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New Jersey Chapter of National Association of Industrial and Office Parks v. New Jersey Department of Environmental Protection

Decided: May 10, 1990.

NEW JERSEY CHAPTER OF THE NATIONAL ASSOCIATION OF INDUSTRIAL AND OFFICE PARKS, A NEW JERSEY CORPORATION, APPELLANT,
v.
NEW JERSEY DEPARTMENT OF ENVIRONMENTAL PROTECTION, RESPONDENT



On appeal from the Adoption by New Jersey Department of Environmental Protection of Regulations Pursuant to the Freshwater Wetlands Protection Act, N.J.A.C. 7:7-1 et seq.

King, Shebell and Baime. The opinion of the court was delivered by King, P.J.A.D.

King

We are again faced with challenges to certain regulations promulgated by the New Jersey Department of Environmental Protection (DEP), in implementing the Freshwater Wetlands Protection Act, N.J.S.A. 13:9B-1 to -30 (the Act or Wetlands Act). Last term we invalidated one such regulation, N.J.A.C. 7:7A-2.7(d)(1) and (2), while upholding several other freshwater wetland regulations and agency practices. See In the Matter of Freshwater Wetlands Protection Act Rules, N.J.A.C. 7:7A-1.1, 238 N.J. Super. 516, 570 A.2d 435 (App.Div.1989). The Supreme Court also has recently considered the issue of the effective date of certain regulatory restrictions relating to the transition-area provisions of the Act. See In the Matter of the Appeal of Adoption of N.J.A.C. 7:7A-1.4, 118 N.J. 552, 573 A.2d 143 (1990), rev'g 240 N.J. Super. 224, 573 A.2d 162 (App.Div.1989), on Judge Skillman's dissent.

The appellant here is the New Jersey Chapter of the National Association of Industrial and Office Parks (NAIOP). The appellant challenges four sections of the regulations: (1) N.J.A.C.

7:7A-2.7(d)(1) and (2), which exempt certain preapproved preliminary site plans or subdivision applications from the statutory requirement of a freshwater wetlands permit, but deny that exemption to those projects not initiated within five years of the enactment of the Act; (2) N.J.A.C. 7:7A-1.6(e), which subjects projects exempted under the Act or regulations to the requirements of other applicable permit programs which existed on June 30, 1988; (3) N.J.A.C. 7:7A-1.4, which defines the "placing of obstructions" in freshwater wetlands; and (4) N.J.A.C. 7:7A-14.1(d) and N.J.A.C. 7:7A-14.2(a)3, which concern creation and enhancement mitigation ratios.

In July 1987 the Legislature enacted the Fresh Water Wetlands Protection Act, N.J.S.A. 13:9B-1 to -30; L.1987, c. 156, eff. July 1, 1988. N.J.S.A. 13:9B-25 directed the DEP to adopt rules and regulations necessary to implement the Act pursuant to the Administrative Procedure Act, N.J.S.A. 52:14B-1 to -15. On December 31, 1987 the DEP published proposed regulations, held public hearings, entertained and responded to public comment and made some changes in the proposed rules and regulations. 20 N.J.R. 1236-1263. Final regulations were published, to be effective June 6, 1988. 20 N.J.R. 1263-1285. This appeal followed.

Last term, as noted, we found meritorious a challenge to N.J.A.C. 7:7A-2.7(d)(1) and (2) which was similar to appellant's first point on this appeal in In The Matter of the Freshwater Wetlands Protection Act Rules, 238 N.J. Super. 516, 570 A.2d 435 (App.Div.1989). We adhere to that ruling today.

In our prior opinion, we extensively reviewed the history and purpose of the Act. See 238 N.J. Super. at 518-524, 570 A.2d 435. We also reviewed the general principles applicable to judicial review of a regulatory scheme. Id. at 525-527, 570 A.2d 435. Since we need not reiterate these matters, we move directly to a consideration of the three remaining viable regulatory challenges presented by appellant NAIOP in this case.

I

Appellant NAIOP contends that N.J.A.C. 7:7A-1.6(e) should be invalidated as an ultra vires or unauthorized action by the DEP. Appellant claims that the regulation violates the Legislature's mandate that the Act be the sole program for freshwater regulation and that it effectively eliminates the "grandfather" exemptions given by the Legislature to particular projects by allowing the DEP to regulate wetlands aspects of those projects through other programs. The State replies that the regulation appropriately implements the statutory directive to consolidate the processing of the wetlands-related aspects of other regulatory programs and that there is no suggestion in the Act that it was intended to repeal any of the other programs which bear on the regulation of freshwater wetlands.

N.J.A.C. 7:7A-1.6 deals with "other statutes and regulations" as they relate to the Freshwater Wetlands Protection Act. Appellant specifically challenges subsection (e), which provides that:

If a proposed project does not involve a freshwater wetland or State open water, does not constitute a regulated activity, or is otherwise exempt from the provisions of the Act and this chapter, the final decision on the application shall be based solely on the requirements of other applicable permit programs. For projects exempted under the Act and this chapter's wetlands requirements under N.J.A.C. 7:7A-2.7(d) or (g), the final decision on the application will be based on the requirements of other applicable permit programs as they existed on June 30, 1988. [ N.J.A.C. 7:7A-1.6(e).]

Appellant contends that this regulation clashes with N.J.S.A. 13:9B-30, which is captioned "Exclusive regulation by this act; exception." That statute provides:

It is the intent of the Legislature that the program established by this act for the regulation of freshwater wetlands constitute the only program for this regulation in the State except to the extent that these areas are regulated consistent with the provisions of section 6 of this act. [Hackensack Meadowlands Development Commission and Pinelands Commission exemptions.] To this end no municipality, county, or political subdivision thereof, shall enact, subsequent to the effective date of this act, any law, ordinance, or rules or regulations regulating freshwater wetlands, and further, this act, on and subsequent to its effective date, shall supersede any law or ordinance regulating freshwater wetlands enacted prior to the effective date of this act. Between

the enactment and effective date of this act, no municipality, county, or political subdivision thereof shall enact any law, ordinance, or rule and regulation requiring a transition area adjacent to a freshwater wetland; provided however, that any such law, ordinance, or rule and regulation adopted prior to the enactment of this act shall be valid until the effective date of this act.

Appellant argues that despite this express statutory direction from the Legislature, N.J.A.C. 7:7A-1.6(e) allows the DEP to "improperly . . . regulate projects exempt from the act under the wetlands-related review standards of other N.J.D.E.P. permit programs." A similar challenge to the regulation was made during the adoption process in Comment 91. The DEP noted that six commentors had alleged that N.J.A.C. 7:7A-1.6(e) was contrary to N.J.S.A. 13:9B-5 (consolidation of other regulatory programs affecting wetlands) and N.J.S.A. 13:9B-30 because it allowed the DEP to continue enforcing preexisting regulatory programs that affected activities in wetlands. The commentors contended that the regulation "should require consolidation of all freshwater wetlands rules within one entity which applied to freshwater wetlands." The DEP responded as follows:

The act requires consolidation of the processing of freshwater wetlands-related aspects of other regulatory programs. The rules consolidate wetlands-related aspects of State regulatory programs by providing "one-stop" permitting, through the Office of Freshwater Wetlands within the Division of Coastal Resources. The adoption has been modified to clarify that these other programs will not regulate based on freshwater wetlands protection issues but rather based on concerns addressed in their respective enabling statutes and rules. However, if a project is exempted from the requirements of the act under an exemption pursuant to N.J.A.C. 7:7A-2.7(d), the wetlands-related review standards of other programs will still apply to the project. This effectively carries out the act's mandate to consolidate, as well as to protect wetlands.

Comment 92 indicated that two other commentors had criticized the regulation as being unclear. These commentors argued that if the DEP intended to notify people that they still had to comply with the provisions of other permit programs, the regulations should so state and the specific programs should be identified. The commentors, though, were not in favor of continuing regulation of wetlands under other permit programs. To this criticism the DEP responded:

As explained above, and clarified in the adoption, the permit process has been consolidated so that applicants need not deal with several different review processes for wetlands protection-related permit applications for projects in freshwater wetlands. Other state programs, which regulate activities based on non-wetlands-related concerns (for example, flood danger) will remain in effect. However, these other State programs will consider the impacts on wetlands only if the activity is exempted under the provisions of N.J.A.C. 7:7A-2.7(d).

In its brief the DEP contends that N.J.A.C. 7:7A-1.6(e) is entirely consistent with and implements N.J.S.A. 13:9B-5, which directs the DEP to consolidate the processing of wetlands-related aspects of other regulatory programs affecting activities in freshwater wetlands. The DEP argues that the Legislature did not intend the Wetlands Act to supercede or preempt other state statutory schemes that also regulate wetlands. The DEP also claims that appellant's reliance on N.J.S.A. 13:9B-30 is misplaced because that provision mandates the preemption of local regulation of freshwater wetlands only, not State enactments.

The Legislature made no reference to supersession or preemption in N.J.S.A. 13:9B-5(a)*fn1 when it directed the DEP to consolidate the processing of wetlands-related aspects of other regulatory programs affecting freshwater wetlands. However, it used precise terminology to that effect in N.J.S.A. ...


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