Homeowners in Cranberry Lake, and other affected lake communities, will have to wait out the COVID-19 crisis for further movement on a bill to amend and clarify language in Chapter 106 of the Planned Real Estate Development and Full Disclosure Act. The law was last changed in 2017, prompting the Cranberry Lake Community Club (CLCC) to mandate membership in the club, which unhappy property owners argue is not and has never been a planned development or homeowners’ association. The club and its attorney Eileen Born have maintained that the CLCC has the right to collect dues from all residents in neighborhoods which were historically part of the original Cranberry Lake Summer Colony built by the Cranberry Lake Development Company, which went defunct in 1925.
Since July 2018, those opposed to the mandatory membership have rallied behind the leadership of long-time Strawberry Point resident Kristine Cerza, whose letter-writing campaign begun in August 2018 eventually grew into a coordinated group known as the Homeowners of Cranberry State Lake United (HCSLU). The HCSLU is being aided in their legal battle against the CLCC by Renee Steinhagen, the executive director of New Jersey Appleseed, a public interest law center based in Newark.
A March 2, 2020 letter from Steinhagen to the CLCC and Born emphatically argues against the club’s claim that the CLCC is a homeowner’s association and a planned real estate development, and calls their use of the 2017 amendment to mandate membership in the club as “an unjustified and perverse application of the law.”
The letter also points out that the CLCC does not now, nor has it ever, owned the land on which its clubhouse and beach are located, having been under the stewardship of the NJ Department of Environmental Protection since the bankruptcy of the Morris Canal Company in 1924, the same year the CLCC was formed as a social club for the benefit of members who primarily spent summers at the lake. The CLCC is currently on a holdover lease with the NJDEP, which was signed for 25-year term in 1990. The lease includes the clubhouse property, the adjacent beach, and the footbridge which spans from the parking area on Rt. 206 across a narrow strait to Frenche’s Grove.
Steinhagen points out that the land, having never belonged to the CLCC for the exclusive use of property owners within what was once designated the Cranberry Lake Summer Colony, means that the club has no jurisdiction over the residents who now live in those communities. Noting that the original incorporation documents for the CLCC describe the organization as being created for the benefit and use of its members and that even the Cranberry Lake Development Company’s documents never describe the area as being intended to be a planned development. Being written in the 1920s, the letter further argues, is not a credible excuse for that detail to have been left out of such important incorporation documents for both entities.
On the legislative front, a bill has been making its way through the Senate to further clarify the language in PREDFDA and halt the mandatory membership push at Cranberry Lake and all other communities facing the same or similar issue. The bill (S908/A2480), which came back to the legislature on a conditional veto from Gov. Phil Murphy, has been reauthored to meet the governor’s requirements and passed through the Senate Community and Urban Affairs Committee and full Senate vote in early February. On Mar 5, Cerza and others including attorney Steinhagen traveled to Trenton to testify before the Assembly Housing Committee, which subsequently voted favorably to return the bill to the Assembly floor. It remains to be seen when the bill will be heard and voted upon, given that the legislature is operating on emergency protocols during the COVID-19 shutdown.
In the interim, Cerza said the club has sent out 2020 membership invoices, as well as past-due 2019 invoices, to Cranberry Lake residents, again with the threat of property liens should homeowners choose not to join. That’s a risk that she and others are willing to take, knowing that passage of the legislature would lift and reverse any levies against their properties. The HCSLU is also willing to take their battle to court, should the bill stall or fail to pass. Local legislators Sen. Steve Oroho and Assemblymen Hal Wirths and Parker Space (all R-24) are sponsoring the bills to ensure their constituents will not be subject to these membership mandates.
“Homeowners who purchase a property that isn’t part of a community association shouldn’t have to fear surprise assessments and compulsory fees,” said Wirths in a press release after the March 5 assembly committee vote, “You can’t change the rules in the middle of the game, and that’s exactly what some communities have tried to do.”