council's statutory authority to

11 A-2775-12T1

determine whether certain areas are in need of rehabilitation,

identifying the area "it believes" is in need of rehabilitation,

and noting its obligation to refer the question to the Planning

Board and its compliance on June 1, 2011. Following those

recitals Resolution No. 1 states:

WHEREAS, the City Planning Board

received a report from the Planning Board

Engineer and the Planning Board Planner that

within the Property the water and sewer

lines are at least [fifty] years old or are

in need of substantial maintenance; and that

a program of rehabilitation is expected to

prevent further deterioration and to promote

the overall development of the City (the

"Report"); and

WHEREAS, based on the Report, the

Planning Board found that the Property

satisfied the statutory criteria to be

designated as an area in need of

rehabilitation under Section 14 of the

Redevelopment Law, N.J.S.A. 40[A]:12A-14(a);

and

WHEREAS, the Planning Board reviewed

this resolution and recommends its adoption

and the designation of the Property as an

area in need of rehabilitation in accordance

with Section 14 of the Redevelopment Law,

N.J.S.A. 40[A]:12A-14(a).

NOW, THEREFORE, BE IT RESOLVED, by the City

Council of the City of Hoboken as follows:

Section 1. The aforementioned recitals

are incorporated herein as though fully set

forth at length.

Section 2. The City Council hereby

designates the Property as an area in need

of rehabilitation pursuant to Section 14 of

12 A-2775-12T1

the Redevelopment Law, N.J.S.A. 40[A]:12A-

14(a).

Section 3. The City Council hereby

directs that the City Clerk transmit a copy

of this resolution to the Commissioner of

the Department of Community of [sic] Affairs

for review in accordance with the

Redevelopment Law.

Section 4. A copy of this resolution

shall be available for public inspection at

the offices of the City.

Section 5. This resolution shall take

effect immediately.

[(emphasis added).]

The statute, N.J.S.A. 40A:12A-14, as it was written prior

to the adoption of L. 2013, c. 159, set forth the criteria for

delineation of an AINreh related to water and sewer

infrastructure as follows:

a. A delineated area may be determined to

be in need of rehabilitation if the

governing body of the municipality

determines by resolution that there exist in

that area conditions such that . . . (2)

more than half of the housing stock in the

delineated area is at least [fifty] years

old, or a majority of the water and sewer

infrastructure in the delineated area is at

least [fifty] years old and is in need of

repair or substantial maintenance; and (3) a

program of rehabilitation, as defined in

[N.J.S.A. 40A:12A-3], may be expected to

prevent further deterioration and promote

the overall development of the community.

Resolution No. 1 indicates that the Council relied on a

report from the Planning Board Engineer and the Planning Board

13 A-2775-12T1

Planner "that within the Property the water and sewer lines are

at least [fifty] years old or are in need of substantial

maintenance." (emphasis added). But clause (2) provides, "or a

majority of the water and sewer infrastructure in the delineated

area is at least [fifty] years old and is in need of repair or

substantial maintenance." (emphasis added). The statute simply

cannot be read to permit a determination based on either the age

of the majority of the infrastructure or the infrastructure's

being "in need of repair or substantial maintenance." If there

were any doubt about whether the structure of clause (2), with

its reference to the age of housing stock and infrastructure,

permitted a reading of the "and" in clause (2) as an "or," there

no longer is.

After this appeal was fully briefed but before it was

argued, the Legislature amended the LRHL with Chapter 159 of the

Laws of 2013. L. 2013, c. 159 (approved September 6, 2013).

Defendants, as authorized by Rule 2:6-11(d), filed a letter

bringing Chapter 159 to our attention in May 2014, and Neumann

filed a response.6 In land use cases, "[a]n agency or reviewing

court will apply the law in effect at the time of its decision

rather than the law in effect when the issues were initially

6

Neither party requested an opportunity to brief the

relevance of the revisions to Chapter 159.

14 A-2775-12T1

presented," Maragliano v. Land Use Bd. of Tp. of Wantage, 403

N.J. Super. 80, 83 (App. Div. 2008), certif. denied, 197 N.J.

476 (2009); see also Manalapan Realty, L.P. v. Tp. of Manalapan,

140 N.J. 366, 378-79 (1995); Riggs v. Tp. of Long Beach, 101

N.J. 515, 521 (1986). Accordingly, we apply the law as it

stands now.

As amended by section 4 of Chapter 159, the portion of

clause (2) of subsection a. of N.J.S.A. 40A:12A-14 addressing

aged housing stock is addressed in clause (2), but aged water

and sewer infrastructure is addressed separately in clause (6)

as follows: "a majority of the water and sewer infrastructure in

the delineated area is at least [fifty] years old and is in need

of repair or substantial maintenance." (emphasis added). The

amendment eliminates the need to ponder what the Legislature

intended here. The statute is unambiguous and must be applied

in accordance with the plain meaning of its terms, which is the

best indicator of the Legislature's intention. Gallenthin,

supra, 191 N.J. at 359, 365.

There is absolutely nothing in the Resolution indicating

that the Council determined that the area it delineated is in

need of rehabilitation in conformity with N.J.S.A. 40A:12A-

14(a)(6), as it is written now, or with N.J.S.A. 40A:12A-

14(a)(2)-(3), as those provisions were written prior to the

15 A-2775-12T1

adoption of L. 2013, c. 159. In short, Resolution No. 1 must be

vacated, because we cannot conclude the Council "determine[d] by

resolution [that an] enumerated condition exists." Bryant,

supra, 309 N.J. Super. at 615.

We are left with a significant doubt about whether

Resolution No. 1 is arbitrary, capricious and unreasonable

because it rests on the Council's disregard or misunderstanding

of the statutory standard. And for that reason, we vacate

Resolution No. 1.

We further conclude that it is appropriate to vacate

Resolution No. 1 without prejudice to the Council reconsidering

the question in light of the pertinent amendments to the LRHL

the Legislature made by adopting L. 2013, c. 159. We reach that

conclusion because our decision to vacate the Resolution is not

based on the inadequacy of the evidence.

II

In the interest of avoiding unnecessary and costly

proceedings in the event that the Council pursues delineation of

this AINreh, we address Neumann's claims about the meaning of

N.J.S.A. 40A:12A-14. None has sufficient merit to warrant

extended discussion.

The LRHL authorizes municipal governing bodies to undertake

clearance, replanning, development and redevelopment, directly

16 A-2775-12T1

or through a redevelopment agency, housing authority or

redevelopment entity. N.J.S.A. 40A:12A-3, 40A:12A-4, 40A:12A-

11, 40A:12A-21. In adopting the LRHL, the Legislature

determined that in some communities in this State there have

been and still are

conditions of deterioration in housing,

commercial and industrial installations,

public services and facilities and other

physical components and supports of

community life, and improper, or lack of

proper, development which result from forces

which are amenable to correction and

amelioration by concerted effort of

responsible public bodies, and without this

public effort are not likely to be corrected

or ameliorated by private effort.

[N.J.S.A. 40A:12A-2(a).]

The Legislature adopted the LRHL with the intention to

"arrest and reverse" such conditions and to "promote the

advancement of community interests through programs of

redevelopment, rehabilitation and incentives to the expansion

and improvement of commercial, industrial and civic facilities."

N.J.S.A. 40A:12A-2(b)-(d). Moreover, as the Preamble to Chapter

159 of the Laws of 2013, phrased as "WHEREAS" clauses, makes

clear, the Legislature has determined that "[m]unicipalites

should be encouraged to engage in economic development

initiatives by promoting and facilitating such efforts to create

local economic stimulus and job creation through the tools and

17 A-2775-12T1

incentives available under the" LRHL and, to that end, "should

be provided the opportunity to pursue such programs without the

use of eminent domain." L. 2013, c. 159 (reprinted as a note

following N.J.S.A. 40A:12A-5 in the New Jersey Statutes

Annotated).

Contrary to Neumann's argument, the delineation of an

AINreh does not convey authority to exercise eminent domain.7

Upon delineation of an AINred, but not upon delineation of an

AINReh, the area is "deemed to be a 'blighted area' for the

purposes of Article VIII, Section III, paragraph 1" of the State

Constitution. N.J.S.A. 40A:12A-14; compare N.J.S.A. 40A:12A-

6(c) and N.J.S.A. 40A:12A-8 with N.J.S.A. 40A:12A-14 and

N.J.S.A. 40A:12A-15.8

7

Sections 2, 3 and 5 of Chapter 159 of the Laws of 2013,

amending N.J.S.A. 40A:12A-5, -6, -8 and -15, limit the power of

condemnation in AINreds delineated after the effective date of

Chapter 159 to instances in which the governing body has given

notice that redevelopment determination will authorize the

municipality to use the power of eminent domain — that is, a

"Condemnation Redevelopment Area," N.J.S.A. 40A:12A-6 (as

amended by L. 2013, c. 159, § 2).

8

In this respect, N.J.S.A. 40A:12A-15 provides:

With respect to a redevelopment project in

an area in need of rehabilitation, the

municipality or redevelopment entity, upon

the adoption of a redevelopment plan for the

area, may perform any of the actions set

forth in [N.J.S.A. 40A:12A-8], except that

with respect to such a project the

(continued)

18 A-2775-12T1

Moreover, the delineation of an AINreh has no immediate

effect. In order to exercise the powers granted in N.J.S.A.

40A:12A-8, other than the power of eminent domain that is not

granted with respect to an AINreh, the governing body must adopt

a "redevelopment plan" in conformity with N.J.S.A. 40A:12A-7.

See N.J.S.A. 40A:12A-15 (providing that a municipality or

redevelopment entity "may proceed with clearance, replanning,

conservation, development, redevelopment and rehabilitation of

an area in need of rehabilitation" but only "[i]n accordance

with the provisions of a redevelopment plan adopted pursuant to

[N.J.S.A. 40A:12A-7]"). While a "redevelopment plan" may

address an AINred, or an AINreh or both, N.J.S.A. 40A:12A-3,

that does not mean that a redevelopment plan may provide for the

taking or acquisition of property within an AINreh.

(continued)

municipality shall not have the power to

take or acquire private property by

condemnation in furtherance of a

redevelopment plan, unless: a. the area is

within (1) an area determined to be in need

of redevelopment prior to the effective date

of [L. 2013, c. 159], or (2) a Condemnation

Redevelopment Area and the municipality has

complied with the notice requirements under

[N.J.S.A. 40A:12A-6(b)(5)(e)]; or b.

exercise of that power is authorized under

any other law of this State.

(emphasis added; changes adopted in L. 2013,

c. 159, § 5 shown in bold).

19 A-2775-12T1

If there was any reasonable basis for concern about the

threat of a municipality's obtaining authorization to effectuate

an acquisition or taking as a consequence of a governing body's

delineation of AINreh, since the adoption of Chapter 159 there

no longer is. To the extent that Neumann argues otherwise, it

misunderstands the law. Given that the Council has not, and

with this decision may not implement Resolution No. 1, there is

no reason to discuss the Blighted Areas Clause.

Neumann also claims that N.J.S.A. 40A:12A-14, as written

prior to the adoption of L. 2013, c. 159, applied to old water

and sewer infrastructure in need of repair or substantial

maintenance only if at least fifty percent of the housing stock

was also old. Section 4 of Chapter 159 eliminates any ambiguity

that may have allowed Neumann to make that argument. N.J.S.A.

40A:12A-14 now addresses aged housing stock in clause (2), and

aged water and sewer infrastructure separately in clause (6) as

follows: "a majority of the water and sewer infrastructure in

the delineated area is at least [fifty] years old and is in need

of repair or substantial maintenance."

To the extent that it was not clear before, which we think

it was, as amended by Section 4 of Chapter 159 there is no

question now that N.J.S.A. 40A:12A-14 requires a governing body

to determine "that a program of rehabilitation, as defined in

20 A-2775-12T1

[N.J.S.A. 40A:12A-3], may be expected to prevent further

deterioration and promote the overall development of the

community" in every case. By that we mean the finding is

required no matter which one of the six criteria for delineating

an AINreh now listed in N.J.S.A. 40A:12A-14 that a governing

body applies.9

Neumann raises another question about the meaning of

N.J.S.A. 40A:12A-14. The contention is that because the sewer

and water structure at issue lies under the public streets and

rights of way, no other property may be included in this AINreh.

The statutory language provides no support for that

interpretation. Moreover, as the evidence presented to the

9

In pertinent part, as amended by Section 4 of Chapter 159,

N.J.S.A. 40A:12A-14 provides:

a. A delineated area may be determined to

be in need of rehabilitation if the

governing body of the municipality

determines by resolution that a program of

rehabilitation, as defined in [N.J.S.A.

40A:12A-3], may be expected to prevent

further deterioration and promote the

overall development of the community; and

that there exist in that area any of the

following conditions such that . . . (2)

more than half of the housing stock in the

delineated area is at least [fifty] years

old; . . . or (6) a majority of the water

and sewer infrastructure in the delineated

area is at least [fifty] years old and is in

need of repair or substantial maintenance.

21 A-2775-12T1

Board and Council demonstrates, planning development and

encouraging measures such as open space, stormwater collection

and use of pervious pavement on private property are related to

the strain on this City's antiquated, combined sanitary and

stormwater sewer system. As things stand, the sewer system

backs up and leaves untreated sewage in the streets of this

portion of the southwestern section of Hoboken and others.

Despite evidence that the sewer authority has undertaken

projects that have had some minimizing impact on the flooding,

there is also evidence suggesting the problem is far from

solved.

Given our disposition of the case, it would serve no

purpose to discuss Neumann's claim that Resolution No. 1 was

adopted as a pretext for an ulterior motive — a purpose

impermissible under the LRHL - and one the City cannot

ameliorate with a program of rehabilitation because it does not

own the sewer or water infrastructure.

Resolution No. 1 is vacated without prejudice to the

Council's reconsideration of the question under current law.

22 A-2775-12T1