On appeal from the Superior Court, Law Division, Middlesex County.
Furman, Petrella and Skillman. The opinion of the court was delivered by Skillman, J.s.c. (temporarily assigned).
The issue raised by this appeal is whether the Sewerage Authorities Law (N.J.S.A. 40:14A-1 et seq.) authorizes a sewerage authority to impose an additional connection fee upon a change in use of property which is not accompanied by a new sewerage connection. We hold that it does not and therefore reverse the contrary determination of the trial court.
The case was presented on stipulated facts which may be briefly summarized. The defendant East Brunswick Sewerage Authority was created in the 1950's. The building in question, consisting of 150,000 square feet, was constructed in 1972-1973 to be used for commercial retail offices and a warehouse. A $50 connection fee was paid to the Authority at that time for permission to connect into an existing sewer line. The occupants have paid annual service fees since then for use of the line. Plaintiff sublet 16,675 square feet of the building in 1983 for the purpose of operating a dinner theater for pre-teens. No use variance was required because restaurants are a permitted use in the zone. After completing interior renovations and expanding the parking area, plaintiff applied for a certificate of
occupancy. However, it was advised by local authorities that no certificate would be issued until a sewer connection fee of $22,935 was paid to the Authority. The authorization for this imposition is provided by Section 11.3 of the Authority's rules and regulations, which reads as follows:
Upon an addition, alteration or change in use of any building already connected to the Authority system, an additional connection fee may be charged. . . .
Since plaintiff was anxious to commence operations, it paid this fee under protest. It is stipulated that renovation of part of the building for use as a restaurant did not require any new connection to the Authority's sewer main, and that there is adequate capacity in the sewer system to accommodate the flow from plaintiff's business. In addition to the disputed connection fee, plaintiff paid $1,039.20 in sewer service fees for its first 11 months of business.
The Sewerage Authorities Law authorizes two types of fees which may be imposed upon users: service fees and connection fees. Service fees are "in the nature of use or service charges" and "shall as nearly as the sewerage authority shall deem practicable and equitable be uniform throughout the district for the same type, class and amount of use or service of the sewerage system." N.J.S.A. 40:14A-8(b). The statute sets forth five specific factors which a sewerage authority may take into account in computing service fees: (1) "the consumption of water"; (2) "the number and kind of water outlets"; (3) "the number and kind of plumbing or sewerage fixtures or facilities"; (4) "the number of persons residing or working" on the property; or (5) "the capacity of improvements." Id. The statute also permits a sewerage authority to compute service fees based upon "other factors determining the type, class and amount of use or service" and to utilize a combination of factors. Id.
With respect to connection fees, the statute provides:
In addition to any such periodic service charges, a separate charge in the nature of a connection fee or tapping fee, in respect of each connection of any property with the sewerage system may be imposed upon the owner or occupant of the
property so connected. Such connection charges shall be uniform within each class of users and the amount thereof shall not exceed the actual cost of the physical connection, if made by the authority, plus an amount computed in the following ...