By Michele S. Byers
If your community’s land and water were contaminated – and the polluter was fined for the damage – where do you think the money should go?
Should the funds be dedicated to protecting or restoring natural resources in the impacted area or should they go into the general state budget, or fill some other program need? This question will be decided by New Jersey voters on Nov. 7.
In theory, here is how New Jersey’s Natural Resource Damages fund works: Companies found liable for damaging the environment pay into a fund whose purpose is to restore damaged lands and waterways, and compensate the community for being deprived of the use of those resources.
In practice, however, not all of the damages money gets spent on cleanups, restorations and environmental projects. For years, state elected officials have used Natural Resource Damages funds to plug holes in the state’s budget, sometimes leaving only a small amount of the money for restoration.
That is exactly what happened with pollution in the Passaic River. Due to decades of industrial uses in the river’s watershed, the Passaic is contaminated with a toxic mix of chemicals, including dioxins, PCBs, pesticides and heavy metals. The pollutants harm the river’s ecosystem, and fish and crabs from the river’s waters are unfit for human consumption.
Between 2013 and 2014, New Jersey received $355 million from settlements with companies responsible for polluting the Passaic. Of the $355 million, the lion’s share – $288 million – ended up in the state’s general operating budget. Less than 20 percent was allocated for restoration work.
This diversion of funds was considered legal. The largest settlement, with Occidental Chemical, required that only $50 million be allocated to restoring the river, with the remaining funds “to be used as the Governor and Legislature deem appropriate.”
A question on the Nov. 7 ballot proposes a “lockbox” that would require Natural Resource Damages funds to be used only for their intended purpose of restoration and environmental cleanup. Hundreds of millions of dollars per year are at stake.
If Public Question 2 passes, the state’s Constitution will be amended to specify that every dollar in polluter fines “would have to be used to repair, restore, replace, or preserve the state’s natural resources.” The money could also be used for the legal costs of recovering fines from polluters.
Passage of the ballot question could impact the state’s pending pollution settlement with ExxonMobil, which has not been finalized due to litigation.
In 2015, ExxonMobil was found liable for damaging 1,500 acres of wetlands and tidal marshes near its Linden and Bayonne refineries and 16 other sites.
The state settled the ExxonMobil case for $225 million, most of which could go toward balancing the state budget and paying legal fees. The settlement is being challenged in court by environmental groups and Sen. Raymond Lesniak, who claim the sum is not sufficient.
Public Question 2, also known as the “Revenue from Environmental Damage Lawsuits Dedicated to Environmental Projects Amendment” question, was put on the ballot in late 2016 by a bipartisan vote of the state Legislature.
Assemblyman John McKeon, one of the sponsors, explained: “These funds were the result of environmental contamination settlements and should only be used to repair the damage caused by the contamination and for measures that can help protect our environment.”
Opponents to placing the question on the ballot maintained the state requires flexibility to allocate funds as needed.
According to the ballot question’s interpretive statement, “This amendment would dedicate moneys collected by the state relating to natural resource damages through settlements or awards for legal claims based on environmental contamination. These moneys would be dedicated to repair, replace, or restore damaged natural resources, or to preserve the state’s natural resources. The moneys would be spent in an area as close as possible to the geographical area in which the damage occurred. The moneys could also be used to pay for the state’s legal or other costs in pursuing the claims. Currently, these moneys may be used for any state purpose.”
Michele S. Byers is the executive director of the New Jersey Conservation Foundation.