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In re Protest of Coastal Permit Program Rules

May 31, 2002

IN THE MATTER OF THE PROTEST OF COASTAL PERMIT PROGRAM RULES
IN THE MATTER OF THE CHALLENGE A-3606-99T3 BY THE NEW JERSEY ASSOCIATION OF REALTORS TO AMENDMENTS OF THE COASTAL PERMIT PROGRAM RULES AND THE COASTAL ZONE MANAGEMENT RULES. *FN1
IN THE MATTER OF COASTAL PERMIT A-3852-99T3 PROGRAM RULES AND COASTAL ZONE MANAGEMENT RULES PROMULGATED BY NEW JERSEY DEPARTMENT OF ENVIRONMENTAL PROTECTION, N.J.A.C. 7:7E.
IN THE MATTER OF COASTAL A-3853-99T3 PERMIT PROGRAM RULES AND COASTAL ZONE MANAGEMENT RULES PROMULGATED BY NEW JERSEY DEPARTMENT OF ENVIRONMENTAL PROTECTION, N.J.A.C. 7:7E.
IN THE MATTER OF AMENDMENTS A-4250-00T3 TO THE COASTAL PERMIT PROGRAM RULES AND COASTAL ZONE MANAGEMENT RULES.



On appeal from the New Jersey Department of Environmental Protection.

Before Judges Braithwaite, Coburn and Weissbard.

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

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued April 29, 2002

These five appeals, consolidated for purposes of this opinion, involve challenges by appellants New Jersey Association of Realtors ("Realtors"), New Jersey Builders Association ("Builders"), American Littoral Society, New Jersey Environmental Federation, Pinelands Preservation Alliance, Association of New Jersey Environmental Commissions, Sierra Club - New Jersey Chapter, and New Jersey Foundation ("Environmental appellants") to the validity of regulations promulgated recently by respondent Department of Environmental Protection ("DEP") pursuant to the Coastal Area Facility Review Act ("CAFRA"), N.J.S.A. 13:19-1 to -21.

Appellants challenge a new permit program, the Sector Permit Program, N.J.A.C. 7:7-9.1 to -9.11, established by DEP in the Coastal Permit Program (CPP) Rules. The appeals also challenge DEP's changes to the location policies of the Coastal Zone Management ("CZM") Rules, N.J.A.C. 7:7E1.1 to -8.21, and the specific sub-chapters pertaining to "development intensity." Development intensity determines the allowable limits of impervious cover (structures and paving) that may be placed on a development site, and of vegetative cover (trees, shrubs, and grasses) that must be preserved or planted on a development site. The appeals also focus on DEP's repealing Subchapter 5 (General Land Areas) of N.J.A.C. 7:7E and its rewriting a new Subchapter 5 (Requirements for Impervious Cover and Vegetative Cover for General Land Areas and Certain Special Areas) and adding Subchapter 5A (Impervious Cover Limits and Vegetative Cover Percentages in the Upland Waterfront Development Area) and Subchapter 5B (Impervious Cover Limits and Vegetative Cover Percentages in the CAFRA Area).

Essentially, although there are other individual claims raised by the appellants that we will address, appellants' claims can be divided into four major themes:

• WHETHER N.J.A.C. 7:7-1.4(b) CONFLICTS WITH N.J.S.A. 13:19-10 BECAUSE IT ALLOWS DEP TO AVOID MAKING THE SPECIFICALLY ENUMERATED FINDINGS REQUIRED BY THE STATUTE BEFORE ISSUING A CAFRA PERMIT (raised by the Environmental appellants).

• WHETHER DEP'S SECTOR PERMIT PROGRAM, N.J.A.C. 7:7-9.1 to -9.11, IS ULTRA VIRES (raised by the Environmental appellants).

• WHETHER THE IMPERVIOUS COVER PERCENTAGES IN N.J.A.C. 7:7E-5B.4 ARE ARBITRARY, CAPRICIOUS OR UNREASONABLE, OR WERE ADOPTED IN VIOLATION OF THE ADMINISTRATIVE PROCEDURE ACT (APA), N.J.S.A. 52:14B-1 to -15 (raised by Builders, Realtors and Environmental appellants).

• WHETHER DEP ERRED BY USING THE STATE PLAN'S 5 CENTERS OR BY CREATING ITS OWN COASTAL CENTERS (raised by Builders, Realtors and Environmental appellants).

Our careful review of the record convinces us that the regulations are valid with the exception of N.J.A.C. 7:7-1.4(b), and the sector permit rules, N.J.A.C. 7:7-9.1 to -9.11, to the extent that these regulations obviate the necessity of DEP making the findings required by N.J.S.A. 13:19-10 before issuing a permit. DEP is ordered to amend these regulations to make clear that it must make the necessary findings pursuant to N.J.S.A. 13:19-10 before it issues a permit. In order to put the issues raised in perspective, we set forth the procedural history and statement of facts.

I. BACKGROUND

A. HISTORY OF THE CAFRA LEGISLATION

In 1973, the Legislature enacted CAFRA "to protect the unique and fragile coastal zones of the State." In re Egg Harbor Assocs. (Bayshore Centre), 94 N.J. 358, 364 (1983). See L. 1973, c. 185. That statutory framework first withstood constitutional attack in Toms River Affiliates v. Department of Envtl. Prot., 140 N.J. Super. 135 (App. Div.), certif. denied, 71 N.J. 345 (1976). It was originally designed to control new large-scale residential development, energy facilities, commercial and industrial developments and certain types of public works projects.

Ten years later after CAFRA's enactment, the Supreme Court explained:

Through CAFRA, the Legislature intended to reverse "serious adverse environmental effects . . . that would preclude or tend to preclude those multiple uses which support diversity and are in the best long-term, social, economic, aesthetic and recreational interests of

all people of the State." N.J.S.A. 13:19-2. To achieve this goal, the Legislature determined that all of the coastal area should be dedicated to those kinds of land uses which promote the public health, safety and welfare, protect public and private property, and are reasonably consistent and compatible with the natural laws governing the physical, chemical and biological environment of the coastal area. [Id.]

Although CAFRA is principally an environmental protection statute, the powers delegated to DEP extend well beyond protection of the natural environment. Succinctly stated, the delegated powers require DEP to regulate land use within the coastal zone for the general welfare. [Egg Harbor Assocs., supra, 94 N.J. at 364.]

In 1993, the Legislature significantly amended CAFRA, expanding its jurisdiction. L. 1993, c. 190. Those amendments substantially changed the thresholds for the issuance of development permits in order to better accommodate urban redevelopment and to provide for greater protection for the sensitive coastal areas at the water's edge. See committee statement at the end of N.J.S.A. 13:19-2 (West Supp. 2002).

The jurisdictional expansion was also noted by DEP when it readopted and revised its regulations in response to the Legislature's amendments. 26 N.J.R. 2934-90 (July 18, 1994). As part of that adoption, N.J.A.C. 7:7-2.1 was amended to state in pertinent part:

(b) The Department interprets its obligation and responsibility to regulate development as defined by CAFRA to include review of the potential impacts of any development, if at least part of that development is located within the area in which a CAFRA permit is required. Therefore, if any development requires a CAFRA permit, the Department will review all the components of the development, not just those that triggered the regulatory thresholds of CAFRA . . . .

At its heart, CAFRA requires that any proposed development within the State's "coastal area" that meets the initial construction and development thresholds articulated in N.J.S.A. 13:19-5 must obtain a permit from DEP before the commencement of that construction unless otherwise expressly exempted. N.J.S.A. 13:19-5, 13:19-5.2, and 13:19-5.3. CAFRA's "coastal area" is defined in N.J.S.A. 13:19-4 as generally extending along the State's coast from Cheesequake Creek along Raritan Bay south along the Atlantic Ocean to Cape May and then north along the Delaware Bay and River to the Kilcohook National Wildlife Center in Salem County. "It ranges in width from as little as about 100 feet to as much as about 20 miles." See 31 N.J.R. 2042 (August 2, 1999).

In enacting and amending CAFRA, the Legislature declared in part in N.J.S.A. 13:19-2

that the coastal area and the State will suffer continuing and ever-accelerating serious adverse economic, social and aesthetic effects unless the State assists, in accordance with the provisions of this act, in the assessment of impacts, stemming from the future location and kinds of developments within the coastal area, on the delicately balanced environment of that area.

The Legislature further recognizes the legitimate economic aspirations of the inhabitants of the coastal area and wishes to encourage the development of compatible land uses in order to improve the overall economic position of the inhabitants of that area within the framework of a comprehensive environmental design strategy which preserves the most ecologically sensitive and fragile area from inappropriate development and provides adequate environmental safeguards for the construction of any developments in the coastal area. [Emphasis added.]

The Legislature also gave DEP power to promulgate new regulations to "effectuate the purposes of this act." N.J.S.A. 13:19-17(a).

In the 1993 amendments, the Legislature added N.J.S.A. 13:19-17(b), which requires that DEP adopt regulations in consultation with the State Planning Commission *fn2 and local governments, and that the CAFRA regulations be "closely coordinated" with the provisions of the State Plan. N.J.S.A. 13:19-17(b) states:

Within one year of the enactment date of P.L. 1993, c. 190 (C. 13:19-5.1 et al.), the department, in consultation with the State Planning Commission and county and municipal governments located in the coastal area . . . shall adopt new rules and regulations to implement P.L. 1993, c. 190 . . . . Any rules or regulations adopted pursuant to this subsection shall be closely coordinated with the provisions of the State Development and Redevelopment Plan adopted pursuant to P.L. 1985, c. 398 (C. 52:18A-196 et seq.) and the federal "Coastal Zone Management Act of 1972," 16 U.S.C. § 1451 et seq. [Emphasis added.]

At the same time, the Legislature also authorized the State Planning Commission to adopt the coastal planning policies of DEP's regulations as the State Plan for the coastal area. N.J.S.A. 52:18A-206(b) of the State Planning Act states, in part:

The State Planning Commission may adopt . . . the coastal planning policies of the rules and regulations adopted pursuant to . . . [CAFRA], the coastal planning policies of the rules and regulations adopted pursuant to . . . [N.J.S.A. 13:19-17(b)] and any coastal planning policies of rules and regulations adopted pursuant to [CAFRA] thereafter as the State Development and Redevelopment Plan for the coastal area. . . . [L. 1993, c. 190, § 19.]

Additionally in 1993, the Legislature repealed a CAFRA statute that directed DEP to develop a long-term environmental management strategy for the coastal area. This repealed provision had required the Commissioner of DEP to prepare an environmental inventory, an estimate of the capability of the coastal area to absorb and react to manmade stresses, and an environmental design strategy for the coastal area. N.J.S.A. 13:19-16, repealed by L. 1993, c. 190, § 2 (effective July 19, 1994).

B. HISTORY OF THE CAFRA REGULATIONS

DEP executes its statutory authority under CAFRA through the Coastal Permit Program (CPP) Rules at N.J.A.C. 7:7, and the Coastal Zone Management (CZM) Rules at N.J.A.C. 7:7E. Both sets of regulations implement CAFRA, as well as the Wetlands Act of 1970, N.J.S.A. 13:9A-1 to -10, and the Waterfront Development Law, N.J.S.A. 12:5-3 to -11. N.J.A.C. 7:7-1.1 and 7:7E-1.1.

The CPP Rules contain the procedures for reviewing coastal permit applications and for enforcing violations. In contrast, the CZM Rules contain the substantive standards for determining development acceptability and the environmental impact of projects for which coastal permits are submitted.

In December 1997, in response to the Legislature's 1993 CAFRA amendments, DEP released the text of draft rules for new sweeping amendments to N.J.A.C. 7:7 and 7:7E; this was referred to as the Interested Party Review, and DEP asked for even further public comment. 29 N.J.R. 5041 (December 1, 1997).

In December 1998, DEP published a reproposal of its new CAFRA regulations. 30 N.J.R. 4167-203 (December 7, 1998). DEP received many comments, and it held four formal public hearings throughout the State. See 31 N.J.R. 2045 (August 2, 1999) (recounting the history of the regulations). DEP again extended the public comment period and held additional meetings with the building community, environmental groups, county planning offices, and municipalities in the affected areas. Ibid.

DEP did not adopt those rules as proposed. Instead, in August 1999, DEP again substantially modified and republished its proposal in response to concerns and issues raised during the comment periods. 31 N.J.R. 2042-99 (August 2, 1999) (proposal). On February 7, 2000, DEP adopted those proposals with modifications. 32 N.J.R. 503-95 (February 7, 2000) (adoption).

At this time, DEP adopted the Sector Permit Program at N.J.A.C. 7:7-9.1 to -9.11. 32 N.J.R. 503-95 (February 7, 2000) (adoption). DEP's goals for adopting the program were to: "(1) establish a more timely and predictable regulatory process; (2) ensure that plans and regulations are compatible between local, regional and State agencies; (3) ensure that planning precedes and guides regulatory activities; and (4) eliminate duplication in planning and regulatory activities." 31 N.J.R. 2046 (August 2, 1999).

However, additionally on February 7, 2000, DEP proposed new amendments to the rules that it had just promulgated on that day. 32 N.J.R. 352-63 (February 7, 2001) (proposal). These amendments expanded the scope of the program to all CAFRA- development within an entire "sector permit municipality" and updated the certification and re-certification process for qualifying municipalities. Id. at 352. On March 5, 2001, DEP adopted those proposals with substantive and technical changes not requiring additional public notice and comment. 33 N.J.R. 843-69 (March 5, 2001) (adoption).

Pursuant to the Sector Permit Program, "a CAFRA-regulated development shall be authorized through the municipal approval process, subject to concurrent [DEP] review and oversight, if the development meets the requirements of N.J.A.C. 7:7-9.3 and if the applicant seeking authorization for the development fulfills the notification requirements at N.J.A.C. 7:7-9.7." N.J.A.C. 7:7-9.1(c) (purpose and scope). In other words, the sector permit municipality authorizes the development in lieu of a separate DEP CAFRA permit, while DEP concurrently reviews and oversees the process. DEP has described the procedure as follows:

Under the sector permit, the municipal government does not conduct a "CAFRA review." It reviews a CAFRA-regulated development application for consistency with its land use ordinances, which, in accordance with N.J.A.C. 7:7-9.4, must regulate the development to the same extent it would be regulated under CAFRA and the rules. Also, the Department will concurrently review each CAFRA application to ensure that it meets the requirements of the sector permit. [33 N.J.R. 846.]

Meanwhile, in October 2000, DEP had (1) adopted further amendments to the definitions, jurisdiction and application procedures in its regulations, (2) added various new types of permits, and (3) changed the rules concerning various coastal zone areas. 32 N.J.R. 3784-828 (October 16, 2000) (adoption); 32 N.J.R. 864-932 (March 20, 2000) (proposal).

In May 2001, DEP adopted amendments to certain specified land boundaries in Appendix 2 of N.J.A.C. 7:7E. 33 N.J.R. 1371- 77 (May 7, 2001) (adoption); 33 N.J.R. 156-59 (January 16, 2001) (proposal).

In November 2001, the Commissioner of DEP published his intent to amend and readopt various regulations in the CZM Rules, N.J.A.C. 7:7. 33 N.J.R. 3566 (October 1, 2001). In fact, in January 2002, DEP published proposed amendments to various regulations, including many in N.J.A.C. 7:7 and 7:7E. 34 N.J.R. 74-170 (January 7, 2002) (proposal). The comment period closed on March 8, 2002, and no adoption has yet been published in the New Jersey Register. The Commissioner published his intent to have the adoption completed in April 2002. 34 N.J.R. 322 (January 7, 2002).

C. THE REGULATIONS AT ISSUE

In 2000, DEP substantially amended its regulations in N.J.A.C. 7:7 and 7:7E by repealing Subchapter 5 of N.J.A.C. 7:7E and rewriting the entire section in addition to adding Subchapters 5A and 5B. 31 N.J.R. 2042; 33 N.J.R. 843. DEP stated that its primary objective was "to replace a site-by-site decision-making process for developments within the CAFRA area with a permit decision-making process that reflects an inclusive planning effort." 31 N.J.R. 2043.

These subchapters apply to all development on the general land areas and to all development on some of the special land areas, unless otherwise stated in the specific special-land-area regulations. N.J.A.C. 7:7E-5.1(c). Subchapters 5, 5A and 5B, however, do not affect single-family-home or duplex developments or those situations when a developed site will be redeveloped at its legally existing coverage. N.J.A.C. 7:7E-5.1(d).

Under the new regulations in Subchapter 5, DEP first makes a distinction between the "upland waterfront development area" and the "CAFRA area." In fact, the methodologies for determining the percentages of impervious cover and vegetative cover are based on this initial distinction.

DEP defines the "CAFRA area" as the "coastal area" defined in N.J.S.A. 13:19-4. N.J.A.C. 7:7E-5.2 (definitions). The "upland waterfront development area" includes all lands inland of the CAFRA area extending from the mean high water line of a tidal water body to the first paved public road, railroad or surveyable property lines existing on September 1980, but no less than 100 feet and no more than 500 feet from the mean high water line. N.J.A.C. 7:7E-5.2 (definitions).

N.J.A.C. 7:7E-1.5 states that "impervious cover"

means any structure, surface, or improvement that reduces and/or prevents absorption of stormwater into land. Porous paving, paver blocks, gravel, crushed stone, crushed shell, elevated structures (including boardwalks), and other similar structures, surfaces, or improvements are considered impervious cover. Grass, lawns, or any other vegetation are not considered impervious cover.

1. The Upland Waterfront Development Area

The methodology for determining impervious cover and vegetative cover percentages for sites in the "upland waterfront development area" is found in new Subchapter 5A, N.J.A.C. 7:7E-5A.1 to -5A.10, and it has not substantially changed from the historical methodology used to determine "development intensity" for all sites in the prior regulations. That is, three specific regulatory factors - growth rating, environmental sensitivity, and development potential - are first ascertained for the site in the upland waterfront development area. N.J.A.C. 7:7E-5A.1 to -5A.7. Once those factors are determined, DEP plugs them into tables found at N.J.A.C. 7:7E-5A.8 to determine the acceptable "development intensity" (high, medium or low) for that site or smaller parts of that site. Thereafter, DEP plugs the development intensity into the applicable tables in N.J.A.C. 7:7E-5A.9 and -5A.10 to ascertain the impervious cover and vegetative cover percentages for a site, forested or unforested, in the upland waterfront development area.

The main difference between the new and old regulations is that the percentages themselves have changed in N.J.A.C. 7:7E-5A.9 and -5A.10.

In the end, maximum impervious cover percentages and minimum vegetative cover percentages for proposed developments in the upland waterfront development area are still based on the final combination of three separate indices to determine development intensity and on whether the site is forested or unforested:

DEVELOPMENT IN THE UPLAND WATERFRONT DEVELOPMENT AREA FOR A FORESTED SITE -- N.J.A.C. 7:7E-5A.9 *fn3

DEVELOPMENT INTENSITY IMPERVIOUS COVER (MAX. AMT.) Vegetative Cover (min. amt.) Tree Preservation Tree Preservation and/or New Planting

High 70% 25% 5%

Medium 40% 25% 5%

Low 5% 30% 0

DEVELOPMENT IN THE UPLAND WATERFRONT DEVELOPMENT AREA FOR AN UNFORESTED SITE

DEVELOPMENT INTENSITY IMPERVIOUS COVER (MAX. AMT.) *fn4 Vegetative Cover (min. amt.) Tree Preservation and/or New Planting

High (in urban area) 90% 5%

High (not in urban area) 80% --

Medium 40% 20%

Low 5% 5%

2. The CAFRA Area

The methodology for determining impervious cover and vegetative cover percentages for sites in the "CAFRA area" is found in new Subchapter 5B, N.J.A.C. 7:7E-5B.1 to -5B.5, and is completely different from the old methodology and from the methodology for sites in the upland waterfront development area.

For a site in the CAFRA area, both the impervious cover and vegetative cover percentages are solely based on where the site is located on the CAFRA Planning Map; that is, in which one or more of the following four specific categories or centers: (1) a coastal center; (2) a Coastal Planning Area; (3) a CAFRA center, CAFRA core or CAFRA node; or (4) a military installation. N.J.A.C. 7:7E-5B.1(a); N.J.A.C. 7:7E-5.1(a)(2). A site in the CAFRA area may include land in more than one category, and the cover percentages appropriate to each category apply to those particular portions of the site. N.J.A.C. 7:7E- 5B.3(I).

In other words, rather than determining the acceptable intensity of development on a site by considering a complex of factors such as patterns of existing development, natural and cultural resources, environmental sensitivity, existing infrastructure, and soil type, the new rules establish impervious cover limits and vegetative cover requirements for development sites that reflect where a site is located. The State Planning Commission's centers that DEP has accepted as its CAFRA centers on the CAFRA Planning Map are listed in Appendix 4 of N.J.A.C. 7:7E. 33 N.J.R. 869.

In its 1998 reproposal of the CAFRA regulations, DEP created its own interim "coastal centers". 30 N.J.R. 4167-203 (December 7, 1998). "Coastal centers" are defined in N.J.A.C. 7:7E-5.2

as a center in the CAFRA area with a boundary delineated by the Department for the purpose of applying the requirements for impervious cover and vegetative cover at N.J.A.C. 7:7E-5 and 5B until such time as, in accordance with N.J.A.C. 7:7E-5B.3, the coastal center expires or is superseded by the CAFRA center. [Emphasis added.]

DEP explained the purpose of delineating its own coastal centers as follows:

Coastal centers were included in the Coastal Zone Management rules to facilitate on an interim basis the permitting of CAFRA- regulated development in a manner consistent with the goals of the State Development and Redevelopment Plan. However, coastal centers generally do not meet the criteria established in the State Plan for size, density, dwelling units, population and other factors. Although coastal centers may not meet those State Development and Redevelopment center criteria, coastal centers were established to accommodate planned, imminent development identified by local officials. . . .

The Department expects that municipalities will examine the coastal center delineations in relation to their own planning efforts and development and redevelopment issues, and in many cases, seek a different community development boundary and formal center designation or plan endorsement by the State Planning Commission. Under the Coastal Zone Management rules, the State Planning Commission approved boundaries are then subject to Department review for consistency with the CAFRA statute and rules. If the Department accepts the State Planning Commission approved boundaries, then the center is incorporated into the Coastal Zone Management rules and CAFRA Planning Map as a CAFRA center. [33 N.J.R. 1375 (May 7, 2001).]

DEP also sought input from coastal municipalities and counties, asking them to identify coastal areas in their own boundaries. In fact, DEP extended its February 1999 deadline to April 1999 for CAFRA area communities to identify themselves as candidates to become eligible for delineation as a "coastal center." 31 N.J.R. 93 (January 19, 1999).

Previously, in December 1998, DEP published a public notice that listed a procedure by which municipalities could identify to DEP places that should be considered as Coastal centers. 30 N.J.R. 4283-84 (December 7, 1998). DEP stated that it would only consider delineating a Coastal center for a community if that community had existing development and was listed in a report that had been filed with the State Planning Commission. 30 N.J.R. 4283.

The other specific CAFRA area categories are defined in N.J.A.C. 7:7E-5.2, as follows:

"Center" means a compact form of development which may have one or more cores and residential neighborhoods. A center may be [one of five types: (1)] an urban center, [(2)] regional center, [(3)] town, [(4)] village, or [(5)] hamlet, based on factors such as comparative size, population density, total population, transportation access, infrastructure, and employment base.

"Core" means a pedestrian-oriented area of commercial and civic uses serving the surrounding municipality or center, generally including some housing and access to public transportation.

"Node" means a concentration of facilities and activities which are not organized in a compact form.

"Planning area" means an area of greater than one square mile that shares a common set of conditions such as population density, infrastructure systems, level of development, or environmental sensitivity. The five types of planning areas are [(1)] Metropolitan Planning Area, [(2)] Suburban Planning Area, [(3)] Fringe Planning Area, [(4)] Rural Planning Area, and [(5)] Environmentally Sensitive Planning Area.

Once the specific location of a site is determined, the gross or net land area of that site is multiplied by the percentages listed in the tables at N.J.A.C. 7:7E-5B.4 and -5B.5 to compute the impervious cover and vegetative cover percentages.

N.J.A.C. 7:7E-5B.3 defines the boundaries of the various land area categories. To determine the boundaries of coastal planning areas, CAFRA centers, CAFRA cores and CAFRA nodes, DEP rejected its existing coastal Growth Ratings Maps and created a CAFRA Planning Map. DEP accepted in total the boundaries of the Planning Areas, Centers, Cores and Nodes approved by the State Planning Commission as the boundaries of its Coastal Planning Areas, CAFRA centers, CAFRA cores and CAFRA nodes. N.J.A. C. 7:7E-5B.3(a).

3. The State Plan, DEP, and Designated Boundaries

In 1992, the State Planning Commission adopted the State Plan and delineated the entire State using five main and distinct "Planning Areas," which are large masses of land (greater than one mile) that share a common set of conditions. *fn5 See N.J.A.C. 17:32-1.4 (definition of Planning Area). Smaller sections in these Planning Areas were conceived of as "Centers," wherein new and old growth could be organized into compact development and surrounded by carefully controlled environs. There are five types of "centers" ranging in scale: urban centers, regional centers, towns, village and hamlets. See N.J.A.C. 17:32-1.4 (definition of Center). Inside centers are "Cores" (the commercial, cultural and civic heart of a center, generally including housing and access to public transportation) and "Nodes" (a concentrated area of facilities and activities, which is not organized in a compact form). See N.J.A.C. 17:32- 1.4 (definitions of Core and Node).

By way of a brief summary, the five Planning Areas of the State Plan are: (1) the Metropolitan Planning Area, which consists of urban centers and older suburbs with little vacant land, and where growth would be in the form of redevelopment even outside designated Centers; (2) the Suburban Planning Area, which provides for most of the future development, which can take place even outside designated Centers; (3) the Fringe Planning Area, which provides a buffer between the more developed Planning Areas and the less developed Planning Areas, and where development is restricted to Centers; (4) the Rural Planning Area, which consists of countryside or farmland with large areas of cultivated or open land surrounding sparse residential, commercial and industrial sites, and where all development is restricted to Centers; and (5) the Environmentally Sensitive Planning Area, which contains large contiguous land areas with valuable resources, and where all development is restricted to Centers.

Under the State Plan, however, centers, cores and nodes are not initially delineated by the State Planning Commission. Instead, through a "voluntary" or "recommended" process, which was called "center designation" and is now called "Plan Endorsement" (34 N.J.R. 285 *fn6 ), only municipal and county governing bodies and regional and state agencies may petition or bring their plans, which include boundaries of these areas, to the Commission for endorsement. N.J.A. C. 17:32-7.2(a). *fn7 Endorsement is a regulatory process that includes public notice, public hearings, meetings and comment periods. N.J.A.C. 17:32-7.3 to -7.8. Petitions to amend endorsed plans may be submitted only by counties, municipalities, and regional and state agencies. N.J.A.C. 17:32-7.12(b).

After endorsement, the designated boundaries in an endorsed plan are incorporated onto the State Planning Commission's State Plan Policy Map. Thereafter, during the actual application of the endorsed plan, private citizens and organizations, in addition to governmental entities, may petition for amendments or minor amendments to that map. N.J.A.C. 17:32-8.2; N.J.A.C. 17:32-8.3; N.J.A.C. 17:32-8.7.

The boundaries of the "coastal centers" that DEP has already delineated are specifically listed in Appendices 2 and 3 of N.J.A.C. 7:7E, and are not influenced by the State Planning Commission. Appendix 2 lists boundaries of seventy-eight mainland coastal centers in the CAFRA area not located on barrier islands, oceanfront spits, or peninsulas, and Appendix 3 lists boundaries of twenty-three coastal centers in the CAFRA area that are located on barrier islands, oceanfront spits, or peninsulas. The boundaries of the coastal centers in Appendix 2 will expire in February 2005, and those areas will be treated as the other land categories in the State Plan. N.J.A.C. 7:7E- 5B.3(g).

DEP explained its use of the State Plan's boundaries as follows:

The Department's planning in the CAFRA area has historically relied on broad, regional boundaries to distinguish rural and environmentally sensitive areas from developed and potential growth areas in order to determine appropriate impervious cover and vegetative cover requirements. Similarly, the State Planning Commission has established boundaries for Planning Areas, which are large masses of land distinguished by certain overall characteristics such as population density, land use, and environmentally sensitive features. The State Planning Commission also approves community development boundaries for centers, which are areas into which development is already or should be directed and concentrated, and recognizes cores and nodes as areas of already concentrated development either as part of centers or in the more heavily developed areas of the State. The factors that the State Planning Commission uses to formally approve centers, cores, and nodes are not unlike the factors which the Department has historically relied on to determine a site's development intensity under the existing Coastal Zone Management rules. Most significantly, the State Plan boundaries for Planning Areas, centers, cores and nodes were drawn after a lengthy public process that extended over a five-year period, included hundreds of meetings among municipal, county, and State officials, and involved the submittal of thousands of documents from public officials and private organizations and individuals. [31 N.J.R. 2044.]

[T]he Department carefully examined those boundaries, the purposes for which they were established, and the factors that determined how the lines were drawn in order to determine whether the Department could utilize the boundaries under CAFRA. Based on its examination, the Department has determined that the boundaries drawn by the State Planning Commission were established and drawn to serve many of the same purposes as the Department's boundaries under the Coastal Zone Management rules for the CAFRA area. The State Planning Commission boundaries are in keeping with the purposes of the CAFRA statute, which include the "encourage[ment of] the development of compatible land uses in order to improve the overall economic position of the inhabitants of [the CAFRA] area within the framework of a comprehensive environmental design strategy which preserves the most ecologically sensitive and fragile area from inappropriate development and provides adequate environmental safeguards for the construction of any developments in the [CAFRA] area." (See N.J.S.A. 13:19-2.) Therefore, by virtue of its authority under the CAFRA statute, the Department has determined to substitute the State Planning Commission boundaries for its own in the CAFRA area, by incorporating by reference into these proposed rules the State Plan structure of Planning Areas and designated centers. The Department has determined that this is an appropriate way to closely coordinate the standards for CAFRA permitting with the State Plan. [30 N.J.R. 4168. Accord 31 N.J.R. 2044.]

When the State Planning Commission formally approves any new or changed boundary to the State Plan, N.J.A.C. 7:7E-5B.3 requires that DEP evaluate the boundary to determine whether it is consistent with the purposes of CAFRA, and then publish a notice of its intention to accept it, reject it, or subsequently promulgate a revised boundary in the CAFRA Planning Map. *fn8 The standards governing DEP's review are set forth in N.J.A.C. 7:7E-5B.3(b):

The Department shall not reject or reject and revise a boundary unless it finds that accepting the State Planning Commission approved boundary would result in unacceptable harm to the coastal ecosystem or the resources of the built or natural environment, or would otherwise be clearly inconsistent with the purposes of the Coastal Area Facility Review Act, N.J.S.A. 13:19-1 et seq., or this chapter. For those new or changed community development boundaries or new or changed core or node boundaries which are located within the Pinelands National Reserve, the Department shall also, in consultation with the New Jersey Pinelands Commission, determine whether the boundaries are consistent with the intent, policies and objectives of the National Parks and Recreation Act of 1978, P.L. 95-625, section 502, creating the Pinelands National Reserve, and the State Pinelands Protection Act of 1979 (N.J.S.A. 13:18A-1 et seq.).

N.J.A.C. 7:7E-5B.3(e) states that DEP may reject or chose to modify the State Planning Commission's formally approved new or changed boundary "by promulgating an amendment to this chapter in accordance with the Administrative Procedure Act ["APA"], N.J.S.A. 52:14B-1 [to -15]." In any case, DEP must publish in the New Jersey Register a notice of its determination to accept, reject, or reject and revise the boundary "[w]ithin 90 calendar days after the date on which the State Planning Commission formally approves such boundary." N.J.A.C. 7:7E- 5B.3(b).

On March 1, 2001, the State Planning Commission readopted the State Development and Redevelopment Plan and a new State Plan Policy Map to replace the prior map. See 33 N.J.R. 2347 (July 2, 2001). In response to that action, in a July 2001 public notice, DEP declared that it had accepted some and rejected some of the planning area boundary changes that had been formally approved by the State Planning Commission. 33 N.J.R. 2347-48 (July 2, 2001).

The bottom line for sites in the CAFRA area is that impervious cover and vegetative cover percentages for a proposed development are based on where the site is located on the CAFRA Planning Map. By way of summary:

A. For impervious cover (see N.J.A.C. 7:7E-5B.4):

If a site is located in a CAFRA center, CAFRA core or CAFRA node - take the higher amount of (1) the acreage of the total land area multiplied by the percentage listed on the following table or (2) the amount of existing cover.

If the site is located in the Coastal Metropolitan Planning Area or in a coastal center - take the higher amount of (1) the acreage of the net land area (i.e., land remaining after subtracting any "special areas" such as wetlands or habitat for threatened or endangered species) multiplied by the percentage listed on the following table or (2) the amount of existing cover.

If the site is not located in a CAFRA center, CAFRA core, CAFRA node, Coastal Metropolitan Planning Area, or coastal center -- take the higher amount of (1) the acreage of the net land area multiplied by the percentage listed ...


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