New Jersey’s Permit Extension Act Extended One Year

On Friday, December 26, Governor Christie signed into law a one year extension of New Jersey’s Permit Extension Act (“PEA”). As noted in our recent blog, the PEA previously was set to expire on December 31, 2014.

Initially enacted in 2008 in response to “the crisis in the real estate finance sector of the economy,” the purpose of the PEA was to toll the expiration of various approvals necessary for development through the end of 2012. The PEA was later amended to extend the tolling of the expiration of those approvals through the end of 2014. The further amendment enacted on December 26, designated as P.L.2014, c.84, tolls the expiration of those approvals through December 31, 2015, thereby providing projects with permits set to expire another year in which to move forward.

The PEA provides for the tolling of any “approval,” as defined in the statute, which is or was in existence during the extension period (now January 1, 2007 through December 31, 2015). Although there are important exceptions, most subdivision, site plan, and variance approvals granted pursuant to the Municipal Land Use Law are encompassed within covered “approvals,” as are many approvals granted by the New Jersey Department of Environmental Protection (NJDEP), New Jersey Meadowlands Commission (NJMC), Delaware and Raritan Canal Commission, New Jersey Pinelands Commission, and various other agencies.

The amendment which was just enacted originally provided for a two year extension, but was revised in committee to provide for only a one year extension. The PEA cannot extend an approval for more than six months beyond the conclusion of the extension period, i.e., through June 30, 2016, and cannot shorten the duration that any approval would have had absent the PEA.

Given that the extension is only for one year, and it is not clear whether there will be any additional extensions, those with existing approvals tolled by the PEA would be well advised to evaluate them now, determine their present status and whether the project can move forward into construction before the approvals expire. If financing is an issue, there are various grant, loan, and other incentive programs which should be explored. If there are reasons why the project may not move forward by expiration of the PEA on December 31, 2015, it would be prudent to investigate now whether other methods of extension are available, and if not, whether new applications will be required. This could be particularly important in situations where changes have occurred in applicable regulations, since any re-applications to obtain new approvals to replace those which have expired must comply with the regulations then in effect. Please contact an attorney in the Gibbons Real Property & Environmental Department if you have a project for which you would like to perform this analysis.

Howard D. Geneslaw is a Director in the Gibbons Real Property & Environmental Department. Andrew J. Camelotto, an Associate in the Gibbons Real Property & Environmental Department, co-authored this post.
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