Ladies of LAC Discussion

Presentedbythe 2021CAI-NJWomen’sLeadershipCommittee 2021 ACT LIKE A LADY THINK LIKE A BOSS RETREAT PRESENTED BY: CHRISTINE F. LI, ESQ., GREENBAUM, ROW, SMITH&DAVIS LLP, PARTNER CLI@GREENBAUMLAW.COM | (732) 476-2680 RADBURN REGULATIONS Effective May 18, 2020, the New Jersey Department of Community Affairs (“DCA”) adopted several amendments to its regulations under the Planned Real Estate Development Full Disclosure Act (“PREDFDA”). The amendments broadly address membership voting rights, elections, and By-Law amendments and are commonly known as the “Radburn Regulations.” A full version of the Radburn Regulations, as amended, are attached. Many of the changes merely affirmed how community associations in New Jersey already operated and managed common interest communities. However, there are provisions which give rise to difficulties in interpretation and implementation. For example, one position on the board is to be reserved for representation by the owner of a household subject to low- or moderate-income controls. What if no affordable owner wants to run for the board? Or, if in a 500-home community only ten homes are designated for income-restricted owners, is it reasonable that one out of the five positions on the board be reserved for an affordable owner? These and other thorny issues are raised by the Radburn Regulations, which include requirements on counting ballots, the inspection of ballots, anonymous voting, the dissemination of sample ballots, write in candidates, open meetings. and many other components of community association life. Of significant importance is the right of the DCA to levy fines and issue penalties against community associations for failure to comply with the Radburn Regulations. Another overarching concern is the fact that PREDFDA, pursuant to which the Radburn Regulations were promulgated, is clear that the conduct intended to be regulated is that of the developers and sponsors, and not that of community associations formed to govern and administer the communities created by those developers or sponsors. Beginning with a letter dated July 16, 2019 to the DCA, the New Jersey Chapter of the Community Associations Institute (“CAI-NJ”), on behalf of community associations throughout the State of New Jersey, voiced its objections to the Radburn Regulations. CAI-NJ also attempted to engage representatives of the DCA in discussions relating to the Radburn Regulations but to no avail. Faced with no other alternative, CAI-NJ filed an (amended) notice of appeal on July 10, 2020, appealing the Radburn Regulations in the Superior Court of New Jersey, Appellate Division. The DCA filed a Motion to Dismiss CAI’s Appeal, and over the objections of CAI-NJ, the Appellate Division panel granted the DCA’s motion. The panel simply stated that CAI must first exhaust certain administrative remedies, without providing any further opinion or analysis. CAI-NJ is now appealing the Appellate Division’s decision to the New Jersey Supreme Court, while at the same time, filing a petition directly with the DCA so as to exhaust the administrative remedies that the Appellate Division pointed to.