New Jersey Tenant Protection Act of 1992

1. This act shall be known and may be cited as the "Tenant Protection Act of 1992."

L.1991,c.509,s.1.

2. a. The Legislature finds that the provision and maintenance of an adequate supply of housing affordable to persons of low and moderate income in this State has been and is becoming increasingly difficult as a result of economic and market forces which require special public actions or subsidies to counteract.

b. One particularly acute result of these forces has been the continual increase in the number of displaced or homeless persons who, lacking permanent shelter, require special assistance from public services in this State and in surrounding states in order to remain alive.

c. The Legislature has taken various actions to increase the supply of affordable housing in the State. However, it also is necessary to protect residential tenants, particularly those of advanced age or disability, or lower economic status, from the effects of eviction from affordable housing in recognition of the high costs, both financial and social, to the public of displacement from affordable housing and of homelessness.

d. The Legislature recognizes that the eviction of residential tenants pursuant to the process of conversion of residential premises to condominiums or cooperatives exacerbates homelessness and makes more difficult the maintenance of an adequate supply of low and moderate income housing.

e. The Legislature, therefore, declares that it is in the public interest to establish a tenant protection program specifically designed to provide protection to residential tenants, particularly the aged and disabled and those of low and moderate income, from eviction resulting from condominium or cooperative conversion.

f. Despite its laudable objectives, the Legislature finds that the "Tenant Protection Act of 1992," P.L.1991, c.509 (C.2A:18-61.40 et al.) has yet to adequately preserve the supply of affordable housing in certain municipalities in which condominium and cooperative conversions have been especially common. Accordingly, the Legislature also finds that condominium and cooperative conversions remove affordable rental housing from the market.

g. In the public interest of preserving affordable housing, the Legislature therefore declares that qualified municipalities may prohibit the conversion of affordable rental housing units.

L.1991, c.509, s.2; amended 2020, c.40, s.1.

3. As used in this act:

"Administrative agency" means the municipal board, officer or agency designated, or the county agency contracted with, pursuant to section 6 of this act.

"Affordable rental housing unit" means a rental housing unit that is subject to a rent control ordinance.

"Annual household income" means the total income from all sources during the last full calendar year, or the annual average of that total income during the last two calendar years, whichever is less, of a tenant and all members of the household who are residing in the tenant's dwelling unit when the tenant applies for protected tenancy, whether or not such income is subject to taxation by any taxing authority.

"Commissioner" means the Commissioner of Community Affairs.

"Conversion" means conversion as defined in section 3 of "The Planned Real Estate Development Full Disclosure Act," P.L.1977, c.419 (C.45:22A-23).

"Conversion recording" means the recording with the appropriate county officer of a master deed for a condominium or a deed to a cooperative corporation for a planned residential development or separable fee simple ownership of the dwelling units.

"County rental housing shortage" means a certification issued by the Commissioner of Community Affairs that there has occurred a significant decline in the availability of rental dwelling units in the county due to conversions; provided, however, that the commissioner shall not issue any such certification unless during the immediately preceding 10-year period:

a. The aggregate number of rental units subject to registrations of conversion during any three consecutive years in the county exceeds 10,000; and

b. The aggregate number of rental units subject to registrations of conversion in at least one of those three years exceeds 5,000.

"Department" means the Department of Community Affairs.

"Index" means the annual average over a 12-month period beginning September 1 and ending August 31 of the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), All Items Series A, of the United States Department of Labor (1957-1959 = 100), for either the New York, NY-Northeastern New Jersey or the Philadelphia, PA-New Jersey region, according as either shall have been determined by the commissioner to be applicable in the locality of a property undergoing conversion.

"Protected tenancy period" means, except as otherwise provided in section 11 of this act, all that time following the conversion recording for a building or structure during which a qualified tenant in that building or structure continues to be a qualified tenant and continues to occupy a dwelling unit therein as his principal residence.

"Qualified county" means:

a. Any county with a population in excess of 500,000 and a population density in excess of 8,500 per square mile, according to the most recent federal decennial census; or

b. Any county wherein there exists a county rental housing shortage.

"Qualified municipality" means any municipality with a population density in excess of 25,000 per square mile, according to the most recent federal decennial census, and which has adopted a rent control ordinance.

"Qualified tenant" means a tenant who is a resident in a qualified county and:

(1) Applied for protected tenancy status on or before the date of registration of conversion by the department, or within one year of the effective date of P.L.1991, c.509 (C.2A:18-61.40 et al.), whichever is later;

(2) Has occupied the premises as his principal residence for at least 12 consecutive months next preceding the date of application; and

(3) Has an annual household income that does not at the time of application exceed the maximum qualifying income as determined pursuant to section 4 of P.L.1991, c.509 (C.2A:18-61.43), except that this income limitation shall not apply to any tenant who is age 75 or more years or is disabled within the meaning of section 3 of P.L.1981, c.226 (C.2A:18-61.24).

"Registration of conversion" means an approval of an application for registration by the department in accordance with "The Planned Real Estate Development Full Disclosure Act," P.L.1977, c.419 (C.45:22A-21 et seq.).

"Tenant in need of comparable housing" means a tenant who is not a qualified tenant under P.L.1991, c.509 (C.2A:18-61.40 et al.) and is not eligible for protected tenancy under the "Senior Citizens and Disabled Protected Tenancy Act," P.L.1981, c.226 (C.2A:18-61.22 et al.).

L.1991, c.509, s.3; amended 2020, c.40, s.2.

4. As of the effective date of this act, maximum qualifying income for the purpose of determining qualified tenant status as defined in section 3 of this act shall be in the case of a household comprising one person, $31,400; two persons, $38,500; three persons, $44,800; four persons, $50,300; five persons, $55,000; six persons, $58,900; seven persons, $62,000; eight or more persons, $64,300. In the case of any application for protected tenancy filed more than one year from the effective date of this act, and upon any occasion when termination of a previously granted protected tenancy is sought pursuant to section 11 of this act upon the grounds set forth in paragraph (2) of subsection a. of that section, these figures shall be adjusted by the percentage change, if any, in the applicable index that has occurred since the effective date of this act.

L.1991,c.509,s.4.

5. a. Each qualified tenant shall be granted a protected tenancy status with respect to his dwelling unit upon conversion of the building or structure in which the unit is located. The protected tenancy status shall be granted upon proper application and qualification pursuant to the provisions of this act.

b. Each qualified tenant in need of comparable housing shall be entitled to remain in his dwelling unit upon conversion of the building or structure in which the unit is located until the owner of the building or structure has complied with the provisions of P.L.1975, c.311 (C.2A:18-61.7 et al.).

L.1991,c.509,s.5.

6. Each municipal governing body in a qualified county shall designate a municipal board, agency or officer to act as its administrative agency for the purposes of this act or may enter into a contractual agreement with an appropriate county to act as its administrative agency for purposes of this act. In the absence of such authorization or contractual agreement, this act shall be administered by the board, agency or officer administering the provisions of the "Senior Citizens and Disabled Protected Tenancy Act," P.L.1981, c.226 (C.2A:18-61.22 et al.) in the municipality.

L.1991,c.509,s.6.

7. The owner of any building or structure in a qualified county who seeks to convert any premises shall notify the administrative agency of that intention prior to filing the application for registration of conversion with the department. The owner shall supply the administrative agency with a list of every tenant residing in the premises, with stamped envelopes addressed to each tenant and with sufficient copies of the notice to tenants and application form for protected tenancy status. Within 10 days thereafter, the administrative agency shall notify each residential tenant in writing of the owner's intention and of the applicability of the provisions of this act and shall provide him with a written application form. The agency's notice shall be substantially in the following form:

"NOTICE

THE OWNER OF YOUR APARTMENT HAS NOTIFIED ................................ (insert name of municipality) OF HIS INTENTION TO CONVERT TO A CONDOMINIUM OR COOPERATIVE.

UNDER STATE LAW YOU MAY BE ENTITLED TO A PROTECTED TENANCY.

PROTECTED TENANCY MEANS THAT YOU CANNOT BE EVICTED BECAUSE OF THE CONVERSION.

YOU MAY BE QUALIFIED:

(1) IF YOU HAVE LIVED IN YOUR APARTMENT FOR A YEAR AND

(2) IF YOUR HOUSEHOLD INCOME IS LESS THAN ............................................. (insert current maximum qualifying income established under section 3 of this act), OR

YOU ARE DISABLED OR ARE AT LEAST 75 YEARS OLD.

IF YOU THINK YOU MAY QUALIFY, SEND IN THE APPLICATION FORM BY ....................... (insert date 60 days after municipality's mailing)

TO THE ............................................. (insert name and address of administrative agency)

EVEN IF YOU DO NOT QUALIFY, YOU HAVE THE RIGHT TO REMAIN IN YOUR APARTMENT UNTIL YOUR LANDLORD HAS COMPLIED WITH LAWS REGARDING THE OFFER OF COMPARABLE HOUSING.

FOR FURTHER INFORMATION CALL................... (insert phone number of administrative agency)

OR .............................................." (insert phone number of Department of Community Affairs)

The department shall not accept any application for registration of conversion for any building or structure unless included in the application is proof that the administrative agency notified the tenants prior to the application for registration. The proof shall be by affidavit or in such other form as the department shall require.

In any municipality where the administrative agency is the same as the agency administering the "Senior Citizens and Disabled Protected Tenancy Act," P.L.1981, c.226 (C.2A:18-61.22 et al.), the notices required under that act and this act may be combined in a single mailing.

L.1991,c.509,s.7.

8. Within 30 days after receipt of an application for the protected tenancy status authorized under the provisions of this act, the administrative agency shall make a determination of qualification. It shall send written notice of qualification to each tenant who is a resident of the qualified county and:

a. applied on or before the date of registration of conversion by the department, or within one year from the effective date of this act, whichever is later; and,

b. has an annual household income that does not exceed the maximum amount permitted for qualification, or is exempt from that income limitation by reason of age or disability; and,

c. has occupied the premises as his principal residence for at least 12 consecutive months next preceding the date of application.

The administrative agency shall likewise send a notice of denial, with reasons therefor, to any tenant whom it determines not to be qualified. That notice shall inform the tenant of his right to remain in his dwelling unit until the owner shall have complied with the requirements of P.L.1975, c.311 (C.2A:18-61.7 et al.) and shall include an explanation of the meaning of "comparable housing" as used in that act. The owner shall be notified of those tenants who are determined to be qualified and unqualified.

The administrative agency may require that the application include such documents and information as may be necessary to establish that the tenant is qualified for a protected tenancy status under the provisions of this act and shall require that such documentation and information be submitted under oath. The commissioner may by regulation adopt uniform forms to used in applying for protected tenancy status, for notifying an applicant of qualification or denial thereof, and conveying to a denied applicant the information concerning his rights to continued tenancy and offer of comparable housing; he may also adopt such other regulations for the procedure of determining qualification as he deems necessary or expedient to the proper effectuation of the provisions and purposes of this act.

L.1991,c.509,s.8.

9. In addition to the limitations set forth in section 4 of P.L.2020, c.40 (C.2A:18-61.48a), a registration of conversion for a building or structure located in a qualified county shall not be approved until the department receives proof that the provisions of section 8 of P.L.1991, c.509 (C.2A:18-61.47) have been complied with, and that notification as required in section 8 of P.L.1991, c.509 (C.2A:18A-61.47) has been made to all tenants who filed application for protected tenancy status on or before the application deadline prescribed in the notice given pursuant to section 7 of P.L.1991, c.509 (C.2A:18-61.46). The proof shall be by affidavit or in such form as the department may require.

L.1991, c.509, s.9; amended 2020, c.40, s.3.

4. a. A qualified municipality may, by ordinance, prohibit the conversion of any affordable rental housing unit to a condominium or cooperative form of ownership. Upon the adoption of the ordinance to prohibit the conversion of affordable rental housing units, the prohibition shall remain in effect until such time as the governing body adopts a resolution to suspend the prohibition, as set forth in paragraph 3 of this subsection. An ordinance to prohibit the conversion of affordable rental housing units shall:

(1) recognize a shortage of affordable rental housing within the municipality and the public need to prevent the loss of affordable rental housing units through conversions;

(2) establish criteria to determine the minimum number of affordable rental housing units required in the municipality. The criteria may include, but not be limited to, the vacancy rate of affordable rental housing units, the proportion of affordable rental housing units to total housing units, the proportion of existing affordable housing units to condominium and cooperative units, or any other consideration that the governing body may deem appropriate; and

(3) provide for the suspension of the prohibition, by resolution, upon finding that the criteria established pursuant to paragraph 2 of this subsection have been met. If after adopting a resolution to suspend the prohibition, the governing body of the qualified municipality finds that the criteria established pursuant to paragraph (2) of this subsection are no longer met, then the governing body may, by resolution, reinstate the prohibition.

b. The governing body of a qualified municipality shall transmit any ordinance or resolution adopted pursuant to subsection a. of this section to the department within five days of adoption.

c. Notwithstanding any other provision of law, rule, or regulation to the contrary, the department shall not approve an application for registration for the conversion of any affordable rental housing unit located in a qualified municipality during such time as the ordinance adopted pursuant to subsection a. of this section remains in effect.

d. Notwithstanding any other provision of law, rule, or regulation to the contrary, any application for registration of conversion, notice of intention to convert, full plan of conversion, public offering statement, or other required documentation submitted pursuant to any law or regulation, including but not limited to, P.L.1991, c.509 (C.2A:18-61.40 et al.), P.L.1981, c.226 (C.2A:18-61.22 et al.), P.L.1974, c.49 (C.2A:18-61.1 et al.), or P.L.1977, c.419 (C.45:22A-21 et seq.), and that is associated with the conversion of any affordable rental housing unit located in a qualified municipality, shall be deemed null and void if submitted to the department, designated administrative agency, or tenant during such time as the ordinance adopted pursuant to subsection a. of this section remains in effect.

L.2020, c.40, s.4.

10. The protected tenancy status authorized under the provisions of this act shall not be applicable to any qualified tenant until such time as the owner has filed his conversion recording. The protected tenancy status shall automatically apply as soon as a tenant receives notice of qualification and the landlord files his conversion recording. The conversion recording shall not be filed until after the registration of conversion.

L.1991,c.509,s.10.

11. a. The administrative agency shall terminate the protected tenancy status authorized under the provisions of this act immediately upon finding that:

(1) the dwelling unit is no longer the principal residence of the tenant, or

(2) the tenant's annual household income exceeds the maximum amount permitted for qualification.

b. Upon presentation to the administrative agency of credible evidence that a tenant is no longer qualified for protected tenancy status under this act, the administrative agency shall proceed, in accordance with such regulations and procedures as the department shall adopt and prescribe for use in such cases, to investigate and make a determination as to the continuance of that status.

c. Upon the termination of the protected tenancy status by the administrative agency, the tenant may be removed from the dwelling unit pursuant to P.L.1974, c.49 (C.2A:18-61.1 et al.), except that all notice and other times set forth therein shall be calculated and extend from the date of the expiration or termination of the protected tenancy period, or the date of the expiration of the last lease entered into with the tenant during the protected tenancy period, whichever shall be later.

d. Any protection afforded to a person under the "Senior Citizens and Disabled Protected Tenancy Act," P.L.1981, c.226 (C.2A:18-61.22 et al.) shall remain in full force and effect. If the administrative agency determines that a tenant is no longer qualified for protected tenancy under that act, the administrative agency shall proceed to determine the eligibility of that tenant under the "Tenant Protection Act of 1992," P.L.1991, c.509 (C.2A:18-61.40 et al.), or, in any case in which the administrative agency is not the same as the agency administering the "Tenant Protection Act of 1992" in the municipality, shall refer the case to the appropriate administrative agency for such determination. If the tenant is found by such determination to be eligible, his protected tenancy status shall be continued. The protected tenancy status of the tenant shall remain in full force pending such determination.

L.1991,c.509,s.11.

12. In the event that a qualified tenant purchases the dwelling unit he occupies, the protected tenancy status afforded under the provisions of this act shall terminate immediately upon purchase.

L.1991,c.509,s.12.

13. a. In the case of a municipality subject to the provisions of this act that does not have a rent control ordinance in effect, no evidence of increased costs that are solely the result of the conversion, including but not limited to any increase in financing or carrying costs, and do not add services or amenities not previously provided shall be used as a basis to establish the reasonableness of a rent increase under subsection f. of section 2 of P.L.1974, c.49 (C.2A:18-61.1).

b. In the case of a municipality subject to the provisions of this act that has a rent control ordinance in effect, a rent increase for a qualified tenant with a protected tenancy status, or for any tenant to whom notice of termination pursuant to subsection g. of section 3 of P.L.1974, c.49 (C.2A:18-61.2) has been given, shall not exceed the increase authorized by the ordinance for rent-controlled units. Increased costs that are solely the result of a conversion, including but not limited to any increase in financing or carrying costs, and do not add services or amenities not previously provided shall not be used as a basis for an increase in a fair-return or hardship hearing before a municipal rent board or on any appeal from such determination.

L.1991,c.509,s.13.

14. In the case of a building or structure located in a qualified county, the public offering statement for a conversion as required by "The Planned Real Estate Development Full Disclosure Act," P.L.1977, c.419 (C.45:22A-21 et seq.), shall clearly inform the prospective purchaser of the provisions of this act regarding the protection of qualified tenants and tenants in need of comparable housing. Any contract or agreement for sale of a converted unit shall contain a clause in 10-point bold type or larger that the contract is subject to the terms of this act concerning such tenant protection and an acknowledgement that the purchaser has been informed of these terms.

L.1991,c.509,s.14.

15. A municipality located in a qualified county is authorized to charge an owner a fee which may vary according to the size of the building to cover the cost of providing the services required by this act.

L.1991,c.509,s.15.

16. Any agreement whereby the tenant waives any rights under this act shall be deemed to be against public policy and unenforceable.

L.1991,c.509,s.16.

17. For one year from the effective date of this act, no action for removal of a qualified tenant shall be instituted, no judgment shall be entered against a qualified tenant based upon a previously instituted action, and no qualified tenant shall be removed from his dwelling unit by a landlord, on the basis of the conversion of the premises. The owner of any residential premises located in a qualified county who, prior to that date, has registered those residential premises for conversion or applied for such registration shall comply with the provisions of this act, and the tenants residing in those premises shall be entitled to the protections extended under this act as if the registration or application for registration had not so occurred prior to that date. However, the provisions of this section shall not apply to any residential unit for which a conversion was registered prior to March 4, 1991 if the unit was sold to a bona fide individual purchaser prior to that date and that purchaser intends to personally occupy the unit as his principal residence.

L.1991,c.509,s.17.

18. Nothing in this act shall be deemed to prevent a court from removing a tenant, qualified tenant or tenant in need of comparable housing from a dwelling unit located in a qualified county for good cause shown not to be related to conversion of the building or structure to a condominium or cooperative.

L.1991,c.509,s.18.

24. If any section, subsection, paragraph, sentence or other part of this act is adjudged unconstitutional or invalid, such judgment shall not affect, impair or invalidate the remainder of this act, but shall be confined in its effect to the section, subsection, paragraph, sentence or other part of this act directly involved in the controversy in which the judgment shall have been rendered.

L.1991,c.509,s.24.

25. The commissioner is authorized to adopt, in accordance with the provisions of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), such rules and regulations as may be necessary to implement the provisions of this act, including but not limited to, the prescribing of administrative and notification procedures which integrate the procedural requirements of this act with those of P.L.1981, c.226 (C.2A:18-61.22 et al.) in order to facilitate the efficient administration of both acts.

L.1991,c.509,s.25.