New Jersey Voters to Decide Fate of Environmental Settlement Funds

NJ Voters Will Decide Whether Environmental Settlement Funds Must Be Reinvested Into Anti-Pollution Efforts

This November, New Jersey voters will decide whether environmental settlement funds must be reinvested into anti-pollution efforts. In the past, funds have been used for non-environmental purposes, such as balancing the state budget.

Environmental contamination lawsuits can generate large windfalls for the state, with settlements often totaling hundreds of millions of dollars. Just last month, the Department of Environmental Protection (DEP) entered into draft settlements with Shell, BP America and Sunoco oil companies that will bring approximately $200 million to the state.

Lawmakers, however, have been critical of how the funds have been used by Gov. Christie and his predecessors. In 2016, Gov. Christie agreed to resolve a long-running contamination lawsuit against ExxonMobil for $225 million, which represented a fraction of the $8.9 billion the state had initially sought. The Governor also drew criticism for dedicating only $50 million to wetlands restoration projects.

The resolution that will appear on the November ballot (SCR-39) would amend the New Jersey Constitution to dedicate all State moneys received from settlements and awards in cases of environmental contamination relating to natural resource damages for certain environmental purposes.

The questions before New Jersey voters states:

Do you approve amending the Constitution to dedicate all moneys collected by the State relating to natural resource damages in cases of contamination of the environment?  The moneys would have to be used to repair, restore, replace, or preserve the State’s natural resources.  The moneys may also be used to pay legal or other costs incurred by the State in pursuing its claims.    

The interpretative statement accompanying the ballot question states:

This amendment would dedicate moneys collected by the State relating to natural resource damages through settlements or awards for legal claims based on environmental contamination. These moneys would be dedicated to repair, replace, or restore damaged natural resources, or to preserve the State’s natural resources. The moneys would be spent in an area as close as possible to the geographical area in which the damage occurred. The moneys could also be used to pay for the State’s legal or other costs in pursuing the claims. Currently, these moneys may be used for any State purpose.

If approved, the constitutional amendment will likely impact how New Jersey environmental contamination cases are litigated and settled. While initial polling suggests that the measure is popular among voters, we will continue to monitor the issue and post updates as they become available.

If you have any questions or if you would like to discuss the matter further, please contact me, Dan McKillop, at 201-806-3364.