$2M Bond Ordinance Introduced For Affordable Housing In Chatham

CHATHAM, NJ — The Chatham Township Committee recently voted to approve the issuance of a $2 million bond ordinance for affordable housing construction, which was first introduced in November.

Chatham Township Administrator Ziad Shehady explained that the $2 million bond will be used to build affordable housing units on the site of the former Charlie Brown's Restaurant.

The 63 affordable housing units will be spread across three buildings at 522 Southern Boulevard in Chatham Township, with a two-story building facing Southern Boulevard and two three-story buildings behind it.

The committee intends to put $100,000 down on the bond, which will be used to build the Walters Group Apartments, with construction potentially set to begin in March.

Mark Lois, a committee member who had previously expressed concern about the bond ordinance, spoke up once more during the committee discussion.

"My concern here is with the down payment amount that we are putting down on this bond ordinance. We of course need to move this bond ordinance through…My issue is that in the past we have ballooned up 33 percent debt up by issuing ban after ban bond anticipation notes and by doing that our debt continues to grow and grow," Lois said.

Lois stated that the township had been slowly reducing its debt, and had recently gotten it down from $18.8 million to $18.1 million, with a projection to lower it to $17.2 million in 2023.

"By issuing $2 million in this ban, with a small down payment of 5 percent, we're going to swell back up to above the $18.8 million that we had previously, and it's unnecessary in my review," Lois said.

Lois suggested that the $346,000 in capital surplus be used to reduce the amount to be loaned through the bond. "The idea that the bond ordinance would be introduced before we even have the chance to fully review all of the financials, or even have a meeting of the finance committee goes to a very poor process, and I don't think we should make that a process we accept."

According to Shehady, he and the township's CFO, Debra King, have reviewed all capital accounts and are considering increasing the initial down payment amount to lower the subsequent loan amount.

Shehady did, however, state that in order for the $2 million bond to be reduced by unused funds for affordable housing, the older bond ordinances must be canceled before they can be applied to the new proposed bond ordinance.

"Our intent is to reduce how much debt we have to actually encumber through this process, but right now this is an ordinance to get that ball rolling in order to meet our obligation under the developers agreement to loan $2 million for the construction of 522 Southern," Shehady said.