CSG Law Alert: Warehouse Siting – “Not in My Backyard, but Where is My Package?”

Developers looking for locations for large warehouse/distribution centers are finding it increasingly difficult as a result of “Not In My Backyard” or “NIMBY” efforts by State and regional planning agencies, as well as municipalities. Concerns regarding loss of open space, impacts of increased traffic and noise often come into conflict with the desire of consumers to receive goods faster and cheaper.

In September 2022, the New Jersey State Planning Commission Office of Planning Advocacy (“OPA”) released the State Planning Commission’s (the “Commission”) policy document regarding warehousing in New Jersey, entitled “Distribution Warehousing and Goods Movement Guidelines” (“OPA Policy Guidelines”). The OPA Policy Guidelines provide background on the warehousing industry in New Jersey, including the demand for warehousing and distribution facilities in New Jersey, and sets forth the policy framework for use across the state in siting and development. In November 2022, the New Jersey State Planning Commission released the Warehouse Siting Guidance Document (the “Siting Document”). The Siting Document does not have the force of law but provides guidance to municipalities to help them regulate warehouse locations.

The Siting Document states, “At the same time, large-scale regional warehousing, can if not properly sited and scaled, result in significant negative impacts, from the intensive consumption of undeveloped land to the degradation of habitat, air and water resources, quality of life, public health, safety, infrastructure, and transportation networks. Traffic tends to be the most obvious impact that affected communities and the public raise concerns about.” The Commission’s policies regarding warehouse siting are as follows: “Conduct Master Plan Reexaminations and update relevant land use, zoning, land development and redevelopment plans, policies, and programs to ensure that they clearly define and reflect various warehouse typologies, including new sub-categories of industrial development. Zoning should ensure that projects are appropriately located, scaled, and designed to mitigate and avoid conflicts with surrounding uses, infrastructure, resources, sensitive receptors and adjacent municipalities, particularly overburdened communities. Mitigate and avoid conflicts with other uses, sensitive populations, and receptors by locating large warehouses away from residential areas/neighborhoods, downtown commercial/retail areas and main streets, schools, daycare centers, places of worship, hospitals, overburdened communities, scenic corridors and historic districts, important public and civic outdoor spaces, and recreational facilities.”

As reported in a previous CSG Law Alert authored by Jennifer Porter, Esq., the Senate and Urban Affairs Committee advanced a new law on March 2, 2023, Senate Bill 3468 (“S3468”), requiring that the Commission publish regulatory guidance to assist municipal planning boards and other local agencies, when acting pursuant to the Municipal Land Use Law (“MLUL”), on applications for warehouse development. The Commission has three months following the enactment of the law to publish the regulatory guidance. S3468 is intended to expand the OPA Policy Guidelines to assist municipalities with warehouse development. A copy of the S3468 can be found here, and a copy of the OPA Policy Guidelines can be found here. As of the date of this posting, no further legislative action has been taken on S3468.

On April 20, 2023, the New Jersey Highlands Water Protection and Planning Council (“Highlands Council”), under the legal authority of the Regional Master Plan (“RMP”), which is a master plan to achieve regional planning in the Highlands region of the State, adopted legally binding standards for siting warehouse and distribution facilities in the Highlands. The standards are set forth in “Policy Standards for Warehousing in the New Jersey Highlands Region.” The Policy Standards are mandatory for all land within the Highlands Preservation Area, and voluntary for lands within the Highlands Planning Area. The Highlands Council will provide funding to municipalities to implement the Policy Standards through revisions of their local zoning ordinances. The Policy Standards list “no-go areas,” where warehouses are expressly prohibited. These areas include the Highlands Preservation Area, the Highlands Protection Zone, and the Highlands Conservation Zone. It should be noted that the OPA Policy Guidelines expressly recognize the New Jersey Highlands Region as a “Special Resource Area,” and direct municipalities within the Highlands to refer and give deference to the Highlands Regional Master Plan in conjunction with the OPA Policy Guidelines.

Several municipalities have already acted to update their zoning ordinances to restrict warehouse development, some of which are being challenged in court as spot zoning. Unless and until municipalities outside of the Highlands enact appropriate zoning ordinances restricting warehouse locations within their borders, the Policy Standards adopted by the Highlands Council are the only legally enforceable restrictions on warehouse locations in the State. However, given the public pressure against warehouses due to the perceived negative impacts on the community, further regulation should be expected in the near future.

Related Services

EnvironmentalReal Estate