On appeal from Decision of the Coastal Area Review Board.
Dreier, Scalera and D'Annunzio. The opinion of the court was delivered by D'Annunzio, J.A.D.
Pursuant to the Coastal Area Facility Review Act (CAFRA), N.J.S.A. 13:19-1 et seq., the Cape May County Municipal Utilities Authority (the Authority) received a Department of Environmental Protection (DEP) permit to construct two pumping stations and a force main "to transmit sanitary wastewater from Stone Harbor Manor and Stone Harbor Boulevard to the Seven Mile Beach/Middle Regional Wastewater Treatment Plant." The project's purpose was to provide sewers and treatment facilities to existing development serviced by malfunctioning individual disposal systems. A March 1980*fn1 report commissioned by the Authority estimated that the Stone Harbor Manor and Boulevard areas had 170 individual disposal systems all of which were malfunctioning. The malfunctioning systems contributed to environmental degradation of an environmentally sensitive area.*fn2
CAFRA prohibits construction of "a facility in the coastal area" without a CAFRA permit, N.J.S.A. 13:19-5. Only a "facility" as defined in N.J.S.A. 13:19-3 is subject to CAFRA. Waste treatment plants and pipelines designed to transport sanitary sewage are CAFRA facilities. N.J.S.A. 13:19-3c(5) and (12). The project in question is within CAFRA's "coastal area." N.J.S.A. 13:19-4.
An application for a CAFRA permit must include an environmental impact statement. N.J.S.A. 13:19-6 and 7. N.J.S.A. 13:19-10 (§ 10) specifies the findings which the DEP must make before a permit can issue. However, N.J.S.A. 13:19-11 (§ 11) provides:
Notwithstanding the applicant's compliance with the criteria listed in section 10 of this act, if the commissioner finds that the proposed facility would violate or tend to violate the purpose and intent of this act as specified in section 2, or if the commissioner finds that the proposed facility would materially contribute to an already serious and unacceptable level of environmental degradation or resource exhaustion, he may deny the permit application, or he may issue a permit subject to such conditions as he finds reasonably necessary to promote the public health, safety and welfare, to protect public and private property, wildlife and marine fisheries, and to preserve, protect and enhance the natural environment. [Footnotes omitted.]
Thus, the Legislature has granted DEP substantial authority to regulate development in the coastal area including the authority to grant a permit subject to conditions found to be "reasonably necessary to promote the public health, safety and welfare . . . and to preserve, protect and enhance the natural environment." See Matter of Egg Harbor Associates, 94 N.J. 358, 364, 464 A.2d 1115 (1983) ("the delegated powers require DEP to regulate land use within the coastal zone for the general welfare").*fn3
The Authority's CAFRA permit contained five administrative and five physical conditions. This appeal concerns physical condition one (the condition). As originally imposed the condition provided:
No connections (sewer hook ups) may be made to the force main or pump stations, or to a collection system tying into the force main or pump stations, to service new development or redevelopment, including the addition of residential units, which is not in compliance with applicable Rules on Coastal Resources and Development. Applicable policies include but are not limited to Island Corridor, Wetlands, Wetlands Buffers, Endangered or Threatened Species Habitat. The CMCMUA is responsible for enforcing this condition, either individually or through an agreement with Middle Township when a collection system is constructed. The CMCMUA must pass a resolution prior to construction agreeing to enforce this restriction of hook ups.
Facially, the condition required all new development, including development which would not constitute a "facility" subject to CAFRA, to comply with the full panoply of CAFRA requirements as a prerequisite to connection with the sewer line. DEP imposed the condition because of its concern that the sewer line would attract and "promote new and/or expanded development along the bay island corridor." DEP Summary Report, August, 1988, p. 2; see N.J.A.C. 7:7E-3.24 for the definition of "bay island corridor" and the severe development restrictions applicable to it.
The Authority and Stone Harbor Boulevard Corporation (SHBC) appealed from imposition of the condition to the Coastal Area Review Board (CARB). N.J.S.A. 13:19-13. The CARB substantially modified the condition by requiring only a DEP determination that a proposed development or redevelopment will not create "adverse secondary impacts" before the Authority ...