SYLLABUS
(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for the
convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please note that, in the
interest of brevity, portions of any opinion may not have been summarized.)
62-64 Main Street, L.L.C. and 59-61 Moore Street, L.L.C. v. Mayor and Council of
the City of Hackensack; Planning Board of the City of Hackensack (A-19/20-13) (072699)
Argued October 7, 2014 -- Decided March 23, 2015
ALBIN, J., writing for a majority of the Court.
The issue in this appeal is whether the designation of plaintiffs’ properties as part of an area in need of
redevelopment under N.J.S.A. 40A:12A-5(a), (b), and (d) of the Local Redevelopment and Housing Law conforms
to the Blighted Areas Clause of the New Jersey Constitution.
In 2006, the Hackensack City Council authorized the City’s Planning Board to undertake a preliminary
investigation to determine whether a two-block area comprised of fourteen individual properties in Hackensack’s
central business district -- a mix of commercial and residential uses -- should be designated as an area in need of
redevelopment. After eight days of hearings, the Planning Board concluded that five of the fourteen properties were
in need of redevelopment, including plaintiffs’ two properties on Main and Moore Streets, five lots where a now
defunct auto body repair shop had operated. All five lots are contiguous to one another and are owned by the same
individuals through two separate limited liability corporations, each of which is a plaintiff in this case.
In February 2008, the Planning Board adopted a resolution recommending that Lots 4-7 at 62-64 Main
Street and Lot 8 at 59-61 Moore Street, along with three other properties comprising six other lots, be designated as
an area in need of redevelopment. The Board determined that Lots 4-7 satisfied the criteria set forth in subsections
(a), (b), and (d) of N.J.S.A. 40A:12A-5 for an area in need of redevelopment. The property met subsection (a)
because the two buildings were “substandard and unsafe for occupancy.” The buildings were “boarded up” and
displayed “prominent signs of structural deterioration.” Subsection (b) was met because the deteriorated condition
of the buildings rendered them vacant and untenantable. In addition, the adjoining “parking area [was] unsightly
and not well maintained.” Last, the property overall “suffer[ed] from faulty arrangement [or] design under”
subsection (d). The Board also determined that Lot 8 satisfied subsection (d) of N.J.S.A. 40A:12A-5 because of its
“faulty arrangement [or] design” as evidenced by the “undefined layout and related poor circulation for the parking
lot.” The Board noted that the conditions on this lot had “a negative impact on the surrounding properties.” In April
2011, the Mayor and Council adopted the recommendations of the Planning Board designating the plaintiffs’ two
properties and three others -- eleven lots in all -- as an area in need of redevelopment.
Plaintiffs filed a complaint in lieu of prerogative writs in the Law Division and argued that their properties
were improperly classified as in need of redevelopment because they did not meet the constitutional standard for
blight set forth in Gallenthin Realty Development, Inc. v. Borough of Paulsboro, 191 N.J. 344 (2007). The court
rejected that argument, reasoning that Gallenthin addressed only an infirmity in subsection (e) of N.J.S.A. 40A:12A-
5, and not subsections (a), (b), and (d) on which the Planning Board and the Mayor and Council relied in making
their redevelopment designations. The court also determined that substantial evidence in the record supported the
findings of the Planning Board and the Mayor and Council that plaintiffs’ properties met the in-need-of-
redevelopment criteria of N.J.S.A. 40A:12A-5(a), (b), and (d).
In an unpublished opinion, the Appellate Division reversed, concluding that the Planning Board and the
Mayor and Council did not apply the required constitutional standard for blight enunciated in Gallenthin. That
blight standard, according to the Appellate Division, requires a determination that the property suffered from
“‘deterioration or stagnation that negatively affects surrounding areas,’” (quoting Gallenthin, supra, 191 N.J. at 363).
In the panel’s view, only if that constitutional threshold is met can property be designated as in need of
redevelopment. The panel concluded that Gallenthin’s definition of blight must necessarily apply to every
subsection of the statute, including subsections (a), (b), and (d).
1
The Supreme Court granted the Planning Board’s and the Mayor and Council’s petitions for certification.
216 N.J. 7 (2013).
HELD: As the Court earlier concluded in Wilson v. City of Long Branch, 27 N.J. 360 (1958), subsections (a), (b),
and (d) of N.J.S.A. 40A:12A-5 do not violate the Blighted Areas Clause of the New Jersey Constitution. A
determination that an area is blighted and in need of redevelopment does not require a finding that the area
“negatively affects surrounding properties,” so long as the legislative definitions are met. Substantial evidence in
the record supports the Hackensack Planning Board’s findings -- later adopted by the Mayor and Council -- that Lots
4-7 at 62-64 Main Street and Lot 8 at 59-61 Moore Street were part of an area in need of redevelopment.
1. The New Jersey Constitution provides that “[p]rivate property shall not be taken for public use without just
compensation.” N.J. Const. art. I, ¶ 20 (Eminent Domain Clause) (emphasis added). One such public use is the
redevelopment of blighted areas. N.J. Const. art. VIII, § 3, ¶ 1 (Blighted Areas Clause). The Blighted Areas Clause
is an affirmative grant of authority to municipal and public entities to rehabilitate and revitalize areas that have
decayed into a state of blight. Gallenthin, supra, 191 N.J. at 359. Although the Constitution does not define blight,
redevelopment laws enacted in the years immediately before the 1947 Constitutional Convention defined the term
and allowed for the taking of private property for slum clearance and other purposes. The Redevelopment
Companies Law in 1944 defined “blighted areas” as those “areas of municipalities . . . [where] there exist
substandard conditions and [un]sanitary housing conditions owing to obsolescence, deterioration and dilapidation of
buildings, or excessive land coverage, lack of planning, of public facilities, of sufficient light, air and space, and
improper design and arrangement of living quarters.” L. 1944, c. 169, § 2. The Blighted Areas Clause was intended
to remove any doubt about the constitutionality of that enactment. (pp. 16-19)
2. Shortly after the ratification of the Blighted Areas Clause, the Legislature passed the Blighted Areas Act, L.
1949, c. 187. According to the 1949 Act, a “blighted area” included “[b]uildings and structures which have
economically deteriorated and where there is a disproportion between the cost of municipal services rendered to the
area as compared with the tax revenue derived therefrom.” L. 1949, c. 187, § 1(c). In 1951, the Legislature
amended the definitions of “blighted area” in the Blighted Areas Act. In 1992, the Legislature replaced the Blighted
Areas Act with the Local Housing and Redevelopment Law (Redevelopment Law), L. 1992, c. 79. The
Redevelopment Law substituted the term “area in need of redevelopment” for the pejorative term “blighted area”
used in the repealed 1951 statute. The definitions of “blighted area” contained in the 1951 Blighted Areas Act are
almost identical to those contained in the Redevelopment Law at subsections (a), (b), and (d) of N.J.S.A. 40A:12A-
5. The structure of subsection (e), however, unlike subsections (a), (b), and (d), underwent a significant change.
The 1992 Redevelopment Law empowered a municipality to declare property blighted in a way never authorized
before -- merely because the property was not put to its optimal use. That was the constitutional issue that the Court
addressed in Gallenthin. (pp. 19-25)
3. In Gallenthin, the Court concluded that an “interpretation of N.J.S.A. 40A:12A-5(e), which would equate
‘blighted areas’ to areas that are not operated in an optimal manner, cannot be reconciled with the New Jersey
Constitution.” Gallenthin, supra, 191 N.J. at 365. Although “deterioration or stagnation that negatively affects
surrounding properties,” id. at 360, describes blight, and perhaps most cases of blight, it does not describe every
possible form of blight. The Court has never stated that an area is not blighted unless it “negatively affects
surrounding properties” because, to do so, would undo all of the legislative classifications of blight established
before and after the ratification of the Blighted Areas Clause -- classifications that the Court has previously declared
to be constitutional. In Gallenthin, the only issue before the Court was the constitutionality of subsection (e) of the
Redevelopment Law, not the constitutionality of subsections (a), (b), or (d). Gallenthin did not establish a
constitutional blight standard to be superimposed on top of the legislative classification of blight. (pp. 25-31)
4. The Blighted Areas Clause must coexist with individual rights enshrined in the State Constitution, such as rights
protected by the Eminent Domain Clause, which ensures that property will not be taken without just compensation.
Redevelopment may not occur at the expense of individual rights. Planning boards and governing bodies are
reminded that they have an obligation to rigorously comply with the statutory criteria for determining whether an
area is in need of redevelopment. So long as the blight determination is supported by substantial evidence in the
record, a court is bound to affirm that determination. (pp. 31-37)
2
5. Substantial evidence in the record supports the Hackensack Planning Board’s findings -- later adopted by the
Mayor and Council -- that Lots 4-8 were part of an area in need of redevelopment. Even if the parking area
designated as Lot 8, standing alone, did not meet the definition of blight, it still might be properly categorized as part
of an area in need of redevelopment. Blight determinations are not viewed in a piecemeal fashion. (pp. 37-44)
The judgment of the Appellate Division is REVERSED.
CHIEF JUSTICE RABNER filed a separate, dissenting opinion, in which JUSTICE SOLOMON joins,
stating that the majority has taken a step backward from Gallenthin. The Chief Justice would hold that when the
government designates an area to be “in need of redevelopment,” it must prove that the property is in fact “blighted”
by demonstrating, through substantial evidence in the record, both components of blight established in Gallenthin:
(1) “deterioration or stagnation” that (2) “negatively affects surrounding properties.”
JUSTICES LaVECCHIA and FERNANDEZ-VINA join in JUSTICE ALBIN’s opinion. CHIEF
JUSTICE RABNER filed a separate, dissenting opinion, in which JUSTICE SOLOMON joins. JUSTICE
PATTERSON and JUDGE CUFF (temporarily assigned) did not participate.
3
SUPREME COURT OF NEW JERSEY
A-19/20 September Term 2013
072699
62-64 MAIN STREET, L.L.C. and
59-61 MOORE STREET, L.L.C.,
Plaintiffs-Respondents,
v.
MAYOR AND COUNCIL OF THE CITY
OF HACKENSACK; PLANNING BOARD
OF THE CITY OF HACKENSACK,
Defendants-Appellants.
Argued October 7, 2014 – Decided March 23, 2015
On certification to the Superior Court,
Appellate Division.
Joseph P. Kreoll argued the cause for
appellant Planning Board of the City of
Hackensack (Law Offices of Richard
Malagiere, attorney).
Thomas P. Scrivo argued the cause for
appellant Mayor and Council of the City of
Hackensack (McElroy, Deutsch, Mulvaney &
Carpenter, attorneys; John P. Michalski and
Robert J. Hitscherich, on the briefs).
Peter Dickson argued the cause for
respondents (Potter & Dickson, attorneys;
Mr. Dickson and Michael J. Monaghan, III, on
the briefs).
David G. Evans submitted a brief on behalf
of amici curiae Pacific Legal Foundation,
National Federation of Independent Business,
Institute for Justice, and Ilya Somin.
JUSTICE ALBIN delivered the opinion of the Court.
The New Jersey Constitution grants municipalities the
1
authority to revitalize decaying and disintegrating residential,
commercial, and industrial areas. Our Constitution states that
the “redevelopment of blighted areas” is a “public purpose” and
that private property may be taken to achieve that end, N.J.
Const. art. VIII, § 3, ¶ 1, provided that owners are awarded
just compensation for their property, N.J. Const. art. I, ¶ 20.
The evident goal of Article VIII, Section 3, Paragraph 1
(Blighted Areas Clause) is to give municipalities the means to
improve the quality of life of their residents and to spur
business opportunity and job growth. To implement this
constitutional mandate, the Legislature initially passed the
Blighted Areas Act, L. 1949, c. 187 (codified as amended at
N.J.S.A. 40:55-21.1 to -21.14 (repealed 1992)), and later the
Local Redevelopment and Housing Law (Redevelopment Law), L.
1992, c. 79 (codified as amended at N.J.S.A. 40A:12A-1 to -73).
The Redevelopment Law defines when an area is blighted and
therefore “in need of redevelopment.” N.J.S.A. 40A:12A-5.
Plaintiffs own five lots in the City of Hackensack on which
stood two dilapidated buildings abutted by two poorly maintained
and decrepit parking lots. Hackensack designated eleven out of
twenty lots in a two-block area as in need of redevelopment,
including plaintiffs’ five lots. In doing so, the Planning
Board made specific findings that those lots met the statutory
definitions of blight in N.J.S.A. 40A:12A-5(a), (b), and (d).
2
The Hackensack Mayor and Council passed a resolution that
adopted the Planning Board’s findings.
Plaintiffs filed an action in lieu of prerogative writs in
Superior Court, challenging Hackensack’s classification of their
lots as blighted. Plaintiffs argued that a finding of blight
under N.J.S.A. 40A:12A-5(a), (b), and (d) of the Redevelopment
Law does not meet the constitutional definition of blight
enunciated in Gallenthin Realty Development, Inc. v. Borough of
Paulsboro, 191 N.J. 344, 373 (2007). On that basis, plaintiffs
sought to strike down the Mayor and Council’s resolution
classifying plaintiffs’ properties as part of an area in need of
redevelopment.
The trial court rejected plaintiffs’ argument, concluding
that Gallenthin merely corrected a constitutional defect in
subsection (e) of N.J.S.A. 40A:12A-5 and did not sweepingly
render other subsections of the Redevelopment Law
constitutionally infirm. The trial court, moreover, determined
that substantial evidence supported Hackensack’s classification
of plaintiffs’ properties as in need of redevelopment.
The Appellate Division reversed, holding that Gallenthin
established a heightened constitutional standard for blight
applicable to every subsection of the Redevelopment Law.
According to the Appellate Division, Gallenthin superimposes
over the statutory definition of blight the need for an
3
additional finding that property has suffered a “‘deterioration
or stagnation that negatively affects surrounding areas,’”
(quoting Gallenthin, supra, 191 N.J. at 363).
We now hold that the Appellate Division has over-read the
scope of Gallenthin, which only addressed a specific
constitutional defect in subsection (e) of N.J.S.A. 40A:12A-5.
In Gallenthin, we simply determined that subsection (e), which
defined blight as the nonproductive use of property, did not
meet the constitutional standard for blight set forth in the
Blighted Areas Clause, N.J. Const. art. VIII, § 3, ¶ 1. We did
not suggest in Gallenthin that the definitions of blight in
subsections (a), (b), and (d) of N.J.S.A. 40A:12A-5, which have
been part of legislative schemes for more than sixty years, were
constitutionally inadequate. Indeed, we upheld the
constitutionality of the provisions at issue in Wilson v. City
of Long Branch, 27 N.J. 360, 378-82 (1958), and Levin v.
Township Committee of Bridgewater, 57 N.J. 506, 510-15 (1971) --
decisions referred to approvingly in Gallenthin.
Applying the required deferential standard of review to the
municipal decision-making in this case, we agree with the trial
court that substantial evidence supported Hackensack’s
designation of plaintiffs’ properties as in need of
redevelopment. We therefore reverse the Appellate Division.
I.
4
A.
In 2006, the Hackensack City Council authorized the City’s
Planning Board to undertake a preliminary investigation to
determine whether a two-block area in Hackensack’s central
business district -- a mix of commercial and residential uses --
should be designated as an area in need of redevelopment. See
N.J.S.A. 40A:12A-6(a). The targeted two-block area is comprised
of fourteen individual properties.
In eight days of hearings between December 2006 and January
2008, the Planning Board took testimony from five witnesses and
received evidence, including expert reports and photographs,
concerning whether to recommend the two-block area as in need of
redevelopment. Ultimately, the Planning Board concluded that
five of the fourteen properties were in need of redevelopment,
including two properties on Main and Moore Streets acquired by
plaintiffs in 1999. Plaintiffs’ two properties encompass five
lots, where a now defunct auto body repair shop had operated.
All five lots are contiguous to one another and are owned by the
same individuals through two separate limited liability
corporations, each of which is a plaintiff in this case.
Plaintiff 62-64 Main Street, L.L.C., owns Block 205, Lots
4, 5, 6, and 7, a 10,443 square-foot parcel of land, on which
sat -- at the time of the hearings -- two vacant, boarded up,
dilapidated buildings with crumbling masonry, which were
5
formerly part of the auto repair business.1 Behind the buildings
is a poorly maintained, partly paved and partly gravel parking
lot.
Plaintiff 59-61 Moore Street, L.L.C., owns Block 205, Lot
8, a 4280 square-foot parcel of land on which formerly sat an
auto garage, which had been demolished. Currently, the property
is used as a paved parking lot, although there are no markings
for individual parking spaces, and the pavement is in a
deteriorated condition. The parking lot has no landscaping or
lighting and encroaches onto the sidewalk.
Plaintiffs intended to build a bank on the five lots, but
could not secure site-plan approval from the City’s Planning
Board or the necessary variances from the City’s Board of
Adjustment to go forward with their proposals. The denials from
those Boards are not at issue in this appeal. Suffice it to
say, plaintiffs have treated all five lots as one property for
development purposes.
The principal witness for the Planning Board was Janice
Talley, a licensed professional planner with H2M Group, the firm
retained by the Board to prepare a redevelopment study of the
area under investigation. According to Talley and the
redevelopment report she authored, the buildings on Lots 4-7
1 While this matter was on appeal, the roof to one of the
buildings collapsed. The building was then torn down.
6
were vacant, dilapidated, and “boarded up due to their unsafe
condition.” The exterior of the buildings showed “prominent
signs of structural deterioration.” Notably, plaintiffs refused
to give Talley access to make an assessment of the buildings’
interior conditions. Talley described the parking lot behind
the two buildings as “poorly surfaced” and without lines,
lighting, or other necessary improvements.
Talley testified that the decrepit state of the buildings
created “unwholesome” living and working conditions and that the
buildings were “a detriment to the . . . safety, health and
welfare of the community.” Talley concluded that Lots 4-7 met
the criteria of N.J.S.A. 40A:12A-5(a), (b), and (d) for an area
in need of redevelopment.
Talley also testified that the current parking area on Lot
8, where the automotive garage once stood, was “crumbling” and
“in disrepair.” The parking area, she noted, had no defined
layout, no lighting, no landscaping, and encroached onto the
sidewalk. That encroachment -- the lack of separation between
the parking area and the sidewalk -- posed a threat to
pedestrians and rendered it a public-safety danger, in Talley’s
view. She concluded that Lot 8 met the criteria of N.J.S.A.
40A:12A-5(d) for an area in need of redevelopment.
Plaintiffs’ expert, Peter Steck, a licensed planner,
testified that Lots 4-8 did not satisfy the criteria for an area
7
in need of redevelopment. He explained that the buildings were
boarded up and therefore did not pose a danger. According to
Steck, the property was in a state of transition, and the
buildings were structurally sound, although vacant at the time.
He insisted that the condition of Lots 4-8 did not retard the
development of properties nearby, such as a new drug store, an
automotive parts store, a bank, and a nail salon. Steck
maintained that the buildings were not detrimental to the
neighborhood and that the unpaved parking areas were similar to
others in the neighborhood. He also noted that plaintiffs were
appealing the denial of their application to construct a bank on
the five lots.2
In Steck’s opinion, plaintiffs’ property should not be
considered in need of redevelopment simply because the City
desires taller buildings in the area, and that the Board should
have taken into account the time it takes to secure the
necessary approvals to rehabilitate the property.
B.
In February 2008, the Planning Board adopted a resolution
recommending that Lots 4-7 at 62-64 Main Street and Lot 8 at 59-
2 In June 2008, the Appellate Division affirmed the Superior
Court’s determination that the Planning Board had not abused its
discretion in denying the necessary approvals for construction
of a bank on the property. The Board’s denial was based on
traffic concerns and lack of adequate parking spaces.
8
61 Moore Street, along with three other properties comprising
six other lots, be designated as an area in need of
redevelopment.3 By a vote, the Board members found Talley’s
testimony more credible than Steck’s.
The Board determined that Lots 4-7 satisfied the criteria
set forth in subsections (a), (b), and (d) of N.J.S.A. 40A:12A-5
for an area in need of redevelopment. The property met
subsection (a) because the two buildings were “substandard and
unsafe for occupancy.” The buildings were “boarded up” and
displayed “prominent signs of structural deterioration,”
resulting in the City issuing plaintiff 62-64 Main Street a
citation to either “demolish the buildings or correct [the]
unsafe conditions.” Subsection (b) was met because the
deteriorated condition of the buildings rendered them vacant and
untenantable. In addition, the adjoining “parking area [was]
unsightly and not well maintained.” Last, the property overall
“suffer[ed] from faulty arrangement [or] design under”
subsection (d).
The Board also determined that Lot 8 satisfied subsection
(d) of N.J.S.A. 40A:12A-5 because of its “faulty arrangement
[or] design” as evidenced by the “undefined layout and related
3 Nine properties comprising nine lots within the two-block study
area did not meet the statutory criteria for an area in need of
redevelopment. In all, eleven lots were deemed part of a
blighted area.
9
poor circulation for the parking lot.” The Board noted that the
conditions on this lot had “a negative impact on the surrounding
properties because it is an unsightly area and the inefficient
utilization of the parking area contributes to greater use of
the on-street parking resources than would otherwise occur.”
In April 2011, the Mayor and Council adopted the
recommendations of the Planning Board designating the
plaintiffs’ two properties and three others -- eleven lots in
all -- as an area in need of redevelopment.4
C.
Plaintiffs filed a complaint in lieu of prerogative writs
in the Law Division, challenging the Mayor and Council’s
designation of their properties as part of an area in need of
redevelopment. Plaintiffs argued that their properties were
improperly classified as in need of redevelopment because they
did not meet the constitutional standard for blight set forth in
Gallenthin. The court rejected that argument, reasoning that
Gallenthin addressed only an infirmity in subsection (e) of
N.J.S.A. 40A:12A-5, and not subsections (a), (b), and (d) on
which the Planning Board and the Mayor and Council relied in
4 The Mayor and Council had passed an earlier resolution adopting
the Planning Board’s recommendations, but that resolution was
withdrawn because of litigation, which challenged, among other
things, whether the Mayor and Council failed to comply with the
Open Public Meetings Act, N.J.S.A. 10:4-6 to -21. Issues
relating to this first resolution are not part of this appeal.
10
making their redevelopment designations. The court also
determined that substantial evidence in the record supported the
findings of the Planning Board and the Mayor and Council that
plaintiffs’ properties met the in-need-of-redevelopment criteria
of N.J.S.A. 40A:12A-5(a), (b), and (d).
D.
In an unpublished opinion, the Appellate Division reversed,
concluding that the Planning Board and the Mayor and Council did
not apply the required constitutional standard for blight
enunciated in Gallenthin. That blight standard, according to
the Appellate Division, requires a determination that the
property suffered from “‘deterioration or stagnation that
negatively affects surrounding areas,’” (quoting Gallenthin,
supra, 191 N.J. at 363). In the panel’s view, only if that
constitutional threshold is met can property be designated as in
need of redevelopment. Although the appellate panel
acknowledged that Gallenthin addressed only subsection (e) of
N.J.S.A. 40A:12A-5, it reasoned that Gallenthin’s definition of
blight must necessarily apply to every subsection of the
statute, including subsections (a), (b), and (d). Thus, the
panel held that Gallenthin’s constitutional standard must be
satisfied, in addition to the Redevelopment Law’s criteria,
before a municipality can designate property as in need of
redevelopment.
11
The panel also suggested that the Planning Board erred in
classifying Lot 8 as an area in need of redevelopment. The
panel recognized that the parking lot lacked “lighting and
landscaping that led to over-utilization of street parking,” and
was hindered by “a faulty layout and crumbling surface.”
Nevertheless, it believed that improvements to the lot would
have eliminated the “negative impact on the community.” In
addition, the panel faulted the Board for not addressing “the
fact that the owners had attempted to obtain approval to develop
the properties, and that the proposals were denied.”
In short, the panel maintained that the Planning Board and
the Mayor and Council did not apply the constitutionally
mandated standard and that the Board’s factual findings did not
meet that standard.
E.
We granted the Planning Board’s and the Mayor and Council’s
petitions for certification. 62-64 Main St., L.L.C. v. Mayor &
Council of Hackensack, 216 N.J. 7 (2013). We also granted the
motion of the Pacific Legal Foundation, the National Federation
of Independent Business, the Institute for Justice, and Ilya
Somin -- three non-profit advocacy groups and a private legal
scholar -- to submit a joint brief and participate as amici
curiae.
II.
12
A.
The Planning Board and the Mayor and Council present
substantially similar positions in support of reversing the
Appellate Division. They argue that the Appellate Division gave
an “overly broad interpretation” of Gallenthin. They submit
that Gallenthin declared only subsection (e) of N.J.S.A.
40A:12A-5 constitutionally defective because subsection (e),
unlike other subsections of that statute, “permitted a
redevelopment designation in cases where a property was merely
being underutilized.” The Planning Board and the Mayor and
Council maintain that the descriptions of blight in subsections
(a), (b), and (d) of N.J.S.A. 40A:12A-5 conform with the
Blighted Areas Clause of our State Constitution. Thus, they
claim that the Appellate Division erred in construing Gallenthin
as requiring a finding of blight in addition to the findings
mandated by subsections (a), (b), and (d). Last, the Planning
Board and the Mayor and Council contend that the Appellate
Division did not pay deference to the Board’s findings, which
should have been upheld because substantial evidence in the
record supported them.
B.
Plaintiffs ask this Court to affirm the Appellate Division
and declare that property may not be designated as in need of
redevelopment unless the property meets both the constitutional
13
standard defining blight enunciated in Gallenthin and the
statutory requirements imposed by N.J.S.A. 40A:12A-5. According
to plaintiffs, Gallenthin’s blight analysis was intended not
only to address the constitutional shortcomings of subsection
(e), but also those of the statute’s other subsections. They
contend that some subsections of N.J.S.A. 40A:12A-5 “plainly do
not describe anything akin to ‘blighted,’” and that despite the
Planning Board’s “cherry-picking of convenient phrases” from
subsections (a), (b), and (d) to declare their property “in need
of redevelopment,” the Board’s findings still fell short of the
constitutional definition of blight.
Plaintiffs also argue that the Law Division “failed to rule
on the city’s designation of the area as opposed to plaintiffs’
properties,” pointing out that the City “did not find that
blighted properties ‘predominated’ in the area” or that those
properties established the area’s “‘general character.’”
C.
Amici, the Pacific Legal Foundation, the National
Federation of Independent Business, the Institute for Justice,
and Ilya Somin, acknowledge that “Gallenthin was resolved by
construing only subsection 5(e) of the Redevelopment Law in
light of the Blighted Areas Clause,” but nevertheless urge this
Court to apply its reasoning to each subsection of N.J.S.A.
40A:12A-5. Amici insist that “[e]ach of the subsections
14
identify conditions which may, in a particular case, indicate
that an area is blighted but will not always satisfy the
Blighted Areas Clause’s requirements.” According to amici,
property is only constitutionally blighted under the Clause
where “‘deterioration or stagnation . . . negatively affects
surrounding properties,’” (quoting Gallenthin, supra, 191 N.J.
at 360). Amici catalogue cases that they claim exemplify the
misuse of the eminent domain power to redevelop non-blighted
areas that were home to the poor and minorities for the purpose
of yielding greater economic value. Amici believe that without
meaningful judicial scrutiny, the political branches will
expansively apply the designation of blight “to encompass merely
unattractive property or land that falls below political
leaders’ desired level of productivity.”
III.
The essential issue is whether the designation of
plaintiffs’ properties as part of an area in need of
redevelopment, pursuant to N.J.S.A. 40A:12A-5(a), (b), and (d),
conforms to the Blighted Areas Clause of the New Jersey
Constitution. To resolve that issue, we must examine the text,
origin, and purpose of the Blighted Areas Clause; legislative
enactments following adoption of the Blighted Areas Clause; and
our jurisprudence that has construed both the Clause and the
Redevelopment Law and its predecessor statutes.
15
A.
The New Jersey Constitution provides that “[p]rivate
property shall not be taken for public use without just
compensation.” N.J. Const. art. I, ¶ 20 (emphasis added).
Although the Constitution does not catalogue the wide array of
public uses for which property may be taken, it does identify
one such public use -- the redevelopment of blighted areas.
N.J. Const. art. VIII, § 3, ¶ 1. The Blighted Areas Clause of
our State Constitution is an affirmative grant of authority to
municipal and public entities to rehabilitate and revitalize
areas that have decayed into a state of blight. Gallenthin,
supra, 191 N.J. at 359.
The Blighted Areas Clause, in relevant part, states: “The
clearance, replanning, development or redevelopment of blighted
areas shall be a public purpose and public use, for which
private property may be taken or acquired. Municipal, public or
private corporations may be authorized by law to undertake such
clearance, replanning, development or redevelopment . . . .”
N.J. Const. art. VIII, § 3, ¶ 1. The limiting principle of this
provision is that an area must be “blighted” before it may be
taken for redevelopment purposes. The Constitution does not
define blight. Therefore, we must inquire into the drafters’
understanding of the meaning of blight at the time of the
ratification of the 1947 New Jersey Constitution. See DePascale
16
v. State, 211 N.J. 40, 48-50 (2012) (explaining that framers’
understanding of constitutional provision was informed by
history leading up to adoption of that provision).
The drafters of the Blighted Areas Clause were not writing
on a blank slate. Redevelopment laws enacted in the years
immediately before the 1947 Constitutional Convention defined
the term “blight” and allowed for the taking of private property
for slum clearance and other purposes. Urban Redevelopment Law,
L. 1946, c. 52; Redevelopment Companies Law, L. 1944, c. 169.
“The proceedings of the constitutional convention indicate that
[the Blighted Areas Clause] was adopted to remove any doubts
with regard to earlier pertinent legislation such as the
Redevelopment Companies Law and the Urban Redevelopment Law.”
McClintock v. City of Trenton, 47 N.J. 102, 105 (1966) (internal
citations omitted) (citing to Proceedings of the New Jersey
Constitutional Convention of 1947, vol. 1 at 742-44); see
Gallenthin, supra, 191 N.J. at 361 (noting that fear that then
existing redevelopment legislation might “be declared
unconstitutional” prompted ratification of Blighted Areas
Clause).
Therefore, we may fairly conclude that delegates who
ratified the Blighted Areas Clause understood the term blight in
the manner in which it was used in contemporaneous legislation,
such as the Redevelopment Companies Law, L. 1944, c. 169. See
17
Lloyd v. Vermeulen, 22 N.J. 200, 210 (1956) (“We recognize fully
that resort may be had to contemporaneous and practical
constructions for whatever aid they may fairly afford in
ascertaining the true sense and meaning of constitutional and
statutory provisions.”). The Redevelopment Companies Law in
1944 defined “blighted areas” as those “areas of municipalities
. . . [where] there exist substandard conditions and
[un]sanitary housing conditions owing to obsolescence,
deterioration and dilapidation of buildings, or excessive land
coverage, lack of planning, of public facilities, of sufficient
light, air and space, and improper design and arrangement of
living quarters.” L. 1944, c. 169, § 2; see Gallenthin, supra,
191 N.J. at 361 (quoting Redevelopment Companies Law’s
definition of “blighted areas”); see also Urban Redevelopment
Law, L. 1946, c. 52 (providing for “acquisition by
municipalities of land areas” where there is “congested,
dilapidated, substandard, unsanitary and dangerous housing
conditions and excessive land coverage”). Indeed, “the
[B]lighted [A]reas [C]lause could reasonably be understood as a
constitutional sanction of [the Redevelopment Companies Law and
the Urban Redevelopment Law].” James R. Zazzali & Jonathan L.
Marshfield, Providing Meaningful Judicial Review of Municipal
Redevelopment Designations: Redevelopment in New Jersey Before
and After Gallenthin Realty Development, Inc. v. Borough of
18
Paulsboro, 40 Rutgers L.J. 451, 474-75 (2009).
B.
Shortly after the ratification of the Constitution’s
Blighted Areas Clause, the Legislature passed the Blighted Areas
Act, L. 1949, c. 187, the predecessor to the current
Redevelopment Law. The Legislature broadly defined “blighted
area.” According to the 1949 Act, a “blighted area” included
“[b]uildings and structures which have economically deteriorated
and where there is a disproportion between the cost of municipal
services rendered to the area as compared with the tax revenue
derived therefrom.” L. 1949, c. 187, § 1(c).
In 1951, the Legislature amended the definitions of
“blighted area” in the Blighted Areas Act. L. 1951, c. 248, §
1. Then, in 1992, the Legislature replaced the Blighted Areas
Act with the Local Housing and Redevelopment Law (Redevelopment
Law), L. 1992, c. 79, in part to “codify, simplify and
concentrate prior enactments” into the new law, N.J.S.A.
40A:12A-2(d). The Redevelopment Law substituted the term “area
in need of redevelopment” for the pejorative term “blighted
area” used in the repealed 1951 statute. N.J.S.A. 40A:12A-3
(“‘[A]rea in need of redevelopment’ means an area . . .
determined heretofore to be a ‘blighted area.’”).
The definitions of “blighted area” contained in the 1951
Blighted Areas Act at subsections (a), (b), and (d) of N.J.S.A.
19
40:55-21.1 (repealed) are almost identical to those contained in
our present Redevelopment Law at subsections (a), (b), and (d)
of N.J.S.A. 40A:12A-5. Indeed, a comparison of those two
statutes reveals that the textual differences in the subsection
(a), (b), and (d) definitions for “blight” and “area in need of
redevelopment” are minor in nature. See Forbes v. Bd. of Trs.
of S. Orange Vill., 312 N.J. Super. 519, 526 (App. Div.),
certif. denied, 156 N.J. 411 (1998) (noting that subsections
(a), (b), and (d) of Blighted Areas Act and Redevelopment Law
are “virtually identical” in terms of “their structure and
verbiage”).
The differences between subsections (a), (b), and (d) of
the Blighted Areas Act and the current Redevelopment Law are
delineated below. Words and punctuation that have a strike-
through were present in the 1951 Blighted Areas Act and are
deleted from our current Redevelopment Law, whereas words and
punctuation that are underscored are additions to the
Redevelopment Law. Today’s Redevelopment Law provides that a
municipality’s governing body may declare “an area in need of
redevelopment” when it finds the following conditions:
(a) The generality of buildings used as
dwellings or the dwelling accommodations
therein are substandard, unsafe,
inunsanitary, dilapidated, or obsolescent, or
possess any of such characteristics, or are so
lacking in light, air, or space, as to be
conducive to unwholesome living or working
20
conditions;.
(b) The discontinuance of the use of buildings
previously used for commercial,
manufacturing, or industrial purposes,; the
abandonment of such buildings; or the same
being allowed to fall into so great a state of
disrepair as to be untenantable;.
. . .
(d) Areas (including slum areas), with
buildings or improvements which, by reason of
dilapidation, obsolescence, overcrowding,
faulty arrangement or design, lack of
ventilation, light and sanitary facilities,
excessive land coverage, deleterious land use
or obsolete layout, or any combination of
these or other factors, are detrimental to the
safety, health, morals, or welfare of the
community;.
[Compare N.J.S.A. 40:55-21.1(a), (b), (d),
with N.J.S.A. 40A:12A-5(a), (b), (d).]
The minor definitional changes in subsections (a), (b), and
(d) are important to our analysis because we have upheld the
constitutionality of those definitions of “blighted area”
contained in the Blighted Areas Act. See Forbes, supra, 312
N.J. Super. at 528-29 (stating that Legislature’s 1951 “multi-
faceted definition of blight . . . has not been successfully
challenged on the basis of constitutional non-conformance,
overstatement or over-breadth”). In Forbes, Judge Pressler
observed that the definition of blight in the Blighted Areas Act
“clearly constituted and came to constitute a community
consensus and expressed a common understanding of what is meant
21
by blight subject to public remediation.” Ibid. (citing Wilson,
supra, 27 N.J. at 370).
In Wilson, supra, we upheld the constitutionality of the
legislative classifications of blight for the then five
subsections of the Blighted Areas Act, including (a), (b), and
(d), which plaintiffs challenge in this appeal. 27 N.J. at 378-
82. We determined that our State Constitution, through the
Blighted Areas Clause, gave “specific approval and authorization
of redevelopment projects.” Id. at 372. In the process of
validating the constitutionality of the 1951 Blighted Areas Act,
we made the following observation:
Community redevelopment is a modern facet of
municipal government. Soundly planned
redevelopment can make the difference between
continued stagnation and decline and a
resurgence of healthy growth. It provides the
means of removing the decadent effect of slums
and blight on neighboring property values, of
opening up new areas for residence and
industry. In recent years, recognition has
grown that governing bodies must either plan
for the development or redevelopment of urban
areas or permit them to become more congested,
deteriorated, obsolescent, unhealthy,
stagnant, inefficient and costly.
[Id. at 370.]
In Wilson, we found that, for constitutional purposes, the
five subsections of the Blighted Areas Act “define ‘blighted
area’ with substantial exactitude and confine the municipal
decision to those limits.” Id. at 378. We concluded that the
22
legislative descriptions of blight sufficiently channeled the
exercise of municipal authority, while acknowledging that “‘the
exigencies of modern government have increasingly dictated the
use of general rather than minutely detailed standards in
regulatory enactments under the police power.’” Ibid. (quoting
Ward v. Scott, 11 N.J. 117, 123 (1952)). We noted that “[t]he
area to be classed as blighted is the portion of a municipality
which in the judgment of the planning board or governing body,
as the case may be, reasonably falls within the definition laid
down by the Legislature.” Id. at 379 (emphasis added). We also
noted that the designation of a “blighted area” might
necessarily include “some sound homes or buildings” to
accomplish the redevelopment plan because it is the
redevelopment of an area, not a particular structure, that is
the statutory objective. Id. at 379-81. We rejected the
argument that the absence of a definition for the term
“blighted” in our State Constitution meant that “the authority”
to define blight “resides in the judicial and not the
legislative branch of the government.” Id. at 381. As we
pointed out, the Blighted Areas Clause authorized the passage of
legislation empowering municipal governments to undertake
redevelopment. Id. at 382-83. Although undoubtedly “the
Judiciary is the final arbiter of the institutional commissions
articulated in the Constitution,” Gallenthin, supra, 191 N.J. at
23
358, we clearly held in Wilson that the Legislature did not
exceed its commission in enacting the Blighted Areas Act.
In 1971, in Levin, supra, the Court addressed whether
vacant, unimproved land “was properly the subject of a
declaration of blight under subsection (e)” of the Blighted
Areas Act. 57 N.J. at 515-16. In doing so, we reaffirmed the
validity of the five subsections of the Blighted Areas Act,
including (a), (b), and (d). Id. at 510. Levin focused
entirely on the application of subsection (e) to the record in
that case.
Although subsection (e) is not at issue in the appeal
before us, a brief discussion of subsection (e) in Levin is
important to an understanding of Gallenthin, where our sole
focus was subsection (e). Subsection (e) at the time of Levin
provided that blight exists when there is
“A growing or total lack of proper utilization
of areas caused by the condition of the title,
diverse ownership of the real property therein
and other conditions, resulting in a stagnant
and unproductive condition of land potentially
useful and valuable for contributing to and
serving the public health, safety and
welfare.”
[Ibid. (quoting N.J.S.A. 40:55-21.1(e))
(emphasis added).]
We stressed in Levin that “the Legislature intended by means of
(e) to encourage the proper and sound growth of suburban and
rural land, particularly open areas which because of the
24
conditions described therein were stagnant and unproductive.”
Id. at 515 (emphasis added). We upheld the declaration of
blight under subsection (e) to the land at issue in Levin. Id.
at 539.
The structure of subsection (e), unlike subsections (a),
(b), and (d), underwent a significant change with passage of the
Redevelopment Law in 1992. Whereas subsection (e) of the
Blighted Areas Act, L. 1951, c. 248, § 1(e), permitted a finding
of blight only if property were “stagnant and unproductive,”
(emphasis added), subsection (e) of the 1992 Redevelopment Law,
L. 1992, c. 79, § 5(e), permitted a finding that property was
“in need of redevelopment” if it were “stagnant or not fully
productive,” (emphasis added). By altering the conjunctive to
the disjunctive in subsection (e), the 1992 Redevelopment Law
empowered a municipality’s governing body to declare property
blighted in a way never authorized before -- merely because the
property was not put to its optimal use.
That was the constitutional issue that we addressed in
Gallenthin.
C.
In Gallenthin, supra, the Borough of Paulsboro classified a
sixty-three-acre parcel of vacant wetlands as “in need of
redevelopment” under N.J.S.A. 40A:12A-5(e). 191 N.J. at 348.
The municipality based that determination solely on a finding
25
that the land’s unimproved condition rendered it “not fully
productive.” Ibid. Paulsboro believed that it was entitled to
make such a classification based on the then language of
N.J.S.A. 40A:12A-5(e), which stated that property qualified as
an area in need of redevelopment if it were “stagnant or not
fully productive,” L. 1992, c. 79, § 5(e). Id. at 357.5 As
earlier noted, the 1992 Redevelopment Law’s version of
subsection (e) was materially different from the subsection (e)
iteration in the Blighted Areas Act, N.J.S.A. 40:55-21.1(e),
which we had found to be constitutionally sound in Levin, supra,
57 N.J. at 511-15 and Wilson, supra, 27 N.J. at 378-82.
We concluded that subsection (e) of the Redevelopment Law
5Following our decision in Gallenthin, the Legislature amended
subsection (e) to read:
A growing lack or total lack of proper
utilization of areas caused by the condition
of the title, diverse ownership of the real
properties therein or other similar conditions
which impede land assemblage or discourage the
undertaking of improvements, resulting in a
stagnant and unproductive condition of land
potentially useful and valuable for
contributing to and serving the public health,
safety and welfare, which condition is
presumed to be having a negative social or
economic impact or otherwise being detrimental
to the safety, health, morals, or welfare of
the surrounding area or the community in
general.
[L. 2013, c. 159, § 1 (emphasis added).]
26
violated the Blighted Areas Clause because it allowed a
declaration of blight to apply to any property that is “‘not
fully productive’ yet potentially valuable for ‘contributing to
and serving’ the general welfare.” Gallenthin, supra, 191 N.J.
at 365. We observed that “[u]nder that approach, any property
that is operated in a less than optimal manner is arguably
‘blighted’” and that “[i]f such an all-encompassing definition
of ‘blight’ were adopted, most property in the State would be
eligible for redevelopment.” Ibid. Thus, we held in Gallenthin
that an “interpretation of N.J.S.A. 40A:12A-5(e), which would
equate ‘blighted areas’ to areas that are not operated in an
optimal manner, cannot be reconciled with the New Jersey
Constitution.” Ibid.
We did not presume in Gallenthin to craft a precise
standard for the metes and bounds of the Blighted Areas Clause.
See id. at 365 (“We need not examine every shade of gray
coloring a concept as elusive as ‘blight’ to conclude that the
term’s meaning cannot extend as far as Paulsboro contends.”).
We noted that in Wilson we had concluded that the Blighted Areas
Act’s “definition of blight was within the bounds of the
Constitution,” id. at 362-63 (citing Wilson, supra, 27 N.J. at
382), and that in Levin we had upheld the validity of the Act’s
definitions of blight, id. at 363 (citing Levin, supra, 57 N.J.
at 511-16).
27
After favorably discussing Wilson and Levin, we remarked:
“Although the meaning of ‘blight’ has evolved, the term retains
its essential characteristic: deterioration or stagnation that
negatively affects surrounding properties.” Ibid.
From that passage and another -- “[a]t its core, ‘blight’
includes deterioration or stagnation that has a decadent effect
on surrounding property,” id. at 365 -- plaintiffs argue that we
created an overarching constitutional standard in Gallenthin for
defining blight. By those comments, we intended nothing more
than descriptions of blight -- not a one-size-fits-all
definition of blight. Had we intended otherwise, we would have
repudiated Wilson and Levin, which upheld the classifications of
blight in subsections (a), (b), and (d) that are challenged in
this appeal. That we did not do. Instead, we observed
approvingly that in Wilson “we upheld the constitutionality of
the Blighted Areas Act’s (BAA) progressive definition of
‘blight.’” Id. at 362.
To be clear, although “deterioration or stagnation that
negatively affects surrounding properties,” id. at 360,
describes blight, and perhaps most cases of blight, it does not
describe every form of possible blight. For example, we did not
mean by those words that an isolated slum, such as a dilapidated
housing project with dangerous conditions that posed an
immediate threat to the health and safety of its residents,
28
would not be a blighted area under a subsection of N.J.S.A.
40A:12A-5 merely because it did not negatively affect
surrounding properties. Nor have we ever suggested that a
crumbling and abandoned toxic industrial site, removed by
distance from other properties, would not fit the statutory
definition of blight.6 We have never stated that an area is not
blighted unless it “negatively affects surrounding properties”
because, to do so, would undo all of the legislative
classifications of blight established before and after the
ratification of the Blighted Areas Clause -- classifications
that we have previously declared to be constitutional.
Additionally, we made clear from the opening statement in
Gallenthin that the only issue before the Court was the
constitutionality of subsection (e) of the Redevelopment Law:
“Because the New Jersey Constitution authorizes government
redevelopment of only ‘blighted areas,’ we conclude that the
Legislature did not intend N.J.S.A. 40A:12A-5(e) to apply in
6 Ifthe dissent is correct that these hypothetical properties
would negatively affect surrounding properties -- no matter how
distant, then it stands to reason that the decrepit, tumble-down
buildings on 62-64 Main Street certainly negatively affected
properties next door and across the street. That would suggest
that the legislative classifications in N.J.S.A. 40A:12A-5(a),
(b), and (d) will lead in most, if not all, cases to the
redevelopment of properties that adversely affect surrounding
properties.
29
circumstances where the sole basis for redevelopment is that the
property is ‘not fully productive.’” Id. at 348. The
constitutionality of subsections (a), (b), and (d) was never at
issue in Gallenthin. There, we never expressed doubt about
Wilson’s validation of those subsections.
Last, had we intended to create a new, far-reaching
constitutional standard for blight, we certainly would have said
so in our holding in Gallenthin. We concluded Gallenthin by
declaring: “N.J.S.A. 40A:12A-5(e) applies only to property that
has become stagnant and unproductive because of issues of title,
diversity of ownership, or other conditions of the same kind.”
Id. at 373 (emphasis added). We simply rendered the statute
constitutional by replacing the “or” with an “and.”
Had we adopted a new constitutional construct in Gallenthin --
as plaintiffs and the Appellate Division believe -- we would
have ended the opinion differently, perhaps by stating that
subsection (e) “applies only to property that has become
stagnant and unproductive and that negatively affects
surrounding properties.”
We therefore reject the notion that Gallenthin established
a constitutional blight standard to be superimposed on top of
the legislative classifications of blight. To the extent that
our language in Gallenthin has created any misunderstanding, we
now make explicit that we did not intend to create a
30
constitutional blight standard that rendered unconstitutional
the classifications of blight we upheld in Wilson and Levin.
D.
The dissent’s jurisprudential approach would require this
Court to declare unconstitutional subsections (a), (b), and (d)
of N.J.S.A. 40A:12A-5 in its present form, and in every prior
legislative iteration since before and after the 1947 New Jersey
Constitution. It would require this Court to find that
redevelopment projects that have helped rebuild Newark, Jersey
City, New Brunswick, and other urban centers were the product of
unconstitutional statutes and reliance on prior misguided
decisions of this Court, such as Wilson and Levin. If we had
intended in Gallenthin to undo the entire carefully crafted
framework of our redevelopment laws, as the dissent concludes,
we would have said so directly. We would not have concentrated
in Gallenthin on the infirmity in subsection (e) -- a single
defective timber -- if the whole statutory scheme was rotten.
If the dissent’s view were to prevail and this Court were
to repudiate its holding in Wilson and strike down subsections
(a), (b), and (d), countless redevelopment projects up and down
this state might be halted and mired in litigation. See Chester
R. Ostrowski, Comment, A “Blighted Area” of the Law: Why
Eminent Domain Legislation Is Still Necessary in New Jersey
After Gallenthin, 39 Seton Hall L. Rev. 225, 228-29 (2009)
31
(identifying almost one thousand redevelopment projects,
including thirty in Jersey City, ongoing in June 2005).
Planning boards, municipal bodies, and courts would have to
apply the dissent’s newly minted constitutional standard as a
substitute for the long-standing legislative definitions on
which they have relied for more than sixty years. The dissent’s
interpretation of subsections (a), (b), and (d) would have dire
implications and perhaps lead to a state of chaos for ongoing
redevelopment projects.
The drafters of the 1947 Constitution understood the
enormous benefits afforded by redevelopment. Their foresight
has been realized by the redevelopment projects that have helped
raise some urban centers literally from the ashes. Those
projects have spurred the opening of new businesses and the
construction of new housing for low- and moderate-income
citizens in our state. Robert S. Goldsmith & Robert Beckelman,
What Will Happen to Redevelopment in New Jersey when the Economy
Recovers? 36 Rutgers L. Rec. 314, 327 (2009) (describing
successful redevelopment projects in Jersey City, Newark,
Trenton, and Perth Amboy).
The redevelopment of decaying neighborhoods was the
objective of the drafters of the Blighted Areas Clause. That
Clause must coexist with individual rights enshrined in our
State Constitution, such as rights protected by the Eminent
32
Domain Clause, N.J. Const. art. I, ¶ 20, which ensures that
property will not be taken without just compensation.7
Redevelopment may not occur at the expense of individual rights.
Our courts will continue to protect individual rights of
landowners, as they have done before and since our decision in
Wilson.
E.
As is clear, plaintiffs are seeking a declaration from this
Court that the descriptions of blight in subsections (a), (b),
and (d) of the Redevelopment Law do not adequately define blight
consistent with the Blighted Areas Clause of our State
Constitution. However, the Redevelopment Law, like all
statutes, is entitled to a “strong presumption of
constitutionality that . . . can be rebutted only upon a showing
that the statute’s ‘repugnancy to the Constitution is clear
beyond a reasonable doubt.’” Hamilton Amusement Ctr. v.
7The Eminent Domain Act provides a number of protections to a
landowner before property can be taken by the government. Hous.
Auth. of New Brunswick v. Suydam Investors, L.L.C., 177 N.J. 2,
14 (2003). Before filing a declaration of taking, a public
entity is required to engage in “bona fide negotiations” with
the owner to acquire the property. N.J.S.A. 20:3-6. If the
negotiations are unsuccessful, the public entity can file a
condemnation action, and the court then appoints three
commissioners to set compensation based on the fair market value
of the property. N.J.S.A. 20:3-12(b). The landowner can reject
the commissioners’ award and request that a jury hear testimony
and award just compensation for the taking of the property.
N.J.S.A. 20:3-13(b).
33
Verniero, 156 N.J. 254, 285 (1998) (quoting Harvey v. Bd. of
Chosen Freeholders, 30 N.J. 381, 388 (1959)), cert. denied, 527
U.S. 1021, 119 S. Ct. 2365, 144 L. Ed. 2d 770 (1999).
Plaintiffs’ challenge to subsections (a), (b), and (d) are not
new. As previously discussed, we upheld the constitutionality
of those subsections in Wilson and reaffirmed their validity in
Levin. Plaintiffs’ constitutional challenge is premised on the
belief that we had established in Gallenthin an overarching
constitutional standard for defining blight under the Blighted
Areas Clause. That belief is mistaken. In Gallenthin, we did
not impugn our decisions in Wilson and Levin. We have no reason
to reconsider the constitutionality of subsections (a), (b), and
(d) in light of the facts before us.
IV.
A.
Having resolved the constitutional issue, we remind
planning boards and governing bodies that they have an
obligation to rigorously comply with the statutory criteria for
determining whether an area is in need of redevelopment. A
finding that an area is in need of redevelopment will have
significant consequences for the property owner. Gallenthin,
supra, 191 N.J. at 373. “In general, a municipality must
establish a record that contains more than a bland recitation of
applicable statutory criteria and a declaration that those
34
criteria are met.” Ibid. A resolution adopted by a planning
board or governing body should clearly articulate the factual
findings that support the statutory criteria for designating an
area as in need of redevelopment. It disserves the municipality
and the parties to go through lengthy hearings, with the
presentation of multiple witnesses and volumes of evidence, only
to have the process jeopardized because of a poorly crafted
resolution.
We must be mindful, however, that after the municipal
authorities have rendered a decision that an area is in need of
redevelopment, that decision is “invested with a presumption of
validity.” Levin, supra, 57 N.J. at 537. “Judicial review of a
blight determination” must be informed by an understanding “of
the salutary social and economic policy” advanced by
redevelopment statutes. Ibid. So long as the blight
determination is supported by substantial evidence in the
record, a court is bound to affirm that determination.
Gallenthin, supra, 191 N.J. at 372-73 (citing N.J.S.A. 40A:12A-
6(b)(5)). That said, the discretion exercised by municipal
authorities “is not unfettered.” Levin, supra, 57 N.J. at 537.
Judicial deference does not mean that a court is a rubber stamp.
A blight determination based on a net opinion or insubstantial
evidence cannot stand. Gallenthin, supra, 191 N.J. at 372-73.
In reviewing the validity of the blight declaration in this
35
case, we must remember that plaintiffs treated 62-64 Main Street
and 59-61 Moore Street -- five contiguous lots -- as one
property for development purposes. The issue is not whether one
isolated lot might have some redeeming features, but whether an
“area” is in need of redevelopment. Levin, supra, 57 N.J. at
539. For example, where an area in need of redevelopment
encompasses a large residential or industrial/commercial area, a
municipality may “draw within a blighted area certain houses or
buildings which are in good condition” because, to do otherwise,
“would be in some instances to defeat the overall legislative
purpose, namely, the redevelopment of blighted areas.” Wilson,
supra, 27 N.J. at 381; see also Gallenthin, supra, 191 N.J. at
372 (“[N]on-blighted parcels may be included in a redevelopment
plan if necessary for rehabilitation of a larger blighted
area.”); Levin, supra, 57 N.J. at 539 (“The fact that single
parcels in the area are useful and could not be declared
blighted if considered in isolation is basis neither for
excluding such parcels nor for invalidating the designation.”).
Nothing in the Blighted Areas Clause or the Redevelopment Law
suggests that an area in need of redevelopment must meet some
minimum size requirement. Maglies v. Planning Bd. of E.
Brunswick, 173 N.J. Super. 419, 422 (App. Div.) (finding blight
“even though confined to a relatively small area”), certif.
denied, 84 N.J. 462 (1980); see also Wilson, supra, 27 N.J. at
36
379 (noting that “courts will not interfere with the boundary
lines adopted in the absence of palpable abuse of discretion”).
B.
We now must assess whether the Hackensack Planning Board
and the Mayor and Council properly designated plaintiffs’
properties as part of an area in need of redevelopment. More
particularly we must decide whether Hackensack’s blight
determination, based on the statutory criteria in N.J.S.A.
40A:12A-5, is supported by substantial evidence in the record.8
As described earlier, the statutory criteria for blight include
buildings that are “substandard,” “unsafe,” “dilapidated,” or
“obsolescent,” N.J.S.A. 40A:12A-5(a); buildings no longer in use
for commercial or industrial purposes, abandoned buildings, and
buildings that have fallen “into so great a state of disrepair
as to be untenantable,” N.J.S.A. 40A:12A-5(b); and “[a]reas with
8 Thedissent does not give Hackensack the benefit of the
deferential standard of review that applies to municipal
designations of blight. The Planning Board credited certain
testimony over other testimony. Making credibility
determinations was within the purview of the Board. Our role is
to see whether the evidence in the record -- in this case, the
hearings before the Planning Board -- support the findings made
by the municipality. The issue is solely whether there is
substantial evidence to support Hackensack’s designations, not
whether we would have come to a different decision if we were
the Planning Board or Mayor and Council. See Lyons v. City of
Camden, 52 N.J. 89, 98 (1968) (stating that if blight
determination is “supported by substantial evidence, the fact
that the question is debatable does not justify substitution of
the judicial judgment for that of the local legislators”).
37
buildings or improvements which, by reason of . . . faulty
arrangement or design . . . are detrimental to the safety,
health, morals, or welfare of the community,” N.J.S.A. 40A:12A-
5(d).
At the redevelopment proceedings, the Planning Board
reviewed reports, inspected photographs, and received testimony
at eight days of hearings. It credited the report and testimony
of a professional planner, Janice Talley, who examined the
properties at issue.
62-64 Main Street -- Lots 4-7
On Lots 4-7 sat two vacant, boarded up, dilapidated
buildings with crumbling masonry -- the vestiges of a defunct
auto repair business. Plaintiffs denied Talley access to the
interior of the buildings. Nevertheless, the buildings’
exteriors showed “prominent signs of structural deterioration”
and were evidently in a dangerous condition, leading Talley to
conclude that the buildings were “a detriment to the . . .
safety, health and welfare of the community.” Indeed, the roof
to one of the buildings collapsed during the appeal of this
case, requiring the building to be torn down.9 Behind the two
9 While it is true that, as the dissent notes, the roof had not
collapsed by the time of the Planning Board hearings, the dire
condition of the property was fully described at the hearings.
The fact is that the building had to be torn down and anyone
observing the property today can see that one of the boarded up
38
buildings was a “poorly surfaced” parking lot that did not have
lines, lighting, or other necessary improvements.
The Planning Board determined that the decrepit buildings
and their decayed parking lot satisfied the criteria for an area
in need of redevelopment, focusing on subsections (a), (b), and
(d) of N.J.S.A. 40A:12A-5. The Board adopted a resolution that
explained its findings: the buildings were vacant, in a
deteriorated condition, “substandard and unsafe for occupancy,”
and untenantable, thus meeting the blight criteria for
subsections (a) and (b). Moreover, the entirety of the
property, including the parking lot, suffered from a faulty
arrangement or design under subsection (d).
We hold that substantial evidence in the record supports
the Planning Board’s findings -- later adopted by the Mayor and
Council -- that Lots 4-7 were part of an area in need of
redevelopment. We cannot look separately at the parking lot,
which was an integral part of the property, in assessing whether
it fits under subsection (d). This is the very type of parsing
that Wilson, supra, cautions against in reviewing whether a
municipality properly exercised its authority in designating an
area in need of redevelopment. 27 N.J. at 379-81.
59-61 Moore Street -- Lot 8
buildings is missing, a point related to the Court during oral
argument.
39
This lot was part of the former auto repair business that
encompassed Lots 4-7. An auto garage that once sat on Lot 8 was
demolished. The ruins of that property were converted into a
parking lot, although one that had no markings for individual
parking spaces, no lighting, and no landscaping. The pavement
of the parking lot was crumbling and in disrepair and encroached
onto the sidewalk. The lack of any visible separation between
the parking lot and sidewalk created a public-safety hazard,
according to Talley.
In its resolution, the Planning Board determined that the
lot’s unsightliness and its inefficient use of the parking area
-- evidenced by its undefined layout -- contributed to a greater
demand for on-street parking, thereby having “a negative impact
on surrounding properties.” The Mayor and Council adopted the
Board’s finding that Lot 8 met the definition of blight under
subsection (d) because of its “faulty arrangement [or] design.”
We hold that substantial evidence in the record supports that
finding.
Even if Lot 8, standing alone, did not meet the definition
of blight, it still might be properly categorized as part of an
area in need of redevelopment. Blight determinations are not
viewed in a piecemeal fashion. Levin, supra, 57 N.J. at 539.
The Planning Board’s expert testified that Lot 8 could not be
redeveloped on its own, and that it could only be redeveloped in
40
conjunction with its neighboring lots. Lot 8 was one of five
lots on which an auto repair business operated, and plaintiffs
treated Lot 8 as one of five combined lots for development
purposes. Thus, the historical and contemplated use of Lots 4-8
was for a single business purpose.
We cannot agree with the Appellate Division that the
Planning Board erred by not addressing “the fact that the owners
had attempted to obtain approval to develop the properties, and
that the proposals were denied.” A landowner’s desire to
develop property “does not militate against [a] blight
declaration.” Levin, supra, 57 N.J. at 540. Here, the
municipal authorities concluded that the property was unsuitable
for the construction of a bank. Plaintiffs unsuccessfully
appealed their failed efforts to secure the municipal
construction approvals for a bank. In short, plaintiffs’
failure to develop the property in accordance with the lawful
requirements imposed by Hackensack land-use authorities cannot
obscure the reality that the property remains in a state of
blight.10
10 Thedissent seems to draw a nefarious inference from the fact
that Hackensack did not give approval to plaintiffs’ flawed
proposals to develop their properties. However, the trial court
reviewed and upheld the decision of the relevant municipal
boards, and the Appellate Division affirmed. Those decisions
are not subject to collateral attack here. There is no basis to
question the good faith of Hackensack in making those earlier
land-use determinations.
41
It bears mentioning that, under N.J.S.A. 40A:12A-8(j),
plaintiffs are free to pursue an agreement with Hackensack that
would permit them to rehabilitate their property in a way
consistent with the redevelopment plan. See N.J.S.A. 40A:12A-
8(j); see also William M. Cox & Stuart R. Koenig, New Jersey
Zoning & Land Use Administration, § 38-7.2 at 953 (2014)
(stating that “statute encourages property owners to voluntarily
repair and rehabilitate buildings and associated improvements to
bring them up to current standards usually accomplished through
an agreement with the governing body or redevelopment entity”).
Even if Hackensack and plaintiffs did not reach an agreement
that would permit either plaintiffs to rehabilitate the property
or Hackensack to purchase the property, plaintiffs are still
entitled to all of the protections of the Eminent Domain Act of
1971, N.J.S.A. 20:3-1 to 20:3-50. In the end, plaintiffs are
entitled to “just compensation” -- the fair market value of
their property -- if Hackensack pursues a taking through its
eminent domain power. See N.J. Const. art. I, ¶ 20; N.J.S.A.
20:3-38 (“The value of any land or other property being acquired
in connection with development or redevelopment of a blighted
area shall be no less than the value as of the date of the
declaration of blight by the governing body upon a report by a
planning board.”).
V.
42
This is not the case of a municipality invoking the
redevelopment laws to declare property blighted solely because
the property -- on which a residence stands or a commercial
business operates -- is not put to its optimal use. We do not
have here, for example, a pristine set of Cape Cod homes
fronting the ocean, which a municipality wants to remove to
build high rises in order to increase its taxable base. This
also is not a case about a municipality driving poor or minority
residents out of a well-maintained older neighborhood for
gentrification purposes. Rather, we have here the more mundane
scenario envisioned by the drafters of the Blighted Areas
Clause, an area in the downtown section of a city, which meets
some of the classic statutory definitions of blight --
dilapidated and vacant buildings, and unsightly and rundown
properties that pose safety hazards.
For sure, the abuse of the redevelopment laws cannot be
countenanced. Although a municipality’s blight determination is
entitled to judicial deference, courts still must be vigilant to
ensure that there is compliance with the Redevelopment Law. But
we cannot forget that the “Blighted Areas Clause [has] enabled
municipalities to intervene, stop further economic degradation,
and provide incentives for private investment.” Gallenthin,
supra, 191 N.J. at 362. Nor can we forget that the
Redevelopment Law promotes a “salutary social and economic
43
policy,” Levin, supra, 57 N.J. at 537, a policy that gives
municipalities the authority to rehabilitate and revitalize
blighted areas for the benefit of the public -- a benefit
realized through better housing and enhanced business and
employment opportunities.
VI.
For the reasons expressed, we reverse the judgment of the
Appellate Division. We affirm the Law Division’s holding that
substantial evidence in the record supports the Hackensack
Planning Board’s and the Mayor and Council’s designations of
plaintiffs’ properties as part of an area in need of
redevelopment.
JUSTICES LaVECCHIA and FERNANDEZ-VINA join in JUSTICE
ALBIN’s opinion. CHIEF JUSTICE RABNER filed a separate,
dissenting opinion, in which JUSTICE SOLOMON joins. JUSTICE
PATTERSON and JUDGE CUFF (temporarily assigned) did not
participate.
44
SUPREME COURT OF NEW JERSEY
A-19/20 September Term 2013
072699
62-64 MAIN STREET, L.L.C. and
59-61 MOORE STREET, L.L.C.,
Plaintiffs-Respondents,
v.
MAYOR AND COUNCIL OF THE CITY
OF HACKENSACK; PLANNING BOARD
OF THE CITY OF HACKENSACK,
Defendants-Appellants.
CHIEF JUSTICE RABNER, dissenting.
One of our most prized liberties is the right to possess
and protect property free from governmental interference. That
right is so fundamental that it appears in the first sentence of
the State Constitution: “All persons are by nature free and
independent, and have certain natural and unalienable rights,
among which are those of . . . acquiring, possessing, and
protecting property.” N.J. Const. art. I, ¶ 1.
In certain limited, carefully prescribed circumstances, a
governmental body may seek to take a person’s private property
for a public purpose. For example, when done properly, towns
can redevelop deteriorated areas in a way that halts further
decay and enhances the life of the community. But before local
or state officials can use that authority and take private
1
property, they must satisfy a number of important requirements.
Among other things, if they seek to redevelop a “blighted” area,
they must abide by another constitutional command and prove that
the property is in fact “blighted.” N.J. Const. art. VIII, § 3,
¶ 1.
In a significant ruling in 2007, Gallenthin Realty
Development, Inc. v. Borough of Paulsboro, this Court analyzed
the meaning of the term “blighted” in the State Constitution.
191 N.J. 344 (2007). The Court unanimously held that the
essential components of blight are (1) “deterioration or
stagnation” that (2) “negatively affects surrounding
properties.” Id. at 363. The Court then applied that concept
to a different section of the statute that is now before us, the
Local Redevelopment and Housing Law, N.J.S.A. 40A:12A-1 to -73
(“LRHL”). The Court held that the clause in question, N.J.S.A.
40A:12A-5(e), could not be reconciled with the Constitution.
Gallenthin, supra, 191 N.J. at 365.
Today, the majority takes a step backward from Gallenthin.
In assessing different sections of the same law, N.J.S.A.
40A:12A-5(a), (b), and (d), the majority concludes that when the
government designates an area to be “in need of redevelopment” -
- a critical step in the takings process -- it need not
affirmatively prove both elements set forth in Gallenthin to
show that a property is “blighted.” Instead, the majority
2
permits the designation of private land for redevelopment even
when government officials have not shown a decadent effect on
surrounding properties.
The majority goes on to affirm the designation of two
private properties in this case as “in need of redevelopment”
based on the conclusory findings of the Hackensack Planning
Board, which the Mayor and City Council adopted. That
designation paves the way for the City to take the properties
from their rightful owners.
When the government seeks to take a citizen’s private
property for redevelopment, it must act with the utmost care.
And it must make its case through substantial evidence in the
record. N.J.S.A. 40A:12A-6(b)(5)(c). To satisfy the commands
of the Constitution, the government must show that the property
it seeks to take is blighted. Because the majority’s approach
falls short of that imperative, I respectfully dissent.
I.
A.
This case involves two adjacent pieces of property in a
commercial area of downtown Hackensack. The first parcel,
located at 62-64 Main Street, encompasses 10,443 square feet of
space or roughly one-quarter of one acre. In 2008, there were
two vacant, boarded-up, masonry buildings and a gravel parking
area on the property. The front portion of one building was two
3
stories; the rear portion and the second building were single-
story. The tax map lists the property as Lots 4 to 7 on Block
205.
The second parcel, located at 59-61 Moore Street (also
known as Church Street), is a single rectangular lot that covers
4,280 square feet or about one-tenth of one acre. The property
is used as a parking lot. It is paved but poorly surfaced, has
no landscaping or lighting, and is not marked for individual
spaces or aisles. In one area, the lot encroaches onto the
sidewalk. The parcel is listed as Lot 8, Block 205.
Both properties are owned by limited liability companies
with the same three members, Michael J. Monaghan, Frank
Callahan, and Danny Callahan. The parties acquired the
properties in 1999 from an old auto body shop. At the time, the
owners demolished a building on the Moore Street property. They
also decommissioned the Main Street property. With an eye
toward redeveloping the property, they spent $20,000 to strip
the interior of the building and remove the electrical and
plumbing work. To address environmental issues, the owners also
spent $60,000 to remediate the properties. Overall, according
to the record, the owners represent that they have invested
“hundreds of thousands of dollars into improving the property.”
Taxes on both properties have been fully paid.
4
In recent years, the owners made a number of efforts to
redevelop the properties. In 1999, they engaged in discussions
with state officials about leasing space to two state agencies;
met with an official at the local building department who
approved a zoning switch from auto repair to office space; and
then abandoned the effort after a meeting with the Mayor who,
according to Monaghan, did not favor the project.
In 2006, the Planning Board denied an application to
demolish the structures at 62-64 Main Street and replace them
with a branch of the Bank of New York and a drive-through teller
lane. The Board’s decision, which was upheld in court, focused
primarily on parking, traffic flow, and congestion issues.
Again in 2011, the City declined permission to build a
branch of PNC Bank with parking and a drive-through lane at the
Main Street site. The Board of Adjustment cited traffic and
parking concerns, among other reasons, when it denied the
request for a variance and site plan approval.
The downtown area near the properties has seen other
development in recent years. CVS, Commerce Bank (now TD Bank),
and Auto Zone have all built new facilities in the area.
B.
At the same time the owners pursued redevelopment plans for
their properties, the City proceeded on a course to take both
parcels. The Mayor and the City Council passed a resolution in
5
July 2006, which authorized the Planning Board to conduct a
preliminary investigation of a two-block area -- that included
the two properties -- as a potential site for redevelopment.
The Planning Board, in turn, hired H2M Group, an architectural,
engineering, and planning firm, to conduct a study. In the
following years, the firm prepared two redevelopment studies and
a separate addendum to report its findings.
The first report, issued in October 2006, was authored by
Janice Talley and Michael Pessolano. It examined twelve
properties in the study area and found that each of them met two
or more criteria in the LRHL which qualified the properties for
designation as an area in need of redevelopment.
The first study concluded that the Main Street property met
five criteria for redevelopment, N.J.S.A. 40A:12A-5(a), (b),
(d), (e), and (h). (The statute is detailed in section III
below.) The report noted that the property, along with the
Moore Street parcel, was the subject of an unsuccessful attempt
to construct a new bank in 2006. In addition, H2M observed that
the two buildings at 62-64 Main Street showed “prominent signs
of structural deterioration,” had “no plaster on significant
portions of the facade,” were boarded up and “vacant due to
deteriorated conditions” that “rendered them untenantable,” were
unsafe, unhealthy, and unsightly, suffered from “faulty
arrangement of design,” and were “economically underutilized.”
6
The study also noted a code enforcement citation for the
property, which the owners had challenged. With regard to
subsection (d), the report stated that the Main Street parcel
has a negative effect on surrounding properties.
The first study also found that the parking lot at Moore
Street met three criteria for redevelopment, N.J.S.A. 40A:12A-
5(d), (e), and (h). H2M stated that the property displayed
“faulty arrangement of design,” had no landscaping or lighting,
encroached into the sidewalk along one street, and was
“economically underutilized.” In addition, the report found
that the parcel had “a negative impact on the surrounding
properties” because it was unsightly and inefficient, in a way
that contributed to greater use of on-street parking.
After a hearing before the Planning Board in December 2006,
which involved extensive questions of Mr. Pessolano, H2M
submitted a revised Redevelopment Study dated May 15, 2007. The
new report assessed the same study area but regrouped the lots
as fourteen properties. This time, H2M found that only eight
properties qualified under the LRHL for designation as an area
in need of redevelopment.
The new version had some additional information --
including the results of several interior inspections -- but was
quite similar overall to the first study. (The report noted
that the owners did not grant permission to inspect the interior
7
of the Main Street property.) The analysis of the Main and
Moore Street parcels remained the same with one exception: the
report no longer found that any properties should be designated
as in need of redevelopment based on N.J.S.A. 40A:12A-5(h) (“The
designation of the delineated area is consistent with smart
growth planning principles adopted pursuant to law or
regulation.”).
Ms. Talley submitted an Addendum to the second
Redevelopment Study on September 26, 2007. The Addendum
responded to a recent property revaluation in Hackensack and the
Court’s decision in Gallenthin. Based on Gallenthin, the
Addendum concluded that the properties no longer met the
criterion for redevelopment under N.J.S.A. 40A:12A-5(e). As a
result, according to H2M, the Main Street property now qualified
as an area in need of redevelopment under only three sections of
the LRHL, N.J.S.A. 40A:12A-5(a), (b), and (d), and the Moore
Street parking lot now qualified under only one section,
N.J.S.A. 40A:12A-5(d).
The Planning Board held public hearings on eight days from
December 13, 2006 to January 24, 2008. During the hearings,
planners testified for both sides. Monaghan also testified
about the history of the properties.
During the course of the hearings, Mr. Pessolano, an author
of the first study and a planner retained by Hackensack,
8
conceded that he had not considered whether property values had
increased, declined, or remained the same in the potential
redevelopment area; whether any properties had been foreclosed
upon or sold through tax sales; whether people were actively
buying or selling property in the area and the prices of any
properties sold; or whether properties were in arrears for non-
payment of taxes, among other related factors. Although the
redevelopment studies highlighted parking, circulation, and
traffic concerns at multiple points, Mr. Pessolano also
testified that no parking study was done of the area, no parking
inventory had been done, and traffic accidents in the area had
not been reviewed.
Ms. Talley, who worked on both studies and the addendum for
the Planning Board, testified as well. Among other things, she
stated that the parking lot at Moore Street met the criteria for
redevelopment under the LRHL. She also agreed, under cross-
examination, that with a few improvements, the property would
not meet the criteria; some landscaping, striping, and exterior
lighting could better define the parking area and separate it
from the sidewalk, so that the parcel would no longer be “in
need of redevelopment.”
Peter Steck, a community planning consultant retained by
the owners, submitted a report and testified as well. He
9
maintained that the properties did not qualify for designation
under the LRHL as areas in need of redevelopment.
On February 13, 2008, the Planning Board adopted a
resolution that designated five properties -- including 62-64
Main Street and 59-61 Moore Street -- as areas in need of
redevelopment. It found that nine other properties did not
qualify. The resolution referenced the studies and testimony at
the hearing, without further comment, and contained brief
findings of fact and conclusions of law for the properties,
which are reviewed below.
The Mayor and City Council passed Resolution No. 272-08 on
August 5, 2008, which accepted and adopted the recommendations
of the Planning Board. For reasons that are not relevant to
this appeal, the governing body withdrew the resolution and, on
April 5, 2011, adopted Resolution No. 159-11 (Resolution), which
again accepted the Planning Board’s recommendations.
C.
Plaintiffs 62-64 Main Street, L.L.C., and 59-61 Main
Street, L.L.C., filed a complaint in lieu of prerogative writs
on May 18, 2011 to challenge the Resolution. They sought a
declaration that the designated properties were not an area in
need of redevelopment.
The trial court affirmed the Resolution. The court
rejected the owners’ interpretation of Gallenthin, supra, and
10
held that “the term ‘blight’ does not apply to each of the
LRHL’s statutory criteria.” The trial judge concluded that
Hackensack had not acted arbitrarily, capriciously, or
unreasonably and found substantial evidence in the record to
support the designation of each property.
The Appellate Division reversed. In an unpublished
opinion, the panel observed that “Gallenthin established a
heightened standard for designating an area in need of
redevelopment, requiring not only a determination that an area
satisfies a subsection under N.J.S.A. 40A:12A-5, but also a
finding of blight.” In light of Gallenthin, that finding was
necessary to satisfy the State Constitution. Thus, although the
Court in Gallenthin addressed only subsection (e) of the LRHL,
the panel reasoned that “Gallenthin’s holding applies to every
subsection of N.J.S.A. 40A:12A-5.”
As applied to this case, the panel noted, “[i]t is also
clear that neither the Board nor the Mayor and Council
considered whether the conditions noted in the Board’s
resolution rose to the level of blight.” In addition, the
Appellate Division found that the resolutions “provide[d]
insufficient findings to support their conclusions.” The panel
therefore reversed Hackensack’s designations under the LRHL.
11
II.
A.
The government’s taking of private property is an
extraordinary event. As this Court has cautioned, “[t]he
condemnation process involves the exercise of one of the most
awesome powers of government.” City of Atl. City v. Cynwyd
Invs., 148 N.J. 55, 73 (1997) (discussing Eminent Domain Act).
The same is true for the redevelopment process. The immense
authority that municipalities have to designate areas in need of
redevelopment and ultimately take private property for that
purpose can serve as “a valuable tool” to reverse the effects of
“economic deterioration.” Gallenthin, supra, 191 N.J. at 365.
But that power, of course, can also be abused. In either case,
use of the government’s authority has lasting, serious
consequences for owners of private property -- not all of whom
have the means to challenge official actions and try to protect
homes and businesses they have lived in and operated for years.
The State Constitution therefore places important limits on
the State’s power to take -- and seek to take -- private
property. As this Court expounded upon in Gallenthin, the
Constitution requires the State to pay “just compensation” for
property taken by eminent domain. Id. at 356; N.J. Const. art.
I, ¶ 20. The Constitution also guarantees that no one can be
“deprived of property without due process of law.” Gallenthin,
12
supra, 191 N.J. at 356 (citing Twp. of W. Orange v. 769 Assocs.,
172 N.J. 564, 572 (2002)). In addition, government may only
take property for a “public use.” N.J. Const. art. I, ¶ 20.
Article VIII, Section 3, Paragraph 1 of the Constitution,
referred to as the Blighted Areas Clause, expands on that
requirement. It states that “[t]he clearance, replanning,
development or redevelopment of blighted areas shall be a public
purpose and public use, for which private property may be taken
or acquired.”
To guard against governmental abuse of power, the United
States Constitution has similar protections. As Justice
Brandeis wrote more than seventy-five years ago, the federal
Constitution requires a “justifying public purpose” and the
payment of just compensation before the government may take
private property under its eminent domain authority. Thompson
v. Consol. Gas Util. Corp., 300 U.S. 55, 80, 57 S. Ct. 364, 376,
81 L. Ed. 510, 524 (1937) (citations omitted). The guarantee of
due process before the government may take private property is
equally well-settled. See Ochoa v. Hernandez y Morales, 230
U.S. 139, 161, 33 S. Ct. 1033, 1041, 57 L. Ed. 1427, 1437
(1913). In light of those state and federal constitutional
protections, any legislation to redevelop and take private
property must strike the right balance between serving a public
purpose and protecting individual property rights.
13
Based on the authority of the Blighted Areas Clause, the
Legislature enacted the LRHL and its predecessor, the Blighted
Areas Act, N.J.S.A. 40:55-21.1 to -21.14 (repealed by L. 1992,
c. 79, § 59), which empowered government officials to designate
areas as blighted or in need of redevelopment. Gallenthin,
supra, 191 N.J. at 357, 362; see also N.J.S.A. 40A:12A-6(c). To
be sure, the Clause granted the Legislature, and state and local
governments in turn, only the authority “allowed by [the] State
Constitution.” Gallenthin, supra, 191 N.J. at 359. For that
reason, the entirety of the LRHL, and not just a single
subsection, derives its authority from the Blighted Areas Clause
and must comply with it. In that way, the Clause “operates as
both a grant and limit on the State’s redevelopment authority.”
Ibid. And those twin purposes enable government both to
redevelop deteriorated property and guard against the abuse of
that power.
The LRHL outlines a careful process for the redevelopment
of private property. First, the governing body of a
municipality must “authorize the planning board to undertake a
preliminary investigation to determine whether the proposed
area” qualifies as a “redevelopment area” under the law.
N.J.S.A. 40A:12A-6(a). The statute calls for notice and a
public hearing in front of the planning board. N.J.S.A.
40A:12A-6(b)(2)-(3). After the hearing, the planning board must
14
recommend whether the area meets the statutory criteria for
redevelopment. N.J.S.A. 40A:12A-6(b)(5)(a). The town’s
governing body, in turn, “may adopt a resolution determining
that the delineated area, or any part thereof, is a
redevelopment area.” N.J.S.A. 40A:12A-6(b)(5)(b). That
determination must be supported by substantial evidence in the
record. N.J.S.A. 40A:12A-6(b)(5)(c).
Section 5 of the LRHL lies at the heart of the process.
The section lists eight specific criteria. N.J.S.A. 40A:12A-
5(a)-(h). For a municipality to designate an area “to be in
need of redevelopment,” town officials must first find that one
of the delineated conditions exists.
The town’s designation is pivotal to the takings process.
Without it, the process stops in its tracks. See Gallenthin,
supra, 191 N.J. at 348, 371 (noting that designation subjects
private property to taking by eminent domain). If town
officials decide that an area is in need of redevelopment, the
governing body may go forward and adopt a redevelopment plan for
the area. N.J.S.A. 40A:12A-7(a). The municipality can then
“proceed with the clearance, replanning, development and
redevelopment of the area designated in that plan.” N.J.S.A.
40A:12A-8. In particular, the town can condemn and acquire
private property under the Eminent Domain Act to carry out the
15
redevelopment plan. N.J.S.A. 40A:12A-8(c) (citing N.J.S.A.
20:3-1 to -50).
B.
In 2007, this Court considered the constitutionality of the
LRHL in Gallenthin. The case centered around a sixty-three acre
parcel of land in Paulsboro, most of which was undeveloped open
space that the State Department of Environmental Protection had
identified as protected wetlands. Gallenthin, supra, 191 N.J.
at 348-49. Gallenthin Realty and George and Cindy Gallenthin
(collectively, Gallenthin) owned the property. Id. at 348.
They sporadically used it as a “dredging depot” and leased parts
of the land to an environmental clean-up organization. Id. at
349.
The Borough of Paulsboro adopted a new master plan in 1998,
which described the Gallenthin property as “idle” and encouraged
the town to explore acquiring and redeveloping the property.
Id. at 350. The following year, the local planning board
investigated whether several parcels -- not including the
Gallenthin property -- could be designated as in need of
redevelopment under the LRHL. Ibid. In 2002, the town added
the Gallenthin property to the potential redevelopment site and
asked an engineering firm to examine the parcel. Id. at 351.
The firm later reported that the land was “stagnant and not
fully productive,” and that it “underutiliz[ed]” a rail line on
16
the edge of the property. Id. at 352. As a result, the study
concluded that the “existing conditions . . . satisfy the
statutory criteria necessary to deem the study area an area in
need of redevelopment.” Ibid. After a public hearing, the
planning board, relying on N.J.S.A. 40A:12A-5(e),1 recommended
1At the time, section 5(e) of the LRHL provided that an area
could be found to be in need of redevelopment if the governing
body found
[a] growing lack or total lack of proper
utilization of areas caused by the condition
of the title, diverse ownership of the real
property therein or other conditions,
resulting in a stagnant or not fully
productive condition of land potentially
useful and valuable for contributing to and
serving the public health, safety and welfare.
[N.J.S.A. 40A:12A-5(e) (2007) (emphasis
added).]
Following Gallenthin, the Legislature amended section 5(e).
It now reads as follows:
[a] growing lack or total lack of proper
utilization of areas caused by the condition
of the title, diverse ownership of the real
properties therein or other similar conditions
which impede land assemblage or discourage the
undertaking of improvements, resulting in a
stagnant and unproductive condition of land
potentially useful and valuable for
contributing to and serving the public health,
safety and welfare, which condition is
presumed to be having a negative social or
economic impact or otherwise being detrimental
to the safety, health, morals, or welfare of
the surrounding area or the community in
general.
17
that the Gallenthin property qualified for redevelopment, and
the Borough adopted the recommendation. Id. at 352-54.
Gallenthin challenged the designation and claimed that its
property did not meet any of the criteria under the LRHL. Id.
at 354. The trial court upheld Paulsboro’s determination, and
the Appellate Division affirmed that judgment. Ibid. This
Court granted Gallenthin’s petition for certification, which
challenged the constitutionality of section 5(e) of the LRHL.
The Court reversed, and its decision followed a
straightforward path. As the Court explained, the appeal
“requires us to ascertain the meaning of the term ‘blighted’ as
used in the New Jersey Constitution, and determine whether . . .
N.J.S.A. 40A:12A-5(e) is within the scope of that term.” Id. at
358 (emphasis added). To decide the first question, the Court
reviewed various definitions of the term “blight,” considered
scholarly articles that spanned sixty years, examined the record
of the 1947 Constitutional Convention, and surveyed the statutes
and case law of other states. Id. at 360-62, 364-65.
The Court also examined the evolution of the term “blight”
in New Jersey. It noted that “in adopting the Blighted Areas
Clause, the framers were concerned with addressing a particular
phenomenon, namely, the deterioration of ‘certain sections’ of
[N.J.S.A. 40A:12A-5(e) (2015) (emphasis
added)].
18
‘older cities’ that were causing an economic domino effect
devastating surrounding properties.” Id. at 361-62. The Court
observed that, years later, the term “blight” expanded beyond
“slum clearance” to include redevelopment plans in suburban and
rural areas and “the acquisition of land in that context.” Id.
at 363 (referencing the Blighted Areas Act).
The Court concluded that “blight” has two components under
the meaning of the State Constitution: (1) “deterioration or
stagnation” (2) that “has a decadent effect on surrounding
property.” Id. at 365. To underscore its holding, the Court
repeated it not once, not twice, but three times:
*“[T]he term presumes deterioration or stagnation that
negatively affects surrounding areas,” id. at 360;
*“Although the meaning of ‘blight’ has evolved, the term
retains its essential characteristic: deterioration or
stagnation that negatively affects surrounding properties,” id.
at 363; and
*“At its core, ‘blight’ includes deterioration or
stagnation that has a decadent effect on surrounding property,”
id. at 365.
The Court placed no limit on its holding. It set out to
define the meaning of blight under the New Jersey Constitution,
not a subpart of a statute. And the Court expressly outlined a
standard. Only after determining what “blight” meant under the
19
Constitution did the Court turn to its second question: whether
subsection (e) complied with the constitutional standard. The
Court found that Paulsboro’s construction of the law did not.
Id. at 365. The Court concluded that “Paulsboro’s
interpretation of N.J.S.A. 40A:12A-5(e), which would equate
‘blighted areas’ to areas that are not operated in an optimal
manner, cannot be reconciled with the New Jersey Constitution.”
Ibid. And the Court explained why: because the meaning of the
term “blight” under the Constitution “includes deterioration or
stagnation that has a decadent effect on surrounding property.”
Ibid. Under Paulsboro’s approach, by contrast, “any property
that is operated in a less than optimal manner is arguably
‘blighted.’” Ibid. The Court reasoned that “[i]f such an all-
encompassing definition of ‘blight’ were adopted, most property
in the State would be eligible for redevelopment.” Ibid.
Because Paulsboro’s sole reason “for classifying the Gallenthin
property as ‘in need of redevelopment’ was that the property, in
isolation, was ‘not fully productive,’” the Court ruled that the
designation went “beyond the scope” of subsection 5(e) and
invalidated the finding. Id. at 372.2
2 To avoid rendering section 5(e) unconstitutional, the Court
held that the clause only applied “to areas that, as a whole,
are stagnant and unproductive because of issues of title,
diversity of ownership, or other similar conditions.” Id. at
348 (emphasis added). The Legislature revised the statute
accordingly in 2013. L. 2013, c. 159, § 1.
20
Gallenthin teaches certain important lessons. Whenever a
town designates an area to be in need of redevelopment, the
designation must satisfy the definition of blight under the
Constitution. As a result, if the Legislature passes a statute
that allows for the taking of property on less than a showing of
blight, as required by the Constitution and defined in
Gallenthin, the statute cannot survive a challenge and the
designation cannot stand.
The Appellate Division understood Gallenthin in that way.
It acknowledged that the opinion only addressed one clause of
the LRHL but highlighted the Court’s approach: that subsection
5(e) could not be “applied to cover property that is not
blighted within the meaning of the Constitution.” Focusing on
the Court’s reasoning, the panel concluded that “Gallenthin’s
holding applies to every subsection of N.J.S.A. 40A:12A-5.”
Another appellate panel made the following similar observation:
Gallenthin “reaffirmed that the New Jersey Constitution requires
a finding of actual blight before private property may be taken
for purposes of redevelopment.” Hoagland v. City of Long
Branch, 428 N.J. Super. 321, 324 (App. Div. 2012), certif.
denied, 213 N.J. 388 (2013).
C.
The majority, however, reads Gallenthin differently. It
essentially argues that Gallenthin could not have meant what it
21
said in light of the history of earlier legislative schemes, the
meaning of the Blighted Areas Clause, and prior decisions of the
Court in Wilson v. City of Long Branch, 27 N.J. 360 (1958), and
Levin v. Township Committee of Bridgewater, 57 N.J. 506, appeal
dismissed, 404 U.S. 803, 92 S. Ct. 58, 30 L. Ed. 2d 35 (1971).
See ante at __-__ (slip op. at 17-25). A careful reading of the
historical record and the case law, however, reveals that they
did not address the meaning of the term “blighted” under the
Constitution or foreclose Gallenthin’s discussion of that issue.
The Blighted Areas Clause was adopted as part of the 1947
Constitution against the backdrop of two legislative schemes:
the Redevelopment Companies Law, L. 1944, c. 169; and the Urban
Redevelopment Law, L. 1946, c. 52. Both acts provided for
public and private roles to redevelop decaying urban areas.
Neither statute, though, defined the term “blighted.” The 1944
law “declared” that “substandard conditions and [u]nsanitary
housing conditions owing to obsolescence, deterioration and
dilapidation of buildings, or excessive land coverage, lack of
planning, of public facilities, of sufficient light, air and
space, and improper design and arrangement of living quarters”
exist in certain municipalities in New Jersey. L. 1944, c. 169,
§ 2. The 1946 act contained a similar declaration. L. 1946, c.
52, § 2 (“congested, dilapidated, substandard, unsanitary and
dangerous housing conditions and excessive land coverage
22
existing in portions of the municipalities in this State are a
menace to the health, safety, morals and welfare of the public,
and constitute social and economic liabilities”). Both statutes
outlined an approach to address the problem, but they did not
identify specific criteria to determine when a parcel of private
land could be considered “blighted” or “in need of
redevelopment,” as the BAA and LRHL later did.
Neither statute appears to have gotten much use. A witness
at the constitutional convention explained that, “with the fear”
that the laws might be “held unconstitutional hanging over their
heads,” “[n]o corporations have been willing, so far,” to invest
money to undertake the public/private projects envisioned.
Proceedings of the New Jersey Constitutional Convention of 1947,
vol. 1 at 743-44.
The Blighted Areas Clause, no doubt, was adopted to address
that concern and signal that the new Constitution authorized
legislation like the 1944 and 1946 acts. See McClintock v. City
of Trenton, 47 N.J. 102, 105 (1966); see also James R. Zazzali &
Jonathan L. Marshfield, Providing Meaningful Judicial Review of
Municipal Redevelopment Designations: Redevelopment in New
Jersey Before and After Gallenthin Realty Development, Inc. v.
Borough of Paulsboro, 40 Rutgers L.J. 451, 474-75 (2009). The
history of the constitutional convention shows that the framers
validated an important concept: the new Constitution, in broad
23
terms, empowered government to redevelop and take blighted
private property. But the framers did not analyze or validate
each declaration and phrase in the 1944 and 1946 acts. Nor did
they define the term “blighted.”
The Legislature acted soon after, in 1949, and passed the
Blighted Areas Act, the predecessor to the LRHL. L. 1949, c.
187. The new law defined “blighted area” in four subsections.
The definition included, for example, “[b]uildings and
structures which are unfit, unsanitary and unsafe for human use
and habitation by reason of age, physical deterioration,
dilapidation or obsolescence,” id. at § 1(a), and “[a]
prevalence of factors conducive to ill health, transmission of
disease, infant mortality, juvenile delinquency, crime and
poverty,” id. at § 1(d).
Two years later, in 1951, the Legislature amended the
statute and broadened the definition of “blighted areas.” L.
1951, c. 248, § 1. (The abbreviation “BAA” refers to this
amended version of the Blighted Areas Act.) As the majority
outlines, the definitions that appear at N.J.S.A. 40:55-21.1(a),
(b), and (d) (repealed) of the BAA are nearly identical to their
companion sections in the LRHL, at N.J.S.A. 40A:12A-5(a), (b),
and (d). See ante __-__ (slip op at 20-21); see also Forbes v.
Bd. of Trs. of S. Orange Vill., 312 N.J. Super. 519, 526 (App.
Div.), certif. denied, 156 N.J. 411 (1998).
24
The Court addressed certain aspects of the
constitutionality of the BAA in Wilson. In that case, the Mayor
and Board of Commissioners of the City of Long Branch adopted a
recommendation of the planning board that declared an area of
the city “blighted.” Wilson, supra, 27 N.J. at 368-69. The
City acted under the BAA. Owners of the land challenged the
designation and argued that the BAA was unconstitutional for
various reasons.
Justice Francis’s opinion offers a robust defense of the
benefit of “[c]ommunity redevelopment.” Id. at 370-71. The
detailed opinion also outlines the specific bases for
plaintiffs’ constitutional challenge: (1) the title of the BAA
embraces three objects and thereby violated Article IV, section
7, paragraph 4 of the Constitution; (2) the BAA permits a taking
of property without just compensation, in that a determination
of blight alone diminishes the market value of property and thus
constitutes a taking; (3) the State and Federal Constitutions
conflict with the BAA because the law “permits the taking of
property by the municipality for private use, namely, for
development by private capital and for the pecuniary profit of
private individuals”; (4) the act “discriminates against private
property owners and in favor of public utilities”; (5) “the act
contains no reasonable standards to guide a planning board or
governing body in making a determination that an area is
25
blighted”; and (6) the authority to define the term “blighted,”
as used in the Blighted Areas Clause of the Constitution,
“resides in the judicial and not the legislative branch of the
government.” Id. at 373-83. Against those particular
challenges, Wilson upheld the constitutionality of the statute.
The first four bases for upholding the law against
constitutional attack are of no relevance here. The fifth claim
-- whether the BAA delegated unbridled discretion to towns --
also rested on explicit arguments that the Court addressed. The
owners claimed that the act’s delegation of power was
unrestrained because (1) it did not contain “any limitation upon
the size of the area which may be designated as blighted”; and
(2) the act allowed for “the possibility that sound structures
or even a portion of a municipality containing a number of such
structures may be included.” Id. at 379. In that particular
context, Justice Francis stated that the five relevant criteria
in the BAA “define ‘blighted area’ with substantial exactitude
and confine[d] the municipal decision to those limits.” Id. at
378. He therefore expressed “no hesitancy in finding [the
criteria] to be a sufficient channeling of the local authority.”
Ibid. The opinion, however, did not attempt to define the term
“blighted” or address whether the individual criteria in the BAA
lived up the term’s meaning under the Constitution.
26
The owners’ sixth constitutional challenge -- whether the
judiciary or the legislative branch had the authority to define
“blighted” -- likewise does not relate to the questions the
Court tackled in Gallenthin.
To be sure, Wilson upheld the BAA against constitutional
challenge. It did so in the context of the specific challenges
leveled before the Court in that case, and it should be read in
that context. As Justice Francis’s careful accounting of the
parties’ arguments reveals, though, the opinion did not squarely
address the core question of the meaning of the term “blighted”
under the Constitution.
The decision in Levin likewise did not directly consider
that issue. For the most part, the Court evaluated whether a
declaration that certain land was “blighted” satisfied the
statutory test of the BAA. Levin, supra, 57 N.J. at 509. It
did not address constitutional concerns except for one minor
issue.
The Levin Court debated whether the facts of the case
justified the declaration under one subsection of the law. Id.
at 541. A sharply divided Court found substantial evidence to
support the finding. Ibid. In the last paragraph of the
majority’s opinion, Justice Francis, relying on Wilson, once
again rejected a constitutional claim that the BAA “delegates
unbridled legislative power to the municipal agencies” without
27
“adequate standards.” Id. at 545. As before, that conclusion
did not address or foreclose the issues raised in Gallenthin.
Gallenthin marked the first time the Court squarely focused
on the meaning of the term “blighted” in the Constitution. See
Zazzali & Marshfield, supra, at 491-92. The opinion did not
need to parse Wilson or Levin, which had a different emphasis in
response to different claims. Because neither decision embraced
a particular definition of “blighted” under the Constitution,
there was no need to “repudiate[]” those rulings, as the
majority suggests. See ante at __ (slip op. at 28). Gallenthin
thus stands as the guiding law for the constitutional meaning of
“blighted.”
Among other reasons, the majority suggests that
Gallenthin’s standard for “blight” -- “deterioration or
stagnation that negatively affects surrounding properties,”
Gallenthin, supra, 191 N.J. at 363 -- was not meant to encompass
parts of the LRHL beyond subsection (e) because the definition
“does not describe every form of possible blight.” Ante at __
(slip op. at 28). As proof, the majority offers hypotheticals
that are hard to imagine. Id. at __-__ (slip op. at 28-29).
Are there “isolated” deteriorating slums that do not affect
surrounding properties? Don’t truly decadent slums have a
harmful effect on neighboring properties -- both developed and
unimproved land -- and inhibit growth because of decay? Can it
28
really be said that a “toxic industrial site” has no effect on
neighboring land? Gallenthin logically extends to both
hypotheticals, and both would likely be able to satisfy its test
for “blight.”
Gallenthin established a clear standard for the meaning of
blight in the Constitution, which prior case law not been
required to address. By doing so, Gallenthin achieved another
important aim: it helped guard against the real risk of abuse
that the power of eminent domain presents. Justice Haneman’s
dissent in Levin gave voice to that concern. He wrote that
“[g]overnment is here taking land from one owner by force and
giving it to another, on terms that may not benefit the former
but will of necessity benefit the latter. . . . In this aspect
of the municipal relationship lies the inherent danger of an
abuse of discretion.” Levin, supra, 57 N.J. at 551 (Haneman,
J., dissenting). The Justice added that “an individual without
political connections runs the risk of having his property taken
from him by force for the benefit of a better connected or more
highly regarded individual.” Id. at 552.
With today’s reversal of Gallenthin’s reach, that risk
resurfaces.
III.
This case focuses on three different parts of the LRHL:
subsections 5(a), (b), and (d). Those sections, as well, should
29
be analyzed in light of the constitutional standard in
Gallenthin. Section 5 provides in part as follows:
A delineated area may be determined to be in
need of redevelopment if, after investigation,
notice and hearing as provided in [N.J.S.A.
40A:12A-6], the governing body of the
municipality by resolution concludes that
within the delineated area any of the
following conditions is found:
(a) The generality of buildings are
substandard, unsafe, dilapidated, or
obsolescent, or possess any of such
characteristics, or are so lacking in light,
air, or space, as to be conducive to
unwholesome living or working conditions.
(b) The discontinuance of the use of
buildings previously used for commercial,
manufacturing, or industrial purposes; the
abandonment of such buildings; or the same
being allowed to fall into so great a state of
disrepair as to be untenantable.
. . .
(d) Areas with buildings or improvements
which, by reason of dilapidation,
obsolescence, overcrowding, faulty
arrangement or design, lack of ventilation,
light and sanitary facilities, excessive land
coverage, deleterious land use or obsolete
layout, or any combination of these or other
factors, are detrimental to the safety,
health, morals, or welfare of the community.
[N.J.S.A. 40A:12A-5 (emphasis added).]
None of the sections expressly requires a finding that a
property suffers from deterioration or stagnation in a way that
has a negative effect on surrounding properties. In other
words, none of the subsections expressly satisfies the
30
constitutional standard. It is therefore necessary to ask
whether the subsections implicitly live up to the required two-
part definition of blight through the way they describe various
conditions of property.
Because the statute is written in the disjunctive, any
combination of findings could justify the conclusion that a
property is in need of redevelopment. In other words, towns can
pick from a menu of factors to reach that end.
Many of the phrases in subsection (a), if supported by
substantial evidence in a record, could justify a finding of
deterioration or stagnation. But is that true for all of the
factors? Is “substandard” property deteriorating or stagnating
in all cases? Do all small properties that are “so lacking in .
. . space . . . as to be conducive to unwholesome living”
necessarily satisfy that requirement? The above language does
not even require that unwholesome conditions actually exist,
only that the premises are “conducive” to that condition.
Subsection (a) is also silent as to the second prong of the
definition of blight -- a negative or decadent effect on
surrounding properties -- which must also be satisfied.
The same concerns are true for subsections (b) and (d).
Once again, many of the factors listed could support a finding
of blight, but it is not clear that all necessarily would.
Under subsection (b), for example, does “discontinuance of . . .
31
use,” on its own, suffice to show blight in all cases? Under
subsection (d), does a “faulty arrangement or design” or
“excessive land coverage” which is “detrimental to the . . .
morals . . . of the community” necessarily establish
deterioration or stagnation? It is far from clear what that
even means. Other combinations of factors also invite troubling
concerns and do not necessarily meet the standard of blight
under the Constitution.
Only subsection (d) comes close to addressing the second
prong that “blighted” encompasses -- a negative effect on
surrounding properties. The section states that the listed
factors must be “detrimental to the safety, health, morals, or
welfare of the community.” But not all of those disjunctive
terms necessarily mean there is an actual negative effect on
neighboring properties.
Gallenthin alleviated those concerns by defining “blighted”
with care. To satisfy the State Constitution, a town seeking to
redevelop and ultimately take property under any section of
N.J.S.A. 40A:12A-5 -- and not just subsection (e) -- must find
that the property is deteriorating and stagnant in a way that
negatively affects surrounding properties. Construed in that
fashion, the statute is saved both from possible overreaching
and constitutional attack.
32
Gallenthin has led to clarity, not chaos. See ante at
(slip op. at 31-32). There is no reason to expect otherwise by
adhering to its holding. The majority’s narrow reading of
Gallenthin, by contrast, leaves open the possibility of
countless future challenges. Even worse, officials of governing
bodies will be empowered to proceed down the road toward taking
private property on less than a meaningful showing of actual
blight. If and when that happens, the commands of the
Constitution will go unmet.
IV.
In my judgment, this matter should be remanded to the
Planning Board. The Board should be allowed to reconsider its
determination in light of the standard for blight in Gallenthin.
In other words, the Planning Board should be asked to consider
whether, in addition to the required findings under subsections
(a), (b), or (d) of N.J.S.A. 40A:12A-5, the two properties are
deteriorating or stagnant in a way that negatively affects
surrounding properties.
The majority instead upholds the City’s determination on
the record before the Court. A close look at the town’s
findings and the record, however, does not support the decision
the town reached.
The majority cites at length to the redevelopment studies
and addendum prepared by H2M. To the extent they support
33
findings in the resolution of the Planning Board, which the
Mayor and City Council adopted, the studies are relevant --
provided they contain “substantial evidence” in support of the
town’s determination. N.J.S.A. 40a:12A-6(b)(5)(c). But the
studies cannot serve as a substitute for the actual findings of
the Board and Council. The Board and Council’s findings must
themselves address and establish blight.
The proper starting point, then, is the limited set of
findings that Hackensack made. The Planning Board resolution
found as follows:
[As to 62-64 Main Street:]
Based upon H2M Group’s revised Redevelopment
Study, dated May 15, 2007 and Addendum 1
report dated September 27, 2007, Mr. Steck’s
Planning Evaluation dated August 21, 2007, and
the testimony given at the hearings by Mr.
Pessolano on December 13, 2006, Ms. Talley on
September 27, 2007, and Mr. Steck on December
4, 2007, the Board found that Block 205, Lots
4 through 7 contains buildings which show
prominent signs of structural deterioration,
and is boarded up to prevent unauthorized
access. The code enforcement issued by the
City to the property owner on March 10th,
2005, to demolish the buildings or correct
unsafe conditions, places the property within
criteria ‘a’ of the statute because the two
buildings are substandard and unsafe for
occupancy. The property meets criteria ‘b’
because the two existing commercial buildings
are vacant due to deteriorated conditions that
have rendered them untenable [sic]. The
parking area is unsightly and not well
maintained. The property also suffers from
34
faulty arrangement of design under criteria
‘d’.3
[As to 59-61 Moore Street:]
Based upon H2M Group’s revised Redevelopment
Study, dated May 15, 2007 and Addendum 1
report dated September 27, 2007, Mr. Steck’s
Planning Evaluation dated August 21, 2007, and
the testimony given at the hearings by Mr.
Pessolano on December 13, 2006, and Ms. Talley
on October 11, 2007 and November 8, 2007, the
Board found that Block 205, Lot 8 meets
criteria ‘d’ for faulty arrangement of design,
which is indicated by the undefined layout and
related poor circulation for the parking lot.
The conditions have a negative impact on the
surrounding properties because it is an
unsightly area and the inefficient utilization
of the parking area contributes to greater use
of the on-street parking resources than would
otherwise occur.
Based on those brief findings -- and nothing more -- the City
can now proceed down the road to take private property from its
3The majority repeats statements counsel made at oral argument -
- that the roof to one of the buildings at 62-64 Main Street
collapsed during this appeal, and the building was later torn
down. See ante at __, __ (slip op. at 6 n.1, 38). That
information does not belong in the opinion. It is not in the
record and, of course, was not before the City when it reached
its decision. A reviewing court evaluates the propriety of a
resolution based on particular evidence at the time of the
initial decision. See N.J.S.A. 40A:12A-6(b)(5)(c). Courts
should not consider evidence outside the record that was not
before a planning board -- whether the evidence strengthens or
weakens the board’s decision. In this case, ironically, the
removal of one of the buildings makes the overall property
safer.
This matter does not require the Court to consider whether
the passage of time and changes to an area might warrant
reconsideration of a town’s redevelopment designation. See
Zazzali & Marshfield, supra, at 499-500.
35
rightful owners because this Court’s decision paves the way. I
believe that the Constitution requires more.
“[A] presumption of validity” applies to a town’s
designation of blight. Levin, supra, 57 N.J. at 537. Its
determination is entitled to deference if supported by
“substantial evidence” in the record. See Gallenthin, supra,
191 N.J. at 372-73; N.J.S.A. 40A:12A-6(b)(5)(c).
Here, the sparse findings of the Board make only a passing
reference to the Redevelopment Studies and Addendum and the
testimony before the Planning Board. The Board’s resolution
mentions few concerns and highlights no particular areas of
testimony. In addition, the resolution offers little by way of
explanation. For the most part, it recites conclusory terms
that mirror the statute: “substandard,” “unsafe,”
“untenantable,” “faulty arrangement of design,” and the like.
Gallenthin, supra, cautioned against that very practice: “[A]
municipality must establish a record that contains more than a
bland recitation of applicable statutory criteria and a
declaration that those criteria are met.” 191 N.J. at 373.
Beyond that, as the Appellate Division noted, it is “clear
that neither the Board nor the Mayor and Council considered
whether the conditions noted in the Board’s resolution rose to
the level of blight” under Gallenthin. The Board’s findings,
36
adopted by the Mayor and City Council, are therefore
insufficient.
The Board’s findings for 62-64 Main Street do not address
whether the property has a negative effect on the surrounding
area. That issue cannot be left to inference and instead calls
for “meaningful and quantitative evidence.” Zazzali &
Marshfield, supra, at 496. The public and the property’s owners
are entitled to a crisp determination on this vital question
before government officials can designate private property as in
need of redevelopment. That is particularly true when
properties are not located in an area suffering from economic
degradation. Here, both parcels are in a thriving, commercial
area that is home to a newly built CVS, Auto Zone, and branch of
TD Bank.
As to 59-61 Moore Street, the resolution points to a
“faulty arrangement of design” because of the lot’s “undefined
layout” and “related poor circulation.” The resolution then
concludes -- in a single sentence -- that the parcel’s
conditions “have a negative impact on the surrounding
properties” because the property is “unsightly” and has led to
more “on-street parking . . . than would otherwise occur.” Yet
one of the City’s experts conceded that no parking study had
been done of the area. And the City’s other expert conceded
that with a few improvements -- some landscaping, striping, and
37
exterior lighting, to better define the boundary between the
parking lot and the sidewalk -- the property would not qualify
as an area in need of redevelopment under the statute. The
Board credited both experts. Cf. ante at (slip op. 37 n.
8). It is difficult to see how those minor conditions, which
can be easily remedied, can satisfy the constitutional
definition of “blighted” and lead to the taking of private
property.
At the core of the Board’s conclusion is the very
possibility that Gallenthin found unacceptable: that private
property might be redeveloped because it “is not used in an
optimal manner.” Gallenthin, supra, 191 N.J. at 373. That sort
of conclusion cannot support a finding of blight under the
Constitution. Ibid.
The majority, focusing on the Moore Street parcel, suggests
that even if the property does not meet the definition of
blight, it might still be designated as part of an area in need
of redevelopment because “[b]light determinations are not viewed
in piecemeal fashion.” Ante at __ (slip op. at 40). The
suggestion, as Hackensack concedes, is premature.
Hackensack focused on whether the Main Street and Moore
Street properties themselves qualify for redevelopment under the
LRHL. The Planning Board’s resolution expressly states that
because “no redevelopment plan has been proposed at this time,”
38
it would be “premature” to include properties “that do not
otherwise meet the statutory criteria” as part of a
redevelopment area.
There are other reasons for concern as well. The LRHL
states that
[a] redevelopment area may include lands,
buildings, or improvements which of themselves
are not detrimental to the public health,
safety or welfare, but the inclusion of which
is found necessary, with or without change in
their condition, for the effective
redevelopment of the area of which they are a
part.
[N.J.S.A. 40A:12A-3 (emphasis added).]
That section finds support in prior case law. Wilson recognized
that a redevelopment area may “include[] some sound homes or
buildings” and that a portion of the plan may “incorporate[]”
structures that “are not substandard” “as an integral part and
necessary to the accomplishment of the redevelopment plan.”
Wilson, supra, 27 N.J. at 379 (emphasis added). Levin similarly
noted that the BAA was “concerned with areas and not with
individual properties” and that single parcels that “could not
be declared blighted if considered in isolation” might be
included. Levin, supra, 57 N.J. at 539.
The Court in Levin made that observation while reviewing
Bridgewater’s designation of 122 acres of rural land as
blighted. Id. at 515-16, 520. The area contained only eighteen
39
or nineteen structures throughout; most of the designated land
was undeveloped. Id. at 516.
This case presents a very different situation. Hackensack
plans to redevelop only five parcels of land that together
comprise less than one acre (.797 acre). The two properties in
question -- 62-64 Main Street and 59-61 Moore Street -- are not
contiguous to the other three parcels. In fact, plaintiffs’
properties are across the street from the other three parcels.
Also, plaintiffs’ two properties comprise 42.4 percent of the
total for all five parcels. (A map of the area captures these
points better than words can, and one is attached at Appendix
A.) If neither of plaintiffs’ parcels qualify as areas in need
of redevelopment under the statute, it is too early to predict
whether they might be “necessary” and “integral” to the
redevelopment of non-contiguous land, separated by a street,
which is comparable in size.4 That question would require
careful scrutiny.
The governing body here had the responsibility to ensure
that its designation of property as “in need of redevelopment”
satisfied the LRHL and the Constitution. It did not do so.
4The City’s Resolution directs the Planning Board to investigate
whether Bridge Street, which bisects the properties, should be
“vacat[ed].”
40
V.
To the majority, this is a “mundane scenario” in which
local officials designated dilapidated, rundown properties in a
downtown section of a city for redevelopment. Ante at __ (slip
op. at 43). It is more than that. According to the record, the
case involved owners of private property who spent hundreds of
thousands of dollars to improve their land in recent years,
leveled part of the buildings on the properties, and presented
three different development plans to town officials -- at the
very time the town moved ahead with its own plan to designate
the area for redevelopment.
That information offers context; the legal question
presented is even more important. Today, the Court permits
privately owned property to be designated for redevelopment --
and ultimately for a taking -- even though local officials have
not found that the land has a negative effect on surrounding
properties. That approach marks a retreat from Gallenthin.
The majority supports its position with pro-development views.
Id. at - (slip op. at 31-32). The Court’s responsibility, though,
is to apply the law in accordance with the Constitution and protect
the individual rights our Constitution guarantees. Those rights serve
as an important check on the power of eminent domain and extend to
residents, homeowners, and businesses that do not want to be removed
from their property and community against their will.
41
To be sure, the redevelopment of deteriorated properties
that cause actual harm to neighboring land can be of great value
to a community. When local officials attempt to take private
property for that purpose, however, they must first satisfy the
commands of the Constitution. Among other things, they must
make a meaningful showing of actual blight. Because that did
not occur here, I respectfully dissent.
JUSTICE SOLOMON joins in this opinion.
42
1
SUPREME COURT OF NEW JERSEY
NO. A-19/20 SEPTEMBER TERM 2013
ON CERTIFICATION TO Appellate Division, Superior Court
62-64 MAIN STREET, L.L.C. and
59-61 MOORE STREET, L.L.C.,
Plaintiffs-Respondents,
v.
MAYOR AND COUNCIL OF THE CITY
OF HACKENSACK; PLANNING BOARD
OF THE CITY OF HACKENSACK,
Defendants-Appellants.
DECIDED March 23, 2015
Chief Justice Rabner PRESIDING
OPINION BY Justice Albin
CONCURRING/DISSENTING OPINIONS BY
DISSENTING OPINION BY Chief Justice Rabner
CHECKLIST REVERSE AFFIRM
CHIEF JUSTICE RABNER X
JUSTICE LaVECCHIA X
JUSTICE ALBIN X
JUSTICE PATTERSON ----------------------- --------------------
JUSTICE FERNANDEZ-VINA X
JUSTICE SOLOMON X
JUDGE CUFF (t/a) ----------------------- --------------------
TOTALS 3 2
1