SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION DOCKET NO. A-3464- 21
IN RE REAUTHORIZATION OF CAFRA INDIVIDUAL PERMIT AND TAW, 1500- 04 -0001.5 LUP190001.

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Argued November 13, 2023

– Decided December 12, 2023 Before Judges Gilson and Berdote Byrne. On appeal from the New Jersey Department of Environmental Protection. Daniel A. Greenhouse argued the cause for appellant s Pinelands Preservation Alliance and Save Barnegat B ay (Eastern Environmental Law Center, attorneys ; Daniel A. Greenhouse and Maggie Broughton , on the briefs ). Kevin DeCristofer, Deputy Attorney General, arg ued the cause for respondent New Jersey Department of Environmental Protection (Matthew J. Platkin, Attorney General, attorney ; Donna Arons, Assistant Attorney General, of counsel; Kevin DeCristofer , Deputy Attorney General, on the brief). William F. Harrison argued the cause for respondent Jaylin Holdings, LLC (Genova Burns, LLC, attorneys; William F. Harrison and Jennifer Borek, of counsel and on the brief).

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION This opinion shall not "constitute precedent or be binding upon any court. " Although it is posted on the internet, this opinion is binding only on the parti es in the case and its use in other cases is limite d. R. 1:36- 3.2 A- 3464

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PER CURIAM Appellants Pinelands Preservation Alliance (PPA) an d Save Barnegat Bay (SBB) seek to prevent the development of property located in the coastal region of the Pinelands National Reserve. After almost tw enty years of administrative review and litigation, appellants again claim the D epartment of Environmental Protection (DEP) erred in granting Jaylin Holdings, LLC's (Jaylin) a Coastal Area Facility Review Act (CAFRA) 1 Individual Permit and Transition Area Waiver. Specifically, appellants contend DEP (1) acted erro neously and arbitrarily in ignoring the required Flood Hazard Area (FHA) an d Riparian Zone (RZ) verifications based on an outdated permit and a generaliz ed finding that Jaylin's proposed development was far enough from those prot ected areas; (2) failed to include the FHA and RZ in its calculation of the ap plicable impervious coverage limits; (3) erroneously permitted Jaylin's proposed modified transition area to encroach upon the FHA and RZ; and (4) arbitrarily i gnored the Pinelands Commission's (the Commission) determination that Ja ylin's proposed development is inconsistent with the Pinelands Comp rehensive Management

1 N.J.S.A. 13:19-1 to - 21.3 A- 3464

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Plan (CMP). According to appellants, each one of t hese errors warrants reversal of the permit and waiver reauthorizations and requi re further submissions by Jaylin and administrative review by DEP before any development can begin. Having reviewed the record and applicable law, we d iscern nothing arbitrary, capricious, or unreasonable in DEP's rea uthorization of the CAFRA Individual Permit and Freshwater Transition Area Wa iver to Jaylin. Because appellants had notice and ample opportunity to rais e the alleged defective delineations of the FHA and RZ on the property to D EP and failed to do so in multiple prior rounds of comments and litigation, t hey are precluded from raising this issue on this appeal

. And substantively, appellants fail to show the FHA or RZ zones depicted on Jaylin's application ar e incorrect or require a different result. We also conclude appellants' arg uments regarding encroachment of the transition area and impervious coverage limits lack merit. Lastly, we conclude appellants' argument concerning the Commission is moot as we previously ruled on that issue in our prior o pinion, see Pinelands Pres. All. v. Dep't of Enviro. Prot., 436 N.J. Super. 510, 516 (App. Div. 2014). Accordingly, we reject all of appellants challenges and leave the permit and waiver in place.
I.4 A- 3464

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On November 4, 2004, Jaylin applied for a CAFRA Indi vidual Permit and a Freshwater Wetland Transition Area Waiver (TAW) p ursuant to the Freshwater Wetlands Protection Act 2 (FWPA) to the DEP's Division of Land Resource Protection (Division) for proposed develop ment of land located in the Townships of Toms River and Manchester (the property). The property is located in the coastal zone of the Pinelands Nation al Reserve. Within 500 meters of the proposed development is an unnamed tr ibutary of the Sunken Branch stream. The property is currently forested and undeveloped and was initially determined by DEP to possess a mix of wet land habitats having intermediate or exceptional resource value. DEP su bsequently amended its determination to consider all the property's wetlan ds to be of exceptional resource value based on more recent information on threatened and endangered species on the property. Jaylin's initial application sought to construct a 208,433 square foot department store, with an approximately 20,000 squa re foot garden center, three stormwater basins, parking to accommodate almost 1, 200 vehicles, two outparcels to be reserved for future use, and acces s road off Route 37 and

2 N.J.S.A. 13:9B-1 to - 30.5 A- 3464

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Northampton Boulevard. After fifteen years of admi nistrative review and an appeal in 2014, Jaylin submitted another CAFRA Indi vidual Permit and TAW application on December 9, 2019 (the application). The application proposed a substantially reduced footprint: an 81,275 square foot retail building, a 4,800 square foot restaurant, a 9,322 square foot retail building, 570 parking spaces and associated circulation roadways, stormwater man agement measures, utilities, and landscaping. Jaylin submitted a Stormwater Management Report and CAFRA Individual Permit Report with its applica tion. The former noted the proposed development was more than 400 feet awa y from the stream encroachment line and the finished floor elevation was set more than 6 feet above the 100-year flood elevation. On February 12, 2020, Jaylin's application was foun d to be administratively complete and proceeded to public c omment. PPA timely submitted comments to the application and addressed the TAW averaging plan, threatened and endangered species, coordination wit h the Commission, and impervious cover requirements. The Commission also provided DEP with its own assessment of Jaylin's proposed development and determined the plan "remain[ed] inconsistent with the wetlands protecti on and the threatened and endangered . . . species protection standards of th e CMP."6 A- 3464

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The Division issued Jaylin a CAFRA Individual Permi t and TAW on September 2, 2020. Included with those approvals w as an engineering report which stated a flood hazard verification was not ne eded because the "[p]roposed development is located at significant higher elevat ions than the approved stream encroachment line [and is] far enough from the stre am." PPA and SBB appealed on various grounds and DEP mov ed before us to remand the permitting decision. We granted the rem and, and a new thirty-day public comment period was held from April 21, 2021, until May 20, 2021. Again, appellants submitted public comments and req uested a hearing. These comments addressed many of the same issues as their previous comment: the TAW averaging plan, threatened and endangered speci es, coordination with the Commission, and impervious cover requirements. In addition to appellants'

comments , sixty -four other persons and entities submitted comments , most of which opposed Jaylin's application. Some of the comments raised concerns about the habitat of the Northern Pine Snake and Pi ne Barrens Tree Frog, wetlands, impervious cover calculations, stormwater management, and the CMP. Jaylin responded on October 2, 2021. One mon th later in November 2021, PPA submitted further comments with regards t o threatened and endangered specious and impervious cover.7 A- 3464

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On May 31, 2022, DEP issued a reauthorization of Ja ylin's CAFRA Individual Permit and TAW. Concurrent with the app rovals, DEP issued an environmental report addressing all the comments it received. DEP then published an Amplification of Record on July 28, 2022, to clarify its May reauthorization. This appeal followed.
II. Our review of an administrative agency's decision i s circumscribed. N.J. Highlands Coal. v. State, Dep't of Env't Prot., 456 N.J. Super. 590, 602 (App. Div. 2017). An agency's decision will not be rever sed unless: "(1) it was arbitrary, capricious, or unreasonable; (2) it viol ated express or implied legislative policies; (3) it offended the State or Federal Constitution; or (4) the findings on which it was based were not supported b y substantial, credible evidence in the record." Id. at 602-03 (quoting Univ. Cottage Club of Princeton N.J. Corp. v. State, Dep't of Env't Prot., 191 N.J. 38, 48 (2007)). With respect to DEP, "great deference" is provided to decisions balancing the competing interest of development and conservation. Id. at 6 03 (quoting In re Stream Encroachment Permit No. 0200- 04 -0002.1 FHA, 402 N.J. Super. 587, 597 (App. Div. 2008)). The party challenging DEP's permit au thorization must demonstrate "not that the agency's action was merel y erroneous, but that it was8 A- 3464

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arbitrary." Ibid. (quoting Stream Encroachment Per mit, 402 N.J. Super. at 597). An agency, however, cannot issue a permit prior to satisfaction of the applicable statutory and regulatory criteria. Del. Riverkeepe r Network v. State, Dep't of Env't Prot., 463 N.J. Super. 96, 113 (App. Div. 202 0) (quoting In re Authorization for Freshwater Wetlands Gen. Permits, 372 N.J. Super. 578, 596 n.8 (App. Div. 2004)).
III. 1. Verification of FHAs and RZs. First, appellants contend DEP impermissibly relied upon an outdated Stream Encroachment Permit from 2005 and, based on that outdated permit and information, arbitrarily determined Jaylin's propos ed development was far enough away from the property's FHA and RZ to obvia te verification. According to appellants, the Flood Hazard Area Control Act ( FHACA) requires DEP to specifically identify and delineate FHAs to protect the public's health, safety, and general welfare. Because FHAs and RZs are "special areas," Jaylin was required to submit with its application site pl ans which delineated the "upper and lower limits of all special areas, as de scribed at N.J.A.C. 7:7-9" pursuant to DEP's Coastal Zone Management (CZM) rul es.9 A- 3464

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Appellants argue the only way to avoid verification would be if the proposed development were either: (a) not in a FHA or RZ, or (b) met one of the conditions listed at N.J.A.C. 7:13-5.5(a). Nei ther DEP nor Jaylin provided any documentation delineating the express locations of the FHA and RZ on the property. Appellants claim it was improper for DEP to issue the CAFRA permit with out "knowing these details with formality, certaint y and specificity." Appellants contend the matter must be remanded for further findings to correct this "fatal flaw" in the CAFRA permit reauthorizati on. They further argue, rather than focusing on the requirements of the cur rent regulatory framework, DEP prioritized the stream encroachment line, which is no longer part of the applicable regulations. As an initial matter, we note that appellants faile d to first raise this issue regarding delineation of the FHA and RZ to DEP. Ap pellants had ample time and opportunity to present their concern that the a pplication lacked precise delineation of the FHA and RZ during the five notic e-and-comment periods but failed to do so. Had they done so, Jaylin could ha ve properly and timely responded. Moreover, at oral argument, appellants conceded they do not have an expert or engineering report to demonstrate Jayl in's delineations on its Stormwater Management Report, filed with the applic ation in 2019, are10 A- 3464

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incorrect or do not fall within the exception to FH ACA. In other words, appellants argue only that Jaylin's failure to prov ide an expert or engineering report delineating the FHA and RZ violates the appl icable regulation. Ordinarily, we would not address issues appellants failed to raise before DEP. Stream Encroachment Permit, 402 N.J. Super. at 602. Nevertheless, we relax this rule when the questions raised on appeal concern matters of great public interest. Zaman v. Felton , 219 N.J. 199, 226- 27 (2014). DEP was required to abide by the applicable statutes and regulations regardless of whether appellants raised compliance issues prior to its decision. See L.W. ex rel. L.G. v. Toms River Regional Schs. Bd. of Educ., 381 N.J. Super. 465, 489 (App. Div. 2005) (holding an agency action that violates express or implied legislative or regulatory policies is ev idence of arbitrary and capricious conduct). Because Jaylin's proposed project is near land incl ud ing a FHA, RZ, and transition area, Jaylin was required to comply with those regulations governing "special water's edge areas." N.J.A.C. 7:7-9.1, 7:7- 9.25, 7:7-9.26, 7:7-9.28. An FHA is "the space . . . which lies below the [FHA] design flood elevation."
N.J.A.C. 7 :13 -1.2; see also N.J.A.C. 7:7-9.25. A RZ is "the land and vegetation within and adjacent to a regulated water." N.J.A.C .7:7-9.26. A transition area11 A- 3464

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is that "area of land adjacent to a wetland which m inimizes adverse impacts on the wetlands or serves as an integral component of the wetlands ecosystem." N.J.A.C. 7:7-9.28. FHACA's rules require a verification before, or con temporary with, an authorization of an individual permit. N.J.A.C. 7: 13-5.2(b); N.J.A.C. 7:13-5.5. This general requirement is subject to two exceptio ns. N.J.A.C. 7:13-5.5(a). Relevant here, if DEP determines, "based on a visua l inspection of submitted site plans and without review of calculations, that . . . [n]o fill or aboveground structure is proposed within a flood hazard area," then no verification is required. N.J.A.C. 7:13-5.5(b)(1). RZs are absent from N.J.A.C. 7:13-5.5. While verification of a RZ is permissible, N.J.A.C. 7:13-5.2(a)(4), it is not required, see N.J.A.C. 7:13-5.5. DEP noted the tributary is approximately 650 feet a way from the closest point of the proposed project. Topography shows up to eight feet in elevation differences. Based on these regulations, DEP did not arbi trarily waive the FHA verification requirement and was not required to ve rify the RZ. DEP was permitted to visually inspect the site plans provid ed by Jaylin and based upon that visual inspection, permitted to find the propo sed development was sufficiently far enough from the FHA to waive verif ication. Jaylin provided site12 A- 3464

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plans with its application in 2019, and nothing in them contradicts DEP's finding. Nor do appellants point to contrary evide nce; instead, their argument ignores this exception entirely. Although Jaylin's Stormwater Management Report referenced the stream encroachment line and the former stream encroachmen t permit, not the FHA, this supports, rather than detracts from DEP's find ings. Put simply, the term "stream encroachment permit" was merely replaced with the term "flood hazard area permit," which is "a permit or authorization i ssued under [N.J.A.C. 7:13] pursuant to [FHACA]." N.J.A.C. 7:13-1.2. The perm its pursuant to the pre2007 amendments were "called stream encroachment pe rmits" but DEP found the term "impl[ied] the existence of both a stream and an encroachment into the stream, neither of which are necessarily aspects of an activity regulated" under FHACA. 38 N.J.R. 3963 (Oct. 2, 2006). Instead, DE P found the term "flood hazard area permit" was "a more descriptive and acc urate term that better reflects the subject matter of [FHACA]." Ibid. There is nothing in the record to suggest reliance upon the previously established stream encroachment line would be arbitrary or erroneous and appellants fail ed to show any evidence. As stated previously, N.J.A.C. 7:7-23.4(c)(4)(vii) requires applicants provide site plans, which delineate the upper and l ower limits of all special areas13 A- 3464

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such as FHAs and RZs subject to certain exceptions. The maximum width of a RZ is 300 feet. N.J.A.C. 7:13-4.1(c). This is in addition to any other similar zones present on the property, such as an FHA. N.J .A.C. 7:13-4.1(i). At best, the RZ in question would be afforded a 150-foot zon e pursuant to N.J.A.C. 7:13- 4.1(c)(2)(iii). The combined 150-foot RZ buffer wi th the requisite 150-foot transition area would still not reach the proposed development on the property, which is more than 300 feet away from those areas. There is substantial credible evidence in the recor d to support DEP's conclusion its reauthorization of the permit did no t require an engineer delineate the FHA and RZ. FHA verification is not required b efore an individual permit is authorized where DEP can determine, pursuant to a visual inspection of submitted site plans, that no fill or aboveground st ructure is proposed within the FHA. DEP visually inspected the various site maps provided by Jaylin and assessed the distances between the FHA and the prop osed development, as well as the project's elevation above the FHA, and issued a report stating verification
was unnecessary. In doing so, DEP properly relied on the regulation. Appellants present no evidence DEP's findings are e rroneous or arbitrary.
2. The Impervious Cover Calculation.14 A- 3464

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When a CAFRA permit is requested for land situated in a coastal area, all parties concede any development is limited to thirt y percent of the impervious surface coverage. N.J.A.C. 7:7-13.17(d)(1). The n et-land area is calculated by totaling the entire acreage of the property and sub tracting the seven listed special water's edge areas. N.J.A.C.7:7-13.3(e). Appellants argue Jaylin and DEP impermissibly faile d to include the FHA and RZ in that calculation. Although the applicabl e regulation does not require those areas be included in the calculation, appella nts contend that regulatory omission "lacks any coherence and must be rejected . . . ." Due to this incoherence, appellants request we "issue a precede ntial opinion which expressly requires [] DEP to account for the FHA an d the RZ when calculating the allowable impervious coverage of a site under C ZM rules." Appellant's arguments are unavailing. The regulation specifically lists seven special water's edge areas that are to be sub tracted from the total land area calculation. N.J.A.C. 7:7-13.3(e)(2). Although we tlands transition areas must be subtracted from the total land area, N.J.A.C. 7: 7-13.3(e)(2)(iv)(v), FHAs and RZs are absent from the list. Appellants' argument s to the contrary ignore the plain language of the regulation requiring DEP to s ubtract only a subset of the listed special water's edge areas

— seven out of a total of fifteen

— and would15 A- 3464

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require us to overrule DEP's own regulations based on appellants' unsupported belief there is no reasonable distinction between i ntermittent stream corridors and FHAs and RZs. We decline to change the DEP reg ulation. In that regard, we note appellants did not file a timely objection to the DEP regulations. See In re Adoption of N.J.A.C. 11:3-29 ex rel. State, D ep't of Banking & Ins., 410 N.J. Super. 6, 26 (App. Div. 2009) ("To permit a pa rty . . . to raise objections to a rule . . . that it failed to raise before the adm inistrative agency at the appropriate time would be to undermine the very purpose of admi nistrative agencies.") (quoting Bergen Pines Cnty. Hosp. v. N.J. Dep't of Human Servs., 96 N.J. 456, 475 (1984)). There is sufficient credible evidence in the record supporting DEP's exclusion of these areas. FHAs and RZs are not list ed as excludable in the plain language of the statute. The specific seven areas are excluded because they are "the most sensitive special water's edge areas," 32 N.J.R. 503(a) at Response to Comment 465 (Feb. 7, 2000). Appellants' personal d isagreement with this regulation provides no basis for reversal.
3. The Modified Transition Area Calculation. Entities and individuals are not permitted to engag e in commercial development in transition areas, N.J.A.C. 7:7A-2.3( a)(3), without a transition16 A- 3464

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area waiver, N.J.A.C.7:7A-3.3(f). Jaylin's applica tion included a TAW averaging plan governed by N.J.A.C. 7:7A-8.2. A TA W averaging plan "modifies the overall shape of a transition area wi thout reducing its total square footage" and is permissible for regulated activitie s adjacent to exceptional resource value freshwater wetlands. N.J.A.C. 7:7A- 8.2(a). We disagree with appellant's argument that "DEP's i ssuance of the TAW frustrates and violates the FHACA and the FWPA" bec ause DEP's contingent issuance, based upon the creation of a "modified" transiti on area, fails to adhere to the applicable regulations. They argue Jaylin's proposed modified transition area requires the alteration of the existing FHA an d RZ, and, hence, "will not continue to serve functionally equivalent purposes of the original transition area and there will be a substantial net loss in protect ion of the wetlands on site." Once more, appellants' argument sets forth their pr eferred regulatory requirements, rather than citing to existing regula tions. A TAW authorizing the reduction of a transition area adjacent to an excep tional resource value wetland must be conditioned on an averaging plan that provi des an average transition area width of at least 100 feet. N.J.A.C. 7:7A-8.1 (g). DEP must also include additional protective conditions in a TAW to ensure the pro posed activity "does not result in a substantial impact on the adjacent wetlands and does not impair17 A- 3464

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the purposes and functions of transition areas," ifnecessary. N.J.A.C. 7:7A8.1(b). Outside of these general requirements, a T AW averaging plan may modify the shape of the transition area as long as it does not reduce the area's total square footage. N.J.A.C. 7:7A-8.2(a). Appel lants assert DEP should be precluded from approving a modified transition area which takes from the FHA
or RZ but there is no regulatory requirement to account for FHAs or RZs when approving TAW averaging plans. Nor do appellants provide any evidence to support their claim that the approved TAW will caus e a "net loss of significant protections" or "commensurate benefit" to the areas at issue. Moreover, if the modified transition area in the averaging plan "will continue to serve the purposes of a transition area as set forth in N.J.A .C. 7:7A-3.3," then DEP is required to issue a TAW, barring four exceptions no t relevant here. Appellants fail to show how the modified transition area will not continue to serve the purpose of a transition area. Therefore, the recor d supports DEP's grant of the TAW to Jaylin.
4. The Pinelands Commission Plan. Lastly, appellants contend DEP arbitrarily failed t o concur with the Commission and reject Jaylin's application. Appell ants cite the Commission's memorandum, which opined Jaylin's proposed development is inconsistent with18 A- 3464

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the CMP. According to appellants, DEP's single-sen tence explanation for its disagreement is inadequate and is predicated upon D EP's failure to respond to the Commission's previous memoranda on the matter. They claim we are constrained to remand the matter to DEP for an administrative adjudication of this issue. We previously addressed this issue in appellant's 2 014 appeal. There, we concluded "[t]here [was] nothing in the MOA, statut es or regulations . . . requiring that DEP agree with the Commission's find ings on any one application."
In the February 1988 Memorandum of Agreement with DEP, th e Commission agreed that projects within the Pineland s National Reserve (PNR) and Coastal Zone are subject to DEP's authority. T he PNR is an approximately 1,000,000-acre area encompassing much of southern Ne w Jersey. N.J.A.C. 7:7- 9.42(a). The "Pinelands Area" is a smaller subset of the PNR. Ibid. The Commission exercises direct regulatory authority ov er the state-designated Pinelands Area. Jaylin's proposed development is o utside of the Pinelands Area, but inside the PNR and inside the coastal zone subj ect to CAFRA. Thus, DEP has the authority to issue the permits even if the Commission objects. DEP is required only to review the Commission's comments o n development19 A- 3464

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applications within the PNR, which it did. There is nothing inherently erroneous, let alone arbitrary, about DEP's disagre ement with the Commission. In sum, there is substantial, credible evidence DEP comported with applicable regulations and did not act arbitrarily or capriciously in reauthorizing the CAFRA Individual Permit and Freshwater Transiti on Area Waiver to Jaylin. We conclude there is no basis to vacate the permit or wavier. Affirmed.