Authorizes imposition of penalties and forfeiture of economic development subsidies for certain businesses that violate State environmental laws.

A2400

ASSEMBLY, No. 2400

STATE OF NEW JERSEY

222nd LEGISLATURE

�

PRE-FILED FOR INTRODUCTION IN THE 2026 SESSION

Sponsored by:

Assemblyman WILLIAM F. MOEN, JR.

District 5 (Camden and Gloucester)

Co-Sponsored by:

Assemblywoman Haider

SYNOPSIS

���� Authorizes imposition of penalties and forfeiture of
economic development subsidies for certain businesses that violate State
environmental laws.

CURRENT VERSION OF TEXT

���� Introduced Pending Technical Review by Legislative
Counsel.

��

An Act
concerning the forfeiture of economic development
subsidies and supplementing Title 52 of the Revised Statutes.

����
Be It
Enacted
by the Senate and General Assembly of
the State of New Jersey:

����� 1.�
As used in P.L.��� , c.��� (C.������ ) (pending before the Legislature as this
bill):

����� �Authority�
means the New Jersey Economic Development Authority established by section 4 of
P.L.1974, c.80 (C.34:1B-4).

����� �Commissioner�
means the Commissioner of Environmental Protection.

����� �Costs
to address the environmental incident� means any costs incurred to mitigate the
impact of an environmental incident on residents of the geographical area in
the State impacted by the environmental incident, as determined by the
commissioner.� �Costs to address the environmental incident� shall include but
not be limited to, the costs of environmental remediation necessary to contain
and remediate the impact of the incident, housing relocation costs for impacted
residents, the installation of air filtration and fire suppression systems
within impacted buildings or structures, and the costs of psychological or
mental health counseling for impacted residents.

����� �Department�
means the Department of Environmental Protection.

����� �Economic
development program� means any program administered by the authority pursuant
to Title 34 of the Revised Statutes, and any rules and regulations issued
pursuant thereto.

����� �Economic
development subsidy� means any funds or financial assistance provided to a
recipient business by or from a State public body with a value greater than
$25,000 under an economic development program, including, but not limited to,
any bond, grant, loan, loan guarantee, matching fund, tax credit, or other tax
expenditure.� �Economic development subsidy� shall not mean any contract under
which a State public body purchases or otherwise procures goods, services, or
construction on an unsubsidized basis, including any contract solely for the
construction or renovation of a facility owned by a State public body.�

����� �Environmental
incident� means a violation of the State�s environmental laws that causes a
discharge into the air, land or water of this State, which results in a notice
of violation from the department, and which has an adverse impact on the
environment.

����� �Fund�
means the Environmental Incident Recovery Fund established pursuant to section
4 of P.L.��� , c.��� (C.������ ) (pending before the Legislature as this bill).

����� �Recipient
business� means any for-profit corporation, joint venture, limited liability
company, partnership, sole proprietorship, or other form of business
organization or entity either within or outside this State that receives an
economic development subsidy.

����� �State
public body� means the State of New Jersey or any agency, authority, board,
commission or instrumentality of the State.� �State public body� shall not mean
a political subdivision of the State, or an agency, authority, board,
commission or instrumentality of a political subdivision of the State.

����� �State�s
environmental laws� means the �Air Pollution Control Act (1954),� P.L.1954,
c.212 (C.26:2C-1 et seq.), the �Radiation Protection Act,� P.L.1958, c.116
(C.26:2D-1 et seq.), �Spill Compensation and Control Act,� P.L.1976, c.141
(C.58:10-23.11 et seq.), the �Water Pollution Control Act,� P.L.1977, c.74
(C.58:10A-1 et seq.), P.L.1986, c.102 (C.58:10A-21 et seq.), the �Brownfield
and Contaminated Site Remediation Act,� P.L.1993, c.139 (C.58:10B-1 et seq.),
as amended and supplemented, the �Industrial Site Recovery Act,� P.L.1983,
c.330 (C.13:1K-6 et al.), the �Toxic Catastrophe Prevention Act,� P.L.1985,
c.403 (C.13:1K-19 et seq.), the �Solid Waste Management Act,� P.L.1970, c.39
(C.13:1E-1 et seq.), the �Comprehensive Regulated Medical Waste Management
Act,� P.L.1989, c.34 (C.13:1E-48.1 et seq.), the �Major Hazardous Waste
Facilities Siting Act,� P.L.1981, c.279 (C.13:1E-49 et seq.), the �Sanitary
Landfill Facility Closure and Contingency Fund Act,� P.L.1981, c.306
(C.13:1E-100 et seq.), the �Regional Low-Level Radioactive Waste Disposal
Facility Siting Act,� P.L.1987, c.333 (C.13:1E-177 et seq.), the �Pollution
Prevention Act,� P.L.1991, c.235 (C.13:1D-35 et seq.), the �Safe Drinking Water
Act� P.L.1977, c.224 (C.58:12A-1 et seq.), or any other law or regulation by
which the State may compel a recipient business to perform containment or
remediation activities on contaminated property.

����� �State
Treasurer� means the Treasurer of the State of New Jersey.

����� �Tax
expenditure� means the amount of foregone tax collections due to any abatement,
reduction, exemption, credit, or transfer certificate against any State tax,
including, but not limited to: taxes on raw materials, inventories, or other
assets, taxes on gross receipts, income or sales, and use, excise, or utility
tax.� �Tax expenditure� shall not mean any credit against any tax liability of
an employee; any personal exemption, homestead rebate, credit, or deduction for
the expenses of a household or individual; or other reduction of the tax
liability of an individual or household.�

����� 2.�
a.� Whenever, on the basis of available information, the commissioner finds
that a recipient business is responsible for any environmental incident, the
commissioner shall:

����� (1)
issue an order requiring the recipient business to comply with subsection b. of
this� section;

����� (2)
bring a civil action against the recipient business in accordance with
subsection c. of this section;

����� (3)
levy a civil administrative penalty in accordance with subsection d. of this
section; or

����� (4)
bring an action for a civil penalty in accordance with subsection e. of this
section.�

����� b.�
Whenever, on the basis of available information, the commissioner finds that a
recipient business is responsible for an environmental incident, the
commissioner may issue an order: specifying the provision or provisions of law,
rule, regulation, permit or order of which the recipient business is in
violation; citing the action or actions which constituted the violation;
requiring compliance with the provision or provisions violated; ordering
abatement of the violation; and giving notice to the recipient business of its
right to a hearing on the matters contained in the order.� The recipient
business shall have 20 calendar days from receipt of the order within which to
deliver to the commissioner a written request for a hearing.� The order shall
be effective upon receipt and any person to which such order is directed shall
comply with the order immediately.� A request for a hearing shall not
automatically stay the effect of the order.� If no hearing is requested, the
order shall become final after the expiration of the 20-day period.

����� c.�
The commissioner may institute an action or proceeding in the Superior Court
for injunctive and other relief, including the appointment of a receiver for
any violation of P.L.��� , c.���� (C.����� ) (pending before the Legislature as
this bill), and the court may proceed in the action in a summary manner.� In
any such proceeding, the court may grant temporary or interlocutory relief.�
Such relief may include, singly or in combination:

����� (1)
a temporary or permanent injunction;

����� (2)
assessment of the recipient business for the costs of any investigation,
inspection, or monitoring survey which led to the commissioner�s determination,
and for the reasonable costs of preparing and litigating the case under this
subsection; and

����� (3)
assessment of the recipient business for any cost incurred by the State in
removing, correcting, or terminating the adverse health and environmental
effects resulting from the environmental incident for which the action under
this subsection may have been brought.

����� d.�
The commissioner may assess a civil administrative penalty in the amount
determined pursuant to section 3 of P.L.��� , c.��� (C.������ ) (pending before
the Legislature as this bill).� The commissioner shall not assess a civil
administrative penalty until the department has adopted rules and regulations,
pursuant to section 5 of
P.L. , c. (C. ) (pending
before the Legislature as this bill), requiring the commissioner, in assessing
a civil administrative penalty, to consider the operational history of the
recipient business found to be responsible for an environmental incident, the
severity of the environmental incident, the measures taken to mitigate or
prevent further environmental incidents, and whether the penalty will maintain
an appropriate deterrent.

����� e.�
Any recipient business found responsible for an environmental incident shall be
liable for a penalty pursuant to section 3 of
P.L. , c. (C. )
(pending before the Legislature as this bill), to be collected in a civil
action commenced by the commissioner.�

����� f.�
Any person that violates an administrative order or court order issued pursuant
to this section is subject upon order of a court to a civil penalty not to
exceed $100,000 per day of each violation.

����� g.�
Any penalty imposed pursuant to this subsection may be collected, with costs,
in a summary proceeding pursuant to the �Penalty Enforcement Law of 1999,�
P.L.1999, c.274 (C.2A:58-10).� The Superior Court and the municipal court shall
have jurisdiction to enforce the provisions of the �Penalty Enforcement Law of
1999� in connection with P.L.��� , c.��� (C.������ ) (pending before the
Legislature as this bill).

�����
3.� a.� Notwithstanding the provisions of any law, rule, or regulation to
the contrary, a recipient business that is found to be responsible for any
environmental incident may be required to:

����� (1)
make a payment to the State; and

����� (2)
if the payment is not made, forfeit a portion of the value of the economic
development subsidies the recipient business is otherwise eligible to receive
in the tax years following the tax year in which a determination is made
pursuant to subsection c. of this section

����� b.�
The amount of the payment or value of the forfeiture required pursuant to this
section shall be equal to the greater of:

����� �(1)
20 percent of the total value of the economic development subsidies awarded to
the recipient business for the tax year in which the determination is made; or

����� �(2)
the total costs to address the environmental incident, as determined pursuant
to subsection c. of this section.

����� c.�
(1) The total costs to address the environmental incident shall be determined
by the commissioner in consultation with the State Treasurer, the chief
executive officer of the authority, and any other State officials or officers
that the commissioner may deem appropriate.� Upon the request of the
commissioner, each State agency, authority, county, municipality, and political
subdivision of this State shall make any information and materials available to
the commissioner as the commissioner deems necessary to determine the total
costs to address the environmental incident.

����� (2)
Upon determining the total costs to address the environmental incident, the
commissioner shall provide written notice , by certified mail or personal
service, to the recipient business that the recipient business is required to
make a payment to the State or otherwise forfeit future economic development
subsidies. The notice shall include an explanation of the commissioner�s
determination, including an explanation of :� the provision of law under which
the violation occurred; the facts alleged to constitute a violation; the
amounts necessary to support each category of costs to address the
environmental incident ; the amount of the payment to be provided to the State;
and the amount of future economic development subsidies that may be forfeited;
and the party�s right to a hearing.� The recipient business shall have 20
calendar days following the receipt of the written notice within which to
deliver to the commissioner a written request for a hearing to dispute the
finding, order, or penalty of the commissioner.� After the hearing and upon
finding that a violation has occurred, the commissioner may issue a final order
after assessing the amount of the penalty specified in the notice.� If no
hearing is requested, the notice shall become a final order after the
expiration of the 20-day period.� The commissioner shall also transmit a copy
of the written notice and final order to the State Treasurer and chief
executive officer of the authority.

����� d.�
(1) Not later than 30 days following receipt of the final order issued pursuant
to subsection c. of this section, a recipient business shall make the payment
to the State Treasurer.

����� (2)
The proceeds of any payment received by the State shall be deposited into the
Environmental Incident Recovery Fund established pursuant to section 4 of
P.L.��� , c.��� (C.������ ) (pending before the Legislature as this bill), and
shall be appropriated by the Legislature to provide reimbursement payments to
residents of communities impacted by an environmental incident for costs
incurred to address the environmental incident.

����� e.�
If a recipient business
which has entered into an agreement with the
authority for the issuance of an economic development subsidy on or after the
effective date of P.L.��� , c.��� (C.������ ) (pending before the Legislature
as this bill)
fails to comply with the
requirements of this section, the recipient business shall forfeit all economic
development subsidies awarded to the business, and its affiliates, until such
time as the requirements of this section are met.

���� f.�
Any agreement entered into between the authority and a recipient business for
the issuance of an economic development subsidy on or after the effective date
of P.L.��� , c.��� (C.������ ) (pending before the Legislature as this bill)
shall include a provision specifying that a recipient business shall be subject
to the provisions of this section.

�������
4.� a.� There is established in the Department of
Environmental Protection a separate, nonlapsing fund to be known as the
�Environmental Incident Recovery Fund.�� The fund shall be administered by the
department and shall be used solely to provide reimbursement payments to
residents of communities impacted by an environmental incident for costs
incurred to address the environmental incident.� The fund shall contain a
subaccount for each payment received by the State Treasurer for a specific
environmental incident.

����� b.�
The fund shall consist of any payments received by the State Treasurer pursuant
to subsection d. of section
3
of
P.L. , c. (C. )
(pending before the Legislature as this bill), moneys appropriated by the
Legislature for the purposes of the funds, investment earnings of the fund,
moneys contributed to the fund by private sources, and any other moneys that
may become available for its purpose.� The moneys in the fund may be invested
and reinvested by the Director of the Division of Investment in the Department
of the Treasury.� All costs of administering the fund, including the necessary
and proper expenses incurred by the department in administering the fund, shall
be paid from the fund.� The department shall not encumber, invest, divest, or
disburse moneys from the fund for any purpose not specifically included in this
section.�

����� c.�
Subject to the appropriation of funds by the Legislature, the department shall
make distributions from the fund in accordance with the following criteria and
any rules or regulations adopted by the department.� The department shall
establish a process by which residents of communities impacted by an
environmental incident may apply for a reimbursement from the fund.� Payments
from the fund may be made only for costs incurred by residents of a community
impacted by an environmental incident to address the environmental incident.�
Payments may not be made to satisfy a financial commitment for services or
expenses that would otherwise have been paid from another public or private
source, including, but not limited to, Medicaid or private insurance.

�����
5.� The Commissioner of Environmental Protection, in consultation with the
State Treasurer and the Chief Executive Officer of the New Jersey Economic
Development Authority, shall adopt rules and regulations as may be necessary to
effectuate the provisions of� P.L.��� , c.���� (C.������ ) (pending before the
Legislature as this bill), which rules and regulations shall be effective
immediately upon filing with the Office of Administrative Law, for a period not
to exceed 180 days, and may thereafter be amended, adopted, or readopted in
accordance with the provisions of the �Administrative Procedure Act,� P.L.1968,
c.410 (C.52:14B-1 et seq.)

����� 6.
This act shall take effect immediately, except that sections 1 through 4 shall
remain inoperative until the first day of the sixth month next following
enactment and shall first apply to economic development subsidies for which an
agreement is entered into between the authority and a recipient business on or
after the sections 1 through 4 become operative.

STATEMENT

����� This bill provides that a business that has been
awarded an economic development subsidy by a State public body and is found to
be in violation of the State�s environmental laws may be required to make a
payment to the State in an amount equal to the total costs to address the
environmental incident.� If the business fails to make the payment, then it
will be required to forfeit a portion of the value of economic development
subsidies to be provided to the business in future years.�

����� Penalty Provisions.� The bill authorizes the
Commissioner of Environmental Protection (commissioner) to take other actions
against any business that has been awarded an economic development subsidy by a
State public body and is found to be in violation of the State�s environmental
laws.� Under the bill, the commissioner may to issue administrative orders,
levy administrative penalties, bring civil actions for injunctive relief, and
bring an action for civil penalties to enforce the bill�s provisions.� The bill
also authorizes the commissioner to assess a civil administrative penalty not
to exceed $100,000 for violations of administrative or court orders issued
pursuant to the bill.�

����� Payments to the State & Forfeiture of Economic
Development Subsidies.� The bill provides that if the commissioner determines
that a recipient business is responsible for an environmental incident, the
business may be required to make a payment to the State equal to the greater
of: (1) 20 percent of the economic development subsidies awarded to the
business for the tax year in which a determination is made under the bill; or
(2) the total costs to address the environmental incident.� Under the bill,
these costs include, but are not limited to, the costs of environmental
remediation necessary to contain and remediate the impact of the incident,
housing relocation costs for impact residents, the installation of air
filtration and fire suppression systems within impacted buildings or
structures, and the costs of psychological or mental health counseling for
impacted residents.

����� The bill directs the commissioner, in consultation
with the State Treasurer, the chief executive officer of the New Jersey
Economic Development Authority (EDA), and any other State officials the
commissioner deems appropriate, to determine the costs necessary to address the
environmental incident.� The bill requires the commissioner to provide written
notice to the recipient business that the recipient business is required to
make a payment to the State and would forfeit future economic development subsidies
if the payment is not made.� The notice is also required to include an
explanation of the commissioner�s determination, including an explanation of:�
the provisions of law under which the violation occurred, the facts alleged to
constitute a violation, the amount of the payment to be provided to the State
and the amount of future economic development subsidies that may be forfeited,
and the party�s right to a hearing.

����� The bill provides that a recipient business may
request a hearing to dispute the commissioner�s finding within 20 days of
receipt of the written notice.� After the hearing and upon a finding that a
violation has occurred, the commissioner may issue a final order assessing the
amount of the penalty specified in the notice.� If a recipient business does
not request a hearing, the written notice becomes a final order after the
expiration of the 20-day period.

����� The bill provides that if a business, which has
entered into an agreement with the authority for the issuance of an economic
development subsidy on or after the effective date of the bill, fails to make a
payment to the State or forfeit the required amount of economic development
subsidies, the recipient business would be required to forfeit all economic
development subsidies awarded to the recipient business and its affiliates
until the requirements of the bill are satisfied.� The bill also requires future
economic development subsidy agreements entered into by the authority to
include a provision specifying that a recipient business is subject to the
provisions of the bill.

����� The bill requires any payments received by the State
to be deposited into the Environmental Incident Recovery Fund established by
the bill and appropriated to provide reimbursement payments to residents of
communities impacted by an environmental incident for costs incurred to address
the environmental incident.

����� The bill takes effect on the first day of the sixth
month following enactment and applies to economic development subsidy
agreements entered into by the authority and recipient businesses after the
effective date.