On July 29, 1996, Commissioner Robert C. Shinn issued Administrative Order 1996-06, which directed the NJDEP to apply departmental policies and regulations in a manner "consistent with and compatible with the State Development and Redevelopment Plan" ("State Plan"). In September 1996, the New Jersey Builders' Association ("Builders' Association") challenged the validity of the administrative order, contending that the administrative order was, in fact, an improperly adopted administrative rule (no notice nor opportunity to be heard was afforded) that unfairly makes compliance with the State Plan a precondition to the issuance of permits or approvals. The Appellate Division disagreed, and held on December 10, 1997 that the administrative order is merely an "intra-agency statement" embodying existing law and, therefore, is not subject to the formal rule-making process.
A product of the State Planning Act, the State Plan aims to "provide a coordinated, integrated and comprehensive plan for growth, development, renewal and conservation of the State and its region which shall identify areas for growth, agriculture, open space conservation and other designations." In addition, the State Plan must take into account other state, county and municipal land use and development plans, coordinate planning activities and establish Statewide planning objectives.
The administrative order challenged in New Jersey Builders Ass'n v. New Jersey Dep't of Envtl. Protection was issued by Commissioner Shinn pursuant to Governor Whitman's directive that all cabinet officers submit a report detailing their departments' efforts to incorporate the State Plan into their operations. The administrative order directs NJDEP staff to take necessary steps to insure that all its policies and regulations are applied so as to be consistent and compatible with the State Plan.
In its challenge to the administrative order, the Builders Association claimed that NJDEP, by issuing the order, was requiring municipalities to comply with the State Plan which, it claimed, is intended to serve only as a guide to zoning and planning decisions. In addition, the Builders Association contended that the administrative order improperly requires compliance with the State Plan as a prerequisite to the issuance of permits or approvals. In response, the NJDEP argued that the order is merely an "intra-agency" statement directing the NJDEP staff to use the State Plan as a guide.
The Appellate Division agreed with NJDEP and acknowledged that the State Planning Act and State Plan have no regulatory effect or impact on a particular application. The Court noted that the State Plan, by its own terms, is not designed to mandate specific local action. Rather, it provides "the ends to which governments at all levels should aspire in their planning and decision-making." Lastly, the Appellate Court held that "the order does no more than declare NJDEP's intention to encourage local plans to be consistent with the State Plan, a declaration that probably was not necessary, given that, as a state agency, the NJDEP was bound by the act to aid in implementing it."
The Appellate Division's opinion in New Jersey Builders Ass'n appears to represent at least a partial victory for both parties. For the Builders' Association, the Court's decision supports an argument that affirmative proof of compliance with the State Plan is not required when state and local authorities issue permits or approvals. Rather, the State Plan is to be used by NJDEP only as a guide in the decision-making process.
From its opposing perspective, the NJDEP expressed satisfaction with the Appellate Division's decision. Michael Hogan, counsel to the Commissioner, was pleased that the "court took the order at face value." In an address to the Environmental Law Section of the New Jersey State Bar Association on December 15, 1997, Commissioner Shinn stated that he views the Court's opinion favorably, and reiterated the Department's commitment to achieving consistency between its policies and the State Plan.
