The development boom in Bayonne has been much discussed in regional publications recently, often with praise. Residential housing developments are breaking ground left and right as the growing city creates demand from commuters who prefer urban lifestyles. But new luxury housing rents, which often start at more than $2,000 for a one-bedroom apartment, are often out of reach for the low-to-moderate-income community. This is what makes subsidized affordable development so important, according to John Restrepo, director of the Division of Housing & Community Development at Garden State Episcopal Church Community Development Corporation, a local nonprofit affordable housing developer. The group helped bring eight new affordable apartments in the new Hobart Housing Project development in Bergen Point.
“Subsidies are bridging the gap between the target population and what the cost is to develop,” said Restrepo at a May 31 groundbreaking ceremony for Hobart Housing Project, which will provide eight below-market units in the Bergen Point neighborhood. The City of Bayonne committed $1 million from its affordable housing trust fund.
All affordable developments receive subsidies from the U.S. Department of Housing and Urban Development (HUD) and each municipality is required by the Council on Affordable Housing to allocate 15 percent of new development to affordable housing. This development also partnered with the Windmill Alliance, a Bayonne nonprofit that serves adults with special needs, receiving a $314,000 loan from NJ Community Capital.
Restrepo said that subsidized housing relieves some of the burden on families that struggle to pay for healthcare, food, and housing. “Rent-burdened” families and individuals pay more than 30 percent of their income on housing. “In general housing costs are outpacing incomes in the county and throughout the state,” Restrepo said.
The median income in Bayonne is $54,000, and the income requirement for the Hobart Housing Project is between $36 and $48,000 per year. The rent at Hobart after utilities will range from $750 to $1,000 per month, while the average market rent for a three-bedroom apartment in Hudson County is nearly $2,000, according to HUD statistics.
“It was one of my goals when I became mayor to develop the city and not leave anyone behind,” said Bayonne Mayor James Davis. “With rents going up, we need to bring in more housing for people who live here now.” He cited Bayonne’s 14,000 people living at or below the poverty line, the elderly, and the disabled.Two units are allocated for families with disabilities.
Bayonne has the highest median age of all Hudson County municipalities.Davis, who lives in the Hobart neighborhood, said he values communities with diversity of race and income: “I think it makes you more of a well-rounded community when everybody lives and works together.”
The Hobart project has been in the planning stages for three years; the city is planning two more developments.
“With rents going up, we need to bring in more housing for people who live here now.” – Mayor James Davis
Housing is becoming so expensive largely because housing supply is not meeting the demand. As Restrepo pointed out, housing costs, including construction and taxes, are outpacing incomes.
The Wall Street Journal reported that the housing market in the U.S. is most competitive at the lowest and highest end of the price spectrum. This is evident in Bayonne, where low-end homes are attracting more bidders than in years past, driving costs up. With high- and low-end homes most in demand, the supply of middle housing suffers, in what housing policy experts term the “missing middle.”
Without enough low-end housing, low-to-moderate-income people are left competing for an increasingly limited supply of housing in their price range. Meanwhile, rents are rising, further increasing the burden of housing costs.
New housing of any kind is welcome, but until new policies are implemented to incentivize development to meet the full demand for housing, HUD will be relied on more and more to subsidize those whose incomes do not keep up with housing costs. And that’s a big problem for John Restrepo, who took a hard stance against President Donald Trump’s proposed budget,which requested $6 billion cut from HUD, including $3 million in cuts to block grants made to states like NJ, which use the grants to help fund projects like the Hobart Housing Project.
“It makes the gubernatorial election that much more important,” Restrepo said. “To make sure that NJ is prepared in case those cuts are realized.”
HUD Secretary Ben Carson recently described poverty as a “state of mind.”
“There’s a misperception as to who lower income people are,” Restrepo said.“It’s not necessarily people in public housing or people on welfare. These are working-class citizens. They are key to the fabric of our communities.”
Meeting the requirement
The eight units at the Hobart Housing Project are included in Bayonne’s affordable housing requirements set by the state. Every New Jersey municipality is legally required to provide its share of affordable housing. In 1975, the first Mount Laurel decision prohibited municipalities from “exclusionary zoning” practices, which used land-use rules to make it impossible for affordable housing to be built. The second decision in 1983 took the decision further by requiring municipalities to provide housing for low- or moderate-income residents.
The New Jersey State Legislature passed the Fair Housing Act in 1985 that created the Council on Affordable Housing (COAH) to determine affordable housing needs and approve plans to build and rehab units. COAH created acceptable compliance mechanisms every six years, considered “rounds” of compliance.
In 1986, COAH released the First Round rules (1987-1993), requiring 10,849 low- and moderate-income homes per year statewide. In 1994, Second Round rules (1993-1999) were released to require 6,465 low- and moderate-income homes. In 2004, the Third Round was revised to cover 10 years. In 2015, the U.S. Supreme Court ruled COAH a defunct agency, transferring powers to New Jersey superior courts, leading to a ruling determining the Third Round to go from 2016 through 2026.
Rory Pasquariello may be reached at firstname.lastname@example.org.