Over the past eighteen months, the
Assistant Commissioners for Natural
and Historic Resources (NHR) and for
the Site Remediation Program (SRP) have
begun the process of addressing the
more than 4,000 potential claims for
natural resource damages (NRD). These
claims arise from releases of hazardous
substances that have resulted in injuries
to natural resources (loss or impairment
of ecological function) or the deprivation
of natural resource services (e.g. water
supply, recreation, ecological services)
with respect to resources owned by,
managed by, or otherwise within the
trusteeship or co-trusteeship of the
State of New Jersey. The limited staff
of the Office of Natural Resource Restoration
within NHR, case managers among the
offices of SRP, and attorneys from the
Division of Law deserve particular credit
for initial work to resolve claims that
had been systematically disregarded
in the past.
The Department already has demonstrated
substantial success in addressing these
claims. During the first year of Governor
McGreevey's Administration, NRD recoveries
exceeded the total for the six prior
years combined, and recoveries for New
Jersey sites within New Jersey's exclusive
trusteeship exceeded the total for the
preceding eight years combined. Despite
this progress, DEP has resolved only
a small percentage of the universe of
potential claims. An accelerated effort
is needed to ensure that application
of the current statute of limitations
for NRD claims does not result in the
loss of the public's right to compensation
for natural resource injuries.
This directive presents the standards
and process that will be used in developing
and resolving NRD claims, and outlines
the policy objectives and constraints
that will inform the Department's consideration
of voluntary restoration efforts and
proposed NRD settlements.
Claim Identification
Screening. NHR and
SRP shall coordinate a screening process
for sites presenting potential NRD claims,
which shall include a phased process
for completion of the attached screening
form. NHR shall identify the classes
of cases for screening in sequence,
allowing adequate time for file review.
Potentially responsible parties (PRPs)
may use the same form as a basis for
initiating settlement discussions with
the Department.
Excluded Claims. DEP
recognizes that the cost of pursuing
certain classes of claims is certain
to exceed any potential benefit in terms
of restoration or recovery, and so the
following classes of sites shall be
deemed inappropriate for developing
an NRD claim:
- Sites or claims for which the only
responsible parties are residential
homeowners residing at the site at
which the claim arises.
- Sites or claims for which the only
responsible parties are small businesses
with a limited ability to pay.
- Sites that meet the qualifying criteria
for DEP's "Cleanup Star"
Program.
Parties responsible for these sites
may request, and for these sites SRP
or NHR may provide, written assurance
that they are not subject to an NRD
claim.
Settlement Policies
Preference for Restoration.
For all claims, the Department's preference
is for the performance of restoration
work and resource protection in lieu
of payment of money damages, provided
that reasonable allowance is made for
monitoring and oversight to ensure accountability.
Substitute Resources.
In many cases, the provision of substitute
resources or resource services may be
a more cost-effective means to compensate
the public for natural resource injuries.
The Department encourages habitat equivalency
analysis, consideration of both in-kind
and out-of-kind substitute resources,
and similar efforts to provide substantially
equivalent resource services in designing
compensatory restoration projects. With
respect to injured groundwater resources,
acquisition of aquifer recharge areas,
water re-use or recycling projects,
infrastructure improvements to control
stormwater or improve recharge, reforestation
efforts to improve infiltration and
water retention, or any other measure
that enhances the water resource base
in the affected area will be considered.
For lost recreational uses, enhancements
to public access, creation of or improvements
to state or local parks, or the provision
of other alternate recreational opportunities
will be considered.
Groundwater Valuation.
For parties that initiate settlement
discussions with DEP, the Department
will use the settlement valuation formula
developed and applied by the Office
of Natural Resource Restoration in past
years. In the application of the formula,
which shall only be used as a settlement
tool, on-site groundwater will not be
excluded and the temporal scope of the
valuation will be decided on a case-by-case
basis.
Nexus to the Injury. Restoration
projects, whether implemented by DEP
or a responsible party, must bear a
nexus to the injured resource and should
be in the same watershed (or sub-watershed)
to the extent practicable. Damage recoveries
shall be devoted exclusively to restoration
and the associated costs of assessment,
claim development, and recovery.
No-further Action Letter Practice.
In general, and subject to the brownfields
policy below, an assessment of ecological
injuries and resolution of potential
natural resource injuries, if any, should
precede SRP's issuance of no-further
action letters (NFAs). This policy does
not extend to any of the claims or sites
identified as excluded claims above,
or for soils-only NFAs.
Coordination with Brownfields Policies
Consistent with Policy
Directive 2002-03, the policies
of this directive shall be applied in
a manner to encourage and support brownfields
cleanup and redevelopment. Claims for
damages or compensatory restoration
shall not be asserted against brownfields
developers meeting the innocent purchaser
defense requirements under New Jersey
law at sites at which there is a historical
natural resource injury. This policy
shall not diminish responsibility for
restoration actions that are inherent
in remedial activity.
If the DEP Office of Brownfields Reuse,
or any SRP manager identifies any site
or claim at which the assertion of an
NRD claim is an impediment to cleanup
or redevelopment, the Assistant Commissioner
for SRP shall identify that site to
the Commissioner and to the Assistant
Commissioner for NHR and shall propose
whatever policy exception, waiver, or
other resolution is appropriate to eliminate
the impediment. SRP shall ensure that
the resolution, if any, is identified
within ten (10) business days.
Coordination with Federal Natural
Resource Trustees
The Department has entered a memorandum
of understanding to coordinate its NRD
claims on the Passaic River with those
of federal agencies that may be trustees
or co-trustees for natural resources
injured by hazardous substance releases
along the river. The Department should
use this model to coordinate the Department's
NRD claims with those of federal trustee
agencies where resources within federal
trusteeship or co-trusteeship have been
injured.
Coordination with the Division of
Law
The development and assertion of
claims pursuant to this policy shall
be coordinated with the Division of
Law and with any special counsel selected
and duly assigned to NRD matters by
the Attorney General.
Transparency
This directive shall be posted and
made available on DEP's web site, along
with any prior or subsequent policies
or directives that may be useful in
identifying and resolving NRD claims.
This directive creates no enforceable
rights, legal or equitable, for any
person. Nothing in this directive limits
the discretion of the Commissioner to
make further policy changes in response
to public comment and additional data
and analysis.
