Christie Exxon Deal Is Even Worse Than We Thought

DEP Commissioner Martin Makes a Mockery of the Public Comment Process

Fine Print Reveals Further Betrayals of the Public Interest

[Correction and Update below]

DEP just posted their proposed Natural Resource Damage (NRD) Settlement Agreement with Exxon (hit this link to read the document).

DEP also issued a totally inappropriate press release, praising the deal (read DEP press release).

Commissioner Martin’s role is to review and consider public comment and then make a recommendation to the Court to approve, modify, or reject the proposed Settlement based on public comment (see paragraph #26 emphasis mine):

The Plaintiff will submit this Consent Judgement to the Court for entry … unless, as a result of the [public] notice … the Plaintiff receives information that discloses facts or considerations that indicate to the Plaintiff, in its sole discretion, that the Consent Judgement is inappropriate, improper, or inadequate.

Commissioner Martin’s praise for the deal prejudges and totally compromises the independent role he is supposed to serve under law.

• Substantive Flaws Confirmed

A quick read suggests that the Settlement is even worse than we originally thought, based on news coverage and review of the DEP Consultant’s Report. The news has focused on the financial aspects, i.e. less than 3 cents on the dollar of the $8.9 billion claim. But there is a lot more than that going on regarding hundreds of contaminated sites across NJ.

Here are bullet points on the major flaws –

We will flesh each one out but want to get this quick and dirty review out there immediately for press coverage:

• No Full Restoration or Complete Cleanup of Bayway and Bayonne sites is required

The DEP Consultant’s restoration plan would have required excavation and off-site disposal of at least 9 million tons of highly contaminated sludge, soil, and sediments, followed by restoration of on site wetlands systems to their natural conditions.

The cost was estimated at $2.6 billion.

The settlement eliminated – totally – this on site restoration requirement.

In eliminating the on site restoration requirement, the settlement also failed to mandate that Exxon conduct a “permanent remedy” under the 24 year old 1991 site cleanup ACO’s or establish cleanup deadlines.

See this post for an explanation of the huge differences between DEP NRD restoration and DEP remediation requirements. As long as Exxon can show that a cap eliminates human exposure and is protective of public health, Exxon  can leave millions of tons of toxic sludge and soil on site forever. Exxon is paving and waving all the way to the bank, and for less than 3 cents on the dollar.

• There will be no off-site compensatory restoration

The DEP consultant’s Report documented damages to over 1,600 acres of wetlands.

In addition to the $2.6 billion on-site restoration requirements, DEP claim was based on their consultant’s determination that Exxon should compensate the public for those wetlands via a $6.3 billion off site restoration plan.

That plan and any off site compensatory restoration are completely gone.

• Many additional sites including unknown number of gas stations are off the hook for NRD (See Attachment C above)

At least 16 additional Exxon facilities with pollution are included in the deal, along with an astonishing  860 gas stations!

There are hundreds of millions of additional NRD damages that will not be recovered at these sites.

This is totally unacceptable and must be stopped.

• The agreement extinguishes untold million of dollars of NRD as a result of groundwater injury and vapor intrusion pollution at 860 gas stations (including “any contaminant, media, and/or theory of liability” – see definition of “matters addressed” on page 9).

This extraordinarily broad concession by the State is so egregious that it needs it own bullet.

•  The Reservation of MTBE liability is wiped out 100 fold by benzene, BTEX, groundwater pollution

The agreement reserves the State’s rights under the MTBE lawsuit.

However, MTBE is not nearly as pervasive or harmful as other gas station groundwater and vapor intrusion pollution risks, including from carcinogenic benzene.

There also is no primary drinking water MCL for MTBE, which may have legal implications regarding the extent of actual NRD damages.

• There is no scientific or technical basis for the $225 million deal – its a purely negotiated number

The DEP consultant’s Report provided an extensive documentation and technical justification for the $8.9 billion damage claim, based on federally approved Habitat Equivalence Analysis methodology.

The Christie deal provides no factual or technical basis whatsoever for the $225 million number, which might just as well been picked out of a hat.

This is the epitome of arbitrary and capricious decision-making and a flagrant abuse of enforcement discretion.

• DEP agreed not to require cleanup of Morses Creek until  after the Bayway Refinery closes (paragraph #13)

DEP agreed not to require cleanup of Morses Creek until after the Bayway refinery shuts down.

This shows that the NRD agreement is BROADER in scope than just NRD, and instead of strengthening DEP cleanup requirements on site, the deal weakens them.

The definition of “Morses Creek” excludes adjacent hydrologically linked wetlands and riparian areas. THis will narrow the scope of the cleanup obligations for Morses Creek.

Both these concession may violate the Clean Water Act, an issue awe shall take up with EPA.

• DEP agreed to major limitations on seeking off site surface water damages to the Arthur Kill and Raritan Bay and surrendered State control to the federal government (paragraph #8)

DEP agreed to major restrictions on any future surface water NRD claims.

DEP agreed NOT to file NRD claims for surface water pollution of the Arthur Kill and Raritan Bay until the federal government prepares a formal NRD assessment.

DEP also agreed to grant Exxon right to participate in the NRD assessment process above and beyond current or future regulatory requirements.

DEP also agreed to not solely target Exxon for this pollution, regardless if even 99% can be shown to have come from the refinery, and pursue multiple parties for this pollution, again giving away powers they have under current law to proceed individually against Exxon

• Toxic contamination of sediments, fish and wildlife are not even mentioned

I’m sure Exxon will argue that their exclusion from surface water off site impacts means they have no liability for these damages. They have additional arguments under the definition of “matters addressed” and the very broad scope of the agreement in paragraph #9.

Why would DEP leave sediments and fish and wildlife receptors out?

• Exxon  was not required to admit liability or fault in any way for their massive pollution (paragraph #20)

Worse, Exxon got protection – the agreement says  Exxon committed no wrongdoing and admitted no liability for their decades of toxic pollution at these sites.

Incredibly bad move by the State just to protect Exxon.

• DEP agreed to significant new burdens on taking any action to protect public health or the environment at site covered by the agreement (paragraph #16)

Should new concerns at these sites arise, DEP reserved their authority but agreed to limit their future actions at the sites under this agreement  to only “immediate environmental concerns” (IEC) or “imminent and substantial endangerment”.

These are high burdens to meet – why would DEP agree to this?

• The deal is a take it or leave it and can’t be modified by the Court (paragraph #29)

The deal is a package. It can’t be modified without killing the whole thing.

This undermines the public comment process and the ability of the judge to protect the public interests, adn is therefore bad public policy and not in the public interest.

• Exxon retains a veto over any DEP initiated modifications based on public comment (paragraph #34)

Same point as above.

• Exxon retains a unilateral right to veto the deal if the court modifies or does not approve – Exxon walks away with clean hands as if nothing ever happened. DEP can’t use anything in Settlement as evidence (paragraph #38)

Same point as above.

• Basis in police power should eliminate corporate tax loopholes (paragraph #28)

The Star Ledger is reporting today that Exxon may benefit from corporate tax loopholes.

Perhaps the State’s reliance on the police powers as the basis for the deal might eliminate that abuse.

• The State failed to get its huge expert consulting and legal fees compensated (paragraph #14)

Just another insult. Many millions of taxpayer dollars have been invested in this case for consulting and legal fees.

[4/8/15 Correction: I just learned that DEP LOST on the legal issue of counsel fees for lost use of natural resources in the 2009 Superior Court decision]

[Update: 4/7/15 – Tom Johnson at NJ Spotlight has a good story. Wonder how Jim O’Neill at the Record feels now for swallowing the ton of bullshit he did from anonymous Christie sources?

Here’s my comment on Spotlight story:

It is even worse than Mr. Catania thinks.The State not only failed to recover legal and consulting fees in a case a court found liability, the agreement REVERSES the Court’s liability finding and explicitly states that Exxon admits NO LIABILITY and engaged in NO WRONGDOING.As my grandfather used to say: “How do you like ‘dem apples?

The State broadly waived liability for damages from “any contaminant, media, and/or theory of liability”.This broad waiver will harm their ability to recover damages for surface water contamination to Arthur Kill and Raritan Bay.

The State put huge restrictions on any future surface water claim, including waiting for a federal NRD Assessment before proceeding at the State level, thereby surrounding NJ control to the feds.The agreement also fails to define and include damages for fish, birds, shellfish and other wildlife damaged by Exxon, as well as drinking water resounds that are lost to public use due to pollution.

Groundwater pollution from 860 gas stations is not “de minimus” – DEP is insane to make that claim.