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Environmental Alert

December 2001

New Jersey Department of Environmental Protection Re-adopts and Amends the Freshwater Wetlands Protection Act Rules

By Richard F. Ricci, Esq. and Christopher D. Hopkins, Esq.

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n September 4, 2001 the New Jersey State Department of Environmental Protection (“NJDEP”) readopted and amended the Freshwater Wetlands Protection Act Rules, N.J.A.C. 7:7A. The amendments, which were introduced last year and generated extensive comments from the regulated community, mark the first time in ten years that the Freshwater Wetlands regulations have been substantially altered. The amended regulations impact the type of property that may be developed. The following is a summary

• f significant changes.

General Permits

Certain kinds of wetlands projects are common enough that development activity only requires a statewide general permit (“GP”). The new regulations streamline the general permit approval process and provide a holistic view of development projects by establishing more efficient application and permitting procedures. For example, for activities covered by five general permits (underground utility lines, minor road crossings,

• utfalls and intakes, stream bank stabilization and

stream cleaning) there are now combined general permits and transition area waivers, combined freshwater wetlands and flood plain permits, and combined freshwater wetlands and stream encroachment permits. Similarly, projects that disturb freshwater wetlands, transition areas and

• pen waters can be approved with a single general

permit authorization. The amendments also add six new GPs which authorize landfill closures, airport sight-line clearing, animal waste management activities, spring developments and farmed wetlands, stream cleaning and certain types of redevelopment activities.

Individual Permits

Projects not qualifying for a statewide general permit require an individual permit. Individual permits have always been costly and difficult to

• btain, but new requirements may virtually

eliminate the ability to obtain individual permits. In order to obtain an individual permit, an applicant must demonstrate that permit issuance is in the “public interest.” The new rule guides NJDEP in determining whether a project is in the “public interest” by requiring that issued permits meet the “goals, strategies, policy objectives and policies”

• f

the State Development and Redevelopment Plan (“State Plan”). The inclusion

• f such language greatly increases the difficulty in
• btaining individual permits, as it will be difficult

for an applicant to demonstrate that its project meets the numerous and vague “goals and

• bjectives” of the State Plan.

“The key to charting the regulatory wetland maze is starting early.”

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This document is published by Lowenstein Sandler PC to keep clients and friends informed about current issues. It is intended to provide general information only.

65 Livingston Avenue www.lowenstein.com

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Roseland, New Jersey 07068-1791 Telephone 973.597.2500 Fax 973.597.2400

Permit Extensions

The amendments allow one five year extension to any kind of permit/ waiver, if the project and site conditions have not changed. Thus, the new regulations may help developers with approved projects that are delayed by third party problems or local approvals, as long as projects are not expanded and other applicable requirements are not by passed.

Redevelopment

The new regulations facilitate redevelopment in degraded wetlands on former industrial commercial developed properties (previously disturbed sites). GP No. 27 authorizes an extra acre of disturbance (in addition to other GP disturbances) as an incentive to encourage

• redevelopment. To qualify, activities must be in

an area listed by the Brownfields Redevelopment Task Force; subject to a redevelopment agreement under Brownfields law; or in an environmental opportunity zone. In addition, the new regulations expand redevelopment transition area waivers. A transition area (sometimes called a buffer) is a strip of land bordering the wetlands. The width

• f the transition area may vary from 150 feet

down to nothing, depending on the resource value of the particular wetland. If a developer wishes to pursue activities within a transition area, he or she must obtain a transition area

• waiver. Under the old regulations, redevelopment

transition area waivers were only granted if the transition area was paved. The new rule allows an applicant to receive a transition area waiver for an area that is “significantly disturbed so that it is not functioning as a transition area...” Thus, redevelopment is allowed where the transition area is significantly degraded, but not paved, and a developer’s acreage of disturbance at a site is increased.

Residential Construction

The new rule broadens the definition of “residential development project” to include an additional 20 foot area surrounding a house. Thus, construction of new homes that immediately abut transition areas are subject to additional regulation, as a “buffer on a buffer” is created. The goal is to prevent regulated and prohibited activities, that inevitably happen within 20 feet of construction and use of a house, from taking place in transition areas or wetlands. However, the net effect of the regulation is to decrease the amount

• f land available for residential construction in

areas that contain wetlands. If an applicant wishes, they can fence and deed restrict the regulated area and demonstrate how they will use the house without encroaching upon transition areas. Stricter requirements are also imposed for paving around wetlands. The new rule provides that stormwater must be treated when general permit activity would result in one-quarter acre or more of impervious surface that will generate storm water. This requirement to treat and perhaps monitor storm water can be potentially costly and burdensome.

Letters of Interpretation

Prior to development, developers must know whether there are wetland issues associated with a

• project. The method for obtaining this

information historically has been a request for a letter of interpretation (“LOI”) from NJDEP. The new regulations provide that when seasonal conditions make resource classification of a wetland difficult to determine, the applicant has the option of accepting a quick LOI with an automatic (and more heavily regulated) exceptional resource value classification, or wait until a definite resource classification can be made.

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LOI applicants are now also required to survey wetlands boundaries so that NJDEP can incorporate the surveyed line into the letter of

• interpretation. Previously, only sites over five

acres required a survey of the wetlands line. This new requirement adds additional costs to projects.

Mitigation

New mitigation provisions divide mitigation projects into smaller and larger projects. Projects requiring mitigation of 1.5 acres or smaller are to go to the mitigation bank (where a developer may purchase credits for his/ her particular disturbance), while

• nsite

mitigation is encouraged for larger projects. Additionally, mitigation is to occur as close to the wetland disturbance as possible. Where mitigation is not possible within the same watershed, the rule provides for mitigation within the same watershed management area, thus establishing coordination with NJDEP’s Watershed Management Program.

Takings

The determination of whether a designation

• f property as wetlands constitutes a “taking,”

entitling the developer to compensation, is now part of the administrative process. The rule creates an administrative framework for NJDEP to consider a takings claim before an applicant goes to Superior Court. Thus, the takings analysis is performed earlier in the process and fact finding is brought under the control of the NJDEP rather than an administrative law judge or court. The process created by the regulations is lengthy, complex and potentially costly. Additionally, to

• btain consideration of whether a permit denial

constitutes a taking, an applicant must place the property up for sale for a period of at least 180

• days. Recent case law has held that one need not

exhaust administrative remedies to pursue a takings claim if doing so would be futile. Thus, it is questionable whether this newly created level of administrative review meets state and federal case law standards.

Potential Uncertainties for the Regulated Community

While many of the rule amendments are designed to clarify and streamline the permit application process, some provisions of the new rule are restrictive and unpredictable for the regulated community. For example, restrictions placed upon GP No. 6, for disturbance to non- tributary or “isolated” wetlands, appear to be more limiting than the Freshwater Protections Act

• intended. Under the new regulations, GP No. 6

cannot be used for “vernal pond habitat.” The definition of vernal pond habitat is dependent upon the threatened or endangered species found in the pond. Currently, there is no publicly available mapping of vernal ponds. Whose burden is it to demonstrate that species do or do not exist in an area that may be wet but once a year? Does the burden shift? This confusing condition removes predictability in the application process and is burdensome to the regulated community. Additionally, the definition of “isolated wetlands” was changed so that it is inconsistent with the Federal standard on which the GP was

• based. The Federal definition requires a

connection to navigable waters or their headwater

• streams. The new rule goes a step further and

considers wetlands that drain into lakes and ponds with no connection to streams as “tributary” and therefore not isolated. The rule also limits the use

• f GP No. 6 to state open waters that are less than
• ne acre in size.

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The new regulations also subject an applicant to increased scrutiny regarding soil

• contamination. The old rule only allowed NJDEP

to require soil contaminant testing for general permit No. 13 (lake dredging). The new regulations allow the Department to require soil testing for any general permit if there is reason to suspect contamination. The key to charting the regulatory wetland maze is starting early. An applicant should request a pre-application conference with NJDEP in the planning stages of any project. The scope and location of construction projects must be analyzed carefully. While the new regulations have the potential to make development more difficult, they also provide opportunities for the careful and knowledgeable developer. For more information regarding the regulation of Wetlands or other Clean Water Act, CAFRA, Watershed Management or Waterfront Development Act compliance issues, please contact Christopher D. Hopkins, an associate in the Environmental Law & Litigation Department, at 973.422.6414 or at chopkins@ lowenstein.com. We would also be pleased to provide you with advice respecting your other environmental compliance issues. If we can be of assistance in this regard, please call Richard F. Ricci, Chair of the Environmental Law & Litigation Department, at 973.597.2462

• r

at rricci@ lowenstein.com.

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