This is a copy of the Certification of the May 21,1998 Admendment to the Union County District Solid Waste Management Plan signed by Commissioner Robert C. Shinn Jr. on July 20,1998.
Office of the Commissioner
P.O. Box 402
Trenton, NJ 08625-0402
Tel. # 609-292-2885
Fax. # 609-292-7695
IN THE MATTER OF CERTAIN AMENDMENTS |
CERTIFICATION |
BY ORDER OF THE COMMISSIONER:
A. Introduction
The New Jersey Solid Waste Management Act (N.J.S.A. 13:1E-1 et seq.) established a comprehensive system for the management of solid waste in New Jersey. The Act designated all twenty-one (21) of the state's counties, and the Hackensack Meadowlands District, as Solid Waste Management Districts, and mandated that the Boards of Chosen Freeholders and the Hackensack Meadowlands Development Commission develop comprehensive plans for waste management in their respective districts. On August 13, 1980, the Department of Environmental Protection (Department or DEP) approved, with modifications, the Union County District Solid Waste Management Plan (County Plan).
The Act requires that all district plans be based on and accompanied by a
report detailing the existing waste disposal situation in the district, and
a plan which includes the strategy to be followed by the district in meeting
the solid waste management needs of the district for a ten-year planning
period. The report must detail the current and projected waste generation
for the district, inventory and appraise all facilities in the district,
and analyze the waste collection and transportation systems which serve the
district. The disposal strategy must include the maximum practicable use
of resource recovery techniques. In addition to this strategy, the plan must
designate sufficient available suitable sites for the disposal of the district's
waste for a ten-year period.
The Act further provides that a district may review its County Plan at any
time and, if found inadequate, a new County Plan must be adopted. The Union
County Board of Chosen Freeholders (County Freeholders) completed such a
review and on May 21, 1998, adopted an amendment to its approved County
Plan.
The amendment represents the County's supplemental response to the May 1,
1997 decision of the United States Court of Appeals for the Third Circuit
which declared unconstitutional New Jersey's historic system of solid waste
flow control. [See Atlantic Coast Demolition and Recycling, Inc. v. Board
of Chosen Freeholders of Atlantic County et al. 112 F.3d 652 (3d Cir.
1997, cert. den., November 10, 1997.] Specifically, each solid waste
management district must reevaluate its solid waste disposal strategy in
light of this recent court decision and, if necessary, initiate appropriate
amendments thereto.
In general, the Department refers the County to the solid waste regulations
at N.J.A.C. 7:26-1 et seq. to the extent they relate to specific
procedural and substantive issues addressed in this and subsequent plan
amendments. In addition, this certification is in no way intended by the
DEP to represent a legal determination regarding the effect of the Atlantic
Coast decision on any specific contract between public and/or private
parties.
The May 21, 1998 amendment proposes to:
*Re-establish regulatory flow control for solid waste types 13, 23, and 27
following the procurement of disposal services through a nondiscriminatory
process and
*Provides supplemental information on certain components of the Environmental
Investment Charge (EIC) which were remanded for further consideration and
evaluation in the Department's April 30, 1998 certification of the County's
December 18, 1997 amendment.
The amendment was received by the Department on June 1, 1998, and copies
were distributed to various administrative review agencies for review and
comment, as required by law. The Department has reviewed this amendment on
an expedited basis and has determined that the amendment adopted by the County
Freeholders on May 21, 1998 is approved in part and modified in part as provided
in N.J.S.A. 13:1E-24.
B. Findings and Conclusions with Respect to the Union County District
Solid Waste Management Plan Amendment
Pursuant to N.J.S.A. 13:1E-24a(1), I have studied and reviewed the
May 21, 1998 amendment to the County Plan according to the objectives, criteria,
and standards developed in the Statewide Solid Waste Management Plan and
I find and conclude that this plan amendment, as modified, is consistent
with the Statewide Solid Waste Management Plan. In this regard, the County
Freeholders are notified of the issues of concern relative to the May 21,
1998 amendment which are included in Section B.2. below.
In conjunction with the review of the amendment, the Department circulated
copies to sixteen federal and state administrative review agencies and solicited
their review and comment. Pursuant to N.J.S.A. 13:1E-24a(2) and (3),
these agencies included various bureaus, divisions, and agencies within the
Department. All agencies contacted are as follows:
Division of Parks and Forestry, DEP
Division of Fish, Game and Wildlife, DEP
Division of Compliance and Enforcement, DEP
Division of Solid and Hazardous Waste, DEP
Division of Water Quality, DEP
Office of Air Quality Management, DEP
Green Acres Program, DEP
Land Use Regulation Element, DEP
New Jersey Turnpike Authority
New Jersey Advisory Council on Solid Waste Management
Department of Agriculture
Department of Health
Department of Transportation
Department of Community Affairs
U.S. Environmental Protection Agency
Hackensack Meadowlands Development Commission
1. Agency Participation in the Review of the May 21, 1998
Amendment|
The following agencies did not object to the proposed amendment
Division of Compliance and Enforcement, DEP
Office of Air Quality Management, DEP
Green Acres Program, DEP
New Jersey Advisory Council on Solid Waste Management
Department of Transportation
Department of Community Affairs
Department of Agriculture
New Jersey Turnpike Authority
The following agencies did not respond to our requests for comment:
Division of Parks and Forestry, DEP
Division of Fish, Game and Wildlife, DEP
Division of Water Quality, DEP
Land Use Regulation Element, DEP
Department of Health
U.S. Environmental Protection Agency
Hackensack Meadowlands Development Commission
The following agency provided substantive comments as shown in
Section B. of the certification document.
Division of Solid and Hazardous Waste, DEP
2. Issues of Concern Regarding the May 21, 1998 Amendment
Issue: Previously Adopted Atlantic Coast Amendment
On December 18, 1997, the County Freeholders adopted an amendment proposing
their initial response to the Atlantic Coast decision which had six
components:
*Lease of the Union County Resource Recovery Facility (UCRRF) to Ogden Martin
Systems of Union, Inc.
*Voluntary contracts for the disposal of waste types 10 and 25 at the UCRRF
*Regulatory flow control of waste types 13, 23 and 27 to J&J Recycling
Company, Inc. and Linden Landfill based upon nondiscriminatory procurement
*Interdistrict agreement between Union County Utilities Authority (UCUA)
and Bergen County Utilities Authority (BCUA)
*Imposition of Environmental Investment Charge
*Enforcement provisions
Within an April 30, 1998 certification, the DEP took the following actions
relative to each of these six components:
*Approved the lease agreement between Ogden Martin and the UCUA subject to
the provisions of the McEnroe approval and the DEP's approval of an order
regarding the refinancing of the UCUA's debt pursuant to N.J.S.A.
48:3-9;
*Approved the County's strategy to enter into voluntary, long-term contracts
with municipalities and commercial haulers servicing Union County customers
to dispose of waste types 10 and 25 at the UCRRF subject to the provisions
of the McEnroe approval;
*Rejected the imposition of regulatory flow control for waste types 13, 23,
and 27 to J&J Recycling Company, Inc. and the Linden Landfill since the
County failed to demonstrate that contracts were awarded to these facilities
in a nondiscriminatory manner;
*Took no position on the interdistrict agreement between the UCUA and BCUA
which is currently under litigation;
*Approved an EIC of $15.56 per ton for stranded debt and stranded host community
benefits while remanding the administrative fee and transition cost components
for further consideration and evaluation by the County;
|
*Approved with modification the designation of weighing facilities to collect
the EIC contingent upon the approval by the DEP of an administrative action
designating the facilities; and
*Approved the UCUA assuming responsibility for enforcing the County solid
waste management system.
Issue: Regulatory Flow Control
The May 21, 1998 amendment proposes that the UCUA will exercise regulatory
flow control over solid waste types 13, 23, and 27 following the
nondiscriminatory reprocurement of the services of one or more disposal
facilities. According to the amendment, the solicitation of bids were advertised
locally in The Home News and The News Record, throughout New
Jersey utilizing The Star Ledger, regionally with The Philadelphia
Inquirer, and nationally with Waste News. Therefore, this procurement
process was open to all bidders regardless of geographical location but was
not completed as of adoption of the amendment.
Since the nondiscriminatory procurement process was not completed as of adoption
of the May 21, 1998 amendment, within Section C. of this certification the
DEP approves with modification this component of the amendment contingent
upon receipt and approval by the DEP of a subsequent amendment or administrative
action (N.J.A.C. 7:26-6.11(b)10.) which documents awarding a
nondiscriminatorily bid contract(s) to provide disposal services. The distinction
between the adoption of an amendment or the issuance of an administrative
action is that if the selected facility is already included within the County
Plan as a designated transfer or disposal facility, an administrative action
will suffice. Otherwise, the plan amendment adoption process must be
completed.
Issue: Administrative Fee and Transition Cost Components of the Environmental
Investment Charge
The May 21, 1998 amendment provides supplemental information concerning the
administrative fee and transition cost components of the EIC. This information
is provided in response to the Department's remand of these components of
the EIC for further consideration and evaluation as contained within its
April 30, 1998 certification of the County's December 18, 1997 amendment.
Within the May 21, 1998 amendment and an addendum submitted to the DEP, the
County provided the following information.
As part of its restructured system, the administrative costs to be incurred
by the UCUA include a post-lease administrative and operating budget of
$1,553,119 and an enforcement budget of $500,000 for a total of $2,053.119.
An estimated $1,053,119 of this amount will be born directly by the respective
counties with Union County assuming 60% or $634,610 and Bergen County assuming
40% or $418,509. The remaining $1,000,000 will be recouped as follows:
*As a $2.50 per ton component of the existing $50 per ton contract price
to be charged to all Union County municipalities and commercial transporters
that have entered long-term disposal contracts with the UCUA for the use
of the UCRRF.
*As a $2.50 per ton component of the tipping fee charged to all County generators
for waste types 13, 23, and 27 that will be subject to flow control.
*As a $2.50 per ton EIC added to the previously approved EIC of $15.56, which
will partially fund the cost of the enforcement program, to be charged to
all County generators that elect not to utilize the UCRRF. The UCUA anticipates
that this EIC will generate $250,000 ($2.50 per ton X estimated 100,000 tons)
of the $500,000 enforcement budget, on an annual basis. In other words, the
additional EIC component will be used for enforcement purposes only with
other post-lease administrative costs coming from the $50 contract tipping
fee at the UCRRF and the disposal tipping fee for waste types 13, 23, and
27. Regarding the EIC for enforcement, in light of a December 22, 1997 letter
from the UCUA to the Union County Regional Environmental Health Commission
(the designated County Environmental Health Act agency for Union County)
nonrenewing the contract between the UCUA and the regional commission, the
County is directed to submit within 30 days as an administrative action a
narrative description of how the enforcement program will now be implemented
by the UCUA.
The May 21, 1998 amendment also proposes an increase to the April 30, 1998
DEP approved $13.53 per ton stranded debt component of the EIC to defray
additional "transition costs" associated with the delay in restructuring
the County solid waste system. The DEP considers such transition costs to
constitute stranded debt. According to the amendment, the County originally
requested the $13.53 per ton amount based on the implementation of the new
system by January 1998. The amendment notes that since the loss of flow control
in November 1997, it was necessary for the UCUA to establish a market price
lower than the previously established $83.05 rate in order to attract waste
to the UCRRF. Despite the modified $50 per ton rate, the UCUA has only been
able to fill 50% of the UCRRF's capacity. As a result, the UCUA has been
experiencing inadequate cash flow to pay fully all expenses including debt
service. The net impact of this shortfall amounts to a monthly loss of $2
million totalling, in the aggregate, about $16 million from November 1997
to May 1998. The amendment notes that if the system restructuring were completed
by June 15, 1998, the transition cost would be $.45 bringing the debt component
of the EIC to $13.98 per ton. If, however, the system restructuring were
not competed by June 15, 1998, an additional $1.85 per ton transition cost,
above the $13.98 debt component, would be needed for the next three months.
The system restructuring was not completed by June 15, 1998. Therefore, the
County is requesting this additional $1.85 per ton transition cost for up
to the 90 days of additional time that might be required to complete the
system restructuring.
Within Section C. of this certification the Department approves until June
30, 1999 the $2.50 per ton component of the EIC to be utilized to partially
fund enforcement costs associated with the implementation of the County's
solid waste management strategy. Also approved within Section C. until June
30, 1999 is the increase in the stranded debt component of the EIC from $13.53
to $13.98 per ton which represents inclusion of the $.45 per ton transition
cost. Should the County opt to continue collecting an EIC after June 30,
1999, the County may submit such a request as an administrative action
(N.J.A.C. 7:26-6.11(b)10.). Finally, the DEP approves an additional
$1.85 per ton component of the EIC for transition costs for up to 90 days
for completion of the activities associated with the system restructuring.
Therefore, the total EIC approved by DEP shall be at least $18.51 and shall
not exceed $20.36 per ton (for up to 90 days).
The EIC will now consist of the following:
Item Amount
Stranded Debt
$13.53
Stranded Host Community Fee
2.03
Enforcement Costs
2.50
Transition Costs
.45
Additional Transition Costs*
1.85
Total $20.36
*Maximum, calculated on the basis of a 90 day delay in implementation of
the system restructuring
The DEP EIC approvals contained within Section C. of this certification are
consistent with an order issued on April 27, 1998 by the Department of Community
Affairs' Local Finance Board which specified that "The EIC shall...be an
amount that is at least $18.51 per ton [$20.36-1.85=18.51] and shall not
exceed $20.36 without the prior approval of the Board."
Issue: Pending Litigation
Pursuant to an interdistrict agreement between the UCUA and BCUA dated August
25, 1993, the BCUA is required to deliver 192,000 tons per year of processible
solid waste to the UCRRF. The obligations of BCUA under the interdistrict
agreement, including the obligation of BCUA to deliver and/or pay as if waste
were delivered, are the subject of pending litigation in Superior Court,
Union County, Chancery Division, I/M/O/ Union County Utilities Authority
v. Bergen County Utilities Authority, Docket No. UNN-C-161-97, before
the Hon. John M. Boyle. The BCUA has been temporarily restrained by court
order from terminating payments to the UCUA as required by the interdistrict
agreement. The BCUA request that the state court action be vacated to federal
court was denied by the federal district court.
In a separate litigation also pending in Superior Court, Union County, Law
Division, I/M/O Bergen County Utilities Authority v. Union County Utilities
Authority et al., Docket No. UNN-L-3081-98, the BCUA challenged the authority
of the UCUA to assess the EIC against the BCUA. That litigation is still
pending. The BCUA named the Department in that litigation as an indispensable
party, but has not formally served the Department to date.
As noted in the Department's April 30, 1998 certification, significant portions
of the strategy outlined in the December 18, 1997 amendment, as well as the
May 21, 1998 amendment, are reliant upon the continued obligation of the
BCUA to deliver waste to the UCRRF pursuant to its interdistrict agreement.
The Local Finance Board, as noted above, issued its April 30, 1998 resolution
ordering the implementation of a financial plan, including the imposition
of an EIC. The Local Finance Board noted that "...in establishing the EIC,
the Board has relied upon representations by the UCUA and the County that
the execution of a proposed County Deficiency Agreement is intended to be
the ultimate source of payments..." with respect to the bonds which the UCUA
intends to support in the first instance with payments from the EIC. The
UCUA has made similar representations to the Department. Therefore, the
Department notes that this certification is subject to whatever final decisions
are issued in the litigation described above. The Department further notes
that the approval of the EIC is being given with the understanding that the
proposed County Deficiency Agreement is the ultimate source of payment for
amounts required to pay the principal and interest on the 1998 UCUA Bonds
to be issued in connection with the UCUA's restructuring of its debt.
C. Certification of the Union County District Solid Waste Management
Plan Amendment
In accordance with N.J.S.A. 13:1E-1 et seq., specifically
N.J.S.A. 13:1E-21, which establishes specific requirements regarding
the contents of the district solid waste management plans, I have reviewed
the May 21, 1998 amendment to the approved County Plan and certify to the
County Freeholders that the May 21, 1998 amendment is approved in part and
modified in part as further specified below.
Regulatory Flow Control Over Solid Waste Types 13, 23, and 27 Pursuant
to Nondiscriminatory Procurement
The County Plan inclusion of the UCUA's proposal to exercise regulatory flow
control to direct solid waste types 13, 23, and 27 to designated facilities
is approved with modification contingent upon receipt and approval by the
DEP of a subsequent amendment or administrative action which documents awarding
nondiscriminatorily bid contract(s) to provide disposal services.
Administrative Fee and Transition Cost Components of the Environmental
Investment Charge
The County Plan inclusion of a $2.50 per ton component of the EIC, to be
utilized to partially fund enforcement costs associated with the implementation
of the County's solid waste management strategy, is approved until June 30,
1999. Furthermore, the County Plan inclusion of an increase of $.45 in the
stranded debt component of the EIC to reflect transition costs is approved
until June 30, 1999. Should the County opt to continue collecting an EIC
after June 30, 1999, the County may submit such a request as an administrative
action. Also, as noted within Section B., the County is directed to submit
within 30 days as an administrative action a narrative description of how
the enforcement program will now be implemented by the UCUA. Finally, the
County Plan inclusion of an additional interim transition cost of $1.85 per
ton for up to 90 days to defray additional costs incurred by the UCUA resulting
from a delay in implementation of the restructuring of its system is also
approved. Therefore, the total EIC approved by DEP shall be at least $18.51
and shall not exceed $20.36 per ton (for up to 90 days).
D. Other Provisions Affecting the Plan Amendment
1. Contracts
Any contract renewal or new contract for solid waste collection or disposal
which is inconsistent with this amendment to the County Plan and which was
executed prior to the approval of this amendment and subsequent to the effective
date of the Solid Waste Management Act (July 29, 1977), and which shall further
be for a term in excess of one year, shall immediately be renegotiated in
order to bring same into conformance with the terms and provisions herein
set forth. Any solid waste collection operation or disposal facility registered
by the Department and operating pursuant to a contract as herein described,
shall be deemed to be in violation of this amendment and of the County Plan
if such renegotiation is not completed within ninety (90) days of the effective
date of this amendment provided, however, that any such registrant may, upon
application to the Department, and for good cause shown, obtain an extension
of time to complete such renegotiation.
2. Compliance
All solid waste facility operators and transporters registered with the
Department and operating within the County and affected by the amendment
contained herein shall operate in compliance with this amendment and all
other approved provisions of the County Plan. Any facility operator or
transporter who fails to comply with the provisions contained herein shall
be deemed to be in violation of N.J.S.A. 13:1E-1 et seq., in violation
of N.J.A.C. 7:26-1 et seq., and in violation of their registration
to operate a solid waste facility or a collection system issued thereunder
by the Department and shall be subject to the provisions and penalties of
N.J.S.A. 13:1E-9 and 12 and all other applicable laws.
3. Types of Solid Wastes Covered by the District Plan
The provisions of the District Plan shall apply to all solid wastes defined
in N.J.S.A. 13:1E-3 and N.J.A.C. 7:26-2.13 including waste
types 10, 13, 23, 25, and 27 and all applicable subcategories and shall not
apply to liquid and hazardous waste. All nonhazardous materials separated
at the point of generation for sale or reuse are subject to regulation pursuant
to N.J.A.C. 7:26A-1 et seq.
4. Certification to Proceed with the Implementation of the Plan
Amendment
This document shall serve as the certification of the Commissioner of the
Department to the County Freeholders and pursuant to N.J.S.A. 13:1E-24c.
and f., the County shall proceed with the implementation of the approved
amendment, as modified, certified herein.
5. Definitions
For the purpose of this amendment and unless the context clearly requires
a different meaning, the definitions of terms shall be the same as those
found at N.J.S.A. 13:1E-3 and -99.12, N.J.A.C. 7:26-1.4, -2.13,
and N.J.A.C. 7:26A-1.3.
6. Effective Date of the Amendment
The approved amendment, as modified, to the County Plan contained herein
shall take effect immediately.
7. Reservation of Authority
Nothing contained herein shall be construed as a limitation on any other
action taken by the Department pursuant to its authority under the law. The
County Plan, including any amendment made thereto, shall conform with the
Statewide Solid Waste Management Plan, with appendices, which includes the
Department's planning guidelines, rules, regulations, orders of the Department,
and also includes the compilation of individual district plans and amendments
as they are approved.
E. Certification of Approval and Modification of the Amendment by the
Commissioner of the Department of Environmental Protection
In accordance with the requirements of N.J.S.A. 13:1E-1 et seq., I
hereby approve in part and modify in part the amendment, as outlined in Section
C. of this certification, to the Union County District Solid Waste Management
Plan which was adopted by the Union County Board of Chosen Freeholders on
May 21, 1998.
__July 20, 1998_
_____________________________________
Date
Robert C. Shinn, Jr., Commissioner
Department of
Environmental Protection