What Developers Need to Know About NJ’s Environmental Justice Rules

What Developers Need to Know About NJ’s Environmental Justice Rules

On April 23, 2023, the New Jersey Department of Environmental Protection (NJDEP or Department) finalized its much-anticipated Environmental Justice Rules (EJ Rules). The rules implement New Jersey’s Environmental Justice Law (N.J.S.A. 13:1D-157), which is the strongest law of its kind in the country.

The EJ Rules (N.J.A.C. 7:1C) establish the specific requirements that developers must follow when seeking permits for certain industrial facilities located, or proposed to be located, in overburdened communities. This includes identifying relevant environmental and public health stressors, preparing an environmental justice impact statement to assess a facility’s impacts to existing stressors, and complying with procedures intended to ensure meaningful public participation by members of the host community.

Under the new EJ Rules, applicants must respond to public comments in writing. The NJDEP will then evaluate whether pollution from the proposed facility would cause or contribute to environmental and public health stressors at levels disproportionate to those in less burdened communities. The EJ Rules require permit applicants to avoid and minimize such stressors, including through the use of added pollution control technology. Where disproportionate impacts are not avoidable, certain new facilities could be limited, or existing facilities could be subject to additional permit conditions that reduce environmental and public health stressors affecting the community. 

New Jersey’s Environmental Justice Law

As we have discussed in prior articles, the Murphy Administration has made environmental justice a top priority. The state’s Environmental Justice Law, which was enacted in 2020, seeks to reduce pollution in historically overburdened communities and communities of color that have been subjected to a disproportionately high number of environmental and public health stressors. 

Under the Environmental Justice Law, entities seeking to build certain facilities, such as power plants, trash incinerators or sewage-treatment plants, or expand an existing facility, in a “overburdened community” must satisfy certain additional requirements before obtaining a permit. The law specifically requires the NJDEP to consider the environmental and public health stressors presented by the entirety of a facility and its operations, and to deny or condition permits where facilities can’t avoid the occurrence of disproportionate environmental or public health stressors in the overburdened community.

Determining Whether a Project Is Subject to the New EJ Rules

The EJ Rules apply where three specific criteria are satisfied. First, the proposed or existing facility must be one of eight specific types of facilities covered by the law:

• Major sources of air pollution/Title V facilities;
• Resource recovery facilities or incinerators;
• Sludge processing facilities, combustors, or incinerators;
• Sewage treatment plants with a capacity of more than 50 million gallons per day;
• Transfer stations or other solid waste facilities, or recycling facilities intending to receive at least 100 tons of recyclable material per day;
• Scrap metal facilities;
• Landfills, including, but not limited to, a landfill that accepts ash, construction or demolition debris, or solid waste; and
• Medical waste incinerators, except those that accept regulated medical waste for disposal, or is attendant to a hospital or university and intended to process self-generated regulated medical waste.

Second, the EJ Rules govern permits or approvals arising under the NJDEP’s authorities related to solid waste and recycling, land resource protection, water supply and pollution control, air pollution control, and pesticide regulation. (A full list is set forth in the rules.) Notably, the EJ Rules do not apply to permits necessary to perform remediation; or minor modifications of a facility’s major source permit for activities or improvements that do not increase actual or potential emissions.

Third, the requirements of the EJ Rules only apply if a facility is located or proposed to be located, in whole or in part, in an overburdened community. An overburdened community (OBC) is defined under the Environmental Justice Law as “any census block group, as determined in accordance with the most recent United States Census, in which: (1) at least 35 percent of the households qualify as low-income households; (2) at least 40 percent of the residents identify as minority or as members of a State recognized tribal community; or (3) at least 40 percent of the households have limited English proficiency.” As required by the EJ Law, the NJDEP has published a list of overburdened communities and created the Environmental Justice Mapping, Assessment, and Protection tool (EJMAP) to assist applicants with compliance. It uses publicly available data to identify environmental and public health stressors, the appropriate geographic point of comparison, identification of adverse stressors, calculation of the combined stressor total and whether the overburdened community is subject to adverse cumulative stressors.

Understanding the Permit Process Under the EJ Rules

Where the Environmental Justice Law applies, the NJDEP may not deem a permit application complete for review, unless the applicant completes the environmental justice impact statement (EJIS) process to assess the environmental and public health stressors in the overburdened community and the facility’s potential contributions thereto. “Environmental or public health stressors” means either sources of environmental pollution or conditions that may cause potential public health impacts in the overburdened community. The final EJ Rules list 26 specific stressors.

The extent of the EJIS is dependent upon whether the overburdened community is already or will be made subject to adverse cumulative stressors as a result of the facility’s contribution. Notably, the public hearing and EJIS requirements apply not only to new permit applications but also to permit renewals for existing facilities.

After review of the EJIS, response to public comment and any other relevant information, and upon a finding that approval of a permit or permit renewal, as proposed, would, together with other environmental or public health stressors affecting the overburdened community, cause or contribute to adverse cumulative environmental or public health stressors in the community that are higher than those borne by other communities in the State, county, or other geographic unit of analysis as determined by the NJDEP, it must deny a permit for a new facility, or approve a new facility permit with conditions upon the new facility’s demonstration that it meets a compelling public interest; or may apply conditions to a permit for the expansion of an existing facility or the renewal of an existing facility’s major source permit.

If a proposed new facility can’t avoid a disproportionate impact, the NJDEP is required to deny a permit, unless the proposed new facility would serve a “compelling public interest” in the overburdened community. Where an expanded facility or an existing major source can’t avoid a disproportionate impact, the applicant would analyze measures that, if undertaken by the applicant, could avoid, and/or minimize, environmental and public health stressors and, where applicable, provide a net environmental benefit in the overburdened community. In cases where an applicant satisfies the standards of the proposed rulemaking, the NJDEP would issue a decision with conditions intended to ensure that a disproportionate impact is avoided or that appropriate avoidance, minimization, or net benefit measures are implemented.

The Impact of the EJ Rules on Existing Applications

The new EJ Rules are effective as of April 17, 2023. However, under N.J.A.C. 7:1C-2.1(c), any application “complete for review” in accordance with applicable NJDEP regulations prior to the effective date is not subject to their requirements.

According to the NJDEP, applications that would otherwise be subject to the EJ Rules but were declared complete for review before the effective date of the EJ Rules will, however, be subject to the NJDEP’s Administrative Order 2021-25 (AO 2021-25), dated September 22, 2021. AO 2021-25 seeks to implement the spirit and intent of the EJ Law, by requiring applicants to undertake enhanced community engagement, assess facility impacts to environmental and public health stressors, and implement appropriate control measures to avoid or minimize adverse impacts.

The NJDEP has further explained that to the extent an application was deemed complete for review and proceeded under AO 2021-25, the EJ Rules would not apply and the application will have satisfied the requirement of meaningful public engagement. The Department will implement measures necessary to avoid or minimize adverse impacts until permit renewal or facility expansion.

For an application that may have undertaken the AO 2021-25 process prior to being deemed complete for review, the EJ Rules would apply. According to the NJDEP, inn these instances, the Department will evaluate applications on a case-by-case basis to determine whether the procedural aspects of the EJ Rules have been satisfied, including meaningful public engagement and the preparation of an EJIS. Should the Department find that these procedural requirements have been satisfied, it may proceed with review and issue a decision in accordance with the requirements of the EJ Rules.

Key Takeaway

Businesses operating in New Jersey must contend with a growing number of complex environmental regulations. We encourage impacted entities to work closely with experienced counsel when determining the impact of the new EJ Rules and other environmental regulations. At Scarinci Hollenbeck, our experienced environmental law attorneys are prepared to help regulated entities understand how they may be impacted by the new requirements, as well determine to how to successfully navigate the new regime.

If you have questions, please contact us

If you have any questions or if you would like to discuss the matter further, please contact Dan McKillop, or the Scarinci Hollenbeck attorney with whom you work, at 201-896-4100.