Real Property & Environmental Law Alert : New Jersey, New York, Pennsylvania & Delaware Lawyers & Attorneys for Real Estate Development & Environmental Law

While much of the uncertainty regarding affordable housing requirements in NJ remains, the questions involving the applicability and future of the 2.5% nonresidential development fee were answered yesterday. Acting Governor Kim Guadagno signed into law legislation that reestablishes the exemption from the fee for eligible projects. Perhaps the most broadly applicable exemption provides that projects which obtain preliminary or final site plan approval prior to July 1, 2013 are not subject to the development fee provided that building permits are issued by December 31, 2015.

The prior exemption from the fee expired July 1, 2010. The new legislation also provides for the reimbursement of fees paid subsequent to July 1, 2010, unless already spent by the municipality in connection with an affordable housing development. A developer must seek such reimbursement within 120 days of the effective date of the bill.

“With the economy still very much in flux, the suspension of the non-residential development fee will assist New Jersey’s non-residential real estate to get back on track, produce the jobs, taxable revenue and ratables this state desperately needs,” said New Jersey Department of Community Affairs Commissioner Lori Grifa, who oversees the State’s affordable housing development efforts.

For the full text of the legislation, click here.

* Photo courtesy of FreeFoto.com.

Douglas J. Janacek Co-Chairs the Gibbons Real Property & Environmental Department.

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On August 18, 2011, DEP Commissioner Bob Martin and DOT Commissioner James Simpson released a set of guidelines to revamp and apply consistency to New Jersey’s land leasing process for State Lands. A panel of ten State Agencies was convened to analyze the current lease policies and compile a Lease Valuation Report that offers recommendations on leases for Tidelands; Linear Corridor Projects (other than Tidelands); Publicly Bid, Market-Based and Nominal Fee leases; Telecommunications Towers and Antennas, Aquaculture, and leases Related to Transportation Corridors. The guidelines will be adopted by all State agencies, with most of the guidelines implemented immediately.

The panel reported an honest and critical view of the current system for valuing certain types of leases labeling it simply as “broken.” The panel noted that some fee schedules are terribly outdated and that certain rules and statutes prevent the maximization of compensation to the State for the use of its land.

The new guidelines serve two public purposes: 1) to ensure that the State and its Citizens receive fair compensation for the use of State land and 2) to reduce the environmental impact of those that require use of State lands for private projects.

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On August 15, 2011, the New Jersey Department of Environmental Protection (NJDEP) issued proposed Final Rules to implement the Site Remediation Reform Act (SRRA) adopted in May 2009. These rules are intended to be the final implementation step in the phased transition of New Jersey’s site remediation process from NJDEP command and control to private oversight by Licensed Site Remediation Professionals (LSRPs). Instead of NJDEP overseeing every step of a cleanup, the LSRP, licensed by a 13-member Licensed Site Remediation Professional Board with investigative and disciplinary powers, is responsible for making day-to-day decisions about a clean-up. Certain categories of cleanups remain under NJDEP oversight, such as where the responsible party has a history of non-compliance or has failed to meet mandatory deadlines. The rule proposal appeared in the New Jersey Register on August 15, 2011 and can be viewed online. Comments can be submitted until October 14, 2011.

The proposal includes major amendments, repeals and new rules intended to fully implement the new LSRP oversight remediation paradigm. The proposed Final Rules provide for the following:

• Amending the Administrative Requirements for the Remediation of Contaminated Sites (ARRCS) rules, the Underground Storage Tank (UST) rules and the Industrial Site Remediation Act (ISRA) Rules to remove all provisions related to the phase-in period;
• Recodifying all administrative requirements from the ISRA Rules and UST rules to the ARRCS rules;
• Adding mandatory timeframes for completion of remedial investigation and implementation of remedial action;
• Repealing and replacing the current Technical Requirements with new performance-based Technical Requirements, intended to allow more flexibility in addressing contamination and potential exposure pathways. Many of the existing Technical Requirements will be recast as a new series of technical guidance documents providing direction on how to achieve the performance-based goals;
• Amending the Discharges of Petroleum and Other Hazardous Substances rules to require compliance with both a facility’s discharge cleanup and removal plan and the ARRCs rules; and 
• Reformatting text where needed to make the rules easier to understand, to correct typographical and grammatical errors, and to update cross-references.

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Gibbons is pleased to congratulate Edward F. McTiernan on his new position as Deputy Counsel for the New York State Department of Environmental Conservation (DEC).

For the past 17 years, Mr. McTiernan has been a director at Gibbons, leading the firm’s environmental team, representing clients before federal and state administrative agencies, and litigating complex environmental actions. He was also a member of the firm’s Executive Committee. During his tenure, Gibbons achieved stellar rankings in the environmental law category in such publications as the Best Lawyers in America and Chambers USA Guide to America’s Leading Lawyers for Business, and Mr. McTiernan himself was listed in both those publications, as well as in New Jersey Super Lawyers. Prior to his career in law, he worked as an environmental scientist focused on site remediation.

“As leader of the Environmental Team at Gibbons, Ed has earned the trust and respect of Gibbons clients and colleagues with his exceptional skill, commitment, and insight,” says Patrick C. Dunican Jr., the firm’s Chairman and Managing Director. “We are confident Ed will do similarly outstanding work for the DEC, and we wish him all the best.”

Mr. McTiernan starts at the agency on August 29, 2011. Remarks Joe Martens, DEC Commissioner, “Ed is a seasoned litigator who is intimately familiar with environmental regulatory issues. His knowledge of the remediation process and his skill in resolving environmental disputes will make him a valuable member of our legal team.”

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The New Jersey Appellate Division delivered a rebuke to the state’s Department of Environmental Protection (DEP) on August 1, finding that DEP’s Commissioner ignored undisputed evidence and made critical legal errors in holding that two development projects did not qualify for an exemption from the strict requirements of the Highlands Water Protection and Planning Act. The court’s decision in Lakeside Manor v. State of New Jersey Department of Environmental Protection reversed the Commissioner’s decision, finding that the developer had satisfied all statutory requirements for the exemption.

The statute, which was enacted in 2004, contains an exemption from its regulatory provisions for major projects that had received at least one of a specified list of land use approvals and at least one of a specified list of DEP permits by March 29, 2004. Jacinto Rodriguez, the president and owner of two development entities, obtained such approvals for both projects well before the deadline: subdivision and site plan approvals in 1999, and DEP permits for sewer lines in 2000. Based on these and other approvals, Rodriguez commenced construction of the projects.

The projects were not yet complete when the statute came into effect, so Rodriguez filed a combined application with DEP for a “Highlands Applicability Determination” for the two projects. DEP initially denied the application, citing doubts about whether the approvals were still in effect, but Rodriguez sought an adjudicatory hearing, and an Administrative Law Judge (ALJ), in his recommended decision, concluded that the projects qualified for the exemption. DEP’s Commissioner, however, rejected the ALJ’s recommendation, and determined that the projects were not eligible for the exemption. Both entities appealed the final decision to the Appellate Division.

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In early 2011, several bills were introduced to encourage the installation of Electric Vehicle (EV) charging stations. Senator Greenstein introduced Senate bill 2603, in January, which would require the New Jersey Turnpike Authority and the South Jersey Turnpike Authority to provide EV charging stations at the service areas along the toll roads, allocating 5% of the parking spaces to EV stations. The bill was reported out of the Senate Environment and Energy Committee on February 14. In March, another bill, S2784, also introduced by Senator Greenstein, would require new shopping center developments to allocate 5% of the parking spaces to EV charging stations. Both of these bills have been sitting since the Spring. Nonetheless, even in the absence of legislative mandates, EV stations have been popping up in NJ and NY. One of the newest ones announced is in Avalon, NJ.

Touted as the first EV charging station at the Jersey shore, Avalon opened its 24 hour charging station on August 5 in front of its public safety building. Under a public-private arrangement with U-Go Stations, the firm has built and will maintain the charging station and pay the town a percentage of the revenue generated. At the moment, there is not much competition. A search of EV charging stations within 150 miles of Newark, revealed 73 charging stations, two of them in Newark itself and the majority of them in Manhattan and Connecticut. Many of the locations are public parking lots, anticipating the future needs of their customers. Others are colleges and universities. In Connecticut, a number of Whole Foods markets have EV charging stations.

It is unclear exactly who is using these charging stations now. The first battery electric car, the Nissan Leaf, was introduced in December 2010, although other major manufacturers have announced the development of EVs. Moreover, the number of EVs is likely to increase because of new fuel efficiency standards announced requiring cars and trucks to meet the equivalent of 54 mph by 2025.

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In what is described as the country’s biggest Superfund site, Judge William Griesbach of the Eastern District of Wisconsin on July 5, 2011, rejected the United States’ attempts to compel defendants Appleton Papers Inc. and NCR Corporation to comply with an EPA directive requiring sediment remediation in the Fox River at a rate substantially similar to the rate at which they had remediated sediment over the last few years.

A Unilateral Administrative Order issued by EPA in 2007 required the dredging and disposal of approximately 3.5 million cubic yards of sediment from the Fox River, as well as the installation of caps and the use of sand to cover PCB-laden riverbed sediment. In 2009, NCR and Appleton created a limited liability corporation (“LLC”) to perform the work and the LLC entered into a long term contract with Tetra Tech to perform the remediation. Although they dredged 550,000 cubic yards of material in 2009 and 743,000 cubic yards in 2010, NCR and Appleton proposed a reduction in the amount of dredging for 2011. EPA rejected this proposal and instead, issued a work plan requiring the dredging of between 605,000 and 810,000 cubic yards of sediment in 2011.

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On the weekend of June 24-26, 2011, the New Jersey Institute of Continuing Legal Education (“NJICLE”) in cooperation with the New Jersey State Bar Association (“NJSBA”), and New Jersey Corporate Counsel Association, held its annual Environmental Law Section Forum Weekend (“the Forum”). Taking place in Avalon, New Jersey, the Forum featured three days of seminars covering various hot-button environmental topics including, Funding for Remediating Sites, Vapor Intrusion, the LSRP Program, Non-Governmental Organizations’ Perspectives on Issues and Resolutions, the well-known NJDEP v. Occidental case also referred to as the Lower Passaic River litigation, Climate Change, and rounded out the weekend with two programs on Ethical Issues including Alternative Fee Arrangements and Multi-Party Settlements.

David Brooks of Gibbons P.C. was the moderator and a panelist for the Vapor Intrusion presentation, an issue that has received increased attention in recent years from both US EPA and New Jersey. Other speakers at the Forum included not only legal practitioners but the New Jersey Department of Environmental Protection, Non-Profit Organizations, and Private Sector Companies. Jeannie Fox, President of the New Jersey Board of Public Utilities gave a keynote speech during the Forum focusing on solar issues in New Jersey.

As a testament to the increased interest in environmental topics as well as the historical success of the Forum, program attendance increased over last year. Attendees earned 11.4 Continuing Legal Education credits including several highly sought after ethics/professionalism credits.

Sandro G. Ocasio is an Associate in the Gibbons Real Property & Environmental Department.

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