Source: http://nj.findacase.com/research/wfrmDocViewer.aspx/xq/fac.20180905_0000728.C03.htm/qx
Timestamp: 2020-02-23 14:40:45
Document Index: 779799660

Matched Legal Cases: ['§ 717', '§ 717', '§ 4321', '§ 1251', '§ 4332', '§ 1341', '§ 13', '§ 7', '§ 7', '§ 717', '§ 717']

FindACase™ | Township of Bordentown v. Federal Energy Regulatory Commission
TOWNSHIP OF BORDENTOWN, NEW JERSEY; TOWNSHIP OF CHESTERFIELD, Petitioners
FEDERAL ENERGY REGULATORY COMMISSION, Respondent Transcontinental Gas Pipe Line Company, LLC, Intervenor Respondent TOWNSHIP OF BORDENTOWN, New Jersey; TOWNSHIP OF CHESTERFIELD; PINELANDS PRESERVATION ALLIANCE, Petitioners
NEW JERSEY DEPARTMENT OF ENVIRONMENTAL PROTECTION, Respondent Transcontinental Gas Pipe Line Company, LLC, Intervenor Respondent
Submitted Pursuant to Third Circuit L.A.R. 34.1(a) June 11, 2018
On Petition for Review of Orders of the Federal Energy Regulatory Commission (Agency Nos. FERC CPI15-89-000, CPI15-89-001) and of the New Jersey Department of Environmental Protection (Permit Nos. Nos. 0300-15-0002.2 FWW150001, 1322D DWP150001, 0300-15-0002.2 FHA150001, 0300-15-0002.2 FHA150002)
Jennifer Borek Lawrence Bluestone Genova Burns Counsel for Petitioner Township of Bordentown
John C. Gillespie Parker McCay Counsel for Petitioner Township of Chesterfield
Paul A. Leodori Todd M. Parisi Law Offices of Paul Leodori Counsel for Petitioner Pinelands Preservation Alliance
David L. Morenoff Robert H. Solomon Susanna Y. Chu Ross Fulton Rekha Sherman Federal Energy Regulatory Commission Counsel for Respondent Federal Energy Regulatory Commission
Gurbir S. Grewal Jason W. Rockwell Ryan C. Atkinson Lewin J. Weyl Office of Attorney General of New Jersey Counsel for Respondent New Jersey Department of Environmental Protection
Christine A. Roy Brian B. Keatts Richard G. Scott Rutter & Roy Counsel for Intervenor Respondent Transcontinental Gas Pipe Line Co LLC
Before: CHAGARES, GREENBERG, and FUENTES, Circuit Judges.
III. Challenges to FERC's Orders .............................. 12
IV. Challenges to the NJDEP's Order ........................ 56
This consolidated appeal considers a bevy of challenges brought by the Township of Bordentown, Township of Chesterfield, and Pinelands Preservation Alliance's ("PPA") (collectively, the "petitioners"), seeking to prevent the expansion of interstate natural gas pipeline facilities operated by the Transcontinental Pipe Line Company, LLC ("Transco").[1] The petitioners contend that the Federal Energy Regulatory Commission ("FERC") violated the federal statute governing the approval and construction of interstate pipelines, as well as other generally applicable federal environmental protection statutes, by arbitrarily and capriciously approving Transco's proposed project. The petitioners further maintain that the New Jersey Department of Environmental Protection ("NJDEP") violated New Jersey law by (1) improperly issuing to Transco various permits that Transco was required under federal law to obtain before it could commence construction activities on the pipeline project, and (2) denying the petitioners' request for an adjudicatory hearing to challenge the permits' issuance, based only on the NJDEP's allegedly incorrect belief that the New Jersey regulations establishing the availability of such hearings were preempted by federal law.
As explained more fully below, although we conclude that the petitioners' challenges to FERC's orders lack merit, we agree that the NJDEP's interpretation of the relevant federal law was incorrect, thus rendering unreasonable the sole basis for its denial of the petitioners' request for a hearing. Given our disposition, we do not reach the petitioners' substantive challenges to the NJDEP's provision of the permits, which - assuming a hearing is granted - we leave for the NJDEP to address in the first instance. We accordingly will deny in part and grant in part the petitions for review, and we will remand to the NJDEP for proceedings consistent with this opinion.
This case presents challenges to both the federal and state governments' treatment of Transco's application to construct its interstate pipeline project. Before detailing the agency proceedings that preceded this appeal, we first briefly set forth the various interlocking federal and state regulatory schemes at play, which this Court has already elucidated in some detail. See Del. Riverkeeper Network v. Sec'y of Pa. Dep't of Envtl. Prot., 870 F.3d 171, 174 (3d Cir. 2017) ("Delaware II"); Del. Riverkeeper Network v. Sec'y Pa. Dep't of Envtl. Prot., 833 F.3d 360, 367-69 (3d Cir. 2016) ("Delaware I").
Under the Natural Gas Act of 1938 ("NGA"), 15 U.S.C. §§ 717-717z, FERC is tasked with regulating the construction and operation of interstate natural gas pipelines. Id. §§ 717f, 717n. If FERC determines that a given project should proceed, it will issue a "certificate of public convenience and necessity" (the "certificate"), which in turn is conditioned on the pipeline operator acquiring other necessary state and federal authorizations. See Delaware I, 833 F.3d at 367-68. Among the regulatory schemes related to the NGA are the federal environmental laws, including the National Environmental Policy Act ("NEPA"), 42 U.S.C. §§ 4321-4370h, and the Clean Water Act ("CWA"), 33 U.S.C. §§ 1251-1388. NEPA is primarily a procedural statute that requires FERC to assess "the potential environmental impact of a proposed pipeline project." Delaware I, 833 F.3d at 368. Upon completing the analysis, FERC must issue either an Environmental Assessment ("EA," if the analysis indicates that the project will have no significant environmental impacts) or an Environmental Impact Statement ("EIS," if the analysis indicates that the project will be a "'major Federal action' that would 'significantly affect[] the quality of the human environment'"). Del. Riverkeeper Network v. U.S. Army Corps of Eng'rs, 869 F.3d 148, 152 (3d Cir. 2017) (quoting 42 U.S.C. § 4332(C)). As to the CWA, although the NGA explicitly "preempts state environmental regulation of interstate natural gas facilities," it "allows states to participate in environmental regulation of these facilities under . . . the Clean Water Act." Delaware I, 833 F.3d at 368. The CWA permits states, subject to United States Environmental Protection Agency approval, to establish their own minimum water quality standards, including by regulating the discharge of pollutants into bodies of water in the state. Id.
The NGA and CWA converge where, to construct an interstate pipeline, a company must discharge into - or displace water from - the navigable waters of the United States. Before a company is permitted to undertake this activity, it must obtain a permit pursuant to Section 404 of the CWA, which itself may issue only after the company secures a state-issued Water Quality Certification, pursuant to Section 401 of the CWA, "confirm[ing] that a given facility will comply with federal discharge limitations and state water quality standards." Id.; see also 33 U.S.C. § 1341(a) ("Any applicant for a Federal license or permit to conduct any activity . . . which may result in any discharge into the navigable waters, shall provide the licensing or permitting agency a certification from the State in which the discharge originates or will originate, . . . that any such discharge will comply with the applicable [water quality] provisions . . . of this Act"). Because New Jersey has assumed permitting authority under Section 404 - implemented by the NJDEP under the framework of the New Jersey Freshwater Wetlands Protection Act ("FWPA"), N.J. Stat. Ann. § 13:9B-1 - the issuance of a Section 404 permit in New Jersey carries with it a Section 401 Water Quality Certification. N.J. Admin. Code § 7:7A-2.1(c)-(d); Delaware I, 833 F.3d at 368-69.
The permits at issue in this case relate to Transco's Garden State Expansion Project (the "Project"), by which Transco planned to upgrade its existing interstate natural gas pipeline system so that it could support the transportation of another 180, 000 dekatherms per day of capacity for natural gas from its Mainline to its Trenton-Woodbury Lateral. The Project proposed to construct a new meter and regulating station, compressor station, and electric substation along the Trenton-Woodbury Lateral in Chesterfield, New Jersey (Station 203), and to upgrade and modify the existing motor drives and compressor station located on the Mainline in Mercer County, New Jersey (Station 205).
The New Jersey Natural Gas company ("NJNG") contracted with Transco to utilize all the capacity added by the Project, for distribution via NJNG's intrastate pipeline system. In anticipation of obtaining the excess capacity, NJNG has proposed to construct the Southern Reliability Link Project ("SRL"), a 28-mile-long intrastate pipeline that would connect to Transco's Trenton-Woodbury Lateral pipeline and deliver gas south-eastward for connection into NJNG's existing system. Separately, PennEast has proposed to construct the interstate PennEast Pipeline Project, which would deliver natural gas from Pennsylvania's Marcellus Shale region and terminate at an interconnect with Transco's Mainline. NJNG has independently contracted with PennEast to purchase 180, 000 dekatherms per day of the PennEast project's expected supply, for delivery to the SRL via Transco's pipeline network.[2]
As required by the NGA, Transco sought and obtained from FERC a certificate of public convenience and necessity authorizing the construction of the Project, subject - as is generally the case - to Transco "receiv[ing] all applicable authorizations required under federal law." Appendix ("App.") 67. Prior to issuing the certificate, FERC conducted an environmental analysis and issued an EA concluding that, with the appropriate mitigation measures, the Project would have "no significant impact" on the environment. App. 1479; see also App. 45. FERC issued the EA in November 2015 and, after receiving comments, issued Transco the certificate in April 2016. Bordentown and Chesterfield moved FERC for a rehearing, which FERC denied in November 2016. See App. 74-97.
Because the Project would be situated in freshwater wetlands and transition areas, and the construction of the Project would require discharging fill or dredge material into navigable waters as well as the diversion of a significant volume of water, Transco applied to the NJDEP for a Freshwater Wetlands Individual Permit and Water Quality Certificate ("FWW permit") and dewatering permit, as required by the CWA and New Jersey law.[3] The NJDEP held two days of public hearings to consider the FWW permit, and received over 1, 800 written comments, which included concerns raised by each of the petitioners. After obtaining Transco's responses to the public comments, as well as its responses to the NJDEP's requests for additional information concerning possible alternative sites for an electrical substation that would be built as part of the Project, the NJDEP issued the FWW permit on March 13, 2017. Shortly thereafter - and also following a public hearing - the NJDEP on March 16, 2017 issued the temporary dewatering permit.
Pursuant to New Jersey law, the petitioners sought an adjudicatory hearing concerning each permit. Bordentown - later joined by Chesterfield and PPA - filed a request for a hearing on the FWW on March 22, 2017. On April 11, 2017, Bordentown alone also requested an adjudicatory hearing on the dewatering permit. Both requests were filed within the 30-day limitations period established under New Jersey law for seeking adjudicatory hearings. See N.J. Admin. Code §§ 7:7A-21.1(b); 7:14A-17.2(c). Bordentown asserted that it had standing under state law to challenge the permits as a third party because it had a particularized property interest affected by the Project, given that part of the project would be built on Bordentown-owned land, which Transco had acquired through eminent domain under the authority granted by the FERC certificate. See NJDEP App. 37 & n.4; 15 U.S.C. § 717f(h). On August 22, 2017, the NJDEP denied the petitioners' requests for an adjudicatory hearing on either permit. The sole stated basis for the NJDEP's denial of the request was that this Court's decision in Delaware I established that we have "exclusive jurisdiction to review the issuance of permits regarding interstate natural gas pipeline projects" and accordingly that by operation of the NGA "the state administrative hearing process provided for in the [FWPA] is not applicable to permits for interstate natural gas projects." NJDEP App. 39. Concluding that the NGA "requires that final permits be appealed to the Third Circuit," the NJDEP denied the petitioners' hearing requests.
The petitioners timely sought review in this Court, both of FERC's orders issuing the certificate and denying rehearing, and of the NJDEP's issuance of the permits and its order denying the requests for an adjudicatory hearing to challenge them. We have jurisdiction to review these petitions for review of the federal and state agencies' orders regarding the interstate Project under 15 U.S.C. § 717r(d)(1).
III. Challenges to FERC's Orders
We begin with the challenges directed at FERC's orders (docket No. 17-1047). As explained more fully below, we conclude that the petitioners' FERC-related claims are unavailing.