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Bill

A 4444

Concerns exemptions to municipal rent control and rent leveling ordinances.

2026-2027 Regular Session Introduced by Verlina Reynolds-Jackson and 1 co-sponsor

The bill restricts rent-control exemptions for newly constructed rental buildings to the initial amortization period (or 30 years max), applying only to base rent increases and not

Introduced, Referred to Assembly Housing Committee
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Bill Summary · A 4444

Comprehensive Summary of A-4444 (Session 222, New Jersey)

Purpose and Intent

  • This bill clarifies and tightens the exemptions to municipal rent control and rent leveling ordinances that apply to newly constructed multiple dwellings under New Jersey’s existing exemption framework (P.L.1987, c.153, C.2A:42-84.1 et seq.).
  • It reinforces original legislative intent that exemptions apply only during the amortization period of the initial mortgage (or up to 30 years if no initial mortgage is obtained), and that the exemption does not create broader tenant-protection or administrative obligations beyond limiting rent increases.

Key Provisions and Changes

  • Overall framework (Sections 1–6) codifies and clarifies:

    • The exemption from rent control/rent leveling applies only to base rent increases and not to other aspects of the ordinance (e.g., disclosures, registrations, or tenant protections) (Section 6).
    • The exemption term is generally the amortization period of the initial mortgage loan, or 30 years if no initial mortgage financing exists, with a cap of whichever is shorter (Section 2a, 2b).
    • If there is an initial mortgage loan, the exemption period is limited to the loan’s term; if there are multiple amortization periods, the longest applies (Section 2b(2)).
    • Exemption is available only for dwellings constructed for rental occupancy (not for units constructed for sale) (Section 2d).
    • Newly constructed multiple dwellings are defined to determine eligibility; “newly constructed” refers to units built under a construction permit for a multiple dwelling, with specific exclusions for units built for sale or conversion cases (Section 2, various definitions in 1).
    • The “original owner” must file the exemption claim prior to completion of construction; transfers of ownership after completion do not earn a new exemption opportunity (Section 4 and 5).
    • If an exemption filing is not properly made, the property's rent control status reverts to the ordinance by operation of law, and the new owner inherits the regulatory status (Sections 4 and 5).
    • A tenant can petition the municipal rent board to determine whether the owner satisfied the exemption prerequisites; boards must decide within 90 days of a complete petition (Sections 4 and 5).

  • Notice and disclosure requirements (Section 4):

    • Before leases are entered, owners must provide prospective tenants with a written notice containing:
    • Confirmation of newly constructed status, completion date, whether an initial mortgage loan exists and its term, termination date of the exemption, and basis for calculating termination.
    • Tenants’ leases during the exemption period must include this notice.
    • If a misrepresentation occurs, penalties could include violations of the consumer fraud act, with potential penalties (up to $10,000 for first offense; up to $20,000 subsequent offenses) and related remedies.

  • Administrative and compliance mechanics (Sections 3–5):

    • Detailed definitions for terms used in the exemption framework (completion of construction, construction, initial mortgage loan, exemption, etc.).
    • Municipalities may require ongoing updated information to verify continuation of the exemption for four-or-more-unit buildings.
    • The act emphasizes that exemptions apply only to rent-increase limitations and not to broader regulatory requirements.

Who Would Be Affected

  • Property owners of newly constructed multiple dwellings (four or more units) seeking or claiming exemption from local rent control or rent leveling ordinances.
  • Original owners who commenced construction and filed for exemption prior to completion of construction.
  • Municipal rent boards and construction officials responsible for processing exemption filings, notices, and ongoing verification.
  • Tenants residing in exempt buildings, who may receive notices and have a pathway to challenge or verify exemption status via the rent board.

Procedural and Timeline Aspects

  • Effective Date and Applicability:
    • The act takes effect immediately and applies to properties constructed under construction permits issued on or after June 25, 1987 (the original act’s date). The penalty-related notice provisions take effect on the first day of the second month after enactment, with applicability limited to failures to provide proper notice on or after that date.
  • Filing Deadlines:
    • Exemption claims must be filed at least 30 days prior to issuance of a certificate of occupancy.
    • Termination notices must be filed at least 30 days prior to the end of the exemption period.
  • Oversight and Review:
    • Tenants may petition the municipal rent board for determinations, with a 90-day decision window after a complete petition.

Practical Implications

  • The bill tightens the governance around exemptions to ensure they reflect the original mortgage-financing structure and are not extended through ownership changes or unrelated renovations.
  • It introduces clearer notice requirements to tenants and strengthens enforcement via the New Jersey consumer protection framework for misrepresentations.
  • By limiting exemptions strictly to the rent-increase provisions within rent control/rent leveling ordinances, the bill preserves other local tenant protections while clarifying exemption scope.

If you’d like, I can tailor this summary to specific stakeholders (developers, tenants, municipal officials) or convert it into a one-page briefing with a short Q&A.

Compiled from official sources — confirm details with the bill’s official record.

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