New Jersey Natural Gas Company v. Borough of Red Bank and Red Bank Rivercenter Special Improvement District

                NOT FOR PUBLICATION WITHOUT THE
               APPROVAL OF THE APPELLATE DIVISION

                                  SUPERIOR COURT OF NEW JERSEY
                                  APPELLATE DIVISION
                                  DOCKET NO. A-1096-12T4

NEW JERSEY NATURAL GAS
COMPANY,                              APPROVED FOR PUBLICATION

     Plaintiff-Respondent,               October 28, 2014

                                        APPELLATE DIVISION
v.

BOROUGH OF RED BANK and
RED BANK RIVERCENTER
SPECIAL IMPROVEMENT DISTRICT,

     Defendants-Appellants.
________________________________________________________

         Argued March 4, 2014 – Decided October 28, 2014

         Before Judges Messano, Hayden and Rothstadt.

         On appeal from the Superior Court of New
         Jersey,   Law  Division, Monmouth County,
         Docket No. L-1196-12.

         Daniel J. O'Hern, Jr., and Joseph J. Colao,
         Jr., argued the cause for appellants (Byrnes
         O'Hern, L.L.C., attorneys for appellant
         Borough of Red Bank; Lindabury, McCormick,
         Estabrook & Cooper, P.C., attorneys for
         appellant   Red  Bank   Rivercenter  Special
         Improvement District; Mr. O'Hern and Mr.
         Colao, on the joint brief).

         Kevin H. Marino argued the cause for
         respondent (Marino, Tortorella & Boyle,
         P.C., attorneys; Mr. Marino, on the brief).

         The opinion of the court was delivered by

MESSANO, P.J.A.D.
    The   Borough      of    Red   Bank    ("Red     Bank")     and   the    Red    Bank

RiverCenter     Special     Improvement        District     ("RiverCenter,"         and

collectively,    "defendants")         appeal    from     the    October     17,   2012

order of the Law Division that granted plaintiff, New Jersey

Natural   Gas    Company      ("NJNG"),        summary     judgment     and       denied

defendants'     cross-motions       for      summary     judgment.1         The    order

provided NJNG with declaratory relief, as well as relief in the

nature of mandamus against Red Bank, specifically requiring the

borough to issue construction permits so that NJNG could "remove

all underground [gas] regulators located in . . . Red Bank and

replace them with above-ground regulators."

    Defendants contend that the trial judge erred by concluding

that,   pursuant      to    N.J.S.A.      48:9-17,      NJNG's    installation        of

above-ground    gas    regulators       in     public    sidewalks     was    largely

exempt from municipal control.             That statute provides:

           Every [gas] company may lay conductors and
           install related facilities for conducting
           gas through the streets, alleys, squares and
           public   places   in  any   municipality  or
           municipalities in which it may lawfully
           operate, having first obtained the consent
           by resolution or ordinance of the governing
           body of such municipality for the furnishing
           of gas therein and the approval of such
           consent by the Board of Public Utility
           Commissioners.   The consent may be subject

1
   NJNG is a natural gas distribution company that serves
approximately 495,000 customers in 105 municipalities in
Monmouth, Ocean, Middlesex and Morris counties.



                                           2                                  A-1096-12T4
           to reasonable regulations with respect to
           the opening of streets, alleys, squares and
           public places, not inconsistent with the
           provisions of this article.

           [Ibid. (emphasis added).]

    Defendants       further       argue     that       because       the      judge

misconstrued this statute, he erred in not granting defendants

summary   judgment   and   dismissing      NJNG's       complaint     in    lieu   of

prerogative     writs.     They    contend    that      NJNG   was    required      to

exhaust   its    administrative      remedies,       first     by    submitting      a

development     application    pursuant      to   Red    Bank's      planning      and

development regulations.          If NJNG remained dissatisfied with the

result, Red Bank contends the utility's remedies were set forth

in the Municipal Land Use Law ("the MLUL"), N.J.S.A. 40:55D-1 to

-163, a section of which provides:

           If a public utility . . . is aggrieved by
           the action of a municipal agency through
           said agency's exercise of its powers under
           this act, . . . an appeal to the Board of
           Public Utilities . . . may be taken . . .
           without appeal to the municipal governing
           body pursuant to [N.J.S.A. 40:55D-17][2] unless
           such public utility . . . so chooses. . . .
           A hearing on the appeal of a public utility
           to the Board of Public Utilities shall be
           had on notice to the agency from which the
           appeal is taken and to all parties primarily
           concerned, all of whom shall be afforded an

2
  N.J.S.A. 40:55D-17 permits "[a]ny interested party [to] appeal
to the governing body any final decision of a board of
adjustment approving an application" for a type (d) variance
pursuant to N.J.S.A. 40:55D-70(d).



                                       3                                    A-1096-12T4
           opportunity to be heard. If, after such
           hearing, the Board of Public Utilities shall
           find that the present or proposed use by the
           public utility . . . of the land described
           in the petition is necessary for the
           service, convenience or welfare of the
           public . . . a finding by the board that the
           present or proposed use of the land is
           necessary to maintain reliable . . . natural
           gas supply service for the general public
           and that no alternative site or sites are
           reasonably    available   to    achieve    an
           equivalent   public   benefit,   the   public
           utility . . . may proceed in accordance with
           such decision of the Board of Public
           Utilities, any ordinance or regulation made
           under    the    authority   of    this    act
           notwithstanding.

                . . . .

                Nothing in this act shall be construed
           to restrict the right of any interested
           party to obtain a review of the action of
           the municipal agency or of the Board of
           Public Utilities by any court of competent
           jurisdiction according to law.

           [N.J.S.A. 40:55D-19.]

    Alternatively, defendants argue that the judge should have

declined jurisdiction over the dispute and referred the parties

to the Board of Public Utilities (the "BPU") pursuant to the

doctrine of primary jurisdiction.          See, e.g., Curzi v. Raub, 415

N.J. Super. 1, 20 (App. Div. 2010) (quoting Borough of Haledon

v. Borough of N. Haledon, 358 N.J. Super. 289, 301-02 (App. Div.

2003) ("Under the doctrine of primary jurisdiction, a 'court

declines   original   jurisdiction       and   refers   to   the   appropriate




                                     4                                A-1096-12T4
body those issues which, under a regulatory scheme, have been

placed     within    the   special       competence       of     an     administrative

body.'")).

       NJNG   contends     the   trial    judge       properly       determined     that,

pursuant      to    N.J.S.A.     48:9-17        and     binding        Supreme      Court

precedent, a municipality -- under the guise of exercising its

zoning powers -- may not dictate the manner in which gas service

is provided, and that all Red Bank may require is compliance

with   "reasonable     regulations       with     respect       to    the   opening     of

streets, alleys, squares and public places."                    Ibid.

       We have considered these arguments in light of the record

and applicable legal standards.               We reverse.

                                         I.

                                         A.

       Much of the record evidence is undisputed.                        In 1969, Red

Bank passed a resolution authorizing NJNG to "to lay, maintain

and operate its conductors, mains, and pipes, together with the

appurtenances       thereto,     in   all      the     public        streets,    alleys,

squares and public places" in the municipality.                        The resolution

included the condition that

              [NJNG] shall agree that, in all cases in
              which street openings or excavations are
              made   for   the  purposes   aforesaid,  the
              pavement and the surface of the streets,
              alleys,   squares  or   roadways   shall  be
              restored to the same condition as existed



                                          5                                      A-1096-12T4
             prior to the opening thereof, and                                  in
             accordance with Borough [o]rdinances.

             [(Emphasis added).]

       RiverCenter        was      established      in       1991   to    revitalize        Red

Bank's downtown business district, which had suffered decline.

One    of   its    signature        efforts       was    a    $1,800,000         streetscape

project,     completed        in    1998,   that        installed        brick   sidewalks,

decorative street lights and benches, substantially upgrading

the    appearance        of   the    downtown     area.         A   second       streetscape

project was completed in 2002.

       In March 2011, NJNG obtained a construction permit to open

the street and sidewalk in front of a restaurant on Broad Street

in RiverCenter's special improvement district.                            NJNG thereafter

removed a gas regulator from the underground pit in the street

and reinstalled it on the sidewalk in front of the restaurant.

Red    Bank's     borough       administrator,          Stanley     Sickels,         certified

that   although         NJNG's     representative        had     tried     to    schedule      a

meeting with him, no meeting had occurred before NJNG installed

the new regulator, and Red Bank was unaware of NJNG's intentions

when it issued the permit.

       The new regulator protruded approximately 15 inches from

the front of the building, through the sidewalk pavers and into

the public right of way, i.e., the sidewalk.                         Sickels, who also

served      as    Red    Bank's      construction         code      official         and   fire



                                              6                                       A-1096-12T4
marshal, was concerned that the newly installed regulator was a

potential safety hazard for pedestrians, would interfere with

maintenance       of    the    sidewalks          and    building      facades    and    was

subject to impact damage and vandalism.

      On March 22, 2011, Sickels met with NJNG's representatives,

Howard Brey and Holly McGovern.                      There is a factual dispute as

to what exactly occurred at the meeting.

      In its verified complaint, NJNG claimed that following a

system-wide       survey       of     its        underground     regulators,      it     had

concluded that replacement with above-ground regulators would be

necessary because of corrosion problems that compromised safety.

At   the   March       22,    2011    meeting,          NJNG   representatives      showed

Sickels     and    Nancy       Adams,       RiverCenter's        executive       director,

pictures of corroded underground installations in another town.

According    to    NJNG,       "the        Red    Bank    officials     were     uniformly

receptive to the idea of moving the regulators above ground to

address     safety      concerns       and        indicated     that    NJNG     would    be

permitted to proceed with the relocation project."

      Sickels          certified            that         he     recommended         NJNG's

representatives         meet        with     RiverCenter's        representatives        to

discuss the issue, and he called Adams, who arrived for the last

ten minutes of the meeting.                 Brey and McGovern advised that NJNG

intended to replace all underground regulators in Red Bank with




                                                 7                                A-1096-12T4
above-ground installations.                 Sickels did not recall seeing any

pictures,    and     both       he    and   Adams     certified         that   plaintiff's

representatives          made    no    mention       of    safety       concerns.      Adams

suggested NJNG perform surveys to determine if the regulators

could be moved to the side or rear of buildings, as opposed to

sidewalks in front.              According to Sickels, Brey and McGovern

were unreceptive to requests that NJNG examine alternatives.

    On    March      30,    2011,       Red    Bank       passed    a    resolution      that

opposed     the     relocation         project        on    safety       grounds.         The

resolution demanded that NJNG return the Broad Street regulator

to its original location below grade, and suggested that any

safety concerns be addressed with more frequent replacement of

regulators or improved underground enclosures.                            Another meeting

between   NJNG      and    Red       Bank   in      April   failed       to    produce    any

agreement.

    On August 18, 2011, NJNG's general counsel wrote to BPU's

Director of the Division of Reliability and Security with a copy

to Red Bank's counsel asking for assistance in "resolving this

dispute."     She detailed NJNG's investigation after discovery of

leaks in underground regulators in Red Bank, leading to the

conclusion        that     it    could        not    safely        install     underground

regulators.        She asserted that the "serious and imminent risk"




                                               8                                    A-1096-12T4
posed by the corroding regulators rendered NJNG non-compliant

with federal regulations.

    Red Bank's counsel responded by letter dated September 29.

He disputed NJNG's safety concerns, claiming that no leaks had

been reported since the underground regulators were installed in

1992, NJNG refused to share the actual results of its survey or

previous inspections, and NJNG failed to address safety issues

that could result from the placement of regulators aboveground

in heavily trafficked areas.            He proposed that the regulators

could   be    located    in     building      basements,     rather       than    on

sidewalks.     Although he did not request a hearing before the

BPU, counsel observed that "given the fact-sensitive nature of

this dispute, neither the BPU nor any other adjudicative body

would be in the position to render a decision . . . without the

benefit of a more formal evidentiary hearing."

    In February 2012, NJNG submitted multiple applications to

open streets and sidewalks in Red Bank; on each application, the

purpose of the work was described as "sidewalk reg[ulator] pit

renewal" or "sidewalk regulator pit remediation."                    None of the

requests     indicated   that    NJNG       intended    to   place    a    service

regulator in and through the sidewalk.                 Sickels certified that

all were denied because NJNG failed to accurately describe the




                                        9                                  A-1096-12T4
nature of the work to be performed and provide a sketch or

survey.

                                     B.

      On March 14, 2012, NJNG filed a verified complaint in lieu

of prerogative writs, along with an order to show cause seeking

injunctive and declaratory relief.             Among other things, NJNG

sought an order directing Red Bank to immediately issue the

construction permits, and declaratory judgment "that [NJNG] is

lawfully    permitted    and     legally    obligated      to    relocate     the

underground gas delivery equipment to above-ground locations,"

and that defendants were prohibited from interfering with the

relocation efforts.3

      It suffices to say that the complaint contained extensive

technical support for NJNG's claim that it needed to relocate

the regulators aboveground for safety reasons.              This included an

April     26,    2011   letter    from     Emerson    Process      Management,

apparently the manufacturer of the regulators at issue, in which

it   cautioned    against   using   its    device    "in   any    below     grade

installations such as pits or vaults," because that "can cause

3
  Count Two of the complaint sought attorneys' fees and costs
based upon defendants' alleged malicious and unjustified
interference with NJNG's activities.        Although he briefly
addressed this count when denying NJNG a preliminary injunction,
the judge did not specifically address this allegation when he
subsequently granted summary judgment. In light of our ultimate
holding, this count of the complaint lacks any merit.



                                     10                               A-1096-12T4
accelerated corrosion rates in certain regulator components."4

Also attached to the complaint were orders for repairs NJNG made

to gas regulators in Red Bank during 2010.

      On     April      11,      2012,        NJNG        re-submitted          fifty-five

applications for permits to open sidewalks.                               The applications

included sketches, but they continued to omit any reference to

the   relocation       of    regulators      aboveground,            or    their     size   or

location.       On     April     23,     citing         Red    Bank's       "Planning       and

Development     Regulations,"          the   borough          attorney      notified     NJNG

that Red Bank was denying the applications as incomplete and

directed NJNG to submit an application for a development permit.

      Red     Bank's        regulations       require          the        issuance     of     a

development      permit       prior     to        the    "erection,          construction,

alteration,      repair,        remodeling,             conversion,           removal        or

destruction of any building or structure."                       Borough of Red Bank,

N.J.,      Planning    &     Dev.   Regulation,           §     25-3.6(a)(1)(c).              A

"structure" is defined as

             [A]ny combination of materials forming any
             construction, the use of which requires
             location on the ground or attachment to
             something having location on the ground and
             including, among other things:      display
             stands; fences and walls; gasoline pumps;
             gates and gate posts; . . . standpipes;

4
  It is unclear from the record whether the specific regulators
referenced were indeed the same type regulators already
installed in underground pits in Red Bank.



                                             11                                      A-1096-12T4
               tanks of any kind; . . . towers of any kind
               . . . trellises. The word structure shall
               be construed as though following [sic] by
               the words "or part thereof."

               [Id. at § 25-2.]

Development permits are also required for "[t]he construction of

any site improvement either above or below ground."                                          Id. at

§     25-3.6(a)(1)(i).                 Lastly,        the       regulations          specifically

required that "[a]ll utility lines and necessary appurtenances

including      .    .    .    gas   distribution            .    .   .   shall    be   installed

underground within easements or dedicated public rights-of-way."

Id. at § 25-8.34.

       On   June        18,    2012,    after     considering            oral    argument,        the

judge denied NJNG'S request for preliminary injunctive relief.

In his comprehensive written opinion, the judge concluded that

NJNG     had       not        demonstrated        the           likelihood       of    imminent,

irreparable        harm        occasioned       by     alleged           corrosion     problems.

The    judge    further         took    note     of    two        sections      of    Red    Bank's

development regulations.                "Essential Services" were defined as

               [U]nderground gas . . . transmission or
               distribution   systems,    including   mains,
               drains, sewers, pipes, conduits, cables; and
               including normal above ground appurtenances
               such as fire alarm boxes, police call boxes,
               light standards, poles, traffic signals,
               hydrants, and other similar equipment and
               accessories    in    connection    therewith,
               reasonably necessary for the furnishing of
               adequate service by public utilities or
               municipal or other governmental agencies or



                                                 12                                         A-1096-12T4
             for the public health or safety or general
             welfare.

             [Id. at § 25-2.3.]

Further, § 25-5.10, entitled, "Non-Applicability," stated:

             The provisions of this Chapter shall not
             apply to customary underground essential
             services, except that all facilities such as
             pumping stations, repeater stations and
             electric   substations,   which   require   a
             structure above ground or any other above
             ground appurtenance of any type more than
             forty   (40')   feet  high,   shall   require
             approval as a conditional use . . . .

Based   on        these   sections,    the     judge    concluded     that    the

development regulations "explicitly do[] not apply to 'customary

underground essential services' which include gas distribution

systems and regulators."

    The judge also agreed with NJNG that Red Bank's ordinances

clearly set forth what information was required to obtain a

permit to open a street or repair a sidewalk, and therefore the

issuance     of    construction    permits    was   a   ministerial   act     that

involved no discretion.           The judge determined that Red Bank had

"fulfilled its ministerial act" when it denied NJNG's permit

applications.             Nonetheless,       he     denied    granting        NJNG

"extraordinary [injunctive] relief" without a full hearing on

the merits.

    On June 13, Red Bank amended § 25-9.3 of its regulations,

which   defined       "Public     Utilities"      and   designated     them     as



                                       13                               A-1096-12T4
conditional uses.             After amendment, the definition of public

utilities included "structures or appurtenances that may impact

a public sidewalk or right of way."                          A new subsection of the

regulation       provided         that    "[a]ny       structure       or   appurtenance

related to or separate from the installation shall not encroach

upon or unreasonably interfere with the use of public sidewalks

or rights of way."

       On June 22, stating further discovery was unnecessary, NJNG

sought       permission      to    file    a        motion    for     summary     judgment,

contending that the only issue before the court was

              [W]hether a public utility . . . is entitled
              as a matter of law to determine the manner
              in which it will deliver natural gas to its
              customers,    regardless    of   whether   a
              municipality such as Red Bank interposes a
              substantive, principled objection to the
              utility's manner of delivery and proposes an
              alternative   and    reasonable  method   of
              delivery that is nonetheless unacceptable to
              the utility.

The judge granted NJNG's request.

       NJNG    filed    its    motion     for        summary    judgment,       relying   in

large    part    on    the    factual      assertions          made    in   its   verified

complaint.          In a supplemental certification, NJNG supplied a

letter, dated July 31, 2012, from the BPU's bureau chief of

pipeline safety, acknowledging receipt of NJNG's notification

that    it    was     temporarily        replacing       the    "current        underground

regulators with new ones."                  The letter also set forth BPU's



                                               14                                  A-1096-12T4
"ongoing     concerns"     regarding     safety       issues    involving        the

continued use of regulators in underground pits.                      Defendants

cross-moved for summary judgment, arguing that NJNG was required

to submit development applications for the installation of the

above-ground regulators, and that NJNG had failed to exhaust its

administrative remedies before the BPU.

      In his September 24, 2012 written opinion, the judge noted

that "[t]he first issue [was] whether the public utility has the

sole discretion to determine how that utility provides service

to    a   municipality."        Citing      N.J.S.A.    48:9-17,      the     judge

concluded    that    the   utility    must     obtain    authority        from   the

municipality to provide the service, but a municipality "does

not   have   the    authority   to   dictate    the    manner   in   which       such

service is provided."

      The judge described "[t]he crucial issue" as whether the

service      regulators     were      structures        subject      to     zoning

regulations, or were exempt because they were part of the gas

distribution system.       The judge was "convinced" that the service

regulators were part of the distribution line, and, therefore,

NJNG's installations were not subject to zoning regulations but

were only "subject to reasonable regulations with respect to the

opening of the streets" and other public places.                     He reasoned

that "just like a private customer cannot regulate the location




                                       15                                  A-1096-12T4
of the service regulator at their residence," Red Bank could not

regulate, through zoning regulation or otherwise, the location

of the gas regulators.

      Lastly,       the   judge     concluded      N.J.S.A.        40:55D-19   did     not

apply.     He reasoned that because NJNG was not required to obtain

a development permit, but only a construction permit to open

streets and sidewalks, it could properly seek relief to compel

this "ministerial act" in the Law Division.

      The judge entered an order that granted summary judgment

and declared that:              NJNG had sole and exclusive discretion to

determine the manner in which it would distribute natural gas

service within a municipality; Red Bank had no authority to

regulate     or   dictate        the     manner   of   distribution      "except       for

reasonable regulations with respect to the opening of streets,

alleys, squares, and public places"; Red Bank had no authority

via   zoning      or      any    other     ordinance      "to      regulate,     effect,

influence, or dictate" the location of plaintiff's regulators or

its relocation of those regulators to the above ground location;

and   that     neither          action     was    subject     to     municipal      laws,

ordinances     or      regulations       "except    for     reasonable    regulations

with respect to the opening of streets, alleys, squares and

public spaces."           The order further provided that NJNG was only




                                             16                                  A-1096-12T4
required   to    obtain    construction         permits,    which    Red     Bank    was

ordered to issue within seven days.

    The judge denied defendants' motion for a stay.                               Their

application      to    this   court      for    a   stay    pending      appeal      was

similarly denied.

                                          II.

    Rather      than    bringing     a   frontal     challenge      to   Red    Bank's

planning regulations themselves, NJNG took a different tack.                          It

argued that pursuant to N.J.S.A. 48:9-17, when it comes to the

distribution of its gas, NJNG is exempt from any regulation,

save reasonable controls on how and when it opens the streets

and sidewalks.        Thus, NJNG advanced an argument that Red Bank's

obligation to issue a street opening permit was ministerial in

nature, the complete antithesis of the discretionary authority a

municipality      exercises      in      implementing        its     planning        and

development regulations.

    Accepting NJNG's characterization of the issue, the trial

judge took an expansive view of N.J.S.A. 48:9-17 and concluded

that,   but     for    "reasonable       regulations       with    respect     to    the

opening of the streets, alleys, squares and public places," Red

Bank could not "dictate the manner in which [gas] service [was]

provided."




                                          17                                   A-1096-12T4
      To some extent, however, this mischaracterized the issue,

since Red Bank was not attempting to dictate how NJNG provided

its service.         In other words, Red Bank was not compelling NJNG

to use certain type regulators or requiring that they be placed

in certain positions.              Rather, Red Bank wanted NJNG to submit a

development application - nothing more, nothing less.                                   We view

this distinction as critical.

      The    central          issue    before       us     is    whether         the    judge's

expansive reading of N.J.S.A. 48:9-17 was correct.                                      In this

regard, "[w]e review the law de novo and owe no deference to the

trial court . . . if [it has] wrongly interpreted a statute."

Zabilowicz      v.       Kelsey,      200    N.J.    507,       512   (2009)       (citations

omitted).

      We    start        by    noting        that    "[o]ur       overriding           goal    in

interpreting         a    statute       is    to     determine        the    Legislature's

intent."     Brodsky v. Grinnell Haulers, Inc., 181 N.J. 102, 109

(2004).      In      this     case,    we    frame       the    inquiry     as    whether      by

enacting     N.J.S.A.         48:9-17       the    Legislature        intended         that   all

aspects of the delivery of gas service be exempt from local land

use regulations, except "reasonable regulations with respect to

the   opening     of      streets,      alleys,      squares      and     public       places."

Ibid.      As noted, NJNG urged that position in the Law Division,

and it did the same before us.                    We reject the argument.




                                               18                                       A-1096-12T4
      The    first     step     in    divining      legislative       intent    is    to

consider the statute's plain language, Town of Kearny v. Brandt,

214 N.J. 76, 98 (2013), and accord those words "their ordinary

meaning and significance."                 DiProspero v. Penn, 183 N.J. 477,

492 (2005).     "[W]e must examine that language sensibly, in the

context of the overall scheme in which the Legislature intended

the provision to operate[.]"                  N.J. Dep't. of Envtl. Prot. v.

Huber, 213 N.J. 338, 365 (2013).                 Moreover, "[w]hen interpreting

multiple statutes governing the same subject, the Court should

attempt to harmonize their provisions."                    Brandt, supra, 214 N.J.

at 98 (citation omitted).

      Gas    companies        are    public      utilities    under     the     general

supervision, regulation, jurisdiction, and control of the BPU,

which   maintains      the     same    powers      over     utilities'       "property,

property rights, equipment, facilities and franchises so far as

may be necessary for the purpose of carrying out the provisions"

of the Department of Public Utilities Act of 1948 (the "Act").

N.J.S.A.     48:2-1.3;        N.J.S.A.        48:2-13(a).        Further,        unless

specifically provided for by the Electric Discount and Energy

Competition     Act,     N.J.S.A.       48:3-49       to    -98.4,    "all     services

necessary for the transmission and distribution of electricity

and   gas,   including        but    not    limited    to    safety,    reliability,

metering,     meter      reading       and       billing,     shall      remain      the




                                            19                                 A-1096-12T4
jurisdiction of the [BPU]."                N.J.S.A. 48:2-13(d).               The Court

long     ago   recognized       that      "the    public     interest        in     proper

regulation of public utilities transcends municipal or county

lines, and . . . a centralized control must be entrusted to an

agency     whose    continually          developing       expertise      will       assure

uniformly      safe,     proper     and     adequate       service      by    utilities

throughout the State."            In re Pub. Serv. Elec. & Gas Co., 35

N.J. 358, 371 (1961) [hereafter, "PSE&G"].                   Still, the Court has

consistently       recognized       the         inherent     tension         between       a

municipality's right to regulate the land within its borders,

and the benefit to the public-at-large provided by safe and

efficient      utility        services.          "Where     the    state      has     thus

established an agency of its own [(the BPU)] with plenary power

to     regulate    utilities,       it     is    universally       recognized         that

municipalities         cannot       properly         interpose          their        local

restrictions unless and only to the extent any power to do so is

expressly reserved to them by statute."                      Id. at 372 (emphasis

added).

       Under N.J.S.A. 48:9-17, gas companies are granted the power

to "lay conductors and install related facilities for conducting

gas through the streets, alleys, squares and public places in

any    municipality      or    municipalities       in     which   it   may       lawfully

operate."      Ibid.      But, the utility must "first obtain[] the




                                           20                                     A-1096-12T4
consent by resolution or ordinance of the governing body of such

municipality for the furnishing of gas therein and the approval

of such consent by the [BPU] Commissioners."                 Ibid.        Municipal

consent "may be subject to reasonable regulations with respect

to the opening of streets, alleys, squares and public places,

not inconsistent with the provisions of this article."                    Ibid.

    We reject defendants' argument that the statute does not

extend to gas regulators or the gas distribution line.                            The

plain   meaning   of     the    phrase,       "install   related     facilities,"

covers what is at issue here, an above ground extension of the

gas distribution system.            We also do not necessarily accept

defendants' argument that the statute only governs underground

installations.         The     statute    permits      the   utility      to   "lay"

conductors, perhaps implying only installations in the ground,

but it also permits the utility to "install facilities," which

has no such implication.               Moreover, the utility may conduct

either activity "through the streets, alleys, squares and public

places,"   the    plain      meaning     of    which   may   include      both    the

horizontal laying of pipe in the street as well as the vertical

installation of a facility "through" some other public place,

like the sidewalk.

    However,      even    if    N.J.S.A.       48:9-17   applies     to    all    gas

"facilities," above or below grade, it cannot be disputed that




                                         21                                A-1096-12T4
NJNG's      decision      to    install       at     least   some   of     the    regulators

through public sidewalks did not comply with its obligations

under the 1969 resolution.                     Under that agreement, once NJNG

opened a street or a "public place," like a sidewalk, it was

required to restore it to its prior condition.                             Photographs in

the    record       clearly      demonstrate          that   NJNG     did       not    restore

sidewalks      to    prior       conditions          since   there       was     now    a    gas

regulator protruding through the sidewalk.                          Because conditions

in    the   public     right      of    way     would    inevitably        change,       NJNG's

decision implicated more than the powers accorded to it under

the general consent provisions of N.J.S.A. 48:9-17.                              Hence, the

judge's      conclusion,         that     the      regulators       were       part    of    the

distribution system and therefore exempt from regulation other

than street opening permits, was mistaken.

       More importantly, the trial judge's expansive reading of

N.J.S.A. 48:9-17 ignored other provisions of the Act and the

MLUL that clearly provide the municipality with more power than

simply regulating the opening and closing of streets and public

places.             For        example,        N.J.S.A.       48:9-25.4,              entitled,

"Distribution of natural gas; designation of route," provides:

              Any gas company . . . may construct, lay,
              maintain and use facilities, conductors,
              mains and pipes, with the appurtenances
              thereto,   in,  through  and  beyond  any
              municipality . . . for the purpose of
              transmitting through the same natural gas



                                                22                                     A-1096-12T4
            . . . ; provided, that in each case such
            corporation shall first have obtained a
            designation   by   the   governing  body   or
            official having control thereof, of the
            public street, road, highway or place, which
            may be occupied by such corporation for such
            purpose. If any governing body or official
            having control of any public street, road,
            highway or place, after having received from
            such corporation a request to designate such
            public street, road, highway or place, for
            occupancy by such corporation for such
            purpose, shall fail or refuse to make such
            designation or to designate a practicable
            route,   the    [BPU]   Commissioners,   upon
            application by the corporation, and after
            hearing on notice to such governing body or
            official, shall make such designation.

            [Ibid. (emphasis added).]

Contrary    to   the       trial   court's        holding   that   the     municipality

could   play     no    role      in   determining       the    location      of     a    gas

company's distribution facility, even on public property, this

statute    permits         the   governing    body     to   designate      the    "public

street, road, highway or place, which may be occupied by such

corporation for such purpose."               Ibid.     If the municipality fails

to do so, or designates an impracticable route, then the gas

company may petition the BPU to designate the route.                        Ibid.

    It is well-recognized that construing a statute so as to

render any part of it inoperative, superfluous or meaningless is

disfavored.        Perrelli v. Pastorelle, 206 N.J. 193, 207 (2011)

(citing    State      v.    Schumm,   146    N.J.     Super.    30,   34    (App.       Div.

1977). aff’d o.b., 75 N.J. 199 (1978)).                     The trial court's broad



                                             23                                   A-1096-12T4
interpretation   of   N.J.S.A.   48:9-17   would   seemingly    render

N.J.S.A. 48:9-25.4 nugatory.

    Additionally, both historically and presently, applicable

provisions of the MLUL make clear that the Legislature never

denied municipalities the ability to exercise at least some of

their traditional zoning powers simply because a public utility

was involved.    N.J.S.A. 40:55-50 was the statutory predecessor

to N.J.S.A. 40:55D-19.      L. 1975, c. 291, §10, amended by L.

1999, c. 23, § 58.    It provided in relevant part:

         This article ["Zoning"] or any ordinance or
         regulation made under authority thereof,
         shall not apply to existing property or to
         buildings or structures used or to be used
         by public utilities in furnishing service,
         if upon a petition of the public utility,
         the board of public utility commissioners
         shall   after  a   hearing,   of    which   the
         municipality affected shall have notice,
         decide   that   the   present    or    proposed
         situation of the building or structure in
         question is reasonably necessary for the
         service, convenience or welfare of the
         public.

         [See State v. Jersey Cent. Power & Light, 55
         N.J. 363, 367 (1970) [hereinafter "JCP&L"]
         (quoting former N.J.S.A. 40:55-50).]

The Court explained the purpose of N.J.S.A. 40:55-50:

         This    exemption    section   expresses   a
         legislative intent that, in the zoning
         field, at least some power over a utility is
         reserved to a municipality, subject to the
         supervising   authority   of the   Board  to
         declare the local regulation inapplicable if
         it determines "the situation of the building



                                 24                            A-1096-12T4
            or structure in question                       is reasonably
            necessary for the service,                     convenience or
            welfare of the public."

            [PSE&G, supra, 35 N.J. at 373-74.]

We interpreted the statute similarly, by noting "that public

utilities are subject to the municipal zoning power, but by

[N.J.S.A.]      40:55-50        the    Legislature            created    a     method     for

resolving conflicts between different interests and policies --

the 'public' served by the utility on the one hand and the

limited group benefited by the zoning ordinance on the other."

In re Petitions of Pub. Serv. Elec. & Gas Co., 100 N.J. Super.

1, 12 (App. Div. 1968) (citing N.Y. Cent. R.R. v. Borough of

Ridgefield, 84 N.J. Super. 85, 93 (App. Div. 1964)).

      The trial judge relied upon the Supreme Court's decision in

PSE&G,    supra,    which       NJNG   argued       was       wholly    dispositive       and

demonstrated it was exempt from Red Bank's zoning regulations.

NJNG reiterates the argument before us, but we reject it.

      At issue in PSE&G, supra, was "the power of a municipality

to compel a public utility to carry its high-capacity electric

power    lines,    transmitting        current       for      other     than   local    use,

through the municipality by underground installation rather than

on   overhead     structures."          35    N.J.       at    361    (emphasis     added).

After    construction      of    an    overhead      tower       that    was   part     of   a

multi-municipality      distribution              line    had    begun    in    a   private




                                             25                                     A-1096-12T4
railroad        right-of-way,     the   Borough       of       Roselle     ("Roselle")

adopted     a    local   zoning    ordinance     compelling          the   utility    to

obtain a permit.           Id. at 361-62, 366.              Additionally, Roselle

petitioned the BPU to conduct an investigation of the project,

including alternatives to overhead installations.                      Id. at 363.

       The BPU held that the utility was exempt from the local

ordinance pursuant to N.J.S.A. 40:55-50.                       Id. at 373.         After

Roselle filed its appeal from that administrative determination,

it   passed      another   ordinance     that    specifically            required    all

electric power lines be installed underground.                       Id. at 363.     The

utility     challenged     the    ordinance     in    the      Law   Division,     which

granted summary judgment, concluding, as a matter of law, that

"the ordinance was invalid as beyond the police power delegated

to the municipality, because the Legislature had specifically

committed the subject matter to the exclusive jurisdiction of

the Board."       Id. at 364.

       The Court agreed, finding that Roselle had no authority to

pass   an    ordinance     "which     attempts       to   do    nothing     less    than

regulate the method of transmission of high voltage power."                          Id.

at 372 (emphasis added).            In addition, the Court held that the

zoning      authority      reserved     to    municipalities           under     former

N.J.S.A. 40:55-50 was confined to the "physical 'situation' of a

building or structure, like a telephone exchange building, truck




                                         26                                    A-1096-12T4
garage     or     water     tank,"        where       the    regulation       does     not

"substantially affect[] the method of operation and functioning

of the utility."        Id. at 375 (footnote omitted).

     The     case     before      us     is    distinguishable        from    PSE&G     in

critical respects.          First, NJNG has not challenged the validity

of   Red     Bank's       land     use      regulations.           Instead,      it    has

consistently       argued       that   it     is    exempt   from    any     regulation.

Second, unlike PSE&G, this case does not involve a challenge to

the method NJNG has chosen to transmit its gas, only to whether

NJNG must subject itself, in the first instance, to Red Bank's

development regulations.               Third, unlike in PSE&G, where Roselle

attempted to impose specific methods of electrical distribution

on a portion of a multi-jurisdictional project, the location of

NJNG's     regulators      do    not     affect      distribution     of   gas   to    any

municipality other than Red Bank.                      Lastly, in PSE&G, Roselle

attempted to impose a certain method of distribution even though

the utility was operating in a privately owned right-of-way;

here, NJNG has installed the regulators within the public right-

of-way.

     There is subsequent Supreme Court precedent that support's

defendants' position and, in our opinion, is more closely on

point.      In    JCP&L,     supra,      the       utility   was    convicted    in    two

different        municipal       courts        for     violating      ordinances        by




                                              27                                 A-1096-12T4
commencing construction of overhead transmission towers without

submitting applications so as to comply with certain land use

regulations that 1) provided electrical lines were prohibited

uses, and 2) required a site plan be submitted and a variance

obtained.     55 N.J. at 366-67.    The Court described the utility's

position.

            Defendant takes the position, purportedly
            based on this court's opinion in [PSE&G],
            that the attempt of the municipalities to
            apply   their    zoning   ordinances     to   bulk
            transmission lines merely passing through
            the local community to some other place
            constitutes    an   effort   to    regulate    the
            transmission of electrical energy,        a field
            committed to state regulation and beyond
            local legislative power.[]      It is said that
            local zoning authority to which N.J.S.A.
            40:55-50 is applicable can extend only to
            single buildings or structures having a
            particular local situs, such as a water
            tank, or a railroad freight yard. It
            therefore   contends    that    it   may    simply
            disregard     municipal     zoning     provisions
            affecting bulk transmission lines and make
            its own binding decision whether it must
            apply to the Board of Public Utility
            Commissioners     for   exemption     under    the
            statutory section.

            [Id. at 368 (internal citations omitted).]

The municipalities argued that N.J.S.A. 40:55-50 indicated "a

legislative    intention   that    some   local   power   through    zoning

regulation exists as to any utility installation, but with the

final 'say-so' resting in the state agency, subject to judicial




                                    28                              A-1096-12T4
review."      Ibid.     The   Court    generally   agreed      with    the

municipalities, stating,

           We have no doubt that the legislative scheme
           puts the initiative upon the utility to
           petition the Board for relief under N.J.S.A.
           40:55-50     whenever    a    municipal    zoning
           provision affects any proposed installation
           or it is claimed that it does, unless the
           requirement is a purely ministerial one, as,
           for example, where a building permit would
           issue as of course without submission and
           approval    of   structural    or   site   plans.
           Otherwise the utility may be prosecuted for
           violation     of  the    ordinance.    The   very
           language of the section . . . evidences the
           clear intent that the decision should not be
           the     utility's     whether     local    zoning
           provisions should apply at all or to what
           extent, be the proposed facility one which
           has   a    fixed   local   situs    or   a   bulk
           transmission line merely passing through the
           municipality. The statutory provision for
           notice to the municipality and a hearing
           further shows that local interests are to be
           considered and weighed with the broader
           public interest in the light of the Board's
           expertise.

                Nothing we said in [PSE&G] was intended
           to suggest otherwise. We meant no more than
           to suggest, in discussing a hypothetical
           zoning ordinance provision which went "to
           the extent of amounting to attempted local
           regulation   substantially   affecting   the
           method of operation and functioning of the
           utility," such as a prohibition against any
           overhead electric wires in the municipality,
           that such a provision might go so far beyond
           the pale of the local zoning power as to
           permit the [BPU] to completely nullify it
           for that reason in a proceeding brought by
           the utility under N.J.S.A. 40:55-50.   There
           was not the slightest thought intended that




                                  29                             A-1096-12T4
             the utility could make that decision on its
             own and act ex parte accordingly.

             [Id. at 369-70 (emphasis added) (footnotes
             omitted).]

The     Court    affirmed    JCP&L's    convictions     for    violating       the

municipal ordinances.        Id. at 371.

      As already noted, the MLUL's successor statute, N.J.S.A.

40:55D-19,      implicitly      recognizes   a   municipality's      ability    to

exercise its zoning powers while at the same time according the

utility a special avenue for review before the BPU.                         It is

evident that the Legislature's enactment of N.J.S.A. 40:55D-19

actually increased control over a public utility's use of land

within a municipality's borders.             As one noted commentator has

said:

             It is evident that, as to structures and
             uses affecting a single municipality, the
             public utility must now apply to the local
             zoning board of adjustment if a variance is
             required   or   other   relief   within   its
             jurisdiction, or to the planning board if
             relief is within its jurisdiction, such as a
             conditional use permit, is required. Appeal
             therefrom lies to the [BPU] or to the
             governing body or courts. . . .     Thus, the
             1975   act  created   new   powers   for  the
             municipalities in dealing with a public
             utility . . . .

             [Cox & Koenig, N.J. Zoning and             Land       Use
             Administration, § 21-7.2 (2014).]

      NJNG      seizes   upon    the   Court's    language    in    JCP&L    that

development regulations do not apply if the utility's "proposed



                                        30                               A-1096-12T4
installation"      requires       municipal        action     that       is   "purely

ministerial."         JCP&L,    supra,   55   N.J.    at    369.        The   intended

installation in this case, however, involved more than what was

routinely regulated by a permit to open a street or sidewalk.

As   already     noted   above,    NJNG's     installation         of   above-ground

regulators through public sidewalks went well beyond the power

granted by the 1969 franchise resolution because the sidewalks

would, in fact, never be returned to their prior condition and

stanchions holding utility regulators would now be protruding

through the sidewalk and for some fifteen inches from the front

of buildings.

      We hasten to add that we express no position on how Red

Bank's development regulations should be construed, and whether

NJNG, therefore, is required to submit a development permit.

The MLUL provides that "any interested party affected by any

decision of an administrative officer of the municipality based

on   or   made   in    the     enforcement    of    the     zoning      ordinance    or

official map" to appeal to the board of adjustment.                           N.J.S.A.

40:55D-72(a) (emphasis added).           In our view, having received Red

Bank's counsel's letter denying construction permits because it

failed to apply for a development permit, NJNG was in position

to appeal that initial decision to the board of adjustment, and

thereafter to the court or the BPU.            See N.J.S.A. 40:55D-19.




                                         31                                   A-1096-12T4
    Those proceedings could have properly placed before the Law

Division   the   nature,   scope   and    reasonableness    of    Red    Bank's

development regulations.        Since the trial judge agreed that NJNG

was not subject to any regulation, other than those that applied

to the opening of a street or sidewalk, no record has been

created before the municipal agency or in the Law Division.                    We

believe it would be imprudent for us to construe in the first

instance   Red   Bank's    development     regulations     in    relation       to

NJNG's plan to relocate it gas regulators.

    For the reasons stated, we reverse the grant of summary

judgment   to    NJNG     and   grant     defendants'    summary    judgment

dismissing the complaint.




                                     32                                 A-1096-12T4