APPELLATE DIVISION PROVIDES NEW PATHWAY FOR INTERESTED PARTIES REQUESTING ADJUDICATORY HEARINGS TO RECEIVE A PROMPT RESPONSE FROM THE DEP

In an important decision decided last week, the New Jersey Appellate Division held that interested parties seeking adjudicatory hearings before the DEP can petition the DEP to rule on the request within thirty days.

The case, Musconetcong Watershed Ass’n v. N.J. Dep’t of Envtl. Prot., 2023 N.J. Super. LEXIS 81, was initiated when Hampton Farm, LLC sought to develop property in Hampton, New Jersey (the “Property”). The Musconetcong Watershed Association (“MW Association”) objected to the proposed site plan, arguing that it failed to consider an onsite tributary of the adjacent Musconetcong River. To address this issue, Hampton Farm applied to the Department of Environmental Protection (“DEP”) for a determination regarding whether the Property was subject to flood hazard area (“FHA”) regulation. The DEP issued an FHA Determination that an FHA permit was not required. In response, MW Association filed a request with the DEP for an adjudicatory hearing to challenge the FHA Determination. The DEP waited four years and then denied the request, reasoning that MW Association did not have a statutory or constitutional right to an adjudicatory hearing. MW Association appealed the DEP’s final agency decision as well as the DEP’s FHA Determination. Although FHA Determination appeals must be filed within forty-five days, MW Association argued that it would have been premature to appeal the FHA Determination while its administrative hearing request was awaiting a decision by the DEP. The court denied MW Association’s leave to appeal the FHA Determination. MW Association appealed.

The Appellate Division held that MW Association had the right to appeal the FHA Determination because the FHA Determination did not become a final agency decision for purposes of judicial appeal until the DEP denied MW Association’s request for an adjudicatory hearing. The court reasoned that until the DEP determined whether MW Association had a statutory right or a particularized property interest entitling it to a hearing, MW Association’s administrative remedies were not exhausted. The court noted that DEP could have sped up the process by making its determination to reject the request for an adjudicatory hearing shortly after it was filed rather than waiting four years to do so.

The court also held that although there is no time limit for the DEP to rule on a request for an adjudicatory hearing, any interested party, including a third-party objector, can petition the DEP for a timely decision on a request for an adjudicatory hearing under N.J.A.C. 1:1-4.1(a). The DEP then has thirty days to rule on the request. In so holding, the court emphasized that the public should be able to count on the DEP to make timely determinations. The court noted that this ruling would serve to avoid future four-year delays similar to the one that occurred in this case.

Finally, the court held that MW Association was not entitled to an adjudicatory hearing to challenge the FHA Determination because, as a third-party objector, it did not have a statutory right to an adjudicatory hearing. Furthermore, MW Association did not have a particularized property interest related to the FHA Determination given to Hampton Farm that would warrant a hearing. The court noted that mere proximity to the site and a fear of future development are speculative and thus insufficient to trigger a right to a hearing.

This new right of petitioners pursuing an adjudicatory hearing before the DEP to request a prompt response from the DEP Commissioner is expected to expedite DEP proceedings.