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DEP COMPLETES DEMARCO
REVIEW;
DEP WITHDRAWS ACO
The Department of Environmental
Protection (DEP) today announced it has withdrawn its proposed
administrative consent order (ACO) with A.R. DeMarco Enterprises,
Inc. after failing to reach agreement with DeMarco on revised
settlement terms.
In response to recommendations received
from the public and the state Inspector General (IG) on
the proposed ACO during the normal public comment period,
DEP acquired two independent, formal appraisals of land
assets proposed to be conveyed to the State by DeMarco to
settle the penalty for wetlands violations. The agency also
agreed to form a senior committee to review the proposed
wetlands settlement to ensure public confidence in the outcome
and to address any public misperceptions in the matter.
The proposed ACO allowed for transfer of
land and an easement interest in lieu of a $594,000 penalty.
DEP Chief of Staff Gary Sondermeyer stated that the department's
review committee determined that the state could accept
land in lieu of the cash penalty in this case, but the land
should be transferred in fee simple. The department determined
to impose a monetary penalty of $594,000 against DeMarco
after a settlement proposal based on receipt of land in
fee simple was rejected by DeMarco.
"This extensive comment and review showed
us the strengths of our land use permitting and enforcement
program and also areas for improvement," said Sondermeyer.
"Land is appropriate as a penalty, provided an appraisal
is done, the value of the land is at least equal to the
penalty amount, and it is given in fee simple. Relinquishing
land can provide the deterrence of a monetary penalty and
benefit the public."
The committee conducted an exhaustive review
of the appraisals, the IG report and public comments. Specifically,
the committee found that the penalty was properly calculated
in accordance with Department regulations; exceeded any
economic benefit DeMarco realized as a result of filling
the wetlands; any Pinelands Development Credits (PDCs) received
should transfer to the state with any land provided; and
that the easement did have value to the state and public.
In other related actions, Sondermeyer announced
that after very careful analysis, DEP has concluded that
DeMarco Enterprises, Inc. qualifies for two permits to legitimize
the expansion of its cranberry bogs. He said the two permit
applications were approved because the site chosen for expansion
was the only available site that met the Freshwater Wetlands
General Permit requirement for availability of water for
bog operations and had the least ecological value. Wetlands
converted for bog operations must have a water supply of
227 gallons per minute per acre. The two permit applications,
submitted in 2000 and 2001 respectively, each cover 10 acres.
Because bog expansion permit applicants
can only seek to convert 10 acres per year, DeMarco needs
three permits to legitimize the 22 acres of wetlands that
were converted to cranberry bogs. DeMarco will have to apply
for a third permit in 2002 for the remaining two acres.
As a condition of approvals, DeMarco will have to transfer
2 1/4 PDCs to the DEP which will then be sold to the Pinelands
Development Credit Bank and the revenue will be placed in
DEP's white cedar restoration fund.
DEP Deputy Commissioner Bob Tudor said
that the permit applications meet the criteria under newly
revised general wetlands permit rules, noting that DeMarco's
wetlands violations and the approval of the permits were
evaluated as two separate issues.
"Had it not acted prematurely, DeMarco
Enterprises would have received approval under our new rules
for cranberry bog expansions and we believe that the penalty
assessed today sufficiently compensates for the wetlands
disturbance which occurred," said Tudor.
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