|TRENTON – Acting Attorney General John J. Hoffman announced today that the State has filed suit against the owner-operators of the Fenimore Landfill in Roxbury Township, Morris County, charging that they defrauded the Department of Environmental Protection (DEP), misappropriated millions of dollars in landfill tipping fees and created a public nuisance that continues to affect thousands of Roxbury Township residents, including school children.
Filed today in New Jersey Superior Court in Morris County, two State civil complaints name Strategic Environmental Partners, LLC, as well as husband-and-wife Richard and Marilyn Bernardi of Millstone, Monmouth County, as defendants. One of the two Complaints alleges two counts of fraud, two counts of violating the New Jersey False Claims Act, and a single count each of unjust enrichment, breach of fiduciary duty and creating a public nuisance.
The Bernardis are accused of fraudulently gaining DEP approvals for a solar-related redevelopment project at Fenimore Landfill by failing to disclose nearly $2.5 million in corporate and personal debt. They also are accused of misappropriating at least $1.26 million, and potentially up to $3.4 million, in landfill tipping fees that they were legally obligated to put in escrow -- a condition of DEP’s approval of the redevelopment project -- to ensure proper capping and closure of the landfill. The suit also accuses the defendants of creating a public nuisance by failing to control noxious hydrogen sulfide emissions from Fenimore caused by decaying gypsum wallboard material they accepted for disposal.
According to the State’s complaints, pungent “rotten egg” odors emanating from the landfill around-the-clock spawned more than 2,500 complaints to the Roxbury Township Health Department during the six-month period between December 2012 and June of this year.
During the same period, Roxbury school district officials also noted an increase in students reporting to their school nurses with such symptoms as headaches, irritation of the eyes, respiratory distress, and nose and throat discomfort – symptoms consistent with exposure to hydrogen sulfide gas.
According to the State’s lawsuit, the increase in student traffic to school nurses was most noticeable at two elementary schools and one middle school that are attended by students living near Fenimore Landfill, which is about 25 percent of Roxbury Township’s total public school student population.
“The irresponsible, unlawful actions of these defendants not only have cost the State a significant amount of money and fouled our environment in a general sense, they have exposed an entire community, including many school children, to noxious odors that are extremely unpleasant to live with and have the potential to make people feel ill,” said Acting Attorney General Hoffman. “The time for talk and excuses is past. The citizens of New Jersey, and especially the residents of Roxbury Township, deserve better, and that is why we’ve taken this aggressive legal action on behalf of the State today.”
Opened in the 1950s, Fenimore Landfill spans 60 acres and is located on Mountain Road in Roxbury Township. The landfill accepted municipal solid waste from nearby towns until the late 1970s, when it was abandoned by its former owners without proper closing and capping. Strategic Environmental Partners purchased the landfill in February 2011 and ostensibly planned to redevelop the site as a 10-megawatt solar electricity generating facility.
In order to facilitate installation of the solar array by raising the landfill’s elevation, Marilyn and Richard Bernardi -- named respectively as the owner and authorized agent of SEP -- proposed to import 1.2 million cubic yards of fill. Under their proposal, fill imported by the Bernardis would consist mostly of crushed construction and demolition debris regulated by DEP as recyclable material. DEP approved the plan contingent on the Bernardis representation of their financial solvency and ability to pay for the closing and capping of the landfill. It was not until after DEP approved an Administrative Consent Order and Post-Closure Plan that the Bernardis disclosed their substantial debt.
Among other things, the Bernardis agreed to DEP’s condition that they reinvest all landfill tipping revenues – after an initial $750,000 that could be used for the redevelopment project’s start-up costs -- in an escrow account that would be placed under DEP oversight. The escrow account was designed to ensure a source of funds to pay for stabilizing and closing the landfill in the event the Bernardis defaulted on any of their obligations. The Bernardis also agreed to install, maintain and monitor environmental controls on the landfill site in accordance with DEP rules.
Between December 2011 and June of this year, SEP imported more than 375,000 cubic yards of fill material. According to the State’s lawsuit, the company took in an estimated $3.4 million in tipping fees through acceptance of this material, but remained “very far behind schedule” in terms of the agreed-upon landfill closing activities, such as installation of various environmental controls.
In addition to failing to deliver on the promised environmental controls, the State’s lawsuit accuses the defendants of keeping all tipping revenues for themselves, and failing to deposit any of the millions of dollars collected in escrow as agreed. The lawsuit contends the Bernardis lacked sufficient funding for their project from the start, and misled DEP officials about the project’s solvency in order to gain State approvals.
The suit also charges the Bernardis with repeatedly failing to address the problem of overwhelming hydrogen sulfide fumes being emitted by the landfill. The DEP has taken emergency measures to reduce the offending emissions at “significant public expense,” according to the State’s complaints, but hydrogen sulfide odors from Fenimore remain a concern.
To date, the DEP has issued 12 Administrative Orders and Notices of Civil Penalty Assessment (totaling $898,000 in administrative penalties) to the Bernardis for violating the New Jersey Pollution Control Act between December of 2012 and June 2013. The company also has been found guilty in Roxbury Township Municipal Court of 26 separate violations of local ordinance for causing a public health nuisance.
A second civil Complaint filed today outlines specific alleged violations of New Jersey’s Solid Waste Management and Air Pollution Control Acts, and charges a host of violations including: failure to fund an escrow account; failure to control malodorous emissions; failure to account for tipping fee revenues; refusal to permit State inspectors to access the site or provide them requested records and emission of an air pollutant – hyrdrogen sulfide gas – which unreasonably interferes with enjoyment of life or property, and failure to report emissions of an air contaminant. This Complaint also seeks $4.41 million in civil penalties as well as injunctive relief.
Deputy Attorneys General Robert Kinney, Gary Wolf, Lisa Almeida, Lisa Morelli, Nicolas Seminoff and Ray Lamboy of the Division of Law’s Environmental Enforcement Section handled the Strategic Environmental Partners matter on behalf of the State.