Builders in New Jersey may never see eye to eye with Gov. James E. McGreevey. The latest round of the industry's ongoing battle over development issues with the administration started in January when the state's Department of Environmental Protection (DEP) adopted new stormwater rules that require 300-foot buffers along more than 6,000 miles of rivers and streams statewide.
The new regulations also require builders to set up retention basins beyond the buffers. The move formally protects roughly 430,000 acres statewide, about one-third to one-half of which DEP says was already regulated, while the rest may have been open to development.
Responding to critics in the building industry, who say the new regulations are a smokescreen for the governor's anti-growth agenda, state DEP Commissioner Bradley Campbell says the most significant threat to water quality is poorly managed stormwater from new development.
"Stormwater accounts for 60 percent of the pollutants that enter the waterways," says Campbell, who points out that the new regulations provide waivers for urban and redevelopment areas and are part of a broader set of reforms that will shorten review times in smart-growth areas.
Most builders don't buy the state's official line for a second, claiming that these regulations are a change in tactics by the governor, who has backed away from legislating an anti-development agenda that includes building moratoriums, open-ended impact fees, and an extended approval process. The builders say Gov. McGreevey opted for regulation over legislation because the regulatory process is less public and therefore easier to control, it's tougher to litigate against a regulation versus a law, and the process is faster and devoid of the compromises required to pass a law.
Officials from the New Jersey Builders Association (NJBA) say the prevailing view among builders is that the industry is being cast as a scapegoat by an unpopular governor who's looking to ride populist issues such as supporting smart growth and protecting drinking water. As of early 2004, Gov. McGreevey's approval rating stood at roughly 34 percent. The governor is up for re-election in 2005.
"We feel there was a conscious decision by the administration to accomplish its anti-growth agenda via regulation instead of legislation," says Patrick O'Keefe, CEO of the NJBA, who adds that DEP informally acknowledged that the new rules would cancel at least 200 projects statewide.
O'Keefe says the builders are reviewing the new regulations, which were published in the New Jersey Register in early February. He says a lawsuit contesting the stormwater regulations is a possibility.
One move the state association did make was to ask the NAHB to conduct an analysis of the economic impact of the McGreevey administration's development plan. The NAHB has conducted about 200 local economic impact studies, which are usually conducted on a specific local development project, but this was the first time it had calculated the impact of an administration policy. Essentially, what the NAHB did was to calculate the relationship between housing costs and the increased density caused by the smart-growth policies. Here are some highlights of the study:
* The price of a new home would jump from $362,248 to $483,247.
* Annual housing starts would fall by 4,543 single-family homes and 379 multifamily units, a decline of 15 percent.
* Over 10 years, the state would lose $17.1 billion in income, $4.6 billion in tax receipts for state and local government, and 42,806 jobs.
"The administration never put forward any assessment of the economic impact of its radical agenda," says O'Keefe, who says the NJBA wanted to point out the economic impact of the administration's policies to the public.