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In re Adoption of N.J.A.C. 7 1E. Chemical Industry Council of New Jersey

Decided: April 8, 1992.

IN RE ADOPTION OF N.J.A.C. 7:1E. CHEMICAL INDUSTRY COUNCIL OF NEW JERSEY, APPELLANT,
v.
NEW JERSEY DEPARTMENT OF ENVIRONMENTAL PROTECTION & ENERGY, RESPONDENT



On appeal from the Commissioner of the New Jersey Department of Environmental Protection and Energy.

Shebell and D'Annunzio. The opinion of the court was delivered by Shebell, J.A.D. D'Annunzio, J.A.D., Concurring.

Shebell

The Opinion of the court was delivered by

SHEBELL, J.A.D.

This appeal from the adoption of regulations first proposed on May 6, 1991, by the New Jersey Department of Environmental Protection and Energy (DEPE) to implement the July, 1990 amendments to the New Jersey Spill Compensation and Control Act (Spill Act), N.J.S.A. 58:10-23.11d1-23.24, comes to us on an expedited schedule. The DEPE repealed the previous provisions

of N.J.A.C. 7:1E and replaced them with a comprehensive revision. The new regulations when first proposed were published in the New Jersey Register at 23 N.J.R. 1335(a). The public comment period closed on June 12, 1991. Appellant, Chemical Industry Council of New Jersey (CIC), along with other interested parties, submitted written comments on or prior to that date. The final regulations were published on September 3, 1991 at 23 N.J.R. 2656(a) and became operative on September 11, 1991.

On October 18, 1991, the CIC filed a notice of appeal with this court. CIC moved pursuant to R. 2:9-7 before the Commissioner of the DEPE for a stay of the implementation of N.J.A.C. 7:1E pending our review. The Commissioner denied this request. We also denied CIC's request for a stay; however, we ordered that the appeal be expedited.

CIC is a New Jersey based trade association representing approximately 105 chemical and allied product manufacturers in this State. The DEPE is a public agency empowered by our Legislature pursuant to the Spill Act to promulgate rules and regulations to implement the Spill Act. N.J.S.A. 58:10-23.11f6.

In 1990, the Legislature, in response to an ever-increasing number of discharges of hazardous substances in this State and on its waterways, enacted a package of six bills with the purpose preventing and deterring spills and discharges of petroleum products, debris, and other hazardous substances. Five of these bills amended the Spill Act. Signed into law on July 21, 1990, these bills required the DEPE to undertake added responsibilities. The Commissioner of the DEPE accurately summarized the statutes and requirements under each as follows:

1. 1990 Assembly No. 3262 (P.L.1990, Chapter 78). This law established an expanded Discharge Prevention, Containment and Countermeasure (DPCC) Program. DEPE must adopt rules specifying the contents of DPCC and discharge cleanup and removal (DCR) plans, provide criteria for identifying environmentally sensitive areas, review DPCC and DCR plans when submitted, and conduct onsite inspections to verify compliance with adopted standards. DEPE is also required to receive and, where appropriate, respond to notifications

of discharges and leak detection equipment malfunctions. The statute also increases the tax on the transfer of hazardous substances from major facilities by $0.0025 per barrel.

2. 1990 Assembly No. 3265 (P.L.1990, Chapter 79). This law amended the Corporation Business Tax of 1945 and the New Jersey Gross Income Tax Act, eliminating as a deductible business expense any penalty or fine collected for violation of state or federal environmental law. Also eliminated as deductible expenses are treble damages to the State for cleanup and removal costs incurred as the result of the failure of a discharger to clean up an unauthorized discharge.

3. 1990 Assembly No. 3268 (P.L.1990, Chapter 80). This law requires the illumination of marine transfers of hazardous substances on state waterways during non-daylight hours. DEPE must specify the intensity and area of illumination.

4. 1990 Senate No. 2517 (P.L.1990, Chapter 75). This statute gives DEPE added authority to set civil administrative penalties of up to $10 million for discharges of 100,000 gallons or more of hazardous substances.

5. 1990 Senate No. 2520 (P.L.1990, Chapter 76). This bill requires that protective measures, such as the placement of containment booms, be taken during the transfer of hazardous liquids at marine facilities. DEPE must prescribe the type of containment devices to be employed, how they must be deployed and identify the types of hazardous substances which require booming.

6. 1990 Senate No. 2521 (P.L.1990, Chapter 77). The Hazardous Liquids Transportation Act requires registration for transmission pipelines carrying hazardous substances. DEPE must conduct a comprehensive pipeline safety study, including the feasibility of adopting appropriate standards for construction and materials, leak detection systems, and secondary containment for underwater pipelines.

One of the central provisions of the Spill Act, which has long been in effect, requires that any person who may be subject to liability for a "discharge" of a hazardous substance shall immediately report the occurrence to the DEPE. N.J.S.A. 58:10-23.11e. That provision presently reads as follows:

Any person who may be subject to liability for a discharge which occurred prior to or after the effective date of the act of which this act is amendatory shall immediately notify the department. Failure to so notify shall make persons liable to the penalty provisions of section 22 of this act. [ N.J.S.A. 58:10-23.11e (footnote omitted)].

The DEPE, in support of its position in adopting N.J.A.C. 7:1E-1.6 and thereby requiring that all discharges into the water or onto the lands of the State be immediately reported, urges that these rules serve a critically important role in

protecting the environment from pollution through discharges of hazardous substances. The requirement that all discharges of hazardous substances into the waters or lands of the State be reported is intended, according to the agency, to make it aware of such discharges so DEPE can ensure prompt cleanups and liability assessment.

The statute designates two types of discharges:

"Discharge" means [1] any intentional or unintentional action or omission resulting in the releasing, spilling, leaking, pumping, pouring, emitting, emptying or dumping of hazardous substances into the waters or onto the lands of the State, or [2] into waters outside the jurisdiction of the State, when damage may result to the lands, ...


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