Expanding New Jersey’s Energy Infrastructure to Meet Current and Future Demand
There is no doubt that in the next 10 to 15 years, New Jersey will need to focus on expanding its energy infrastructure to meet increased demand. About 75 percent of the state’s households rely on natural gas as their primary heating fuel, 12 percent use electric heat and 10 percent depend on heating oil. Transmission projects like natural gas pipelines and electric transmission lines are needed to support current energy usage. As economic development and population growth drive increased demand in the future, the need for infrastructure that will not only generate this energy – but transport and transmit it – will increase as well.
Expanding Renewable Sources
The Murphy administration is committed to developing and expanding the use of wind and solar energy to meet New Jersey’s recently updated renewable portfolio standards, which require that 21 percent of the electricity sold in the state be generated from renewable sources by 2021, 35 percent by 2025, and 50 percent by 2030. This means that investing in renewables will be critical.
While the governor has established ambitious green energy goals, whether or not they are achievable remains to be seen. Over the years, attempts at developing offshore wind have not been successful, due in large part to the complicated nature of the process. Making these projects easier to build must be a high priority.
In the meantime, as the demand for energy continues to grow, New Jersey relies on natural gas. In 2017, natural gas and nuclear power, combined, provided more than 90 percent of New Jersey’s net electricity generation – and we don’t see this changing overnight. The state’s leadership needs to “connect the dots” to ensure it is investing in the infrastructure necessary to meet not only anticipated energy needs, but today’s need as well.
Economic Development Fuels Demand
The growth in energy demand is resulting in part from the state’s efforts to attract businesses and jobs and spur population growth and prosperity. According to the Department of Labor and Workforce Development, the projected population increase in New Jersey will be 9.7 percent between 2010 and 2030, and the state’s civilian labor force is projected to grow slightly faster than its population.
New Jersey’s strategic location, transportation infrastructure, extensive warehousing and distribution channels, and educated and skilled workforce have long been a draw for businesses large and small. State leaders have been providing a range of incentive programs and resources to capitalize on the explosive growth in sectors such as e-commerce and logistics, and attract startups and established businesses in fields ranging from tech to healthcare.
Efforts are also underway to revitalize New Jersey’s manufacturing industry, which has been a vital contributor to the state’s economy for close to 200 years. Today, nearly 10,000 manufacturers operate in the state, from large pharmaceutical companies to small machine shops. Those companies directly employ close to 250,000 workers and their products account for nearly 90 percent of all New Jersey exports.
Businesses intent on moving to or expanding in New Jersey rely on our utility companies to continue building the infrastructure they need to grow. Economic development also brings greater numbers of people living and working in the state, and an increased need for natural gas. We have to build the infrastructure to meet this anticipated growth in public need in order to avoid falling behind.
Attorneys Play a Key Role in the Success of Any Energy Project
Natural gas is a primary source of energy, and as renewables come into play this reliance may or may not lessen. However, a critical issue that must be addressed is the fact that no defined pathway currently exists for developing renewable energy projects, which involve federal, state and local approvals and the potential for numerous appeals of those approvals. As a result, these projects often get stalled or run out of money. From a legal perspective, building these projects requires a roadmap that doesn’t currently exist.
Attorneys can play an important role in ensuring the success of any energy project – as long as they are involved early on in the process. The work our firm does with natural gas pipeline clients translates to wind and other renewable energy sources.
Streamlining the Land Use Permitting Process
by Richard G. Scott, Esq.
Over the past several years, the New Jersey Department of Environmental Protection (NJDEP) has been working to streamline and standardize the land use permitting programs administered by the Division of Land Use Regulation. Beginning in 2015, NJDEP consolidated its Coastal Permit Program Rules and the Coastal Zone Management Rules into one chapter, the Coastal Zone Management (CZM) Rules, codified at N.J.A.C. 7:7.
NJDEP amended its Flood Hazard Area (FHA) Control Act Rules in 2016 and its Freshwater Wetlands (FWW) Protection Act Rules the following year. Subsequent, revisions to the three programs occurred in 2018 to further standardize the language. While there were a multitude of changes to each of the three regulatory programs, this article focuses on two areas that impact the ability to apply for and obtain permits.
When it comes to who can apply for environmental permits, the old rules limited the applicant to either the owner of the site or the owner’s agent. The FWW Rules stipulated that an individual with the legal authority to perform the regulated activity would also be authorized to submit a permit application.
The rule amendments now apply the FWW’s “legal authority” language to the FHA and CZM Rules, making it more explicit that applicants proposing a project may submit an application on their own behalf so long as they have the owner’s consent. The rule amendments also allow public entities proposing an activity within a right-of-way or easement that is held or controlled by that entity, or that will be appropriated by that entity under the power of eminent domain, to also file an application for a permit.
Ultimately, if you are seeking to submit an application for a project on property you do not own, the rules require that you have the landowner’s consent before submitting the application. Similarly, if your project would impact an easement or right-of-way, you must also have written consent from the holder(s) of that easement or right-of-way. The rules have also been amended to clarify what constitutes written consent if the proposed project is a gas pipeline located within a municipally owned right-of-way.
Although these changes and clarifications are minor, the way the NJDEP enforces the rules can have a big impact on your project’s schedule. While it seems obvious that you can’t construct on someone else’s property until you have a written agreement in place, the NJDEP has made it clear that one of the purposes of the landowner consent rule is to ensure that the NJDEP is not wasting its time reviewing submissions by applicants that do not have the necessary authority to conduct the proposed activity.
Generally, consent is obtained by having the owner sign the Owners’ Certification on the LURP Form when an application is submitted. In recent years, the NJDEP has been taking a much harder look at applications to determine whether an applicant has obtained landowner consent, and may “kick” your application for being administratively incomplete if you have not obtained the required consent.
At Rutter & Roy, we work with clients in connection with their environmental permit applications and have developed proven strategies to address the landowner consent requirement. For instance, in our experience landowners are less likely to sign the LURP Forms. Our firm has developed landowner consent letters that applicants can use in lieu of obtaining signed LURP Forms. These consent letters allow you to submit the permit application and get it reviewed, while reserving the landowner’s ability to negotiate for the necessary land rights in the future.
Holding Public Hearings
Another important change has been to the rules pertaining to the NJDEP’s authority to hold public hearings. Besides the public hearings now being called “fact-finding” meetings, the NJDEP has given themselves greater flexibility by eliminating some of the specific requirements that were originally set forth in the FWW Rules.
For instance, the old FWW Rules constrained the NJDEP to publishing notice of public hearings early in the permitting process. If the NJDEP determined that a public hearing should be held on an application, it was required to publish notice of the hearing within 60 days of finding the application administratively complete. Under the new rules, the NJDEP simply must hold a fact-finding meeting if, based on public comments received and/or a review of the scope and/or environmental impact of the proposed project, the NJDEP needs additional information that can only be obtained through a fact-finding meeting.
Rutter & Roy recommends taking a more proactive approach to permitting. For clients that are proposing major developments that are likely to garner a significant amount of public comment and/or opposition, we advise them to submit a robust permit application and request a fact-finding meeting in their application cover letter. This is due to the fact that NJDEP often decides to hold public hearings late in the permitting process, which can lead to delays in the issuance of permits and to the start of construction. By requesting the hearing early, you are paving the way for a smoother application process.
Richard G. Scott, Senior Associate, joined Rutter & Roy in 2011. He has experience in pipeline law, condemnation, environmental law and real estate law. Rich handles complex Green Acres diversions, permitting issues, land and water conservation conversions, condemnations and various litigation matters.
Green Acres Restrictions Impact Utility and Development Projects: Navigating the Morass of Environmental Regulations and Property Restrictions
by Christine Roy, Esq.
It takes deep understanding of New Jersey’s environmental regulations and property restrictions to successfully plan and develop utility and development projects. The potential pitfalls are not always readily apparent and can add time and frustration to the many challenges companies face, especially when crossing New Jersey’s open spaces.
In over 30 years of advising clients – including major interstate pipeline companies – on planning utility and development projects, our attorneys have found that identifying Green Acres-restricted land is one of the major challenges our clients encounter.
The state created the Green Acres Program over 55 years ago, and under New Jersey’s Department of Environmental Protection (NJDEP) it has preserved more than 680,000 acres of open space. Green Acres parcels can be extremely difficult to identify, especially if they are unfunded parcels not listed on a local unit’s Recreation and Open Space Inventory (ROSI), the NJDEP’s master list of Green Acres-encumbered properties in each municipality. For example, we identified a conservation restriction which was labeled as a “Drainage and Conservation Easement” on a filed map only. The Township deemed it Green Acres restricted and a diversion was required.
Despite our decades of experience with environmental and development regulations, we often come up against situations and issues that we’ve never seen before. That’s why it’s critical that companies work with legal professionals who understand and have experience with New Jersey’s property restrictions and know what’s required to navigate the various statutory and regulatory processes.
At Rutter & Roy, we conduct in-depth research using an internal checklist that includes the ROSI, title search and information from the municipality, County or non-profit organization, as well as Green Acres files and other records in Trenton. From the outset, we presume that if it’s municipally-owned land, it’s Green Acres-restricted land. Many publicly owned properties are not, but after handling more than 20 diversions under the 2006 Green Acres Rules, I know the answer often is not black and white.
I tell clients that it’s important to identify property restrictions as early as possible because they can lead to significant project delays. The jurisdictional review process alone can take six months to a year, as the participants wrestle with identification and determining whether they fall under other federal funding programs such as Land & Water Conservation. We also check to see whether properties are subject to a Deed of Easement conveying the non-agricultural development rights to a county, town or the State Agriculture Development Committee making them preserved farms.
The Green Acres diversion process has multiple steps, and we ensure that our clients stay on schedule and guide them through the necessary regulatory requirements. The diversion process is onerous and includes two local hearings to take public comments concerning the project and any compensation package the proponent is offering. Then, the Commissioner of the NJDEP must recommend approval of the final application before it goes to the New Jersey State House Commission for final approval. Where there is a Green Acres conservation easement, we know how to best streamline the diversion process and the restriction release process so that the project can be constructed on time.
The rules are intentionally strict to discourage companies from obtaining a diversion on protected lands. However, we believe that it’s always preferable to go through the diversion process rather than to condemn. Legal professionals who understand New Jersey’s property restrictions are essential to companies navigating the statutory and regulatory process.
Christine A. Roy, Partner, joined the firm in 1999. She focuses primarily on environmental law, and has extensive experience in land use law, railroad law, transportation law, pipeline law and appellate practice. Christine has handled right of way acquisitions involving interstate natural gas pipeline projects, and has been lead counsel on approximately 100 condemnation actions filed in the U.S. District Court of New Jersey (Newark, Trenton, and Camden combined) in connection with six major interstate natural gas pipeline projects.
Q&A with Environmental Law Attorney Stephen J. Resnick, Esq.
You have an extensive background on cases involving civil and criminal environmental law. What is the focus of your work at Rutter & Roy?
I work on cases involving violations of New Jersey’s civil and criminal environmental statutes and administrative code provisions. Back in 1980, I investigated the hazardous waste site in Elizabeth where a warehouse owned by Chemical Control Corporation exploded. Since then, I have taken part in numerous investigations and trials.
As a prosecutor, a government attorney representing the DEP, and now as a defense attorney, I have seen how the government deals with alleged environmental violators; whether it’s a corporate manufacturer polluting a river, a commercial waste hauler violating waste flow or a liquid waste hauler intentionally leaking waste onto the highway (known as “cocktailing”).
Based on my experience there are many factors that determine how seriously the DEP will view a violation, how far they will go to seek penalties and remediation, how a particular incident will affect the government’s attitude toward the violator in the future and what to do to assure a positive outcome.
What are the most common issues you handle in waste management cases in New Jersey?
Many times, waste management clients come to Rutter & Roy after their regular attorney has dealt unsuccessfully with their DEP issues. Working with a firm that understands the statutes and administrative code provisions relating to waste and other environmental areas is extremely important. Absent a background in enforcement, they are extremely complex and very difficult to interpret.
It is common for defendants in these cases to underestimate the government’s field agents. I’ve seen many cases where a company owner mistakenly believes he or she can talk their way out of a penalty. But the agents, their supervisors and the lawyers that represent them have seen and heard it all, and they usually don’t approach their target until they have all the evidence they need to make a case. The best thing to do when approached by investigators is to say nothing and contact your attorney immediately.
Have you seen any cases involving environmental issues?
Frequently, the New Jersey DEP will respond to political events. We saw this happen in the late 1970’s and early 1980’s when the DEP forcefully and aggressively asserted its responsibilities for acquiring and maintaining clean water and clean air in the state. As a result, regulations were enacted to hold polluters responsible, and cases involving the problems presented by the improper disposal of solid waste, hazardous waste and toxic waste became a focus. The disposal of medical waste was also included in the regulations.
During the late 1980’s, government legislation on brownfields restoration was enacted to push for the clean-up of abandoned industrial sites. Today it remains a major issue for businesses. There is a need for due diligence; that is, to properly investigate real estate purchases so as to avoid liability for dumping that may have occurred generations ago.
Brownfields cases continue to wind their way through the courts in 2016; and DEP permits decisions can be influenced by county, municipal and even neighborhood demands that former industrial sites be remediated beyond the requirements of the Licensed Site Remediation Professional (LSRP) hired to oversee the process. Another recent environmental issue is the DEP innovation of LSRP’s, and the developing body of law involving the appointment, education, employment and utilization of these quasi-governmental inspectors who can make or break an investment in commercial or industrial real estate.
What have been your greatest successes defending clients?
I have several hundred jury trials under my belt, but the greatest victories are always those in which my clients are able to avoid trial. Trials should be a last resort, when no other solution is economically or personally viable. When you go to trial, you lose control over the process and the outcome is always in doubt, even after the verdict. The elation of victory often dissipates when you learn that the party you beat is appealing or declaring bankruptcy, and the judgment you spent thousands on is now worthless. It is almost always better to settle and, in criminal cases, to resolve the case without jail time or an onerous fine.
Stephen J. Resnick joined Rutter & Roy of counsel in 2004 after serving 25 years as a Deputy Attorney General for the State of New Jersey in both the Division of Criminal Justice and the Division of Law. He had also served in the Mercer County Prosecutor’s Office and the Brooklyn, New York, District Attorney’s Office. He has considerable experience in environmental law, having served as Unit Chief of the Environmental Prosecutions Section and supervised investigations and trials of cases involving the solid waste industry as well as other environmental matters.