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Matter of Adoption of N.J.A.C. 71I

June 3, 1996

IN THE MATTER OF THE ADOPTION OF N.J.A.C. 71I; TOWNSHIP OF VOORHEES, APPELLANT,
v.
DEPARTMENT OF ENVIRONMENTAL PROTECTION, ENVIRONMENTAL CLAIMS ADMINSTRATION, RESPONDENT.



On appeal from the Environmental Claims Administration, Department of Environmental Protection.

Approved for Publication June 3, 1996.

Before Judges Long, Muir, Jr., and Loftus. The opinion of the court was delivered by Muir, Jr., J.A.D.

The opinion of the court was delivered by: Muir

The opinion of the court was delivered by

MUIR, JR., J.A.D.

The Sanitary Landfill Closure and Contingency Fund Act (Closure Act), N.J.S.A. 13:1-100 to -116, created a fund to pay for damages resulting from the improper operation or closure of sanitary landfills in New Jersey. Based on the Closure Act provision that recoverable damages include costs related to installation and maintenance of monitoring wells at an improperly closed sanitary landfill, Voorhees Township filed a claim against the Sanitary Landfill Facility Contingency Fund (the fund) for the costs of monitoring wells it had installed pursuant to a Department of Environmental Protection (DEP) consent order. Given that Voorhees, five years prior to the Closure Act, had purchased the site of the monitoring wells, a closed sanitary landfill, and that the Closure Act made owners or operators of sites whereon a sanitary landfill "is or has been located" liable for any damages arising from improper closure, the DEP denied the claim.

In a subsequent adjudicatory hearing, an Administrative Law Judge (ALJ) ruled Voorhees was not an owner within the intendment of the Closure Act. In response, the DEP adopted new regulations to overcome the ALJ ruling along with other regulations directed at Voorhees' claim and the nature of its damage claim. Subsequently, the same ALJ ruled that under the new regulation redefining an owner liable for damages under the Closure Act Voorhees could not recover its damage claim from the fund. The final decision of the DEP Commissioner affirmed on limited grounds.

In these consolidated appeals, Voorhees challenges certain aspects of the newly adopted regulations and at the same time seeks reversal of the Commissioner 5 final decision. We hold, based on Vi-Concrete Co. v. State, Department of Environmental Protection, 115 N.J. 1, 556 A.2d 761 (1989), that Voorhees is not an owner within the intendment of the Closure Act. In doing so, however, we reject the initial ALJ reasoning which gave rise to the DEP regulation redefining owners liable for damages under the Closure Act. Accordingly, we reverse the Commissioner's final decision. However, due to issues left unresolved by the ALJ in the second proceeding, we remand for further proceedings consonant with this opinion.

I.

Voorhees Township is the owner of a 37-acre tract of land it purchased in 1977 for nominal consideration to use as a public park. The property from 1959 to 1972 was part of a sanitary landfill that serviced Voorhees' solid waste disposal needs. Voorhees asserts it purchased the property believing the landfill had been closed in accordance with existing law and with no reason to believe there would be environmental concerns in the future.

In October 1986, the DEP unilaterally issued a draft New Jersey Pollutant Discharge Elimination System (NJPDES) permit to Voorhees delineating the need for monitoring wells to be installed and maintained on the former landfill. The DEP, it appears, later issued a final permit only to rescind it based on the holding in Vi-Concrete Co. v. State, Department of Environmental Protection, supra, 115 N.J. at 3, 4. Issuance of the draft permit was the first notice Voorhees had that the landfill site might have environmental problems. Apparently based on its interest in resolving environmental concerns for the former landfill and prior to the Vi-Concrete ruling, Voorhees entered into a DEP consent order in November 1987. The consent order required Voorhees to install and maintain appropriate monitoring wells.

In July 1987, Voorhees filed a claim with the DEP seeking reimbursement for costs incurred in the installation and maintenance of the monitoring wells. Voorhees included related legal fees in its claim. The claim sought recovery of the costs from the fund created by the Closure Act.

The Legislature created the fund as a mechanism for compensating for certain damages incurred as the result of the improper operation or closure of a sanitary landfill. See N.J.S.A. 13:1E-101. To that end, the Closure Act provided in part:

13:1E-105. Sanitary landfill facility contingency fund

The Sanitary Landfill Facility Contingency Fund (hereinafter referred to as "the fund") is established as a nonlapsing, revolving fund in the Department of Environmental Protection. The fund shall be administered by the department, and shall be credited with all tax revenues collected by the division pursuant to section 5 of this ...


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