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September 27, 1996

ROBERT C. SHINN, JR. individually and as Commissioner of State of New Jersey, Department of Environmental Protection and Energy; JEANNE M. FOX, individually; CAPE MAY COUNTY MUNICIPAL UTILITIES AUTHORITY; GEORGE MARINAKIS, individually and as Executive Director of Cape May County Municipal Utilities Authority; and RICHARD S. DOVEY, Defendants.

The opinion of the court was delivered by: RODRIGUEZ

 RODRIGUEZ, District Judge

 There are three motions presently before this court: (1) plaintiffs Waste Management of Pennsylvania, Inc. and Geological Reclamation Operations and Waste Systems, Inc.'s (collectively, "Plaintiffs") motion pursuant to Fed. R. Civ. P. 56 for partial summary judgment with respect to Count VII of the First Amended Complaint; (2) defendants Robert C. Shinn, Jr. and Jeanne M. Fox's joint motion pursuant to Fed. R. Civ. P. 56(b) for summary judgment and a stay; and (3) Atlantic County Utilities Authority ("ACUA") and Richard S. Dovey's ("Dovey") (collectively, the "Atlantic County Defendants") joint motion pursuant to Fed. R. Civ. P. 56(b) for summary judgment dismissing all counts of the First Amended Complaint as against the ACUA and Dovey. For the reasons expressed below, Plaintiffs' motion for partial summary judgment on Count VII will be granted, Shinn and Fox's joint motion for summary judgment and a stay will be granted in part, denied in part, and dismissed in part as moot, and the Atlantic County Defendants' motion for summary judgment will be denied.



 In 1970, the New Jersey Legislature vested the Department of Environmental Protection ("DEP") with broad authority to regulate solid waste collection, disposal and utilization activity as a utility service under the Solid Waste Management Act, N.J.S.A. 13:1E-1 et seq. ("SWMA"), and to regulate the solid waste disposal rates under the Solid Waste Utility Control Act of 1970, N.J.S.A. 48:13A-1 et seq. ("SWUCA"). The SWMA designates each New Jersey county and the Hackensack Meadowlands District as a discrete solid waste management district, N.J.S.A. 13:1E-19, and requires that each district develop a comprehensive long-term plan which controls the collection, transportation and disposal of all solid waste generated in the district, including specifying the disposal facilities to be utilized. N.J.S.A. 13:1E-20, -21. The DEP incorporates the terms of each district's plan as waste flow regulations. N.J.A.C. 7:26-6.5. The DEP also established a mechanism for the issuance of emergency waste flow redirection orders. N.J.A.C. 7:26-6.7. An emergency redirection order ("ERO") which has a duration of greater than 180 days must be adopted in accordance with N.J.A.C. 7:26-6.6 as an amendment to the applicable waste flow rule.

 The SWMA also requires the DEP to adopt a Statewide Solid Waste Management Plan. N.J.S.A. 13:1E-46. In 1985, the DEP developed and proposed a Solid Waste Management Plan Draft Update 1985-2000 (the "1985 Draft Plan") which set forth New Jersey's waste management goals of source reduction, recycling, and disposal self-sufficiency for the nonrecyclable waste flow.

 In April 1990, then-Governor Florio established the Emergency Solid Waste Assessment Task Force whose mandate was to reevaluate the State's waste management policies. In July 1990, the Task Force issued its Report, which analyzed the State's waste stream and identified portions of the waste stream that could be eliminated through source reduction and recycling. Certif. of Leslie Dannin Rosenthal, Exh. D. The Task Force recommended goals of 60% recycling and disposal self-sufficiency for the nonrecyclable waste stream by 1999. Governor Florio accepted the recommendations of the Task Force Report in November 1990.

 In June 1991, the DEP issued its "Solid Waste Policy Guidelines in Response to Governor Florio's Emergency Solid Waste Assessment Task Force Report (the "1991 Guidelines"). Rosenthal Certif., Exh. E. The 1991 Guidelines stated that "New Jersey remains committed to self-sufficiency and has made significant strides toward this goal." Id. at 21. The 1991 Guidelines also stated that "the DEP will be evaluating the use of out-of-state disposal capacity under existing contractual arrangements on a case-by-case basis and consider authorization of this practice in the context of broader county and regional plans. New proposals for the long-term use of out-of-state capacity will not be approved." Id. at 22.

 A Statewide Solid Waste Management Plan Update 1993-2002 (the "Statewide Plan") was adopted in January 1994. The Statewide Plan's fundamental objective is to achieve "self-sufficiency in disposal capacity" by eliminating the use of out-of-state disposal facilities by the year 2000. See Certif. of Documents/Appendix in Support of Plaintiffs' Motion, Exh. A, Exec. Summ., at 13. The Statewide Plan decrees that (1) new proposals or contracts for the long-term use of out-of-state disposal facilities by New Jersey's counties will not be approved, Statewide Plan at 22; (2) the DEP will continue to foster self-sufficiency through the use of its planning, permitting and financial review processes, Statewide Plan at 22; (3) the DEP will issue emergency waste flow orders to maintain a steady source of solid waste disposal income for in-state disposal facilities, Statewide Plan at 101; and (4) New Jersey's objective is to achieve waste disposal self-sufficiency by December 31, 1999, Statewide Plan at 160-61, Table 25. The foregoing "objectives, criteria and standards" of the Statewide Plan form the benchmark against which the district plans are reviewed. N.J.S.A. 13:1E-2(b)(6) and 13:1E-24.

 Plaintiff Waste Management of Pennsylvania, Inc. ("WMPA") is a Pennsylvania corporation which engages in interstate commerce in solid waste within the state of New Jersey and elsewhere. Plaintiff Geological Reclamation Operations and Waste Systems, Inc. ("GROWS") is a Pennsylvania corporation and an affiliate of WMPA which also engages in interstate commerce in solid waste. Plaintiffs' interstate business services include the disposal of solid waste from New Jersey at landfills located within the Commonwealth of Pennsylvania.

 Beginning in 1988, WMPA entered into a series of contracts with New Jersey waste management districts for solid waste disposal at landfills located in Pennsylvania. In February 1988, WMPA entered into a contract with the Mercer County Improvement Authority ("MCIA") for the disposal of 4.5 million tons of Mercer County's solid waste and ash through the year 2016. DEP Commissioner Shinn included within the Solid Waste Facility Permit for the Mercer County incinerator a condition requiring Mercer County to have "in-state non-hazardous residuals disposal capacity available by December 31, 1999, at the latest, consistent with the Department's adopted disposal self-sufficiency objective." See First Amended Complaint, Exhs. D and E, P 15(b) ("Condition 15(b)"). To ensure that self-sufficiency is timely achieved, Commissioner Shinn further required the MCIA to prepare and submit to the DEP "a schedule for the siting, decision, construction and operation of an in-county or other in-state disposal facility for non-hazardous residual materials prior to the initiation of facility operations." Id.

 On March 22, 1990, the ACUA published and released a Request for Proposals ("RFP") entitled "Request for Proposal for the Acquisition of an Undivided Interest in Real Property, Consisting of the Acquisition of Certain and Landfill License Rights in One or More Out-of-County Landfills." See ACUA 135. The RFP was issued to allow the ACUA (1) to pursue the acquisition of an undivided interest in real property located outside of the geographic boundaries of Atlantic County, and (2) to enter into a License Agreement which would entitle the ACUA to use purported "air rights" for the disposal of up to 1.6 million tons of solid waste generated within the geographic boundaries of the County. On April 20, 1990, the ACUA received responses to the RFP from WMPA and others, which also included "mark-ups" of the draft License Agreement. On May 15, 1990, the ACUA adopted Resolution No. 90-109, which designated WMPA as the entity with whom the ACUA would negotiate for the purchase of the license. See ACUA 176-78. On May 24 and 30, 1990, representatives of the ACUA and WMPA participated in private negotiation sessions with respect to the terms and conditions of the License Agreement. On May 31, 1990, the ACUA adopted Resolution No. 90-126 which authorized execution of the License Agreement with WMPA. See ACUA 179-81. On June 8, 1990, Atlantic County entered into a license agreement with WMPA for the disposal of 2.0 million tons of Atlantic County's solid waste for a period not to exceed 10 years. See ACUA 197-290.

 The License Agreement was reviewed by then-Commissioner Judith Yaskin, who notified the Atlantic County Utilities Authority ("ACUA") by letter dated November 7, 1990 (the "DEP Directive") that one issue required "immediate attention." Rosenthal Certif., Exh. N. Section 6.1(m) of the ACUA-WMPA License Agreement prohibited Atlantic County, unless ordered by DEP and/or BPU, from initiating or pursuing any discussions with another governmental body concerning the processing and disposal of certain waste if the effect might be diversion of waste from the Plaintiffs' landfill to a solid waste facility located in another New Jersey county. Commissioner Yaskin found that Section 6.1(m) was "totally inconsistent with the statewide solid waste management plan and stated self-sufficiency objectives, and the [Emergency Solid Waste] Task Force['s] final recommendations." Id. at 2. Commissioner Yaskin ordered the ACUA to resume negotiations with other counties. Id.

 The Cape May County Municipal Utilities Authority ("CMCMUA") independently solicited the ACUA to send its solid waste for disposal at its landfill located in Cape May. By letter dated April 2, 1993, the ACUA advised the CMCMUA that Atlantic County had waste which was capable of being sent to the Cape May landfill but indicated that such waste was committed by contract to WMPA. See ACUA 64. The letter also indicated that in November 1990 the DEP had ordered the ACUA to "resume negotiations with other counties toward regionalized solid waste management," and that, although informed of the DEP Directive, WMPA had not taken any action to attempt to reverse or modify its mandate. The ACUA advised the CMCMUA that the ACUA would require "a redirection order from [the DEP] to commence" waste flow to Cape May's landfill. Id.

 By letter dated July 26, 1993, WMPA advised the ACUA that it objected to the ACUA's attempt to send solid waste to the Cape May landfill, and asserted that the ACUA and WMPA had a binding contract "under which ACUA is obligated to deliver all acceptable waste generated in Atlantic County to the G.R.O.W.S. landfill, in Pennsylvania, until the Mercer County Resource Recovery Facility is operational." See ACUA 297.

 The CMCMUA sought an emergency redirection order to commence action under the ACUA-CMCMUA interdistrict agreement. Beginning in July 1993 and continuing through September 1993, the DEP held numerous "informational meetings" at which all parties affected by the potential redirection of Atlantic County waste were invited to attend and present testimony. At these meetings the DEP and WMPA worked to identify potential sources of material from other counties which could compensate WMPA for the loss of Atlantic County waste. See ACUA 69.

 On January 14, 1994 Acting DEP Commissioner Fox issued an Emergency Redirection of Solid Waste Flow And Notice to Solid Waste Haulers ("the January ERO") redirecting the flow of certain waste generated from within Atlantic County to the Cape May landfill. First Amended Complaint, Exh. B. The January ERO was appealed by WMPA and others to the Superior Court of New Jersey, Appellate Division. The Appellate Division, having determined that there was no evidence that an "emergency" existed which would support the issuance of an ERO by the DEP, vacated the January ERO in Matter of Emergency Redirection of Solid Waste, 275 N.J. Super. 1, 645 A.2d 144 (App. Div. 1994). Pursuant to the Appellate Division's order, the ACUA once again directed its solid waste to WMPA's landfill.

 Hudson County disposed of its solid waste at the Hackensack Meadowlands Development Commision ("HMDC") landfill. On September 14, 1993, GROWS contracted with the HMDC to bale and load solid waste and to operate the HMDC landfill. In March 1994, the Essex County incinerator began to accept and receive out-of-state solid waste, particularly from New York City. Shinn issued an emergency redirection order on March 29, 1994 (the "March ERO"), which directed approximately 150,000 tons of waste from Hudson County and 100,000 tons of waste from Passaic County to the Essex incinerator. First Amended Complaint, Exh. C. The effect of the March ERO was the full utilization of all disposal capacity at the Essex incinerator by waste generated in New Jersey and the exclusion of waste generated out-of-state and transported across state lines into New Jersey. The redirection was a critical step towards eliminating out-of-state disposal at the Essex incinerator.

 On or about November 22, 1993, the ECUA and WMPA entered into a Memorandum of Understanding which would have provided for the disposal of 2.2 million tons of ash from the Essex County incinerator, starting on July 21, 1994, at the GROWS landfill. The WMPA-ECUA disposal agreement was the subject of the action entitled Chambers Waste System of New Jersey, Inc., et al. v. Essex County Utilities Authority, Superior Court of New Jersey, Law Division, Essex County, Docket No. L-1333-94 wherein the Honorable Burrell Ives Humphreys, A.J.S.C., found that the License Agreement was a contract for services between the ECUA and WMPA and that the ECUA's private negotiation process violated the Local Public Contracts Law, which requires service contracts paid with or out of public funds to be subject to a public bidding process. See N.J.S.A. 40A:11-1 et seq. The Superior Court set aside the WMPA-ECUA disposal agreement, appointed a fiscal agent to oversee bidding and retained jurisdiction over the matter pending award of the contract under the Local Public Contract Law. WMPA appealed the order setting aside the agreement to the Appellate Division of the Superior Court. *fn1"

 In accordance with New Jersey's self-sufficiency objective, Mercer County began to develop its plan to include the construction of an incinerator. Atlantic County was to be a partner in the use of that incinerator. In the plan certification issued by the DEP, which approved this regional agreement, the DEP reiterated that "self-sufficiency continues to be the policy of the State of New Jersey." Rosenthal Certif., Exh. O, at 8. Moreover, the DEP ordered the Atlantic and Mercer County landfill contracts amended to include a directive to comply with in-state self-sufficiency by December 31, 1999 and ordered the counties to continue to investigate alternate primary in-county or in-state disposal capacity for ash and bypass waste. Id.

 Throughout the permitting process for the Mercer County incinerator, the DEP maintained the policy of in-state self-sufficiency and emphasized the need for Mercer County to develop in-state capacity for disposal of the ash residue produced at the incinerator. The May 11, 1993 Notice of Deficiency for the Mercer County incinerator required the MCIA to develop a backup disposal strategy and to "address [the] DEP's position on the reliance on long-term out-of-state disposal dependency." Rosenthal Certif., Exh. P at 14. Both the draft permit and the final Mercer County incinerator permit included Condition 15(b), which contained the DEP's long-standing requirement that Mercer County have "in-state residuals disposal capacity available by December 31, 1999, at the latest, consistent with the Department's adopted disposal self-sufficiency objective." First Amended Complaint, Exhs. D and E. WMPA filed an appeal of the permit condition in the Appellate Division of the Superior Court of New Jersey in October 1994, based on state law claims as well as alleged violations of the Commerce and Contract Clauses of the state and federal constitutions. Rosenthal Certif., Exh. Q. *fn2"

 In 1993, WMPA entered into two additional contracts for out-of-state disposal with New Jersey waste management districts. In both instances, the DEP rejected the long-term nature of these contracts as inconsistent with New Jersey's self-sufficiency objective. The DEP has stated that it has rejected every long-term out-of-state disposal contract submitted to the DEP after the adoption of the 1985 Draft Plan. See Defendants' Brief in Support of Motion for Partial Summary Judgment and a Stay, at 19; Rosenthal Certif., Exhs. R1, R2 and R3.

 In July 1993, the DEP reviewed CMCMUA's proposed contract with WMPA, effective May 1, 1996 for the disposal of up to 1.5 million tons of solid waste for a ten year period. The DEP rejected Cape May County's planned reliance on long-term out-of-state disposal, stating that approval would be "contrary to the goals of the Task Force Final Report and the objectives, criteria, and standards of the January 1993 draft State Solid Waste Management Plan Update: 1993-2003." Rosenthal Certif., Exh. S at 12. The DEP approved the contract on a short-term basis only and directed the CMCMUA to submit a timeline with specific milestones for negotiation of interdistrict agreements with other New Jersey waste management districts. Id. at 12-13.

 The MCMUA-WMPA agreement was submitted for review by the DEP on October 28, 1994. The DEP issued its limited approval of the agreement on December 29, 1994, again limiting its approval to the use of out-of-state disposal to the development of in-state facilities for all of Morris County's waste by December 31, 1999. Rosenthal Certif., Exh. W. In February 1995, WMPA filed a state court appeal of this approval, based on state law claims and alleged violations of the Commerce and Contract Clauses of the state and federal constitution. Rosenthal Certif., Exh. X. On October 11, 1995, the appeal was dismissed by consent of the parties and remanded to the DEP for reconsideration. Rosenthal Certif., Exh. AA.

 On November 22, 1994, Morris County submitted a plan amendment to the DEP which sought approval of a Memorandum of Understanding ("MOU") between Morris and Essex Counties for the disposal of up to 225,000 tons of Morris County waste, constituting approximately 70% of its annual waste flow, at the Essex County incinerator. Rosenthal Certif., Exh. U. The MOU recited the fact that both the MCMUA and the ECUA were required to "pursue agreements with other New Jersey Counties for or with respect to the utilization of available excess capacity at in-State solid waste disposal facilities prior to, or in lieu of, utilization of and reliance on out-of-state disposal facilities." See MOU at 2. Commissioner Shinn and the DEP declared that Morris County's plan is "contrary to the [DEP's] disposal self-sufficiency goal." See Rosenthal Certif., Exh. W, at 5. Commissioner Shinn and the DEP have notified Morris County "as self-sufficiency is clearly an adopted policy position of the Department, the term for continued out-of-state disposal of municipal waste will in no case exceed December 31, 1999." Id. WMPA filed an Order to Show Cause in the New Jersey Superior Court, Law Division, seeking to enjoin the MOU and have the plan amendment declared invalid. Rosenthal Certif., Exh. V. On March 24, 1995, the Law Division heard oral argument on the WMPA Order to Show Cause and rendered a bench decision, followed by a written order on April 22, 1995, which ruled that the terms of the MCMUA-WMPA contract allowed for processible waste to be transported to the Essex County incinerator, but that a pro rata share of Morris County ash produced at the Essex County incinerator, as well as all non-processible and bypass waste be transported to and disposed of at the WMPA landfill. Rosenthal Certif., Exh. V at 68; Final Judgment at 2. WMPA filed an appeal of this decision with the New Jersey Superior Court, Appellate Division on June 1, 1995. Rosenthal Certif., Exh. CC. *fn3"

 The matter presently before the court was commenced by WMPA and Geological Reclamation Operations and Waste Systems, Inc. ("GROWS") (collectively referred to as "Plaintiffs") on April 29, 1994, seeking injunctive and declaratory relief and compensatory damages from various New Jersey State and county public entities and current and former State and county officials for alleged violations of Plaintiffs' rights under the Contract and Commerce Clauses of the United States Constitution. On December 22, 1994, Plaintiffs filed a First Amended Complaint which incorporated the allegations contained in the complaint and added an eleventh count. The State Defendants' motions to dismiss the Complaint based on principles of abstention and immunity from suit were denied by the court on June 22, 1995.


 A party is entitled to summary judgment if "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(c). An issue is "genuine" if it is supported by evidence such that a reasonable jury could return a verdict in the non-moving party's favor. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986). A fact is "material" if, under the governing substantive law, a dispute about it might affect the outcome of the suit. Id. In determining whether a genuine issue of material fact exists, the court must view the facts and all reasonable inferences drawn from those facts in the light most favorable to the non-moving party. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 89 L. Ed. 2d 538, 106 S. Ct. 1348 (1986).

 The moving party has the initial burden of demonstrating the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986). Once the moving party has met its opening burden, the non-moving party must identify, by affidavits or otherwise, specific facts showing that there is a genuine issue for trial. Id. at 324. The non-moving party may not rest upon the mere allegations or denials of its pleading. Id. Moreover, the court must rule "on the record the parties have actually presented, not on one potentially possible." Madeirense v. Stulman, 147 F.2d 399 (2d Cir. 1945). "The plain language of Rule 56(c) mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." 477 U.S. at 322.


 I. Plaintiffs' Motion for Partial ...

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