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Town of Kearney v. Hackensack Meadowlands Development Commission

September 28, 2001


On appeal from the Superior Court of New Jersey, Law Division, Hudson County, L-6636-00.

Before Judges Baime, Newman and Fall.

The opinion of the court was delivered by: Newman, J.A.D.


Argued: September 20, 2001

On leave granted, this appeal concerns whether the Department of Environmental Protection (DEP) is the proper forum to determine whether a town in which an access road to a transfer station is located is entitled to a "host community benefit" payment under N.J.S.A. 13:1E-28.1. The trial court ruled that while the DEP has exclusive jurisdiction to decide the amount of the payment, the DEP and Law Division have concurrent jurisdiction to determine what comprises a transfer station and whether a town is eligible for payment under the host community benefit statute. We now reverse and transfer the action to the DEP for further proceedings.

The facts are not in dispute. Hackensack Meadowlands Development Commission (HMDC) is a state agency that was created to oversee the development or redevelopment of the Hackensack Meadowlands District which encompasses several municipalities.

HMDC entered into an agreement with Waste Management of New Jersey, Inc. (Waste Management) on September 7, 2000, leasing 10.73 acres located in the Borough of North Arlington (North Arlington) to Waste Management for use as a transfer station. A transfer station is a type of DEP regulated solid waste facility as defined in the Solid Waste Management Act (SWMA), N.J.S.A. 13:1E-3. The transfer station serves as a facility where non-hazardous waste is delivered to an enclosed building on the property, the waste is sorted, useful materials are salvaged and the remaining waste is collected and shipped by solid waste vehicles to an off-site sanitary landfill or other disposal area. Trucks delivering waste to and from the transfer station must exit State Highway No. 7 - Belleville Turnpike, and utilize Baler Boulevard to enter and subsequently exit the transfer station. Baler Boulevard is a private road that is owned, in part, by HMDC. This is the only access road to the transfer station. Part of Baler Boulevard is located in the Town of Kearny (Kearny).

Upon learning of the proposed lease agreement between HMDC and Waste Management, Kearny met with HMDC representatives in August 2000 asserting that Kearny was entitled to quarterly payments under the host community benefit provision of N.J.S.A. 13:1E-28.1. Such host community benefit payments had been provided to North Arlington under the contract between HMDC and Waste Management. The statute provides in pertinent part:

Any municipality within which a transfer station is located pursuant to an adopted and approved district solid waste management plan shall be entitled to an annual economic benefit to be paid or adjusted not less than quarterly in an amount established by agreement with the owner or operator of the transfer station or by order of the [DEP]*fn1, but not less than the equivalent of $0.50 per ton of all solid waste accepted for transfer at the transfer station . . . . For the purposes of calculating the payments, the owner or operator of the transfer station may, subject to the prior agreement of the relevant municipality and the approval of the [DEP], provide the municipality with any of the following benefits in consideration for the use of land within its municipal boundaries as the location of a transfer station: [alternative payment methods listed]. [N.J.S.A. 13:1E-28.1a.]

Kearny attempted to negotiate payments under the statute with HMDC representatives since access to the transfer station in North Arlington was only available by use of Baler Boulevard and therefore, Kearny argued, the access road was an integral part of the transfer station. Kearny also requested payments for use of a weighing facility located in Kearny. However, use of the Kearny weighing facility has been discontinued since November 20, 2000.

Kearny and HMDC were unable to reach an agreement. On October 25, 2000, Kearny filed a Complaint in the Law Division in Hudson County, asserting that it was entitled to a host community benefit for use of the weighing station and access road and requesting that the HMDC negotiate in good faith with Kearny to determine the amount of the benefit.

On November 29, 2000, HMDC filed a motion to dismiss the complaint for failure to exhaust administrative remedies or for transfer of Counts I and II to the DEP. HMDC also filed a Motion to Dismiss Count III of the Complaint for failure to state a claim which relief upon can be granted. However, Kearny withdrew Count III of the complaint without prejudice before consideration by the court.

HMDC argued that under N.J.S.A. 13:1E-28.1, the DEP was responsible not only for determining how much a host municipality is entitled to, but whether, as a threshold issue, there is any entitlement to those payments at all. HMDC further argued that if a municipality and the owner or operator of a transfer station cannot come to an agreement, the municipality must petition the DEP for an appropriate order before resorting to the courts for resolution.

The trial court concluded that while the DEP did have exclusive authority to determine the amount of benefits a host community is entitled to, the DEP did not have exclusive jurisdiction to decide the threshold issue of entitlement to a host benefit. The court reasoned that no special expertise was needed in determining what constitutes a transfer station location. The court decided that there was concurrent jurisdiction between the DEP and the courts. In denying the motion, the court considered the ...

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