IN THE MATTER OF THE DENIAL OF HEARING REQUEST, ETC. (NEW JERSEY DEPARTMENT OF ENVIRONMENTAL PROTECTION) ( 2021 )

NOT FOR PUBLICATION WITHOUT THE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-2341-19
IN THE MATTER OF THE
DENIAL OF HEARING
REQUEST OF THE APPEAL
OF NEW JERSEY POLLUTANT
DISCHARGE SYSTEM
ANNUAL FEE INVOICE
____________________________
Argued August 17, 2021 – Decided September 8, 2021
Before Judges Gilson and Gummer.
On appeal from the New Jersey Department of
Environmental Protection, Docket No. NJ0028436.
George J. Tyler argued the cause for appellant Raritan
Township Municipal Utilities Authority (Law Offices
of George J. Tyler, PC, attorneys; George J. Tyler, of
counsel and on the briefs; James Aversano, III, and
Margaret B. Carmeli, on the briefs).
Patrick S. Woolford, Deputy Attorney General, argued
the cause for respondent New Jersey Department of
Environmental Protection (Andrew J. Bruck, Acting
Attorney General, attorney; Melissa H. Raksa,
Assistant Attorney General, of counsel; Patrick S.
Woolford, on the brief).
PER CURIAM
Raritan Township Municipal Utilities Authority (RT Authority) appeals
from a decision by the New Jersey Department of Environmental Protection
(DEP) that denied its request for an adjudicatory hearing to contest a fee. The
RT Authority separately appealed the DEP's denial of its request to recalculate
that fee. We affirm because we have already held that the DEP correctly
determined the contested fee. Accordingly, the request for an adjudicatory
hearing is moot. Moreover, even if we were to consider the merits, DEP
properly denied the request for a hearing.
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. Entities that discharge wastewater are required to have a New
Jersey Pollutant Discharge Elimination System (NJPDES) permit. N.J.A.C.
7:14A-2.1(d); N.J.A.C. 7:14A-2.4(a) and (b).
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. For publicly owned facilities that discharge to
surface water, the NJPDES fee is based, in part, on whether the facility is
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permitted as a "major" or "minor" facility. N.J.A.C. 7:14A-3.1 tbl. III. A major
municipal facility is defined as a facility that is designed to handle one million
gallons or more of wastewater per day. N.J.A.C. 7:14A-1.2. A minor facility is
a facility that is not classified as a major facility. Ibid.
The RT Authority, which is a public entity, operates two wastewater
treatment plants: its Main Plant and the Flemington Wet Weather Facility (WW
Facility). The Main Plant handles most of the wastewater from the RT
Authority's service area. The WW Facility operates during heavy wet weather,
when more than 1.35 million gallons per day of wastewater is anticipated to flow
to the Main Plant. When such weather occurs, the RT Authority diverts the
excess flow to the WW Facility. Consequently, the WW Facility discharges
wastewater only on certain days, which averages out to about one day per month.
In 2009, DEP issued the most recent NJPDES permit for the WW Facility,
which became final in 2010. The permit designated the WW Facility as a
"major" facility because it has the capacity to handle 3.85 million gallons of
wastewater per day. The RT Authority has appealed the final NJPDES permit,
and that appeal is pending in the Office of Administrative Law. The designation
of the WW Facility as a major facility, however, is not being challenged in that
administrative appeal. Moreover, the RT Authority is not challenging the permit
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for the WW Facility in this appeal. Instead, this appeal concerns the annual fee
for the WW Facility.
For at least fifteen years before 2019, the WW Facility was charged annual
NJPDES fees as if it were a minor facility. For fiscal year (FY) 2019, however,
the DEP calculated the fee for the WW Facility based on its designation as a
major facility. Consequently, the proposed fee increased by more than 125%
and went from a fee of just over $5,500 for FY 2018 to a fee of just over $12,400
for FY 2019.
The proposed FY 2019 NJPDES fee and assessment were included in
DEP's annual fee report, issued in April 2019. That fee report was posted on
DEP's website, and notices of the report were mailed to the RT Authority and
other permit holders. The report was then opened to public comment, and DEP
held a public hearing on the report on May 1, 2019. 51 N.J.R. 1073(a) (June 17,
2019). The RT Authority did not submit any objections to or comments on the
FY 2019 annual fee report.
On May 10, 2019, DEP sent the RT Authority an invoice for $12,476.78
for the FY 2019 NJPDES fee for the WW Facility. Three weeks later, on June
4, 2019, the RT Authority requested a recalculation of the fee, pointing out that
the WW Facility does not run continuously and runs only during severe wet
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weather. The RT Authority also requested an explanation of the fee, noting that
the FY 2019 fee had gone up by almost $7,000.
On June 17, 2019, DEP published its final FY 2019 annual fee report and
assessment of fees. Ibid. Two weeks later, on July 1, 2019, DEP sent the RT
Authority a letter denying its request for a recalculation of the FY 2019 fee.
DEP acknowledged that it had previously calculated the fee for the WW Facility
as if it were a minor facility. DEP went on to explain that it was correcting that
mistake by calculating the FY 2019 fee based on the WW Facility being a major
facility.
The RT Authority filed a separate appeal from the DEP's denial of its
request to recalculate the FY 2019 fee for the WW Facility. The RT Authority
also requested an adjudicatory hearing to challenge the denial of the
recalculation. In December 2019, DEP denied the request for a hearing, and the
RT Authority filed this appeal from that decision. We denied a request to
consolidate those two appeals.
In December 2020, we issued an opinion affirming DEP's denial of the RT
Authority's request to recalculate the 2019 fee for the WW Facility. In re
Contesting of Invoice for FY 2019 Flemington Wet Weather Facility, No. A-
5201-18 (App. Div. Dec. 21, 2020) (slip op. at 11-12) (the Fee Appeal Decision).
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We now address RT Authority's appeal from the December 24, 2019 decision
by DEP denying its request for an adjudicatory hearing.
II.
On this appeal, the RT Authority argues that its request to recalculate the
FY 2019 fee was a contested case and, therefore, it was entitled to an
adjudicatory hearing in the Office of Administrative Law. We reject that
argument for two reasons. First, because we have already determined that DEP
correctly calculated the FY 2019 fee, the request for an adjudicatory hearing is
moot. Second, DEP acted within its authority and discretion in denying the
request for an adjudicatory hearing.
A.
In our Fee Appeal Decision, we reviewed and analyzed the various
arguments the RT Authority presented in challenging the fee calculation. In so
doing, we were aware of the RT Authority's separate appeal seeking an
adjudicatory hearing. Nevertheless, we determined that there were no material
issues of disputed facts requiring a hearing. Accordingly, we determined the
merits of the fee appeal. Having done so, the request for an adjudicatory hearing
is moot. An Administrative Law Judge could not make findings that would
overturn our Fee Appeal Decision. In re N.J. Dep't of Env't Prot. Conditional
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Highlands Applicability Determination, 433 N.J. Super. 223, 234 (App. Div.
2013) (quoting Greenfield v. N.J. Dep't of Corr., 382 N.J. Super. 254, 257-58
(App. Div. 2006)) (explaining "[a]n issue is 'moot' when the decision sought in
a matter, when rendered, can have no practical effect on the existing
controversy").
B.
"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 Mod.
Indus. Waste Serv., Inc., 153 N.J. Super. 232, 237 (App. Div. 1977)). Although
the APA establishes the process for an administrative hearing, "[t]he 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)
(second alteration in original) (quoting Christ Hosp. v. Dep't of Health & Senior
Servs., 330 N.J. Super. 55, 61 (App. Div. 2000)).
The RT Authority has no constitutional right to an administrative hearing.
See In re Freshwater Wetlands Statewide Gen. Permits, 185 N.J. 452, 471
(2006). The United States Supreme Court has identified three factors to consider
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in analyzing the constitutionality of administrative procedures affecting
property interests:
First, the private interest that will be affected by the
official action; second, the risk of an erroneous
deprivation of such interest through the procedures
used, and the probable value, if any, of additional or
substitute procedural safeguards; and finally, the
Government's interest, including the function involved
and the fiscal and administrative burdens that the
additional or substitute procedural requirement would
entail.
[Mathews v. Eldridge, 424 U.S. 319, 335 (1976);
accord In re Freshwater Wetlands, 185 N.J. at 467.]
Application of these factors establishes that RT Authority is not entitled
to a hearing to dispute the fee for FY 2019. The interest is the amount of the
fee. There is no showing that the amount is incorrect; rather it is based on the
WW Facility being a major facility, and no additional procedural safeguards are
needed to confirm the undisputed fact that the WW Facility is a major facility.
Finally, considering the governmental interests and the process involved, there
is no need to require the DEP to provide more procedures to the RT Authority.
The RT Authority also has no statutory right to an administrative hearing.
Under N.J.S.A. 58:10A-7(d), "[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
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administrative hearing." By contrast, the Act does not identify a dispute over
the amount of a fee as a matter requiring an administrative hearing. See N.J.S.A.
58:10A-9 (authorizing NJPDES permit fees, but not providing a right to an
administrative hearing to contest fee amount).
In matters where neither a statute nor a constitutional provision requires a
hearing, 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 enumerates six reasons for the DEP to deny a request for an
adjudicatory hearing. N.J.A.C. 7:14A-17.4(b). Among those reasons is that
"[t]he request does not include genuine issues of material fact or of law which
are relevant to the [DEP's] decision." N.J.A.C. 7:14A-17.4(b)(2).
The RT Authority has not identified any genuine issues of disputed
material facts. Instead, the RT Authority contends that a hearing is necessary to
evaluate whether (1) the DEP's decision was arbitrary, capricious, or
unreasonable; (2) the doctrine of equitable estoppel applied; and (3) the DEP
engaged in de facto rulemaking. We considered and rejected all these arguments
in our Fee Appeal Decision. See slip op. at 9-12.
The controlling issue on this appeal, as well as on the related fee appeal,
is whether the DEP acted arbitrarily, capriciously, or unreasonably in correcting
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a mistake and assessing the FY 2019 fee based on the WW Facility being a major
facility. That issue does not involve any genuine disputes of material facts. The
DEP candidly explained that it had made a mistake. The RT Authority argues
that a hearing could explore "the billing history," the DEP's "history of applying
its rules to [the WW Facility], and whether there were any changes to the [WW
Facility], DEP's rules, or the NJPDES permit." The record establishes that there
are no relevant material factual disputes concerning those issues. The billing
history is undisputed: the DEP mistakenly billed the WW Facility as a minor
facility and then corrected that mistake for FY 2019. There is also no dispute
concerning the DEP's history of applying the rules to the WW Facility. The
WW Facility has always been permitted as a major facility. The mistake was
not in the permit; rather, it was in the annual fee, which had been assessed
erroneously as if the WW Facility was a minor facility. Finally, there is no claim
that the facility changed or that the rules changed. As already noted, the RT
Authority is not claiming that the WW Facility is a minor facility. Accordingly,
it is undisputed that the WW Facility is a major facility.
The RT Authority also argues that it is entitled to a hearing as a matter of
fundamental fairness and administrative due process. We disagree. When the
DEP notified the RT Authority of the FY 2019 fee, the RT Authority requested
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the DEP to recalculate the fee in accordance with N.J.A.C. 7:14A-3.1(a)(6). The
DEP reviewed that request but denied it. In doing so, the DEP explained why it
had changed the fee for the WW Facility. The RT Authority then appealed, but
we affirmed. Accordingly, the RT Authority was accorded the administrative
and appellate process to which it was due. It has no further right to an
adjudicatory hearing.
Affirmed.
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