SENATE BUDGET AND APPROPRIATIONS COMMITTEE

 

STATEMENT TO

 

[Second Reprint]

ASSEMBLY, No. 1954

 

STATE OF NEW JERSEY

 

DATED:  DECEMBER 18, 2017

 

      The Senate Budget and Appropriations Committee reports favorably Assembly Bill No. 1954 (2R).

      This bill changes the laws governing financial assistance and grants for the remediation of contaminated sites from the Hazardous Discharge Site Remediation Fund.  The bill eliminates the availability of grants and loans to persons who would otherwise not be eligible for assistance but who remediate a site using innovative technology, who remediate to an unrestricted use or limited restricted use standard, who voluntarily perform a remediation, or who perform a remediation in an environmental opportunity zone.

      The bill establishes limitations on grants to municipalities, counties, and redevelopment entities for projects in brownfield development areas.  In those areas and to those government entities, the bill authorizes grants of up to 75 percent of the total costs of the remedial action and no more than $750,000 at any one site for remedial action.  Further, the bill reduces the additional amount over the annual cap on financial assistance and grants otherwise in effect, which may be awarded in any one year to those government entities for projects in brownfield development areas, from $2,000,000 to $1,000,000.

      The bill also reduces the cumulative total amount of matching grants that may be awarded to municipalities, counties, and redevelopment entities for projects involving the redevelopment of property for recreation and conservation purposes from $5,000,000 to $500,000 per year and reduces the maximum grant for an individual project in that category from 75 percent to 50 percent of the costs of remedial action.

      The bill reduces the maximum amount of money a person may receive through an innocent party grant from $1,000,000 to $500,000 and imposes an annual maximum award of $100,000.

      The bill requires that at least 25 percent of the monies in the remediation fund be used for financial assistance and grants to municipalities, counties, and redevelopment entities for projects in brownfield development areas, of which at least five percent must be allocated for preliminary assessments, site investigations, or remedial investigations.  At least 30 percent of the monies in the remediation fund are be allocated for financial assistance or grants to persons for the preliminary assessment, site investigation, or remedial investigation of a site, not located in a brownfield development area, that has been contaminated by a discharge or a suspected discharge of a hazardous substance or hazardous waste.

      The bill reduces the cumulative annual cap on the maximum amount of financial assistance and grants that may be issued to a person from $1,000,000 to $500,000, and to municipalities, counties, and redevelopment entities from $3,000,000 to $2,000,000 except for projects in brownfield development areas as noted above.  The bill imposes a cap of $750,000 on grants to a municipality, county, or redevelopment entity at any one site.

      The bill changes the priority for the award of financial assistance or grants from the remediation fund to provide first priority to sites on which there has been a discharge and the discharge poses an imminent and significant threat to a drinking water source, to human health, or to a sensitive or significant ecological area; second priority to sites that are owned by a municipality in a brownfield development area where the developer is a public entity; and third priority to sites in areas designated as Planning Area 1 (Metropolitan) and Planning Area 2 (Suburban) pursuant to the "State Planning Act."  This priority would only apply to monies allocated pursuant to paragraph (6) of subsection a. of section 28 of P.L.1993, c.139 (C.58:10B-6).

      The bill requires the New Jersey Economic Development Authority (EDA) to adopt criteria, which must be met by a municipality, county, or redevelopment entity that applies for a grant, that the subject real property be developed within a three-year period from completion of the remediation.

      In addition to any other caps or limitations in the law, the bill establishes additional limitations on financial assistance and grants.  For a preliminary assessment and site investigation, the EDA may award for a site with soil contamination only, up to 100% of the costs up to a total amount of $30,000, and for any other site, the EDA may award up to a total amount of $75,000.  For a remedial investigation, the EDA may award for a site with soil contamination only, up to 100% of the costs up to a total amount of $100,000, and for any other site, up to a total amount of $250,000.  The bill also provides that an award of financial assistance or a grant for a preliminary assessment or site investigation of a contaminated site must be expended within two years after the date of the award, and an award of financial assistance or a grant for a remedial investigation of a contaminated site must be expended within three years after the date of the award.  If the financial assistance or grant is not expended within the time limits provided, the award would be cancelled.  In addition, no award would be approved until the applicant demonstrates to the satisfaction of the EDA that it has expended or will expend the full amount of any previous financial assistance or grant awarded to the applicant for the same property.

      As reported, this bill is identical to Senate Bill No. 1237 (1R), as also reported by the committee.

 

FISCAL IMPACT:

      The Office of Legislative Services (OLS) determines that this bill would reallocate available Hazardous Discharge Site Remediation Fund (HDSRF) resources among qualified applicants for HDSRF grants and loans for the remediation of eligible contaminated sites.  Given that demand for assistance exceeds available resources, the OLS anticipates that the bill would not alter the total amount of financial assistance provided annually.

      The reallocation of available HDSRF resources may affect the revenues of municipalities and counties.  The OLS, however, cannot determine to what extent the bill would alter:  a) the total amount of HDSRF financial assistance that will be awarded to counties and municipalities; and b) amounts of financial assistance that will be awarded to a particular municipality or county.

      The HDSRF is capitalized by constitutionally dedicated moneys from the State Corporation Business Tax.  These moneys are appropriated to the New Jersey Economic Development Authority (EDA) for site cleanups on a formulaic basis in the Annual Appropriations Act.  Approximately $10 million in FY 2017 Corporation Business Tax collections was appropriated for this purpose and $11 million is appropriated therefor in FY 2018.