Some observers have questioned whether a recent decision by the New Jersey Appellate Division suggests that New Jersey’s traditionally stringent environmental cleanup requirements are becoming more business-friendly. Upon review, the July 6 decision alone represents only a narrow loosening of cleanup obligations in New Jersey. However, the case comes at a time of other major changes in New Jersey’s site remediation regulatory framework that offer both new benefits as well as burdens for those owning contaminated property or conducting site remediations in the Garden State. As such, the court’s observations on the legislative intent associated with changes in the program over time welcome closer scrutiny.
The case at issue, Des Champs Laboratories v. New Jersey Department of Environmental Protection , involved the validity of a condition imposed by the NJDEP on parties seeking to obtain a de minimis quantity exemption (DQE) from requirements imposed by the Industrial Site Recovery Act (ISRA). This statute mandates cleanup of “industrial establishments” in New Jersey at the time of certain triggering events, such as sale of the property or business or cessation of operations. To constitute an industrial establishment, a business must have a specified North American Industrial Classification System number, operated on or after December 31, 1983, and used or stored one or more listed hazardous substances. Industrial business and real property transactions in New Jersey frequently lead to complex ISRA compliance issues, which can be avoided if the business can show it did not use hazardous substances above specified de minimis levels.
