Many legislators speak out against proposed ExxonMobil settlement

Two new bills in the works to overhaul use of settlement funds

UNION COUNTY, NJ — In the wake of the controversial $225 million proposed ExxonMobil settlement, Democrat lawmakers have initiated legislation that will not only protect how environmental settlement money is divided at the state level but also ensuring that the public is kept in the loop about such matters.

There were several pieces of legislation sponsored recently by, among others, Union County Assembly Democrat Annette Quijano. The first bill will set in stone how settlement money is allocated while the second gives the public more time to understand contamination settlements.

Both bills are in response to the decision by Gov. Chris Christie’s administration to settle with ExxonMobil for what Democrats feel is a fraction of the $8.3 billion that the DEP was asking for in damages for contamination and loss of use of more than 1,750 acres of wetlands, marshes, meadows and waterways in Linden.

Also upsetting democrats is that the governor’s administration accepted the $225 million settlement days before a Superior Court judge was expected to rule on the decades-long lawsuit. The 11th-hour decision to settle the lawsuit in mid-March against Exxon shocked Democrat lawmakers, including State Sen. Ray Lesniak, who several days later held a press conference in the shadow of the Bayway Refinery to decry the three-cents on the dollar proposed deal.

Meanwhile Christie and other Republican stakeholders touted the settlement as “historic and the largest settlement payment negotiated by a single corporate defendant – ever.” McKeon and other democratic assembly members expressed strong concern about the timing of the settlement and the fact the general public knew nothing about the entire proposed deal until it was agreed upon by sides.

The first bill, sponsored by Assembly Democrats Quijano, John McKeon, Gary Schaer, Speaker Vincent Prieto and Benjie Wimberly, would amend the 2015 state budget to provide that one-half of all amounts involving environmental lawsuit recoveries received by the state, in excess of $50 million, be deposited into the Hazardous Discharge Site Cleanup Fund.

The purpose is to ensure that these settlement monies are appropriated for the direct and indirect costs of remediation and restoration cleanup.

“Current law allows the administration to use most of the Exxon settlement money to balance the budget. Residents have been terribly shortchanged by this settlement,” McKeon said, adding that using these funds as a short-term budget fix adds “insult to injury.”

“This bill amends the law so the bulk of monies received from environmental lawsuits are reserved for damage restoration,” said the assemblyman.

“If the decision to settle with Exxon for less was not bad enough, now we have to contend with the possibility that the majority of funds will not be used to repair the damage created,” said Schaer, adding “this sends a terrible message to the communities affected. We must be proactive in identifying new revenue sources, but not at the expense of our residents and our natural resources.”

Quijano stressed similar feelings, reacting strongly to the fact the contamination at one site took place in her district, which includes the Linden Bayway Refinery.

“The settlement reached by the state leaves more questions than answers. This was decade’s worth of contamination. To use most of the settlement money for purposes other than repairing the damage sends the wrong message about our commitment to protecting our natural resources,” said the assemblywoman.

Wimberly felt that the state being allowed to spend a decade legally pursuing Exxon for environmental damages and then turn around and use a large portion of that money for something other than restoration was wrong.
“If we are going to hold these companies accountable for polluting our natural resources, we cannot disregard our responsibility to restore these resources as best as possible,” he said.

This bill was passed by the assembly March 26 in a 43-30-1, later passing the senate 23-14. The bill is now on the way to the governor’s desk for his approval or veto.

The second bill, A-4307, would require the Department of Environmental Protection to provide at least 60 days public notice prior to entering into a settlement, as noted in the Spill Compensation Control Act “The many concerns surrounding the ExxonMobil settlement make a glaring example of why the public notice time frame needs changing,” said McKeon, adding “the questionable size of the settlement, the extent of the damage and the length of time involved with this litigation makes a 30-day public notice period inadequate. More time is appropriate for this and all future settlements.”

Quijano said the decision by the state to settle for less “merits scrutiny.”
“Residents, especially those living in the communities directly impacted by the contamination, deserve to be heard,” said the assemblywoman, adding “this bill gives the public ample time to digest this information and voice any concerns they may have about the terms of the environmental settlements being eyed by the state, especially when the benefits of the settlement don’t add up.”

McKeon, chair of the Assembly Judiciary committee, has been a harsh critic of the state’s proposed $225 million settlement, saying the number fell far short of the original target goal of $8.9 billion.

Christie has defended the agreement, noting at a town hall meeting last month that it was “a good settlement.” The settlement is in addition to an agreement ExxonMobil made with the state to clean up the contaminated site in Linden and Bayonne, which is expected to cost in excess of $4 billion.

Earlier in March the senate passed a non-binding resolution asking a judge to reject Christie’s $225 proposed settlement with ExxonMobil. The proposed settlement, though, still has to be approved by the judge overseeing the 2004 lawsuit after a 30-day public comment period, according to the DEP.

The senate resolution condemned the settlement and urged the judge to reject it. They described the settlement as “grossly inappropriate, improper, inadequate and violates the public trust.”

Republican Assembly minority Leader Jon Bramnick urged calm in the face of outrage, pointing out that ExxonMobil could extend the litigation for years if it chose to do so, noting “they have more money than the state of New Jersey.”