Christie appealed, arguing that the agency's functions would remain the same when placed under his Department of Community Affairs and that he was merely seeking to streamline one of the most bureaucratic functions of state government. The Supreme Court then took up the case; it is not clear when it will rule.
Time and again, Christie has accused the Supreme Court of standing in the way of his agenda. It stymied his efforts to alter not just the affordable housing system, which he says unfairly mandates how municipalities provide housing for the poor, but also his proposed changes to school funding.
In response, Christie has admonished justices at news conferences and sought to add to the court new members who he believes would take a less activist approach to the law.
Although Christie has gotten much of his agenda through a Democratic Legislature - thanks to working relationships with both elected and unelected power brokers - he has been unable to win confirmation of his Supreme Court nominees.
Just one of his appointees now sits on the court. Two nominees were rejected by Senate Democrats - the first time in state history that had happened. A hearing has not been scheduled on his two most recent nominees.
Christie called that "reprehensible" last week, but Democrats could conceivably avoid vetting his picks until after the November gubernatorial and legislative elections. Meanwhile, two acting justices are sitting on the seven-member court.
At Monday's hearing, Robert Lougy, an assistant state attorney general, arguing on Christie's behalf, said other governors have made significant changes to state commissions, boards, and authorities under the 1969 Reorganization Act. Christie's handling of the affordable housing agency was no different, he said.
Justice Barry T. Albin asked Lougy whether that meant that any governor could "destroy" and "completely blow up" any independent agency and give those powers to one member of the governor's cabinet.
"Do you think that the Legislature intended to delegate that kind of authority to the governor?" Albin asked.
"Yes, your honor, I absolutely do," Lougy said.
Later, Chief Justice Stuart Rabner asked Lougy whether both branches of the Legislature are needed to create an agency but not needed to abolish it. Lougy said, "Yes."
Adam Gordon, a lawyer with Fair Share Housing Center, which challenged Christie's move, said the implications of this position were far-reaching. He noted that this was the same power that Christie sought to use last year when he tried to merge Rutgers-Camden and Rowan Universities. The plan ultimately was scaled back, and Rutgers-Camden remained part of the Rutgers system.
Dozens of other agencies, such as the Board of Public Utilities, the Ethics Commission and the Office of the Public Defender, could be affected by the power Christie seeks. The Election Law Enforcement Commission, which enforces campaign-finance rules, could be "politicized" by a governor, Albin said.
Albin at times seemed incredulous at the assistant attorney general's arguments that the laws governing independent agencies were written to give the governor this degree of control.
"You're saying the Legislature intended to give up all of its own power and hand it over the executive branch just like that?" he asked.
Lougy noted that in 2011 the Legislature had an opportunity to call a session to reject Christie's plan, but did not.
Christie has acted as though he already runs affordable housing matters. Last year, he seized $140 million in municipalities' unused affordable housing trust funds and put the cash into his budget. That move was blocked by an appellate court and is now before the Supreme Court.
After Monday's hearing, Gordon called Christie's motives "very dangerous." If he succeeds, "it would really change the structure of government in our state."
Contact Matt Katz at 609-217-8355, email@example.com, or follow @mattkatz00 on Twitter. Read his blog, "Christie Chronicles," at www.philly.com/ christiechronicles.