The Ocean Grove Camp Meeting Association has backed down from its recent efforts to increase property leases in the historic district.
“We got a resolution acceptable to all parties. We wanted a return to the status quo and that is what we got,” Ocean Grove Homeowners Association President Barbara Burns said.
A potential lawsuit that could have voided all of the original property leases, which are issued for 99 years and can date back to 1869, may also have been a factor in the OGCMA decision.
All land in Ocean Grove is owned by the Ocean Grove Camp Meeting Association and leased to property owners at $10.50 annually per lot. In addition, property owners are still taxed on the value of their land and building just like any other township property owner.
The association, however, began raising the property leases earlier this year.
Earlier this year when the Carriage House Bed and Breakfast was sold, the Camp Meeting Association increased the ground rent from $21 (for two lots) per year to $5,000 per year. The sale closed but not before the sellers reduced the sale price by approximately $40,000.
This increase raised a lot of concerns not only among property owners, but also among realtors and banks, some of which curtailed issuing loans or mortgages.
The OGCMA said the commercial land leases and residential-to-commercial land leases were going to be evaluated on a case-by-case basis. But a potential lawsuit that may have ended the entire property lease agreement loomed and the increases have now become a thing of the past.
“OGCMA has no intention to seek any modification of ground rent or other terms and conditions contained in any residential lease, including those currently operating as bed and breakfasts or inns. However, OGCMA will continue to preserve its right against any residential ground lessee who may now, or in the future, be in default of the terms or conditions of a ground lease,” the organization said in an Oct. 1 prepared statement.
For Ten Fifty Inc.- a group of Ocean Grove homeowners, business owners, realtors and inn keepers- hired Roseland-based attorney Matthew Adams to represent them in fighting the increases.
“The OGCMA is at long last acknowledging that it erred arbitrarily in deciding to, at least on a test basis, raise the annual assessment, whatever its internal justification for doing so at the time was. For Ten Fifty Inc. always believed that the OGCMA- a decidedly religious organization lacking municipal zoning and other governmental powers- was operating outside of its legal authority for a host of reasons,” Adams said in a recent prepared statement.
Adams said the Ocean Grove property lease is a “unique land situation” and that few other communities in the United States have such an arrangement.
“It’s a very unique situation that, if challenged, in a modern court, may not hold up. And, even if it does, they can’t just modify a contractual commitment in the middle of the game, so to speak,” he said.
Burns said many residents she has spoken to are all pleased that the issue has been resolved.
“I think residents wanted clarity and stability and that’s what they got. I think it’s good for both sides to have clarity,” she said.