From the Peanut Gallery – One Man's Opinion

Municipal Challenge to Affordable Housing Law Fails

I have posited as a basic economic principle “that as a general rule people will tend to act in what they perceive to be their (economic, political, social) best interest.”

What is true at the individual level remains true in the aggregate; case in point: municipal governments and housing. New Jersey has over 500 municipalities, each largely funded by the local property tax and dedicated to the concept of home rule and the political survival of incumbent office holders. The greatest and most basic gripe of the local voter is that property taxes are too high, and a major component of that tax burden is the school tax which is directly related to the number of children attending the locally supported public schools.

It is not surprising, therefore, that municipalities will encourage development that generates tax revenue without increasing the need to provide local services, especially as represented by school children. This motive is often, but not always, openly acknowledged; sometimes it will be camouflaged by citing planning concepts such as preservation of the environment or the character of the area and the prevention of suburban sprawl, some of which the advocates may actually believe (in addition to the core goal of making sure unwanted development happens elsewhere, that “someone else” will bear the cost).

To limit school children, these municipalities seek to limit the residential development that will generate school children, at least in numbers that will exceed the new housing’s proportionate contribution to the local property tax base. Techniques to do this include limiting housing to single-family homes of a certain minimum size on large lots (ironically causing the very suburban sprawl used to justify the regulation in the first place).

Home builders are in business to make a profit. Faced with these regulations they will build the expensive, luxury housing that the local government will at least tolerate. But if the regulations were otherwise, they might build significantly more homes on the same land that might be within the reach of the less wealthy.

In the 1970s New Jersey’s Supreme Court issued its decision in cases challenging this misuse of the local zoning power. In what has become known as the Mount Laurel Doctrine, the Court held as a matter of state constitutional law that developing municipalities must use their zoning power to provide a realistic opportunity for the construction of their fair share of housing affordable to low and moderate income households. The initial decision generated litigation, not housing, so in 1983 the Court created the “builders remedy,” an incentive for profit-seeking enterprises to propose the construction of housing in significantly greater density than would otherwise be permitted so long as a substantial percentage was “affordable.”

Fast forward 40 years. The Legislature responded by enacting the Fair Housing Act which created the Council on Affordable Housing (COAH) to create specific regulations to determine each town’s obligation and what housing would qualify as a credit against the obligation and grant “substantive certification” to protect compliant towns from the dreaded builder’s remedy. Municipalities that did not participate in the COAH process took the risk that they might be sued. Still, the whole idea that someone else could tell a municipality what to do, especially in a way that was inconsistent with its own parochial interests, continued to rankle. COAH was never able to adopt rules for the third housing round that passed judicial muster and ultimately the Supreme Court removed the requirement that potential Mount Laurel plaintiffs exhaust (plainly unavailable) administrative remedies before initiating exclusionary zoning litigation.

Instead of state-wide standards for determining the municipal obligation and compliance techniques, there was the potential for considerable variation depending upon where the case was tried. Most municipalities sought to settle these claims, but the parties were limited in their ability to justify the numbers offered and demanded. A few towns took the risk of litigation, resulting in trials that were battles of the planning experts and generally were not as advantageous to the municipal positions as they had hoped.

In 2024 the Legislature passed a statute eliminating COAH and providing a substitute administrative process. When the resulting municipal obligations were published, there as widespread complaint that they were too high. A coalition of towns sued to overturn that act and sought preliminary relief pausing not only its process, but the entire Mount Laurel obligation until their suit was resolved.

Last week the trial court judge denied that relief.¹ There are lots of issues discussed in the decision (it’s long, but not unnecessarily so, and largely accessible even without a law degree), but many keep coming back to the point that the law which the coalition was challenging is not in reality the source of the grievance. Municipalities that are not willing to accept the numbers determined in accordance with that statue do not have to participate in the process; just as before the statute was passed they may bring their own declaratory judgment actions seeking to establish their preferred numbers or do nothing and take the risk of an exclusionary zoning lawsuit. The statute does not limit these choices.

The coalition’s real beef is with the Mount Laurel Doctrine itself. But people have to live somewhere. At its core the Mount Laurel Doctrine is not about charity housing but that municipalities may not use their governmental power to make themselves enclaves for the wealthy. If certain types of development impose what a town considers to be an unfair burden (relative to its neighbors) to pay for education, I suggest that responsibility for that public service be transferred from the local to the state level.

Jay Bohn

January 6, 2025

Thanks to Redevelop NJ for this link: https://www.redevelopnj.com/wp-content/uploads/sites/561/2025/01/MER-L-1778-24-Order-Denying-Plaintiffs_-Requests-for-Injuctive-Relief.pdf ↩︎

NJ’s Opposition to Congestion Pricing Is All About the Money

I hope those New Jersey residents who drive into lower Manhattan aren’t counting on Govenor Murphy to stand for (their) principles in his battle with New York governor Kathy Hochul over Sunday’s impending start of “congestion pricing,” a money grab that will charge cars $9 to enter Manhattan south of 60th Street. Of course, there are those who insist that the purpose of the plan is to encourage commuters to find an alternative to driving in, but the NY State law that authorized congestion pricing requires that it raise $1 billion a year for New York’s transportation projects. And it doesn’t hurt that a lot of the people paying the tax to enter the holy land of lower Manhattan are from New Jersey.

(You may recall that Governor Hochul “paused” the implementation of congestion pricing to avoid hurting NY democrats in the November election. It was unpaused a few weeks later.)

A number of lawsuits have challenged the scheme, but until recently New Jersey’s was the last one with a chance to keep congestion pricing from taking effect as scheduled. Although the court hearing that suit ruled that more environmental analysis is needed, both sides are claiming victory on whether it will start on Sunday.

There are apparently settlement negotiations (secret of course), but it appears that the question is not whether there should be congestion pricing or how much drivers will pay, but what will be New Jersey’s cut. Supposedly there was an offer for money to help NJ Transit. Those NJ residents who think they would benefit from congestion pricing because their commute does not involve driving (and so someone else will pay) are pushing Murphy to settle.

There is of course no guaranty that any settlement funds earmarked for NJ Transit will actually get there, and even if those dollars do, the Legislature can just cut other funds that would have gone there to pay for other, more vote-getting priorities.

Jay Bohn

January 2, 2025

No Obvious Solution to Insurance-Caused Healthcare Costs

With the impending loss of the Star-Ledger Editorial Board and its opinions as a source of blog-fodder, I am trying out a one-year subscription to the online edition of the Washington Post. A few days ago, it published a guest opinion by David Goldhill, described as the CEO of Sesame, a health-care marketplace, entitled “Insurance is what makes U.S. health-care prices so high: America needs a working marketplace where patients are the primary customers.“¹ I half agree with the opinion; that is, I agree with half of it, the diagnosis, but the proposed cure still seems rather vague.

The piece starts by quoting Andrew Witty, the CEO of UnitedHealth Group, who points out: “No one would design a system like the one we have. And no one did . . . .² It’s a patchwork built over decades.”

Goldhill’s basic description of the problem is:

Health insurance was meant to work like other kinds of insurance: When policyholders got sick, they would use the collective financial resources of the healthy to cover their costs. But this model was designed to pay for emergencies such as hospitalizations — not to “share the risk” of erectile dysfunction, weight loss, lifelong management of chronic conditions, or the mental health treatment needed by 1 in 5 Americans. . . . .

It’s as if homeowners’ policies expanded from insuring against fires and floods to also covering utility bills and property taxes, or even replacing worn-out furniture.

This reminds me of the great economic trek that the hypothetical reader of this blog and I took just over three years ago. I said, “Health insurance has grown, not just in the number of insured but in the scope of its benefits. It is no longer just for major expenses (although all medical expenses are now beyond what a typical patient could afford to pay out of pocket), but it covers office visits, physical examinations and prescriptions.”

In the cental post of that extended discussion of economics, I proposed the following thesis: broad-based demand-side subsidies tend to cause the price of the subsidized commodity to increase, a proposition for which I drew further support “from what I described as the SEP Problem: the fact that ‘someone’ else is paying for something can have the effect of increasing the cost that thing, especially where ‘someone’ is someone of whom the consumer is willing to take advantage (the government or insurance companies, for example).”³

The next post applied this concept directly to healthcare:

It has long been my premise that the availability of a source of ready payment for such services means that the cost of the services will increase to absorb available funds. The insured rarely shop for healthcare based on price because the deductible/co-payment will either be a fixed amount or relatively insignificant and somebody else is paying for the balance. Health insurance itself acts as a demand-side subsidy.

So far, Goldhill and I seem to agree. His solution is that “America should get the entire [healthcare] industry to compete vigorously for customers — for patients, that is, not insurance companies.” He believes that “[c]ompetition among providers for dollars spent directly by prudent consumers would not only bring prices down but also encourage more innovative approaches to packaging care.” Perhaps so, but I must have missed how America engenders that competition and prudence. Taking the latter point, how do we encourage such consumers to be prudent? The only obvious answer that springs to mind is that they must have some metaphorical skin in the game, that the consumer must share in the cost of care. This is not going to sit well with those who push for equal access.

Jay Bohn

December 30, 2024

The same opinion actually appeared in yesterday’s Star-Ledger. ↩︎
Unfortunately, I do not have access to the source, so I am uncertain if these are three consecutive sentences. ↩︎
Indeed, in his editorial Goldhill says: “Medicare, Medicaid and Veterans Affairs health care all have been dressed up as pretend insurance. Americans individually pour hundreds of thousands of dollars into the system through premiums and deductibles, yet they somehow keep believing that someone else is paying for their care.” [emphasis added] ↩︎

Biden’s Commutation of 90% of Federal Death Sentences Doesn’t Go Far Enough

For those who are Christian, the Christmas holy day is a good time to reflect on the virtues of mercy and forgiveness. Coincidentally, every four years it coincides with the closing days of a presidential term, a time when presidential pardons and other acts of clemency are common, in part because the political price to be paid is discounted for the incumbent, who is unlikely to run for political office ever again.¹

In addition to the now customary and tongue-in-check Thanksgiving turkey pardon, on December 1, shortly after the 2024 presidential election, President Biden granted his son Hunter a broad pardon, asserting that Hunter had been singled out by his political opponents. On December 12, 2024, citing America’s promise of possibility and second chances, President Biden announced that he had pardoned 39 people and commuted the sentences of nearly 1,500 others. As the public reaction to these actions has shown, such actions will often be controversial and a source of further grief to those who were the victims of the recipient’s conduct.

The President’s constitutional prerogative to show mercy is not limited to those whom he believes have been unjustly prosecuted or who have been rehabilitated. Until a few days ago there were 40 people under sentence of death for federal crimes. On December 23 President Biden announced that he was commuting the sentences of 37 of them to life imprisonment without the possibility of parole.

After expressing “condemn[ation of] for these murderers, grie[f] for the victims of their despicable acts, and ache for all the families who have suffered unimaginable and irreparable loss,” the President stated that “guided by my conscience and my experience as a public defender, chairman of the Senate Judiciary Committee, Vice President, and now President, I am more convinced than ever that we must stop the use of the death penalty at the federal level.”

There has been the predictable response by political partisans and relatives of the victims who will not get to experience eye-for-an-eye justice. I, on the other hand, do not believe that President Biden went far enough; as an opponent of capital punishment in all cases, I would have preferred that all federal death sentences had been commuted.

President Biden’s statement itself did not explain the exceptions. An accompanying “fact sheet” rephrased the President’s stated belief in the need to stop the use of the death penalty at the federal level–a categorical statement–into one with an exception for “cases of terrorism and hate-motivated mass murder.” Sounds to me that like some aide wanted to leave some wiggle room. Which is the President’s true position?

The death penalty is either always wrong or sometimes right. If not always wrong, the decision to impose it becomes a matter of degree. If President Biden truly believes, as his statement says, “that we must stop the use of the death penalty at the federal level,” then are the three exceptions being sacrificed on the altar of political expediency?

Jay Bohn

December 26, 2024

As is true for so many other things, the end of President Trump’s first term is an exception to this statement. Not only did he (successfully) repeat his quest for a second term after losing his 2020 re-election bid, but experience probably convinced him that there would be no political price to be paid for anything he did. ↩︎

Mourning the Loss of Disagreeable Opinion

I didn’t see it in the Star-Ledger‘s announcement of the end of its print edition, but later I learned that it will also discontinue its editorial board and the columns of Tom Moran and Paul Mulshine. I don’t know if it was just the economics of not wanting to pay for locally produced opinion content or if management determined that many people do not subscribe because the newspaper is too liberal. Not that I agreed with all, or indeed most, of the Star-Ledger‘s editorial positions, but I will miss the labeled editorials for several reasons:

The labelled opinion pieces often provide factual details that are not actually reported in the “news” articles.
Opinion is more likely to get included in what is supposed to be news. (I’ve complained about this several times before, for example here.) Look at the choice of covering the end of the presidential campaign. If the Star-Ledger was your only source of news you can be excused for believing that Harris had all the enthusiasm.
Any non-local opinion sources will not give sufficient coverage to local issues. Local policies will be unexamined.
The “other side” might just be right; it’s healthy to know its arguments.

Jay Bohn

November 11, 2024

Not Happy About Being Right

At the end of last year the two newspapers to which I subscribe, the Star-Ledger and the Express-Times, eliminated their Saturday print editions. When that change was announced I posted Elimination of Saturday Print Edition the Beginning of the End for Star-Ledger Newspaper, in which I said: “I believe that [the elimination of the Saturday print edition] marks the point where it became inevitable that local news for most of us, such as it is, will be available only on-line.”

Today, just over a year later, I have been proved right. Both the Star-Ledger and the Express-Times announced yesterday that they will be ending their print editions entirely on February 2, 2025. The carnage includes a number of affiliated papers.

Both publications promise to reallocate resources to strengthen their core newsrooms which, if true, is the only good to come out of this development.

Look, I’m no Luddite. I get lots of news on-line, but I believe that the daily newspaper is the archetype. The publishers must decide once per day what stories make the grade, and they are permanently fixed. Once published the words cannot be unpublished. I like to think that this means great care is taken, certainly more than in an on-line edition. (I often wonder if the online editors actually even proofread what gets posted.) Other concerns apply to on-line articles, as I suggested recently.

It’s also that I find it easier to read a newspaper. A physical paper is actually more portable that a computer or tablet and to read a virtual newspaper on a phone is just way too much scrolling.

I also wonder what the elimination of print newspapers will mean for legal notices that are required to be published. With the elimination of the Star-Ledger and the Express-Times, a substantial percentage of municipalities will have lost their only local daily newspaper. See my prior posts The Purpose of Legal Advertising is to Inform the Public, Not to Support Newspapers and Some Reasons Why Public Notices Should be in the Newspaper.

Jay Bohn

October 31, 2024

The Merits of a Public Policy Do Not Justify the Executive’s Taking a Dive in a Challenge to a Statute

Last Friday the Star-Ledger‘s on-line incarnation, NJ.com, published a guest column by three members of a group opposed to the exemption in New Jersey’s Smoke Free Air Act for smoking in casinos. Among the topics of conversation was a lawsuit brought by that group seeking to have the exemption declared unconstitutional.¹

They certainly have a legitimate argument that the allowing of smoking in casinos (when it is prohibited in almost all other public indoor venues) is bad public policy, but I part ways with them in their criticism of Governor Murphy and the commissioner of health for defending the statute in the litigation and in urging them to stop defending the lawsuit.

Policy choices like this are for the Legislature to make. Unless a statute’s unconstitutionality is clear, the executive branch has a duty to defend the statute in court. Now that a trial judge has upheld the legality of the exemption, there is all the more obligation on their part to defend that decision in the promised appeal.

Consider if it were otherwise. A governor could have a political crony challenge a policy the governor does not like and then tell the attorney general not to respond. Eventually a default would be entered. Absent discovery of and reporting on the lawsuit by the news media, the Legislature may not even know that there is a challenge. This is a misuse of the court system.

Jay Bohn

September 26, 2024

This article reports on the dismissal of the lawsuit. ↩︎

Truth in Acronyms: YIMBY or YIYBY?

NIMBY is a well-known acronym for “not in my back yard,” referring to those who are opposed to the nearby construction of LULUs (another acronym, this one standing for “locally unwanted land uses”).¹ Such opposition reflects the reality that the benefits of a particular development are often more geographically dispersed than its negative impacts.

In this case the term “back yard” is metaphorical; it means near my property, not actually on it. With the exception of utility infrastructure easements, development in my actual back yard will bring particular benefits to me that outweigh the detriments (to me), else I wouldn’t do it.

NIMBYism may not reflect opposition to a particular development anywhere, just not close by. If we have to have it, put it somewhere else: somebody else should “pay” for the social good that comes from it.

More recently I have seen the term YIMBY (yes in my back yard) touted as the opposite of NIMBY. Unlike NIMBY, which is usually used pejoratively, YIMBY is adopted as a badge of honor, if not moral superiority. See, for example, YIMBYs for Harris.

But I’m not convinced. You see, NIMBY has two opposites. YIMBY is one, but YIMBY means that I will accept a nearby development that others don’t want. That’s not what they’re pushing. I doubt that most YIMBYs for Harris want a lot more housing in their own back yards. Not to pick on him, but one of the politicians listed among YIMBYs for Harris is current Jersey City mayor (and New Jersey governor hopeful) Steve Fulop. A few years ago, Fulop made NIMBY-like noises against allowing parking on the streets near his Rhode Island vacation home to accommodate public access for surfers.

Most of the examples of YIMBYism I see discussed really seek to channel development to someone’s else’s back yard: “yes in your back yard,” or the less pronounceable YIYBY.²

Look, I get it. The so-called YIMBYs are right that we have a housing shortage and the cost of housing is increasing because demand is outstripping supply. I have said as much previously. But, if we’re going to build more housing, it’s going to be in someone’s back yard and the political process, as ever, is going to pick winners and losers, so let’s at least be honest about that and try to make those choices on a rational basis and not just raw power.

Jay Bohn

September 23, 2024

See the Wikipedia article for the development of the term and variations of it. ↩︎
Although I came to the acronym YIYBY independently, I am not the first. See, for example, these writings by Arlingtonians for Upzoning Transparency and 48hills, both of which use the term. ↩︎

Newsweek’s Supreme Court Coverage Still Wanting

Last year in a post entitled “Mixed Bag in Media Review,” I criticized a Newsweek article about a case before the U.S. Supreme Court as factually accurate but misleading because it lacked crucial context and because the headline’s choice of wording implied that there was some chance that the Court would take the case. I said, “[P]rofessional journalists should have a bit more working knowledge of how our court system works.”

Two recent Newsweek articles, by two different writers, continue to reflect a disappointing lack of familiarity and imply a lot more significance to routine actions.

In “Donald Trump Lawyer Botches Court Filing in Mar-a-Lago Case,” the author recounts an error that was made when the notice of appearance for Emil Bove, one of the attorneys representing former President Donald Trump in the Government’s appeal of Judge Aileen Cannon’s dismissal of the charges against him in the classified document case. Back in olden times when I became a lawyer filing with a court consisted of the physical delivery of a “wet-ink” signed document to the court clerk. Now most filing is accomplished electronically.¹ Document filers, mostly attorneys, have their own individual accounts with login ID, password, and potentially other security. In the context of this article, the court’s procedure required that the notice of appearance be filed using the account of the specific attorney, but Mr. Bove’s notice was filed using someone else’s account. Mr. Bove promptly corrected the deficiency upon notice from the court.

So, there was a minor procedural misstep unrelated to the merits of the case which was quickly corrected. I would not describe it as “botching” a court filing and am left with the impression that the author of the headline (who may not be the author of the article) did so in order to embarrass the attorney, presumably because of the author’s disdain for his client.

The other recent article, “Supreme Court Justices Refuse to Reconsider Their Decisions,” accurately reports that a recent list of Supreme Court orders disposed of many cases in which the disappointed party asked the Court to reconsider its denial of his/her/its petition for certiorari and that the grant of a petition for rehearing is extremely rare. While a request for reconsideration may be understandable (few litigants are willing to admit that their case is finally, irretrievably lost), in most cases the arguments for reconsideration either were, or could have been, asserted in the petition in the first place. They are seeking the proverbial “second bite at the apple.”

Ultimately, I believe that the facts that these articles report are simply not newsworthy, and the articles would never merit space in a print publication. But the lower cost of on-line publication coupled with the constant need for new content arising from the twenty-four-hour news cycle (and the constant desire for clicks to generate ad revenue) incentivizes “click-bait” headlines.

Jay Bohn

July 25, 2024

In federal courts the system is called “electronic court filing,” or “ECF.” ↩︎

Election Follies

As a resident of New Jersey, I have been treated to a good seat to view the run up to the upcoming election. I write not of the Presidential contest, which until yesterday looked like it was going to be a rematch of 2020 that few wanted but we didn’t seem able to avoid,¹ but of the New Jersey Senate race.

Democratic incumbent Robert Menendez, our senior senator, has served since he was appointed by Governor Corzine to fill the vacancy created by Corzine’s election as governor. Menendez was the subject of a recall attempt² and much later a corruption trial that resulted in a hung jury. Although he politically survived both events, his second indictment, last September, accompanied by tales of gold bars and jacket pockets stuffed with cash, led to his recent conviction (nobody survives gold bars) on all sixteen charges and intensified calls for his resignation or expulsion from the Senate.

Immediately following the indictment, Representative Andy Kim said that he would run for the seat in the Democratic primary. Kim’s most prominent announced opponent, N.J. First Lady Tammy Murphy, also sought the seat and had the advantage of her husband, the governor’s, party influence. This influence was potentially decisive as New Jersey primaries feature what is known as “the party line” which allows the county party to group favored candidates together, consigning others to “ballot Siberia.”³

Kim promptly filed a federal lawsuit challenging the county line (a similar lawsuit had been pending for a while) and sought a preliminary injunction to prohibit the use of the county line in the 2024 Democratic⁴ primary and replace it with the office block style ballot used everywhere else.

A number of legislative leaders promised to address the matter (eventually) in an effort to keep the judge from entering the injunction. County party leaders were apoplectic about the threat to their influence. Ultimately, after the damage was done, Tammy Murphy did not pursue the nomination.

Although Menendez did not file a petition to run in the Democratic primary, he did qualify to run as an independent, and his presence on the ballot just might siphon enough votes away from Kim to allow the Republican⁵ candidate a chance to be the first Republican elected to the Senate from New Jersey since 1972.

While Menedez’s conviction does not disqualify him from the Senate, it promptly led to many Democrats calling for him to resign or be expelled. If either event happens, Governor Murphy would have the power to appoint a replacement who would serve for the balance of the term (unless Murphy also calls a special election). Kim would seem to be the logical choice for the Democratic governor, but remaining sour grapes might lead Murphy to appoint someone else, even his wife, as a caretaker.

Jay Bohn

July 22, 2024

Actually, as I was writing this post. the growing chorus of Democratic elites are desperately trying to dump the candidate who won their primaries, incumbent Joseph Biden, succeeded and replace him with . . . (well, that’s not the important bit). ↩︎
Then lieutenant governor/secretary of state Kim Guadagno correctly determined that Ney Jersey’s state laws on the procedure could not authorize the recall of a federal officeholder. ↩︎