On appeal from regulations promulgated by the New Jersey Department of Environmental Protection, Docket No. 03-11-02.
The opinion of the court was delivered by: Parrillo, P.J.A.D.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Before Judges Parrillo, Sabatino and Fasciale.
The opinion of the court was delivered by PARRILLO, P.J.A.D.
In response to Executive Order No. 2 (EO2), mandating State agencies to adopt rules for waiver to "ensure that regulations shall be efficient, consistent . . ., accessible and transparent to all interested parties," 42 N.J.R. 577(a)-78 (Feb. 16, 2010), the Department of Environmental Protection (DEP or the Department) proposed new regulations entitled "Waiver of Department Rules," to be designated as N.J.A.C. 7:1B-1.1 to -2.4 (the waiver rules). 43 N.J.R. 473(a)-78 (Mar. 7, 2011) (proposal). Following public hearing and comment,*fn1 DEP's Commissioner adopted the rules, with certain modifications, on March 6, 2012, 44 N.J.R. 981(b)-1047, to be effective April 2, 2012, 44 N.J.R. 981-82, and then published them in the New Jersey Register, 44 N.J.R. 981, 986 (Apr. 2, 2012). Thereafter, twenty-eight environmental and labor organizations, led by the American Littoral Society, united to appeal the DEP's promulgation.*fn2
Appellants argue that the waiver rules exceed DEP's legislated authority and, in any event, are facially invalid due to the lack of adequate standards to guide the agency's discretion and implementation. They also challenge DEP's guidance documents and many of the other postings on DEP's website created exclusively for the waiver rules after their adoption, as de facto rulemaking in violation of the Administrative Procedures Act (APA), N.J.S.A. 52:14B-l to -15.*fn3
For reasons that follow, we uphold DEP's authority to promulgate the waiver rules and find they contain adequate standards. We reject, however, the documents posted on the agency's website as violative of the APA.
By way of background, EO2 was issued on January 20, 2010,*fn4
"establishing 'Common Sense Principles' for State rules and regulations that will give this State the opportunity to energize and encourage a competitive economy to benefit businesses and ordinary citizens; . . . ." 42 N.J.R. 577(a). Accordingly, "[f]or immediate relief from regulatory burdens," EO2 directed "all agencies," in part, to:
c. Adopt rules for "waivers" which recognize that rules can be conflicting or unduly burdensome and shall adopt regulations that allow for waivers from the strict compliance with agency regulations and such waivers shall not be inconsistent with the core missions of the agency. Each State agency shall prepare and publish on its website a policy describing the circumstances in which such waivers will be granted. [EO2, § 1(c), 42 N.J.R. 577(a).]
"For long-term relief from regulatory burdens," EO2 directed "all agencies," in part, to:
c. Focus all proposed rules on achieving outcomes rather than on the process used to achieve compliance and be based on the best scientific and technical information that can be reasonably obtained and designed so that they can be applied consistently. [EO2, § 3(c), 42 N.J.R. 578.]
Notwithstanding those findings and directives, the Governor made it clear that EO2 was not intended to, and does not confer any legal rights upon businesses or others whose activities are regulated by New Jersey's agencies, . . . and shall not be used as a basis for legal challenges to rules, approvals, permits, licenses or other actions or to any inaction of the governmental entity subject to it. [EO2, § 6, 42 N.J.R. 578.]
Although acting almost immediately after the Governor's mandate, DEP made clear that the agency was "not draw[ing] its authority to promulgate the waiver rules from Executive Order No. 2, but from its comprehensive legislation." 44 N.J.R. 1001. Relying on this delegated legislative authority, DEP explained its reasons for proposing the waiver rules:
With decades of rulemaking experience and implementing its regulatory programs, it is clear to the Department that no administrative rule, however carefully crafted it may be, can possibly anticipate each and every factual circumstance that might fall within the purview of the waiver rules. While the Department attempts to craft its rules to address the factual scenarios that might be reasonably anticipated, unanticipated situations do arise that may warrant relief from strict compliance with an existing rule. [44 N.J.R. 1002.]
As N.J.A.C. 7:1B-1.1 further makes plain, DEP's purpose was to set forth the limited circumstances in which the Department may, in its discretion, waive the strict compliance with any of its rules in a manner consistent with the core missions of the Department to maintain, protect, and enhance New Jersey's natural resources and to protect the public health, safety, and welfare, and the environment.
To that end, the rules establish several critical steps containing discrete requirements that a waiver applicant must meet before approval.
First, the applicant, to be successful, must demonstrate that its request complies with one of four threshold requirements, or bases, to obtain a waiver. N.J.A.C. 7:1B-2.1(a) lists the four thresholds: (1) "[c]onflicting rules"; (2) "strict compliance with the rule would be unduly burdensome"; (3) "net environmental benefit"; or (4) "public emergency." These terms are defined in N.J.A.C. 7:1B-1.2:
"Conflicting rules" means a situation in which two or more Department rules, or a Department rule and the rule of another State agency or a Federal agency, conflict so as to make compliance with both rules impossible or impracticable.
"Unduly burdensome" means a situation in which the strict compliance with a specific Department rule would result in either:
1. Actual, exceptional hardship for a particular project or activity, or property; or
2. Excessive cost in relation to an alternative measure of compliance that achieves comparable or greater benefits to public health and safety or the environment.
"Net environmental benefit" means a situation in which the quantitative or qualitative benefit to a natural resource or other related environmental good for which the Department has responsibility would substantially outweigh any detriment to that natural resource or environmental good, which would result from a waiver. There must be an adequate geographic and resource nexus between the environmental offset and the natural resource or other environmental good that is protected by the rule being waived. The net environmental benefit may include mitigation, but it must be beyond what the waived rule would have required independent of the waiver.
"Public emergency" means a situation in which a Federal or State official with the authority to do so declares a public emergency.
Second, the applicant must demonstrate that its waiver request does not fall within certain prohibitions expressed within the waiver rules. N.J.A.C. 7:1B-2.1(b) identifies thirteen categories of DEP's rules and requirements that cannot be waived:
1. A requirement of, or duty imposed by, a Federal or State statute or [f]ederal regulation, unless that statute or regulation provides for such a waiver;
2. A rule providing for a [f]ederally delegated, authorized, or assumed program where the waiver would not be consistent with New Jersey's delegation, authorization, or assumption of authority pursuant to a Federal program;
3. A rule that implements a [f]ederally enforceable program pursuant to a State Implementation Plan (SIP), as defined at N.J.A.C. 7:27-18.1;
4. A rule that is part of a collaborative program involving multiple states or jurisdictions where the waiver would not be consistent with New Jersey's participation in the multi-state or multi-jurisdiction program;
5. A rule concerning the air emissions trading program;
6. A rule providing for a numeric or narrative standard protective of human health;
7. A rule concerning the designation of rare, threatened, or endangered status of any species of flora or fauna, or habitat for such species;
8. A rule providing for a remediation funding source, claim or other reimbursement, grant, loan, or other financial assistance;
9. A rule providing for a license, certification, or registration for a vehicle, boat, individual, or business;
10. A rule providing for a license or approval for hunting, fishing, or trapping;
11. A rule providing for public participation or notice;
12. A rule providing for a fee, over-sight cost, or other Department cost; or
13. Any provision of this chapter.
Moreover, no waiver can be granted that would conflict with any of DEP's "core missions . . . to maintain, protect, and enhance New Jersey's natural resources and to protect the public health, safety, and welfare, and the environment." N.J.A.C. 7:1B-1.1;
Third, the applicant's request, to be successful, must satisfy various specific evaluation criteria. N.J.A.C. 7:1B-2.2, which ...