New Jersey-2024-A1616-Introduced

An Act establishing a pilot program to incentivize the construction of sustainable tiny homes, supplementing P.L.1983, c.530 (C.55:14K-1 et seq.), and making an appropriation.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. The Legislature finds and declares that:

a. The construction of sustainable tiny homes could provide a mechanism for reducing the State's carbon footprint and combating climate change.

b. It is estimated that anywhere from 25 to 40 percent of the national solid waste stream is construction-related waste and only 20 percent of construction waste or demolition debris is actually recycled.

c. During the construction of the average size house, nearly seven logging trucks of wood products are used whereas in a tiny home, only about half of one logging truck is needed.

d. The pollution associated with an average house is significant, totaling on average 28,000 pounds of carbon dioxide emissions annually. By contrast, a tiny home only generates approximately 2,000 pounds of carbon dioxide emissions annually.

e. The climate change caused by rising global temperatures will likely continue to decrease the size of polar ice sheets and land-based glaciers, causing sea levels to rise and contributing to enhanced coastal erosion, coastal flooding, and the loss of habitats and species.

f. Combating climate change should be a joint goal for the State and local governments, and this pilot program is a significant step toward achieving that goal.

2. As used in P.L. , c. (C. ) (pending before the Legislature as this bill):

"Agency" means the New Jersey Housing and Mortgage Finance Agency established pursuant to section 4 of P.L.1983, c.530 (C.55:14K-4).

"Builder" means any nonprofit organization, or any individual corporation, partnership, or other business organization, engaged in the construction of new homes.

"Commissioner" means the Commissioner of Community Affairs.

"Construction waste" or "debris" means unwanted materials produced directly or incidentally by the construction of tiny home dwelling units, including, but not limited to, lumber, insulation, nails, electrical wiring, rebar, dredging materials, tree stumps, and rubble.

"Eligible project" means a housing development consisting of tiny home dwelling units that conform to the standards and requirements of P.L. , c. (C. ) (pending before the Legislature as this bill) and the regulations promulgated pursuant thereto.

"Executive director" means the Executive Director of the New Jersey Housing and Mortgage Finance Agency.

"Housing development" means development undertaken for the purpose of creating one or more residential units for occupancy under lease or ownership by persons who shall occupy such units as their usual and permanent residence, together with any structures or facilities appurtenant or ancillary thereto.

"Pilot municipality" means a municipality selected by the executive director to participate in the pilot program, pursuant to subsection b. of section 3 of P.L. , c. (C. ) (pending before the Legislature as this bill), that agrees to participate in the pilot program.

"Pilot program" means the "Sustainable Tiny Home Pilot Program" established in the New Jersey Housing and Mortgage Finance Agency pursuant to subsection a. of section 3 of P.L. , c. (C. ) (pending before the Legislature as this bill).

"Tiny home dwelling unit" means a permanent dwelling place or domicile for occupants having an interior floor space not in excess of 300 square feet.

3. a. The executive director, in consultation with the commissioner, shall establish in the agency the "Sustainable Tiny Home Pilot Program," to encourage the development of tiny home dwelling units.

b. (1) The executive director shall select for participation in the pilot program not less than one, but not more than two municipalities in each of the northern, central, and southern regions of the State. In selecting the pilot municipalities, the executive director may consider:

(a) the municipality's expressed interest in participating in the pilot program;

(b) the level of anticipated financial and other participation of municipal economic development agencies;

(c) the existence of preexisting agreements between the municipality and builders willing to construct tiny home dwelling units in accordance with this pilot program;

(d) the municipality's willingness to temporarily suspend applicable zoning restrictions to permit development in accordance with this pilot program; and

(e) whether the municipality operates any form of public utility service and maintains records and accounts for its public utility service in accordance with R.S.40:62-1 and R.S.40:62-2.

(2) Upon receipt of a resolution by the governing body of a pilot municipality agreeing to participate in the pilot program, the executive director shall collaborate with each pilot municipality on the procedures to be implemented to effectuate the purposes of the pilot program.

(3) A pilot municipality shall annually submit to the agency public utility service records and accounts for tiny home dwelling units constructed under the pilot program during each year the pilot program is in operation.

c. (1) (a) Under the pilot program, the executive director shall award grants to builders for the construction of housing developments within pilot municipalities to consist of tiny home dwelling units.

(b) A grant recipient shall agree to build housing developments consisting of tiny home dwelling units constructed in accordance with the green building standards adopted by the executive director pursuant to section 6 of P.L. , c. (C. ) (pending before the Legislature as this bill).

(c) A grant recipient shall agree to submit to the agency the total quantity, in cubic yards, of construction waste and debris that were recycled or delivered to a recycling or waste management facility during construction of each tiny home dwelling unit built under the pilot program.

(2) The executive director shall manage the pilot program, in consultation with the commissioner, to increase sustainable housing options most effectively and to otherwise reduce carbon emissions and waste in the State. The executive director shall administer the pilot program for three years following the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill).

(3) Grant awards totaling $1.65 million shall be awarded by the executive director to builders during each year the pilot program is in operation.

d. A builder seeking a grant under the pilot program shall submit an application to the agency that shall include the following information:

(1) the approximate number of tiny home dwelling units the builder has the capacity to construct through funding from grants;

(2) a detailed description of the construction to be completed, including, but not limited to, the builder's ability to outfit the tiny home dwelling units with energy efficient features or equipment capable of minimizing the environmental impact of the structure throughout the life of the structure;

(3) the anticipated sales price of each tiny home dwelling unit to be constructed;

(4) any relevant experience in successfully carrying out accountability and reporting requirements involved in the proper administration of grant funds; and

(5) any additional information deemed necessary by the executive director.

4. Any eligible project that conforms to the standards and requirements of P.L. , c. (C. ) (pending before the Legislature as this bill), and the regulations promulgated pursuant thereto is declared to be a permitted use in all residential districts of a pilot municipality and shall not require a bulk variance pursuant to subsection c. of section 57 of P.L.1975, c.291 (C.40:55D-70).

5. Any eligible project that conforms to the standards and requirements of P.L. , c. (C. ) (pending before the Legislature as this bill), and the regulations promulgated pursuant thereto, is hereby declared to be a public work in furtherance of the environmental policy of this State, and any contribution of property, money, or services in furtherance of such pilot program by the agency or by a unit of local government shall be deemed an expense or cost incurred in furtherance of a public purpose.

6. The executive director, in consultation with the Commissioner of Community Affairs and the Commissioner of Environmental Protection, shall promulgate rules and regulations pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), necessary to carry out the purposes of this act. The rules and regulations shall include green building standards for tiny home dwelling units for the purposes of determining eligibility for a grant pursuant to P.L. , c. (C. ) (pending before the Legislature as this bill). The green building standards shall include standards and ratings equivalent to the standards and ratings set forth in to the most recent version of the Leadership in Energy and Environmental Design Green Building Rating System for New Construction and Major Renovations, as adopted by the United States Green Building Council, with necessary modifications and exceptions based on the unique characteristics of tiny home dwelling units.

7. Within 90 days following the conclusion of each administrative year for the pilot program, the executive director shall report to the Governor and the Legislature, pursuant to section 2 of P.L.1991, c.164 (C.52:14-19.1), regarding the allocation of the moneys appropriated pursuant to section 8 of P.L. , c. (C. ) (pending before the Legislature as this bill). The report shall include, but not be limited to, the municipalities selected to participate in the pilot program, the importance of the financial incentive in the decision by builders to construct developments consisting of tiny home dwelling units, the construction waste or debris generated during the construction of an eligible project, and the utility service costs of each tiny home dwelling unit constructed under the pilot program. The final report shall include the opinion of the executive director on the on the advisability of continuing, expanding, or modifying the program.

8. There is appropriated from the General Fund the sum of $5 million to the New Jersey Housing and Mortgage Finance Agency in the Department of Community Affairs for the purposes of effectuating the provisions of this act. The moneys may also be expended for appropriate and reasonable administrative expenses incurred in the administration of the pilot program by the agency.

9. This act shall take effect immediately and shall expire upon submission of the final report required to be prepared under section 7 of this act, except the regulations adopted pursuant to section 6 of this act shall remain in effect.

STATEMENT

This bill creates the "Sustainable Tiny Home Pilot Program" as a three-year pilot program to combat climate change and reduce the State's carbon footprint through the construction of small, environmentally friendly homes.

This bill requires the Executive Director of the New Jersey Housing and Mortgage Finance Agency in the Department of Community Affairs to select municipalities in three regions of the State to participate in the pilot program. The executive director must also manage the pilot program to award grants to builders for the construction of housing developments consisting of homes having no greater than 300 square feet of interior floor space. The executive director, in consultation with the Commissioner of Community Affairs and the Commissioner of Environmental Protection, must adopt green building standards for tiny home dwelling units for the purposes of determining eligibility for a grant under the pilot program. Under the bill, any tiny home dwelling unit constructed in accordance with this pilot program would be considered a permitted use in all residential districts of a pilot municipality.

This bill appropriates $5 million from the general fund, of which the executive director would distribute $1.65 million during each of the three years the pilot program is in operation to qualified builders for the construction of housing developments consisting of tiny homes. The executive director would be required to submit an annual report to the Governor and Legislature detailing the pilot program's progress in decreasing the State's carbon footprint and combating global warming.

The climate change caused by rising global temperatures will likely continue to decrease the size of polar ice sheets and land-based glaciers, causing sea levels to rise and contributing to enhanced coastal erosion, coastal flooding, and the loss of coastal habitats and species. It is estimated that anywhere from 25 to 40 percent of the national solid waste stream is construction-related waste and only 20 percent of construction waste or demolition debris is actually recycled. The pollution associated with an average house is significant, totaling on average 28,000 pounds of carbon dioxide emissions annually. By contrast, a tiny home only generates approximately 2,000 pounds of carbon dioxide emissions annually. This pilot program would help address climate change by providing environmentally friendly housing options for the State's residents.