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In re Freshwater Wetlands Protection Act Rules

July 26, 2004

IN THE MATTER OF FRESHWATER WETLANDS PROTECTION ACT RULES


On certification to the Superior Court, Appellate Division.

SYLLABUS BY THE COURT

(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for the convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please note that, in the interests of brevity, portions of any opinion may not have been summarized).

In this appeal, the Court is asked to determine the validity of certain rules adopted by the New Jersey Department of Environmental Protection (DEP) under the Freshwater Wetlands Protection Act (Act), N.J.S.A. 13:9B-1 to -30.

In 1987, the Legislature passed the Act to provide a comprehensive scheme for the regulation and protection of New Jersey's freshwater wetlands. It sought to maintain a delicate balance between environmental interests and the rights of property owners. The program instituted by the Act is similar to the federal Clean Water Act (CWA), 33 U.S.C.A. § 1344, but it includes several key differences that afford greater protection for wetlands.

The Act, for example, regulates more activities and "mandates buffers around wetlands, called transition areas, to protect wildlife and minimize the impact of development." 278 N.J. Super. at 112-13. A permit is required to engage in regulated activities in freshwater wetlands and the Act prohibits certain activities in transition areas. Transition areas are required for freshwater wetlands of "exceptional resource value" and of "intermediate resource value." The size of the transition area depends on the value of the freshwater wetland to which it is adjacent, no greater than 150 feet for a wetland of "exceptional resource value" and no greater than 50 feet for a wetland of "intermediate resource value."

DEP adopted rules implementing the Act in 1988 and adopted additional provisions governing transition areas in 1989. The rules were amended in 1992 and, in August 2000, DEP proposed a comprehensive re-adoption of the rules with amendments that became effective in September 2001. One part of the rules now under challenge concerns the definition and application of a "residential development project" within the wetlands area and any adjoining transition areas. By definition, a "residential development project" includes the area within 20 feet of the structure on all sides, N.J.A.C. 7:7A-1.4. The effect of the "residential development project" rules (RDP Rules) was the expansion of the width of transition areas for wetlands adjacent to structures by an additional twenty feet.

DEP defended the RDP Rules by asserting that, based on its vast experience, it was inevitable that the activities of homeowners would spill from their land either into a freshwater wetland of ordinary value or into the transition areas surrounding wetlands of intermediate and exceptional resource value. DEP considered the cost of policing and eradicating those violations on a case-by-case basis as prohibitive and preemptively sought to prevent such violations through the RDP Rules.

DEP's responsibilities include the issuance of general permits to allow regulated activities in freshwater wetlands. N.J.A.C. 13:9B-23. N.J.A.C. 13:9B-23c authorizes DEP to issue additional general permits for certain enumerated categories of activities and section 23d authorizes DEP to modify or rescind general permits under certain conditions. General Permit 6 (GP 6), codified at N.J.A.C. 7:7A-5.6, is the isolated wetlands general permit required by DEP pursuant to N.J.S.A. 13:9B-23b. A prior rule, N.J.A.C. 7:7A-5.6(c)(5), prohibited any GP 6 activity in "vernal habitats," areas of habitat for vernal species strictly located in isolated wetlands. However, that rule was deleted and a new rule was adopted directing that any activity "authorized under a general permit shall not take place in a vernal habitat, ...or in a transition area adjacent [thereto]." N.J.A.C. 7: 7A-4.3(b)16.

The New Jersey Builders Association (Builders Association) asserts that DEP exceeded its statutory A-91-03 IMO Freshwater Wetlands Protection Act Rules 2. authority and extended the maximum buffers allowed under the Act by (1) adding twenty feet to the statutory transition area widths for exceptional and intermediate resource value wetlands; and (2) creating a buffer for wetlands of ordinary value even though they are not required by the Act. Also, Builders Association contends that DEP exceeded the regulatory scope of the CWA by regulating activities in vernal habitats because the CWA does not apply to most isolated wetlands.

The Appellate Division affirmed the rules at issue.

The Supreme Court granted Builders Association's petition for certification.

HELD: The relevant statutory provisions are clear and unambiguous. The Department of Environmental Protection's attempt to expand the reach of the Freshwater Wetlands Protection Act through the "residential development project" rules is ultra vires and cannot be sustained. Also, DEP exceeded its statutory authority by attempting to incorporate a vernal habitat ban on General Permit 6 activities.

1. This Court must give great deference to an agency's interpretation and implementation of its rules enforcing the statutes for which it is responsible. Agency rules are accorded a presumption of validity and reasonableness and the challenging party has the burden of proving the rule is at odds with the statute. Despite the deference, if the regulation is plainly at odds with the statute, we must set it aside. (Pp. 12-13)

2. The legislative history of the Act demonstrates that the establishment of transition areas was the result of a "delicate compromise" between environmentalists and developers. Thus, transition areas appear to have been the result of the type of compromise that is part of the legislative process. The statute clearly sets forth the dimensions for transition areas adjacent to freshwater wetlands of exceptional and intermediate resource value. The statute makes no reference to transition areas for wetlands of ordinary resource value. Although the RDP Rules appear to serve the laudatory purpose of combating the potential spill over of regulated and/or prohibited activities into wetlands and transition areas, the decision whether to provide that additional protection resides with the Legislature. DEP seemingly failed to account for the delicate compromise underlying the concept of transition areas when it adopted the RDP Rules. (Pp. 13-16)

3. The primary principle of statutory construction is to look at the plain language of the statute. Although DEP might have a valid concern that the destruction of vernal habitats would cause adverse environmental impacts, and that such adverse environmental impacts are prohibited under the Act and the CWA, GP 6 was issued pursuant to N.J.S.A. 13: 9B-23b, which does not mandate an adverse environmental impact analysis. We find no justification to read into N.J.S.A. 13: 9B-23b the adverse environmental impact requirement of N.J.S.A. 13: 9B-23c. If the Legislature intended to make general permits under both N.J.S.A. 13: 9B-23b and N.J.S.A. 13: 9B-23c subject to an adverse environmental impact analysis, it would have done so explicitly. We do not question that DEP has authority to modify or rescind a general permit pursuant to N.J.S.A. 13: 9B-23d, but it may not issue a general rule in contravention of the express provision for the issuance of a general permit under N.J.S.A. 13: 9B-23b. Pursuant to N.J.S.A. 13: 9B-23d, DEP may modify or rescind a general permit only upon proper findings on a case-by-case basis. (Pp. 16-20)

The judgment of the Appellate Division is REVERSED.

CHIEF JUSTICE PORITZ and JUSTICES VERNIERO, LAVECCHIA, ZAZZALI and ALBIN join in JUSTICE WALLACE's opinion. JUSTICE LONG did not participate.

The opinion of the court was delivered by: Justice Wallace

Argued December 1, 2003

In this appeal we determine the validity of certain rules adopted by the New Jersey Department of Environmental Protection (DEP) under the Freshwater Wetlands Protection Act (Act), N.J.S.A. 13:9B-1 to -30. The New Jersey Builders Association (Builders Association) asserts that DEP exceeded its authority under the Act by adopting rules to restrict (1) residential construction near "transition areas," which are buffer zones surrounding freshwater wetlands; and (2) activities near "vernal habitats," which are areas of habitat for vernal species. The Appellate Division affirmed the rules at issue. We granted certification, 177 N.J. 221 (2003), and now reverse. We hold that the rules exceed DEP's statutory authority under the Act.

I.

In 1987, the Legislature passed the Act to provide a comprehensive scheme for the regulation and protection of New Jersey's freshwater wetlands. N.J.S.A. 13:9B-2; MCG Assocs. v. DEP, 278 N.J. Super. 108, 111 (App. Div. 1994); M. Alfieri Co. v. State, 269 N.J. Super. 545, 548 (App. Div. 1994), aff'd o.b., 138 N.J. 642 (1995). The Legislature declared that its policy was "to preserve the purity and integrity of freshwater wetlands from random, unnecessary or undesirable alteration or disturbance." N.J.S.A. 13:9B-2. It sought to maintain a delicate balance between environmental interests and the rights of property owners. Ibid.

When the Act was passed, the United States Army Corps of Engineers (the Corps) regulated the "discharge of dredged or fill material" into New Jersey's freshwater wetlands pursuant to section 404 of the federal Clean Water Act (CWA), 33 U.S.C.A. § 1344. MCG Assocs., supra, 278 N.J. Super. at 111. The CWA authorized states to assume the regulatory responsibilities of the federal program, 33 U.S.C.A. §§ 1344(g)-1344(h), provided the state program was "as stringent as the federal program and... compl[ied] with all the requirements of the federal regulations," In re Freshwater Wetlands Prot. Act Rules, 238 N.J. Super. 516, 520 (App. Div. 1989) (In re FWPA Rules). As a result, the Legislature passed the Act to regulate all activities in the freshwater wetlands and to assume the Corp's regulatory functions. N.J.S.A. 13:9B-2; In re FWPA Rules, supra, 238 N.J. Super. at 520.

The program instituted by the Act is similar to the CWA, but it includes several key differences that afford greater protection for wetlands. 33 N.J.R. 3045, 3118-20 (Sept. 4, 2001); see generally N.J.S.A. 13:9B-3 (defining "regulated activity"). In MCG Assocs., supra, the Appellate Division summarized those differences:

First, the federal statute authorizes federal regulation of wetlands which are adjacent to or part of the "waters of the United States" or wetlands the degradation of which might affect interstate commerce.

No similar restriction appears in the Act, and thus DEP has the authority to regulate more wetlands.

Second, [the] Act regulates more activities. The federal program requires a permit for the "discharge of dredged or fill material into the navigable waters" of the United States. 33 U.S.C. § 1344(a). Thus, while a developer needs a permit to fill in a wetland, no federal permit is required to take material out of a wetland.... [The] Act is much more comprehensive, requiring a permit to fill, drain, remove any soil, disturb the soil in any way, drive pilings, place obstructions, or destroy plant life which would alter the character of the wetland. N.J.S.A. 13:9B-3

(definition of "regulated activity").

Finally,... the [Federal Environmental Protection Agency (EPA)] and the Corps lack authority to regulate land adjacent to wetlands, such as a buffer area between the wetland and the adjoining upland. [The] Act mandates buffers around wetlands, called transition ...


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