NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court."
Although it is posted on the internet, this opinion is binding only on the
parties in the case and its use in other cases is limited. R.1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-2382-15T4
IN THE MATTER OF LANDIS
SEWERAGE AUTHORITY NJPDES
PERMIT NO. NJ0025364-46537
__________________________
Submitted August 22, 2017 – Decided September 21, 2017
Before Judges Manahan and Gilson.
On appeal from the New Jersey Department of
Environmental Protection, Division of Water
Quality, NJPDES Permit No. NJ0025364.
Gruccio, Pepper, DeSanto & Ruth, PA, attorneys
for appellant (A. Steven Fabietti, on the
briefs).
Christopher S. Porrino, Attorney General,
attorney for respondent (Melissa H. Raksa,
Assistant Attorney General, of counsel;
Nicolas G. Seminoff, Deputy Attorney General,
on the brief).
PER CURIAM
Landis Sewerage Authority (Landis) appeals from a January 19,
2016 denial of its requests for administrative hearings concerning
fees assessed by the New Jersey Department of Environmental
Protection (DEP). The fees related to the 2014 and 2015
assessments imposed under the New Jersey Pollution Discharge
Elimination System (NJPDES) for Landis' operation of its
wastewater treatment plant. Having considered the contentions of
the parties in light of the record and law, we affirm.
I.
The DEP regulates the discharge of pollutants to the surface
and ground waters of New Jersey under the Water Pollution Control
Act (the Act), N.J.S.A. 58:10A-1 to -43. Any entity or person who
discharges wastewater in New Jersey is required to obtain an NJPDES
discharge permit from the DEP. N.J.A.C. 7:14A-2.4(a).
Landis operates a wastewater treatment plant located in
Vineland, New Jersey. As part of its operations, Landis discharges
effluent to ground water through 130 acres of spray irrigation
fields and 125 acres of infiltration lagoons. In 2014, Landis'
facilities were capable of discharging 8.2 million gallons per
day. Accordingly, Landis is required to obtain and maintain an
NJPDES permit.
The Act authorizes the DEP to "establish and charge reasonable
annual administrative fees, which fees shall be based upon, and
shall not exceed, the estimated cost of processing, monitoring and
administering the NJPDES permits." N.J.S.A. 58:10A-9. The DEP
has promulgated regulations governing how it calculates NJPDES
permit fees. N.J.A.C. 7:14A-3.1. At the beginning of each fiscal
year, the DEP receives an appropriation from the Legislature in
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an amount estimated for running the NJPDES program. At the end
of the fiscal year, the DEP publishes an annual fee report and
assessment of fees representing the total cost for the year's
program activities and apportioning those costs among those who
discharge wastewater according to the fee calculation rules.
The 2014 and 2015 annual fees were published in the New Jersey
Register on March 17, 2014, and March 16, 2015, respectively.
Those reports contained lists of the proposed NJPDES permit fees,
including the fees for Landis. In each year, there was a one-
month comment period following the publication of the fee report.
In both years, Landis submitted written comments in opposition to
the fees and spoke at the public hearings held by the DEP on April
16, 2014, and April 15, 2015.
On June 19, 2014, the DEP sent Landis an invoice for its
fiscal year 2014 fee of $104,667.11, of which $93,267.11 consisted
the fee for discharge to ground water. On July 21, 2014, Landis
requested a recalculation of the portion of the discharge to ground
water fee, but paid $31,128.38, which constituted the uncontested
portion of the fee. On September 2, 2014, the DEP rejected Landis'
recalculation request. Thereafter, on September 26, 2014, Landis
requested a hearing and a stay of its obligation to pay the
disputed amount of the fee.
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On May 7, 2015, the DEP sent Landis an invoice for its fiscal
year 2015 NJPDES permit of $85,319.72, of which $73,919.72
consisted of the fee for discharge to ground water. On May 29,
2015, Landis requested a recalculation of the portion of the fee
for discharge to ground water, but paid $56,400, which represented
the uncontested portion of the fee. On July 28, 2015, the DEP
again rejected Landis' recalculation request. On August 18, 2015,
Landis requested a hearing and a stay of its obligation to pay the
contested amount of the fee. The DEP agreed to suspend the
invoices for the contested fee subject to its evaluation of the
request for a hearing.
On January 29, 2016, the DEP denied Landis' 2014 and 2015
administrative hearing requests. In its denial letter, the DEP
explained that it had reviewed Landis' 2014 and 2015 comments and
testimony in opposition to the fees. The DEP then explained that
it had responded to Landis' comments and objections in April 2014,
and April 2015. The DEP therefore reasoned that it had correctly
applied the rules and fee reports in determining Landis' permit
fees in 2014 and 2015. Accordingly, the DEP denied Landis' request
for an administrative hearing reasoning that Landis was
essentially challenging duly promulgated regulations and not the
DEP's application of the regulations. The DEP cited N.J.A.C.
7:14A-17.4(b)(5) for that position.
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Landis now appeals from the January 19, 2016 denial of its
requests for administrative hearings.
II.
On this appeal, Landis makes two principal arguments. First,
it contends that the DEP misapplied the governing regulations in
calculating the NJPDES permit fees for 2014 and 2015. In making
that argument, Landis contends that (a) the DEP failed to
recalculate the minimum fee since 2007; (b) the DEP failed to use
information reported by Landis in calculating Landis' fees; (c)
the DEP used inaccurate overhead factors in 2014; and (d) the DEP
included uncollected permit fees from prior years in calculating
the fees for 2014 and 2015. Landis also contends that because its
permit fee increased by over 500% in 2014, it is entitled to an
administrative hearing to explore that increase. Second, Landis
argues that the DEP failed to provide specific answers to questions
raised by Landis and that failure constitutes a violation of
procedural due process.
After evaluating Landis' arguments in light of the law, the
record, and our scope of review, we reject them for two reasons.
Landis is seeking to challenge the 2014 and 2015 NJPDES permit
fees. Those fees were adopted as rules, but Landis failed to
properly appeal those rules. Second, the objections Landis raise
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do not present material facts requiring adjudication at an
administrative hearing.
A. The 2014 and 2015 NJPDES Permit Fees
"The New Jersey Administrative Procedure Act (APA), N.J.S.A.
52:14B-1 to -24, 'prescribes the procedure to be followed in the
event an administrative hearing is otherwise required by statutory
law or constitutional mandate.'" In re NJPDES Permit No.
NJ0025241, 185 N.J. 474, 481 (2006) (quoting In re Application of
Modern Indus. Waste Serv., Inc., 153 N.J. Super. 232, 237 (App.
Div. 1977)). Although the APA establishes the process for an
administrative hearing, "the right to an administrative hearing
generally must be found outside the APA in another statute or
constitutional provision[.]" In re Fanelli, 174 N.J. 165, 172
(2002) (alteration in original) (quoting Christ Hosp. v. Dep't of
Health and Senior Servs., 330 N.J. Super. 55, 61 (App. Div. 2000)).
Under N.J.S.A. 58:10A-7, "[a] determination to grant, deny,
modify, suspend, or revoke a permit shall constitute a contested
case . . . [and] [t]he permittee . . . shall have the opportunity
to contest the determination in an administrative hearing." In
all other cases, however, "the [DEP], in its discretion, shall
decide the extent to which, if at all, the request for an
adjudicatory hearing shall be granted." N.J.A.C. 7:14A-17.4. The
regulation identifies six enumerated reasons for the DEP to deny
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a request for an adjudicatory hearing. Among those reasons is
that if "[t]he request challenges duly promulgated regulations and
not the [DEP's] application of the regulations," then the DEP
"shall deny [the] request for an adjudicatory hearing." N.J.A.C.
7:14A-17.4(b)(5).
Here, the DEP properly applied its regulation in denying
Landis’ request for an administrative hearing. The regulation
gives the DEP the power to decide whether to provide an
administrative hearing for matters other than a determination to
grant, deny, modify, suspend, or revoke a permit. See N.J.S.A.
58:10A-7. Further, a proceeding involving the amount of permit
fees is not adjudicative or quasi-judicial. Instead, it is
legislative in nature and thus, in the absence of statutory or
regulation requirements, an adjudicative hearing need not be held.
See N.J. Builders Assoc. v. Sheeran, 168 N.J. Super. 237, 248
(App. Div.), certif. denied, 81 N.J. 293 (1979); see also N.J.A.C.
7:14A-3.1(b)(3) ("Upon publication of [the] Notice of Adoption in
the New Jersey Register, any adopted new or revised minimum fee(s)
identified in the Notice of Adoption shall be incorporated into
Table III as an administrative change.").
DEP provided notice and gave interested parties, such as
Landis, an opportunity to voice their concerns prior to the
adoption of the permit fees in 2014 and 2015. Moreover, Landis
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actively participated in those meetings and submitted written
objections to the fees. The DEP then considered Landis' arguments
and submissions, but rejected the objections and adopted the fees.
At that point, Landis had forty-five days to object to the adoption
of the new permit fees, but it did not do so. See R. 2:4-1(b).
As such, the DEP properly exercised its discretion in denying
Landis' request for an administrative hearing.
B. The Lack of Material Factual Disputes
"[A] presumption of reasonableness attaches to the action of
an administrative agency, and the one who challenges the validity
of that action has the burden of showing that it was arbitrary,
unreasonable or capricious." Sheeran, supra, 168 N.J. Super. at
250. Administrative hearings "are appropriate when there exist
adjudicative facts in dispute." NJPDES Permit No. NJ0025241,
supra, 185 N.J. at 486. "[B]ecause a trial is a process for taking
evidence, subject to cross-examination, and because taking
evidence is not appropriate except on disputed facts, trial
procedure is not required on issues of law, policy or discretion."
Ibid. (quoting High Horizons Dev. Co. v. Dep't of Transp., 120
N.J. 40, 50 (1990)). Here, Landis failed to carry its burden
of showing that there are material facts in dispute.
Landis advances five arguments before us. First, it argues
that the DEP had failed to raise the minimum NJPDES permit fee
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since 2007, as required by N.J.A.C. 7:14A-3.1(a)(9). N.J.A.C.
7:14A-3.1(a)(9) sets forth a formula that the DEP must use in
calculating the annual fee for all discharges. The regulation,
however, is silent with respect to whether such calculation must
be computed annually. Landis is not challenging the accuracy of
the DEP's calculation in 2014 and 2015, instead it is objecting
to the application of a specific regulation. We discern no abuse
of DEP's discretion in interpreting the regulation, and there are
no adjudicative facts in dispute requiring a hearing.
Second, Landis claims that the DEP failed to utilize its
self-reported information in calculating the fee. In making that
argument, Landis relies on N.J.A.C. 7:14A-3.1(a)(7), which states:
[T]he [DEP], in calculating Environmental
Impact, shall use information reported by the
permittee on MRFs for the [twelve-month]
period for which data is available on the
[DEP’s] computer. . . . Where this information
is not available, the [DEP] shall use permit
limitations, information submitted in permit
applications, technical reports prepared by
the [DEP].
N.J.A.C. 7:14A-3.1(a)(7) applies to "the general conditions
and applicability of the fee schedule for NJPDES permittees and
applicants.” Here, Landis is not challenging the general
conditions, but instead the fee for discharges to ground water.
The calculation for annual fee for ground water is set forth in
N.J.A.C. 7:14A-3.1(d). Landis is not disputing that any of the
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values used in calculating the fees are wrong. As such, there are
no material facts in dispute with respect to the fees for ground
water discharges.
Next, Landis contends that the DEP used an incorrect overhead
factor in 2014, which included an allegedly inaccurate fringe
benefit cost. Specifically, Landis argues that the 2014 fringe
benefit cost failed to reflect a change in the New Jersey state
budget. Fringe benefit cost impacts the cost per hour in
calculating minimum fees. N.J.A.C. 7:14A-3.1(a)(9)(iii). As we
have stated previously, the DEP is not required to calculate the
minimum fee on an annual basis. As such, there was no need for
an administrative hearing on this issue.
Landis then argues that the DEP incorrectly used uncollected
permit fees in 2014 and 2015 in its fee calculations. The 2014
and 2015 annual reports provided a clear breakdown of all factors
used in calculating the permit fees, and uncollected fees were not
part of that breakdown. Landis failed to specify how and where
those uncollected fees were used in calculating the 2014 and 2015
fees. As such, we conclude that Landis failed to present
sufficient evidence to support its allegation that there are
material facts in dispute as to whether the DEP used uncollected
fees in its fee calculations.
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Lastly, Landis claims that an adjudicative hearing is
necessary because its permit fee increased by over 500% in 2014,
and it has no other recourse to contest the drastic increase in
permit fee. We have explained that Landis had forty-five days
after the publication of the annual fee report to challenge the
adoption of the fee and the data used to calculate that fee.
Further, in both 2014 and 2015, Landis requested a recalculation
of its permit fee. Landis took advantage of all available
opportunities and exhausted all of its remedies within the
administrative process. As such, we reject Landis' argument that
an adjudicative hearing is its only recourse to voice its concern.
Affirmed.
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