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DOCKET NO. A-2141-07T12141-07T1




Argued telephonically October 2, 2008 - Decided

Before Judges Carchman, R. B. Coleman and Sabatino.

On appeal from a Final State Agency Decision of the New Jersey Housing and Mortgage Finance Agency, Docket No. HFA 12102-05.

Clive S. Cummis argued the cause for appellant Marineview Housing Co. No. 1 (Sills, Cummis & Gross, P.C., attorneys; Mr. Cummis and Steven R. Rowland, of counsel and on the briefs).

Robert M. Purcell, Deputy Attorney General, argued the cause for respondent New Jersey Housing and Mortgage Finance Agency (Anne Milgram, Attorney General, attorney; Lewis A. Scheindlin, Assistant Attorney General, of counsel; Mr. Purcell, on the brief).


Petitioner, Marineview Housing Co. No. 1 ("Marineview"), the owner of a large, government-financed housing project, appeals from a November 28, 2007 final agency decision of the New Jersey Housing Mortgage and Finance Agency ("HMFA" or "the agency"). The agency substantially reduced Marineview's request for a thirty-three percent rent increase for calendar year 2005. The agency also made certain determinations concerning the project's reserve accounts for repairs and renovations, allocating less to those reserves than the sums that had been sought by Marineview.

Marineview's primary contention on appeal is that, in considering the rent increase application, the HMFA misconstrued a series of mortgage modification agreements governing the project. The agency thereby allegedly deprived Marineview of revenues Marineview had earmarked to pay down its significant debt. Marineview also claims that the HMFA arbitrarily eliminated from its budget various funds that are allegedly needed at this time to make repairs. Additionally, Marineview contends that the agency's decision violated the Takings Clause and was otherwise improper.

We affirm.


Marineview is the owner of Grogan Marineview Plaza, a 432-unit apartment complex in Hoboken. The project was built in the early 1970s. It was subsidized with public financing furnished by the HMFA's statutory predecessor, the New Jersey Housing Finance Agency ("the HFA").

The 1973 MLA and The Agency's Oversight of Rental Increases

On May 7, 1973, Marineview and the HMFA entered into a Mortgage Loan Agreement ("MLA"), in which the HMFA agreed to provide financing to Marineview for the development of a moderate-income housing project. Under the terms of the MLA, the agency provided Marineview with a $12,700,000 mortgage, and Marineview became the fee simple owner of land on which it built a twenty-five-story high-rise apartment building. A corresponding Mortgage and Regulatory Agreement of the same date provided that:

(c) [Marineview] shall have the right to charge to and receive from any occupant such amounts as from time to time may be mutually agreed upon between the occupant and the Owner and approved in writing by the [a]gency for any facilities and/or services which may be furnished by the Owner or others to such occupant upon his request, in addition to the facilities and services included in the approved "Rental Schedule or Carrying Charge Schedule."

(d) The [a]gency will at any time entertain a written request for an increase in rentals or carrying charges properly supported by substantiating evidence and with[in] a reasonable time shall:

(1) Approve a schedule that is necessary to compensate for any next increase, occurring since the last approved schedule, in taxes (other than income taxes) and operating and maintenance expenses over which the Owner has no effective control, or;

(2) Deny the increase stating the reasons therefore.

[Emphasis added.]

The agency's oversight role over Marineview's rental increases, as contractually specified in the MLA, is consistent with applicable HMFA regulations. See N.J.A.C. 5:80-9.1 to -9.14.

Tenants began to occupy the apartment building in 1975, but the building did not reach full occupancy until 1978. Because Marineview is designated as a "market" project, it is not eligible to receive federal subsidies. Instead, Marineview has relied on periodic rent increases to cover its operating costs. Those rent increases, particularly in the early years of the project, caused tenants to vacate the building and difficulties in obtaining new tenants. The revenue shortfalls, in turn, caused Marineview to default on the MLA. Marineview also defaulted on a separate rental agreement that it had with the Hoboken Parking Authority ("HPA").

The 1980 MMSA

Rather than foreclosing on the property when it fell into default, the agency entered into a Mortgage Modification and Settlement Agreement (the "1980 MMSA") with Marineview on April 30, 1980. In effect, the 1980 MMSA allowed Marineview a period of ten years to cure the default.

The 1980 MMSA recited that the outstanding principal balance of the mortgage was then $12,642,328, with $81,382 immediately due and owing at that time. The agreement further stated that Marineview owed an additional $4,007,421, a sum which consisted of the following: $2,066,943 in Construction Period Interest Arrearages; $1,808,186 in Operating Period Interest Arrearages; and $132,292 in mortgage fees and charges. In exchange for agreed-upon future payments from Marineview, as specified in the 1980 MMSA, the agency agreed to treat these defaults as if they had been cured. The agreement also noted that the HPA had agreed to defer collection of its judgment against Marineview in the amount of $192,400.

More specifically, the 1980 MMSA contained nineteen Articles, several of which are pertinent to this appeal and Marineview's present indebtedness. We summarize those relevant provisions as follows.

Article FIRST obligated Marineview to make a $955,000 payment to the agency, applying $81,382 to the principal arrearages and $837,618 to the Operating Period Interest Arrearages. Additionally, Marineview agreed to pay a $200,000 Initial Fixed Payment, to be applied to the Construction Period Interest Arrearages and interest.

Article SECOND stated that Marineview additionally would pay a total of $700,000, in four yearly installments, known as Future Fixed Payments. These amounts were also to be applied to the Construction Period Interest Arrearages.

Article FOURTH stated that Marineview would pay the Adjusted Original Indebtedness, which consists of both the Construction and Operating Period Interest Arrearages, in accordance with a debt service table attached to the agreement. The first 120 payments on the debt service would be treated as Priority Payments.

Article FIFTH provided that if Marineview produced excess cash flow during a year within the ten-year Deferral Period, i.e., the period between May 1, 1980 and April 30, 1990, it would make a Cash Flow Installment Payment. That sum was to be applied to the unpaid balance of Priority Payments.

Article NINTH provided that if the balances of the following items are not paid at the end of the Deferral Period, they shall become due on the maturity date of the First Mortgage in the year 2025: (1) Construction Period Interest Arrearages and interest; (2) Operating Interest Arrearages and interest; (3) any sums due and owing on Mortgage Fees; and (4) all interest that has accrued on an unpaid portion of a Priority Payment.

Article TENTH, a balloon provision, stated that the unpaid balance of Priority Payments, up to a maximum amount of $900,000, shall be deferred and payable with interest on the maturity date of the note. This Article further provided that if the unpaid balance exceeded $900,000, it was to be paid by Marineview as a balloon payment on May 1, 1990.

Article ELEVENTH stated that at the end of the Deferral Period, the monthly payments shall be due from Marineview each month thereafter as set forth in the debt service table. In the event that Marineview did not have adequate cash flow to make such monthly payments, the amount of those payments were to be deferred and payable on the due date of the First Mortgage, up to a sum of $900,000.

Article THIRTEENTH declared that Marineview is not entitled to any Return on Equity ("ROE") during the Deferral Period, unless the Mortgage, Parking Charges, Increased Indebtedness, and the judgment in favor of the HPA are all current.

Finally, Article FOURTEENTH provided that the Agency would not exercise its right to foreclosure during the Deferral Period.

Despite these numerous loan accommodations, Marineview continued to have serious financial difficulties. Consequently, on April 30, 1990, when the ten-year Deferral Period under the 1980 MMSA ended, Marineview was still in substantial arrears on the mortgage. According to the report of Marineview's expert witness, Anthony W. Tozzi, Esq., Marineview owed the following substantial amounts on the day the MMSA came due: (1) a $12,052,187 mortgage balance; (2) $2,045,306 in additional debt service arrears; and (3) $3,902,121 in Construction Period Interest, Operating Period Interest and fees. Also due at that time was the balloon payment prescribed by Article TENTH of the 1980 MMSA.

The May 1990 Third Amended MMSA

As a result of Marineview's continued arrearages, the parties executed a Third Amendment to the Mortgage Modification and Settlement Agreement (the "Third Amended MMSA") on May 1, 1990. The Third Amended MMSA stated that, as calculated pursuant to Article TENTH of the 1980 MMSA, Marineview then owed $2,731,174 as a balloon payment. Marineview agreed to make a partial payment of $1,016,623 of that amount upon execution of the agreement. The remaining balance, $1,714,551, would be financed in accordance with the provisions of the Third Amended MMSA. The Third Amended MMSA also established a new debt service table.

The Third Amended MMSA also addressed Marineview's possible prepayment of its indebtedness. Specifically, Article FIFTH provided that on May 1 of each year, Marineview may prepay an amount no greater than any excess cash flow realized by its operations in the preceding year. Article SEVENTH likewise permitted Marineview "to prepay, from sources other than Excess Cash Flow Payments, any required principal and interest payments . . . without any . . . penalty."

Significantly for the present appeal, the parties agreed in Article EIGHTH that Marineview will not make any distributions as ROE without first receiving approval from the agency. Such approval is to be evaluated in accordance with the HMFA's standard practices, policies and procedures, and is to be granted only if Marineview is current with all amounts due on the Mortgage and the HPA judgment.

Article NINTH addressed the subject of future rent increases. In particular:

For future rent increase purposes, the [agency] will recognize as a legitimate operating expense of the Project . . . any monthly payments required to be made under this Agreement, the Mortgage, the Note and MMSA, as amended.

[Emphasis added.]

The August 1991 Amended and Restated MMSA

On August 16, 1991, the parties executed an Amended and Restated Third Amendment to the MMSA ("the Amended and Restated MMSA") after the parties discovered that the Third Amended MMSA had contained an arithmetic error. Specifically, Article TENTH of the Third Amended MMSA had overstated the amount due and owing from Marineview on May 1, 1990 as a balloon payment. The Amended and Restated MMSA corrected this problem and acknowledged that the amount owed by Marineview on May 1, 1990, was $1,722,669, of which it paid $1,016,623 upon execution of the Third Amended MMSA. Thus, the balance due on May 1, 1990, was $706,046, a sum which was reflected in the Amended and Restated MMSA.

Additionally, the Amended and Restated MMSA provided that Marineview would make prepayments on May 1, 1991, which would reduce the principal indebtedness amount to $211,128. That balance would be paid off in monthly installments. Any monthly payments made under the Amended and Restated MMSA were to be recognized as legitimate operating expenses for future rent increase purposes.

The HPA's Judgment

As we have already noted, the HPA obtained in 1978 a judgment of $192,400 against Marineview for unpaid parking charges. In order to avoid foreclosure on the property by the HPA, the parties entered into a series of agreements. Together those agreements do not require Marineview to make payments to the HPA to satisfy the judgment, except to the extent Marineview achieves surplus cash flow. In addition, the HPA has agreed not to enforce its judgment against Marineview without the consent of the HMFA, unless the HMFA itself begins foreclosure proceedings. Consequently, the HPA, which has since been dissolved and replaced by another municipal entity, the Hoboken Parking Utility ("HPU"), has not attempted, to date, to collect on Marineview's obligation.

Marineview's 2005 Rent Increase Application

On February 2, 2005, Marineview filed a rent increase application with the HMFA, seeking an increase of thirty-three percent. The record reflects that the magnitude of this request far exceeded the percentage rent increases the agency had authorized for Marineview in recent years, which were generally in the single-digit range. Its application claimed that the increased rental stream would make the following improvements possible: (1) kitchen upgrades, (2) bathroom upgrades, (3) the replacement of HVAC units, (4) continuing lobby restoration, and (5) balcony repair. The application noted that these types of improvements have not been made during the thirty-year life of the building.

Marineview also supplied the agency with a certified audit from 2004, a summary of income and expenses over the last twelve months prior to its application, and a proposed 2005 budget. As part of that budget, Marineview allocated $840,000 for its Repair and Replacement ("R&R") Reserve.

According to Marineview, the R&R schedule for the project showed a deficiency of $3,108,944 as of June 10, 2004. The HMFA's Housing Manual provides that an R&R deficiency can be eliminated by the sponsor making a single additional deposit, making deposits in accordance with the new annual requirement, submitting a comprehensive plan to reduce the deficiency over the next several years, or by offering alternative guarantees to satisfy the agency that major repairs and replacements will be funded when needed.

The HMFA initially approved a 2005 allocation of $248,000 to Marineview's R&R account. Marineview contested that amount as insufficient and contrary to the agency's general policies concerning rents and reserve accounts. Specifically, Marineview maintains that the agency should have budgeted its full request of $840,000 for the R&R account. That proposed figure does not include the costs of bathroom replacement, and, according to Marineview, is not even enough to cover the costs of a necessary elevator replacement.

Apart from its desire to enhance the R&R account, Marineview also sought to justify its proposed 33% rent increase to enable it to begin to pay down its substantial indebtedness, before those amounts all ultimately become due in the year 2025. It points out that without such paydown efforts, it will be unable, under the terms of its various agreements with the HMFA, to reap any return on equity from its investment until the year 2025. In this regard, Marineview argued that paydown of the indebtednesses is within the meaning of the "monthly payments required to be made" described in Article NINTH of the Third Amended MMSA, and thereby eligible to be factored into a rent increase.

The Agency's Initial Rent Decision

In a letter to Marineview dated July 29, 2005, the agency approved a 3.5 percent rental increase for Marineview, effective September 1, 2005. The letter further recognized that earlier in 2005, Marineview had implemented an additional three percent "automatic" rent increase, in accordance with N.J.A.C. 5:80-9.4(c). Thus, in the aggregate, the HMFA authorized a 6.5% rent increase for 2005, a figure significantly lower than the 33% sought by Marineview.

Having failed to obtain the sought-after rent increase in full, Marineview requested a contested case hearing in the Office of Administrative Law ("OAL"). The dispute was referred to an Administrative Law Judge ("ALJ"), who conducted five days of intermittent hearings between July and September 2006. The hearings were followed by written post-hearing submissions from counsel. The project's tenants' association also participated in the OAL proceedings.

The ALJ's Recommendations

On August 24, 2007, the ALJ issued an Initial Decision essentially adopting Marineview's arguments. In particular, the ALJ recommended that the HMFA (1) restore $428,000 to Marineview's 2005 budget to begin to pay down supplemental HMFA financing and also Marineview's parking debt to the HFA; (2) restore $592,000 to the R&R account in Marineview's 2005 budget, thereby elevating the total annual reserve to $840,000; (3) amend the reserve schedule to fund the estimated future cost of remodeling bathrooms; and (4) recalculate the 2005 rent increase to incorporate these additional budgeted expenses, provided that the maximum rent increase shall not exceed 33%.

The Agency's November 2007 Final Decision

After considering the ALJ's Initial Decision and the various exceptions filed to it, the HMFA issued a Final Decision and a corresponding Order on November 28, 2007. The Final Decision substantially disagreed with the ALJ's recommendations, rejecting and modifying them in numerous respects. In particular, the Final Decision and Order provided as follows:

We hereby REJECT the Initial Decision insofar as it restores $328,000 to Marineview's 2005 approved budget to pay down supplemental [a]gency financing and the parking debt; and

. . . .

We hereby MODIFY the Initial Decision insofar as it orders that $592,000 be added to the R&R account and we ORDER that $174,400 be added thereto, thereby making the allocation to the R&R account for the 2005 budget $422,400; and

We hereby REJECT the Initial Decision insofar as it orders that the [a]gency amend the Grogan Marineview reserve schedule to fund the "estimated future cost" of remodeling bathrooms and we ORDER that Marineview comply with applicable [a]gency procedures . . . . [and]

We hereby MODIFY the Initial Decision insofar as it orders the [a]gency to recalculate the 2005 rent increase approved for Marineview to incorporate all additional budgeted expenses provided for in the Initial Decision, up to a maximum rent increase of 33 percent, and we ORDER that the [a]gency recalculate the 2005 rent increase approved for Marineview to incorporate the additional $174,400 to be added to the R&R account, for a total of $422,400 for the 2005 budgeted R&R account.

Marineview now appeals the HMFA's final determination. It raises the following arguments:



A. The Agency Imposed an Affordability Requirement That Do Not Exist In Its Regulations or the Parties' Agreements.

B. The Agency Has Violated the Covenant of Good Faith and Fair Dealing By Artificially Keeping the Plaza's Rents At A Level Insufficient to Produce ROE And Maintain The Project.

C. Pursuant to the 1980 MMSA, The Parties Agreed To Attempt To Create Excess Cash To Reduce or Eliminate The Arrearages Deferred Through That Agreement.

D. The Agency Head Committed Error of Law When He Construed The Parties' Agreements To Require Marineview To Subsidize Tenant Rents By Prohibiting It From Seeking Rent To Pay Project- Related Debt.

E. The Agency Head Erroneously Found That Marineview Forfeited Any and All Ability to Obtain Return on Equity By Sua Sponte Invoking Article NINTH of the Amended Third MMSA.

F. The Agency Head's Attempt To Portray Marineview As A "Bad" Landlord Who Diverted Rents Generated By Its Prior Requests For Funds To Amortize The Agency Supplemental Financing And The HPA Debt Is Flat-Out False, And Unsupported In The Record.








We begin our analysis with a recognition of the limited scope of judicial review of final decisions by state administrative agencies. It is well-established that, "[a]n administrative agency's final quasi-judicial decision will be sustained unless there is a clear showing that it is arbitrary, capricious, or unreasonable, or that it lacks fair support in the record." In re Herrmann, 192 N.J. 19, 27-28 (2007) (citing Campbell v. Dep't of Civil Serv., 39 N.J. 556, 562 (1963)).

As the Supreme Court noted in Herrmann, "[t]hree channels of inquiry inform the appellate review function." Id. at 28. These are:

(1) whether the agency's action violates express or implied legislative policies, that is, did the agency follow the law; (2) whether the record contains substantial evidence to support the findings on which the agency based its action; and (3) whether in applying the legislative policies to the facts, the agency clearly erred in reaching a conclusion that could not reasonably have been made on a showing of the relevant factors.

[Ibid. (quoting Mazza v. Bd. of Trs., 143 N.J. 22, 25 (1995)).]

"When an agency's decision meets [these] criteria, then a court owes substantial deference to the agency's expertise and superior knowledge of a particular field." Ibid.

In the present context, we are cognizant of the HMFA's long-standing expertise in the oversight of state-financed housing projects. See, e.g., Overlook Terrace Mgmt. v. Rent Control Bd. of West New York, 71 N.J. 457, 460-68 (1976); In re Application for a Rental Increase at Zion Towers Apartments, HMFA #2, 344 N.J. Super. 530, 532-36 (App. Div. 2001). In applying that expertise to sponsor requests for rent increases, the HMFA must assure that rents are "sufficient to pay normal operating, maintenance and utility costs," provide "an adequate rate of return" to project sponsors, provide "debt service payments adequate to protect the financial interest of the [HMFA] and its bondholders," provide "reserves for repair and replacement," and "ensure adequate, safe and sanitary housing for the low and moderate income families that the [HMFA] was created to serve." N.J.A.C. 5:80-9.1.

We must accord a "strong presumption of reasonableness" to an administrative agency's "exercise of its statutorily-delegated duties." In re Certificate of Need Granted to The Harborage, 300 N.J. Super. 363, 380 (App. Div. 1997). Here, the agency's ongoing oversight of annual rent increases and reserve accounts implicates a host of technical regulatory issues warranting such judicial deference.

Mindful of our limited standard of review and the HMFA's regulatory expertise, we are satisfied that the agency's Final Decision in this case is supported by substantial evidence in the record, is consistent with the applicable law, and is neither arbitrary nor capricious. We, therefore, affirm the determination, essentially for the reasons cogently expressed in the HMFA's detailed Final Decision of November 28, 2007. We add only a few comments.

With respect to Marineview's desire to increase rents so that it can prepay some of its long-term indebtedness, we concur with the HMFA's legal analysis that such prepayments are not "required" under Article NINTH of the Third Amended MMSA. In this respect, we agree with the agency that the ALJ's contrary interpretation of this contractual language was erroneous.

As the HMFA's Final Decision correctly observed, "[t]he expression of required payments in Article NINTH . . . necessarily means the exclusion of voluntary payments." (Emphasis deleted). The agency noted that "the MMSA and the Third MMSA establish that the [so-called] secondary indebtedness is not amortizing indebtedness, but [instead] is 'due and payable' only upon 'the maturity date of the Note' (April 2025)[.]" As the agency further pointed out, "only 'required' monthly payments, not voluntary repayments, need [to] be considered by the [a]gency in evaluating rent increases submitted by Marineview." We agree that optional paydowns are simply not covered by this provision.

The meaning of the contract term "required" in Article NINTH of the 1980 MMSA is therefore unambiguous. The court may not rewrite the contract for the parties, even if there may be legitimate reasons for Marineview wanting at this time to reduce the debt that will eventually become due in 2025. See Marini v. Ireland, 56 N.J. 130, 143 (1970). Our conclusion in this regard is bolstered by the fact that Marineview, obviously a sophisticated business enterprise, was represented by counsel in the negotiation and drafting of these complex refinancing instruments. If Marineview wanted a right to have optional paydowns of future debt included in periodic rent calculations, it should have injected contractual language to confer such a right.

Furthermore, applying the terms of the 1980 MMSA and the subsequent Amended and Restated MMSA, Marineview's argument that debt deferred to 2025 constitutes an "operating expense" to be included in the calculation of its annual rent increase is equally misplaced. In accordance with the plain language of Article NINTH of the 1980 MMSA, the unpaid balances of Construction Period Interest Arrearages, Operating Period Arrearages, Mortgage Fees and applicable interest "shall be due and payable on the maturity date of the Note . . . ." Therefore, those debts are not "monthly payments required to be made" under the agreement, and should not be considered for future rent increase purposes. The agency properly concluded that deferred debt was not an operating expense, and that it was properly excluded from the rent calculations.

Marineview urges that it should be able to raise rents for purposes of debt reduction because it otherwise will not be able to obtain a return on equity on the property until the year 2025. In assessing that claim, we bear in mind that Marineview has repeatedly defaulted on this project and, but for the agency's indulgence and assistance, it would have been in foreclosure on multiple occasions. In exchange for the HMFA's relief, Marineview chose, through Article EIGHTH of the Third Amended MMSA, to bargain away its present ability to reap any ROE until all amounts due on the HMFA's mortgage and the HPA judgment are satisfied.

Such a quid pro quo arrangement, negotiated to the mutual advantage of the parties, does not amount to an unconstitutional taking. The cases relied upon by Marineview in this regard are inapposite, as none of them involved such a mutually-negotiated deferral of a present economic advantage. See Andrus v. Allard, 444 U.S. 51, 65-66, 100 S. Ct. 318, 327, 62 L. Ed. 2d 210, 223 (1979) (noting that the loss of a strand of a full bundle of property rights does not comprise a taking because the aggregate must be viewed in its entirety).

We are further satisfied that the record bespeaks that the agency dealt with Marineview, by all indications, fairly and in good faith. The fact that the HMFA is now insisting on enforcing its bargained-for contractual rights does not prove that Marineview is being treated unfairly.

We are mindful that on more than one occasion the record indicates that the agency has gratuitously permitted Marineview to include some optional debt service in calculating its budget. However, the record further reflects that Marineview did not apply those extra rent revenues to such optional debt service, but instead utilized the funds for other needs. Given these circumstances, the agency was well within its discretion to deny Marineview's similar request in 2005.

We discern no reason to alter the agency's Final Decision because the present status and computation of the parking debt owed to the HPA is not totally clear. Even if, for the sake of argument, Marineview were now current on the parking charges, it still has not fulfilled the other contractual terms and conditions with the HMFA that could entitle it to a present return on equity, or to a corresponding rent increase.

With respect to the HMFA's denial of certain line items for the repair and replacement of bathrooms, kitchens, and other categories of improvements, we defer to the agency's expertise concerning the immediate necessity of such expenditures and the appropriate timing to undertake them. We perceive no illegality or unreasonableness in requiring the sponsor to obtain multiple bids before the agency authorizes rent increases for estimated repairs. We note that the record does not include proof of any housing code citations requiring such repairs on an immediate basis. It is also noteworthy that the agency, on reflection, did replenish the R&R account by an additional $174,400, following the ALJ's Initial Decision, which is a further indicator of the agency's attempt to be fair.

In making these observations, we do not ignore the age of this building and its component fixtures but regard the agency as being presumptively in the best position to ascertain how and when renovations should be pursued. We discern no arbitrariness in the agency's disposition of this issue. Moreover, the agency's denial of a rent increase for these expenditures for the year 2005 is, of course, without prejudice to Marineview seeking the agency's approval in future rent years, perhaps with stronger documentation of necessity and proof of multiple bids documenting the anticipated costs.

We have fully considered the balance of Marineview's arguments, including but not limited to its claims that the agency improperly was guided by considerations of tenant affordability and by inchoate "ulterior influences," and find those arguments lacking in sufficient merit to warrant comment in this opinion. See R. 2:11-3(e)(1)(D) and (E).



Tozzi is a former HMFA official.

The precise amount presently due, with any applicable interest, is unclear from the record.

N.J.A.C. 5:80-9.1 provides that:

It is the express purpose of the following regulations to promote the statutory functions and obligations of the Agency by ensuring that the rents and/or carrying charges applied in housing projects are sufficient to pay normal operating, maintenance and utility costs; provide an adequate rate of return to individuals or corporations that provide capital to assist in the development of housing projects; provide debt service payments adequate to protect the financial interest of the Agency and its bondholders; provide reserves for repair and replacement . . . .

[Emphasis added.]

The tenants' association is not a party to this appeal.

We cannot discern readily from the briefs the exact percentage increase in rent that these modifications would produce, but they clearly fall short of the 33% increase sought by Marineview.





October 10, 2008