Mercer and Atlantic Counties Resource Recovery Facility

Plain-English summary

Three New Jersey groups challenged an extension and modification of a PSD permit for a proposed resource recovery facility. The project’s public financing and construction plans changed, the original permittee said it would no longer build the facility, and a possible transfer to another operator remained uncertain. The EAB found substantial doubt about whether the facility would ever be built under the permit then on appeal. It remanded the matter to the New Jersey Department of Environmental Protection to determine whether the permit extension was still justified, and denied requests for discovery and another stay. The Board did not decide the merits of the permit challenge.

Decision snapshot

• Cited authorities: 40 C.F.R. § 52.21(r)(2), 40 C.F.R. § 124.19, 40 C.F.R. § 124.19(a), and 40 C.F.R. § 124.20(d).
• Outcome: The appeal was remanded to NJDEP for a determination about the permit extension.
• Key point: When a permitted project may no longer be built, the permitting agency must reassess whether an extension remains justified before the EAB reaches the permit challenge.

Full text (EPA EAB public release)

        BEFORE THE ENVIRONMENTAL APPEALS BOARD
     UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
                   WASHINGTON, D.C.



                           )

In re: )
)
Mercer and Atlantic Counties ) PSD Appeal No. 96-7
Resource Recovery Facility )
)

                      REMAND ORDER

By petition dated September 28, 1996, the New Jersey

Environmental Federation, the New Jersey Chapter of the Sierra

Club, and the Mercer Citizens for Public Accountability

(hereafter "petitioners") seek review of an extension and

modification of a Prevention of Significant Deterioration permit

issued by the New Jersey Department of Environmental Protection

("NJDEP") on August 29, 1996, for construction of the Mercer and

Atlantic Counties Resource Recovery Facility. The original

permit was issued on June 22, 1994, and was extended at the

permittees’ request.

The Board has stayed proceedings in this matter since

November 22, 1996, to allow the parties to ascertain the status

of the proposed facility following a November 7, 1996 vote by the

Mercer County Board of Chosen Freeholders ("MCBCF"). In their

original request for a stay dated November 15, 1996, petitioners

informed the Board that the MCBCF voted to reject a proposed

amendment to the Mercer County Solid Waste Plan, "which amendment
 2

provided for the financing, construction and operation of the

[facility]." Motion For Stay of Proceedings by the Petitioners,

New Jersey Environmental Federation, The New Jersey Chapter of

the Sierra Club, and the Mercer Citizens for Public

Accountability ("Motion for Stay") at 1 (Nov. 15, 1996). With

regard to this vote, petitioners stated:

  The clear purpose of the Freeholders’ vote was to
  terminate the Facility. However, to the best of
  petitioners’ knowledge, the vote has not yet been
  memorialized in a written decision, order or other
  document for submission to the Environmental Appeals
  Board * * *. Notwithstanding the lack of such
  memorialization, it was the express understanding and
  explicit purpose of the Freeholders and the [Mercer
  County Improvement Authority ("MCIA"), a co-permittee
  of the proposed facility,] that the November 7 vote of
  the Freeholders would determine the fate of the
  Facility. (For example, all newspapers and other mass
  media reported the vote and its declared effect as the
  termination of the Facility. * * *) Inasmuch as the
  Freeholders voted to reject the amendment which
  contained the Facility * * *, it seems beyond serious
  doubt that the Freeholders intended to and did
  terminate the facility.

       Accordingly, it appears to a virtual certainty
  that the PSD permit, as issued, and the petitioners’
  appeal of same, have been or shortly will be rendered
  moot for lack of a project either to build or dispute
  and, therefore, the matter should be dismissed.

Id.

  In responding to the stay request, MCIA stated that:

  MCIA has no objection to a continuance of this matter
  pending a clear indication from the [MCBCF] as to
  whether the County will participate in the construction
  and operation of the subject resource recovery
  facility. Once the MCIA receives a clear directive
  from the Freeholder Board regarding the facility, the
  MCIA and its co-permittee, Ogden Martin Systems of
  Mercer, Inc., will be in a position to decide whether

3

 any party will pursue activities authorized by the
 subject PSD permit.

Letter from Michael G. Luchkiw, counsel for MCIA, to Eurika

Stubbs, Clerk of the Board (Nov. 21, 1996).1 By order dated

November 22, 1996, the Board stayed the proceedings in this

matter until February 21, 1997.

 By letter dated February 20, 1997, MCIA requested that the

stay be extended for an additional 30 days "to allow the parties

to ascertain the status of the facility." Petitioners and NJDEP

consented to the request. On February 20, 1997, the Board

granted MCIA’s request and extended the stay until March 24,

1997. On March 21, 1997, petitioners requested that the stay be

extended for another 30 days. According to petitioners, the

additional stay was necessary in order to allow the MCBCF to

consider a resolution to terminate any further activity on the

proposed facility. By letter dated March 24, 1997, MCIA opposed

the request, stating as follows:

 MCIA does not concur with any further stay in this
 matter and respectfully requests that the Board render
 a decision based on the information that is currently
 before it. The MCIA will not be making any further
 submittal.


 1
  MCIA also stated that it objected "to the Petitioners’

characterization of these proceedings and the PSD Permit itself
as moot and maintains that the subject PSD Permit is presently in
full force and effect due to petitioners’ failure to timely file
its Request For Administrative Review." Letter from Michael G.
Luchkiw, counsel for MCIA, to Eurika Stubbs, Clerk of the Board
(Nov. 21, 1996). MCIA did not provide any information relating
to the potential effect of the MCBCF vote.
 4

Letter from Michael G. Luchkiw, counsel for MCIA, to Eurika

Stubbs, Clerk of the Board (March 24, 1997). MCIA made no

reference to the actions of the MCBCF, nor did it provide the

Board with any useful information regarding the current status of

the facility. Notwithstanding MCIA’s objection, the Board once

more extended the stay until April 25, 1997, and, as with

previous orders, directed the parties to promptly inform the

Board of any changes in circumstances that would affect the

Board’s consideration of this matter. Neither party, however,

provided the Board with any further information on the status of

the facility.

 By order dated May 2, 1997, the Board ordered MCIA to

provide by May 16, 1997, a "detailed and complete statement

assessing the current status of the proposed facility and whether

or not the facility will be constructed." Order to Show Cause at

4. In addition, the order required petitioners to show cause by

May 23, 1997 "why the appeal should not be dismissed as moot or

proceed forthwith." Id. at 5. MCIA and NJDEP were given until

May 30, 1997, to file a response. Id. The Board took this

action because it appeared from the parties’ representations that

the facility may not be built, thereby making it unnecessary for

the Board to resolve the issues raised in the notice of appeal.

All submissions required by the May 2 order have now been

received.
 5

In its submission dated May 15, 1997, MCIA concedes that the

MCBCF action effectively "prohibits the MCIA from being involved

with the construction activities associated with the" proposed

facility. Letter from Michael G. Luchkiw, counsel for MCIA, to

Kathie A. Stein, Environmental Appeals Judge at 2. Nevertheless,

MCIA contends that the Board should proceed with this matter

because MCBCF’s action "does not prohibit another party from

constructing a resource recovery facility." Id. MCIA states

that although it will not be constructing the facility, MCIA "is

not precluded from transferring its permits, including the PSD

permit, to another party that would assume obligations imposed

under the permits and go forward with the construction and

operation of a resource recovery facility * * *." Id. To this

end, MCIA states that it has been negotiating with various

entities interested in constructing the facility.

In petitioners’ response to the Board’s May 2, 1997 Order to

Show Cause, they argue that MCIA "has not provided the Board with

adequate or useful information from which the Board can determine

whether this is a ‘real’ project or merely a speculative or

hypothetical one." Letter from R. William Potter, counsel for

petitioners, to Kathie A. Stein, Environmental Appeals Judge at

4-5 (May 23, 1997). Petitioners argue that the Board should

order discovery on this issue and, if necessary, schedule an

evidentiary hearing. Petitioners also request that the Board
 6

continue the stay in this matter "until these fundamental

questions are suitably resolved." Id. at 5.

On May 30, 1997, NJDEP filed a response to MCIA’s

submission. The response states, in part:

[The permit] is transferrable to another operator upon
administrative amendment of the PSD Permit requiring
Federal Register notice. To date, there has been no
request for such a transfer. Any changes to the
facility or its operation, however, would likely
require a permit modification necessitating
corresponding review and approval of the [NJDEP].

     Notwithstanding the above, the [NJDEP] notes that
the [MCBCF] has determined not to amend its Solid Waste
Management Plan to provide for a voluntary system for
delivery of solid waste -- "economic wasteflow" -- to
the [facility]. With judicial action prohibiting
"mandatory wasteflow," such an amendment would be
necessary before resource recovery facility
construction.

Letter from Howard Geduldig, Deputy Attorney General of New

Jersey, to Kathie A. Stein, Environmental Appeals Judge at 2

(May 30, 1997).

It is clear from the above-quoted submissions that MCIA will

no longer be constructing the facility. Although MCIA states

that it seeks to transfer the permit to a private entity, it is

unclear when and if such a transfer will ever take place.

Moreover, as the above-quoted portion of NJDEP’s May 30, 1997

submission indicates, even if MCIA can find an interested party,

that party must be approved by the NJDEP before the permit can be

transferred. Such approval is by no means guaranteed.

Furthermore, NJDEP has indicated that further amendment of the
 7

permit would likely take place should the permit be transferred

to another party. Thus, the Board has substantial doubts as to

the future status of facility and whether it will ever be

constructed under the permit currently on appeal to the Board.

 As we have previously stated "[i]t would be a waste of both

the Board’s and the parties’ time and resources to review this

matter if the facility will no longer be built." Order to Show

Cause at 2. Furthermore, there is a substantial possibility that

the issues raised in the petition for review may be moot, and a

likelihood that further permit modifications would in any event

take place before the facility could be constructed. After

careful consideration of the parties’ submissions, the Board has

decided to remand this matter to NJDEP.2 On remand, NJDEP should

make an on-the-record determination as to whether, given the fact

that MCIA is no longer authorized to construct the facility, the

August 29, 1996 permit extension should be reconsidered. That

is, given the change in circumstances since the permit extension

was granted, NJDEP should determine whether the extension is

still "justified" within the meaning of 40 C.F.R. § 52.21(r)(2).

That section states, in part, that "[a]pproval to construct shall

 2
  Cf. In re New York Power Authority, 1 E.A.D. 825, 826-27

(Adm’r 1983) (Order Remanding Permit for Denial) (declining to
review the merits of petition for review and remanding permit to
the permit issuer for denial where there was no realistic
prospect that construction would commence within 18 months after
issuance of a final PSD permit decision and the proposed facility
had no reasonable prospect of completion).
 8

become invalid if construction is not commenced within 18 months

after receipt of such approval * * *. The Administrator may

extend the 18-month period upon a satisfactory showing that an

extension is justified." Although we are hesitant to impose a

deadline, we see no reason why NJDEP should not make its

determination on remand within six (6) months of the date of this

order.3, 4

 So ordered.5

 3
  If NJDEP should conclude that the extension is still

"justified," the Board will not entertain a petition for review
of that determination unless a transfer of the permit has
occurred and has been formally approved by NJDEP, together with
any modifications of the permit deemed necessary or appropriate
by NJDEP. Under those circumstances, petitioners would be free
to file a petition with the Board at that time seeking review of
NJDEP’s determination in accordance with the rules for filing
petitions for review set forth in 40 C.F.R. § 124.19.
4
As previously stated, petitioners, in addition to seeking a
continuation of the stay in this matter, have requested that the
Board order MCIA to submit to discovery regarding the current
status of the facility. Petitioners’ request for discovery is
denied. Although we agree with petitioners that the status of
the facility is far from certain, we are not convinced that a
discovery order is necessary or appropriate at the present time.
Petitioners’ request that we continue the stay is also denied.
Under the circumstances, we believe that a remand will both
preserve petitioners’ rights and conserve the Board’s and the
parties’ time and resources.
5
As previously stated, MCIA has asserted that the appeal was
not filed in a timely manner. Although the petition for review
was not received by the Board within 30 days of the date the
permit was issued as required by 40 C.F.R. § 124.19(a), we
nevertheless consider it to have been timely filed. Although the
(continued...)
 9

                               ENVIRONMENTAL APPEALS BOARD

Dated: 6/24/97 By: /s/
Kathie A. Stein
Environmental Appeals Judge

5
  (...continued)

Board ordinarily requires strict compliance with filing
deadlines, we make an exception in the present case because Bill
Wolfe, then the Policy Research Director for the New Jersey
Environmental Federation, one of the petitioners in this matter,
has submitted an affidavit stating he was given and relied upon
incorrect information by the Clerk of the Board. In particular,
although the petition for review was due on September 30, 1996,
Wolfe states under oath that during a telephone conversation with
the Clerk of the Board, he was told that an overnight package
sent on September 30, 1996, would constitute timely filing. The
Clerk of the Board has confirmed the substance of this
conversation. The petition was not received by the Board until
October 3, 1996. Although Wolfe did not disclose to the Clerk of
the Board the method by which the final permit decision was
served, the Clerk of the Board apparently believed that the
decision had been served on petitioners by mail, in which case 3
days are added to the prescribed time period for filing a
petition for review. 40 C.F.R. § 124.20(d). However, because
the final permit was served on petitioners on August 30, 1996, by
hand delivery, the petitioners were not entitled to this
additional time. Under these very narrow and unusual
circumstances, we consider the petition to have been timely
filed. See American Farm Lines v. Black Ball Freight Services,
397 U.S. 532, 539 (1970) (Agency may relax procedural rules if
the ends of justice so require); In re Genessee Power Station
Limited Partnership, 4 E.A.D. 832, 837 n.6 (EAB 1993) (excusing
failure to comply with filing requirements of 40 C.F.R.
§ 124.19); In re BASF Corp, 2 E.A.D. 925, 926 n.3 (Adm’r, 1989)
(where a petitioner relies on erroneous filing information from
the Region, a petition for review will not normally be rejected
as untimely).
 CERTIFICATE OF SERVICE

 I hereby certify that copies of the foregoing Remand Order

in the matter of Mercer and Atlantic Counties Resource Recovery
Facility, PSD Appeal No. 96-7, were sent to the following persons
in the manner indicated:

First Class Mail,
Postage Prepaid
and facsimile: Bill Wolfe
NJ Chapter of the Sierra Club
57 Mountain Ave.
Princeton, NJ 08540
Fax # (609) 924-8799

                              R. William Potter
                              Potter and Dickson
                              194 Nassau St.
                              Princeton, NJ 08542
                              Fax # (609) 921-2181

                              Michael G. Luchkiw
                              DeCotiis, Fitzpatrick, & Gluck
                              500 Frank W. Barr Blvd.
                              Teaneck, NJ   07666
                              Fax # (201) 928-0588

                              Howard Geduldig
                              Deputy Attorney General
                              Division of Law
                              NJDEP
                              CN093
                              Trenton, NJ 08625
                              Fax # (609) 984-9315

                              Walter E. Mugdan
                              Steve Riva
                              U.S. EPA Region II
                              290 Broadway
                              25th Floor
                              New York, NY   10007-1886
                              Fax # (212) 637-3115

Dated: 6/24/97 /s/
Mildred T. Johnson
Secretary