‘A bad deal for New Jersey taxpayers’

Seven environmental groups file lawsuit to stop proposed Exxon settlement

UNION COUNTY, NJ — Seven environmental groups last week filed legal action to block the $225 million deal the state made with Exxon earlier this year, asking the court to reject the proposed settlement they claim should be in the billions.

The motion to intervene, filed in Union County Superior Court June 10 by the Columbia Environmental Law Clinic and Natural Resources Defense Council on behalf of the seven groups, focused on the actual cost of damages from generations of toxic pollution dumped in the groundwater and soil by Exxon at the Linden and Bayonne refineries and 16 other sites and 800 gas stations throughout the state.

The environmental groups involved in the motion included the New Jersey Sierra Club, New Jersey and New York Baykeeper, Clean Water Action, Delaware Riverkeeper, Delaware Riverkeeper Network, Environment New Jersey, and New Jersey Audubon.

“We’re asking to be heard because this is a bad deal for New Jersey taxpayers, public health and the environment,” said David Pringle, New Jersey campaign director of Clean Water Action.

“When you add up all the details in the proposed settlement, it’s a sweetheart deal for Exxon, possibly less than half of one tenth of one cent on the dollar for an actual restoration,” he said, adding “this is a raw deal for the people of New Jersey, the public, and the state legislature.”

Pringle said members have spoken up resoundingly against the settlement and feel “the polluter should pay.” His comments were echoed by Jeff Tittel, director of the New Jersey Sierra Club, who explained why his group signed on to the lawsuit.
“This is not a settlement. It is a sellout to taxpayers and the environment,” he said adding “we are going to court to do the job the DEP should do, which is to reject this settlement and make Exxon pay their fair share.”

Tittel also had strong opinions regarding Gov. Chris Christie praising the proposed settlement between the state DEP and Exxon as one of the largest in state history.

“This dirty deal should not stand. Not only does it affect Linden and Bayonne, but communities from one end of New Jersey to the other. The DEP never gave the judge or the public any information on the 16 other sites or the hundreds of gas stations,” the Sierra Club director said, adding “this makes this dirty deal even dirtier, the corporate subsidy even bigger.”

Tittel said the environmental groups are intervening to represent the people “since the DEP is more concerned about Exxon.”
“We will go to court to uphold the public trust doctrine and make sure polluters pay for the damages to natural resources. We are here to put the trust back in the public trust doctrine and ensure those people in those communities get the money they are entitled to,” Tittel said.

The court motion followed the closing on June 5 of the 60-day public comment period allowed by law before the state and Exxon was expected to submit a finalized agreement to Superior Court Judge Michael Hogan for his stamp of approval. Prior to that, a broad coalition of state legislators, labor, housing, residents and environmental groups called for the proposed settlement to be rejected, using petitions and the media to rally residents to send comments urging the DEP reject the move.

There also was a protest June 4 on the statehouse steps prior to more than 15,000 comment cards and petitions being delivered to the DEP, with protesters holding signs saying “don’t sell out to Exxon” and “Kindergartners against the Exxon settlement.”

The protest came the day after the Assembly Judiciary Committee, which was tasked with investigating the settlement, held its final hearing on the issue in Bayonne, one of the two sites involved in the lawsuit between the state and Exxon. The Linden Bayway refinery was the other site.

The settlement was touted by the state and governor as historic because the DEP had battled the oil mogul in and out of court for more than a decade prior to the settlement.

The state first filed a lawsuit against ExxonMobil in 2004, when the court ruled the oil company was liable for polluting the waterways, wetlands and marshes on and near the refinery sites in Linden and Bayonne.

Hogan presided over the 66-day trial in 2014 in which the state went head-to-head with Exxon in an attempt to get the only publicly traded oil company to make restitution for the damages it did from 1909 until 1993.

At that time the state Department of Environmental Protection had floated $8.9 billion as the amount it would take to compensate the public for the decades of pollution that left more than 1,500 acres of land in Linden contaminated with oil ten-feet deep in places.

Hogan was in the process of deliberating the amount Exxon would have to pay and was expected to rule within days of the state abruptly deciding to forge a deal with Exxon that reduced a settlement to just $225 million.

Although the proposed settlement was expanded to include sites that were not in the original lawsuit, including Exxon oil facilities around the state and more than 800 gas stations, the seven environmental groups maintain the $225 million will not be enough to clean up these sites.

“The damage at these additional 16 sites is extensive, the lawsuit maintains, pointing out that chemicals were found in the groundwater including benzene, toluene, BTEX and many other volatile organic compounds.

Maya van Rossum, Delaware Riverkeeper and leader of the Delaware Riverkeeper Network explained why they signed on to the lawsuit.

“We are moving to intervene in this action to ensure that Exxon and all those who would damage our natural resources understand they cannot and will not be let off lightly for harming present and future generations and to ensure that Exxon is held fully accountable,” she said, pointing out that a 2009 DEP report found that 118 million gallons of groundwater were contaminated as a result of a spill along 34 acres next to the Delaware River in South Jersey.

Democratic state lawmakers, elected officials and environmentalists reacted with disbelief and anger when it was announced the oil company would only be paying pennies on the dollar.

Democrat State Sen. Ray Lesniak was more than livid when he heard about the proposed deal and immediately made plans to block the settlement.

“The more we learn about this deal, the worse it smells,” he said, adding “in fact this has to be the biggest corporate giveaway in history and it’s being done for the most profitable oil company in the world.”

Despite the backlash, both the DEP and Attorney General maintained it was the best deal they could negotiate considering this was the second largest payout involving an environmental settlement. They also said the settlement met the goals they set for the case, which was to recover an amount that fairly and reasonably compensated the state for natural resource damages and reinforce ExxonMobil’s requirement to cleanup the Linden and Bayonne sites.

However, the proposed settlement would release the oil company from liability and damages at all of the 18 major sites and 800 gas stations around the state, which objectors claim was a critical part of the lawsuit against the oil company. The seven groups also argue that while the initial lawsuit required Exxon to clean up the Linden and Bayonne sites, the company was responsible for paying $8.9 billion to remove all the oil and chemicals from the soil and groundwater at the two sites and then restore the wetlands and other vital ecosystems, the proposed settlement does not.

“Under the proposed Christie administration settlement, the state will not recover anywhere near the funds they need to restore these incredibly damaged sites to their original condition and make New Jersey residents whole for the loss of these natural resources,” the seven groups noted in the lawsuit. In addition, Exxon does not have to clean up these sites to their original state, they said.

Under the new proposed deal, Exxon does not have to clean-up the site to the extent they had to before. And, there is difference between site restoration and remediation. Tittel explained that under the original court case Exxon would have had to “restore” the site to its original condition prior to the spills and leaks. This would include removing all the oil and chemicals and then restoring the wetlands.

In the proposed settlement, Exxon can just cap the site, which means the soil beneath the cap would still be contaminated and oil would still be leaking into the groundwater.

Tittel said he is confused by the DEP forging the proposed deal with Exxon because they were winning the case all long and it made no sense to settle.

“Instead of waiting for the judge’s decision, the administration circumvented the judge for pennies on the dollar,” he said, adding that even according to the Christie administration’s court brief the pollution was “staggering.”

“The administration had no reason to settle, other than giving away the store to Exxon at the expense of our environment. It’s a dirty deal done dirt cheap,” Tittel said, adding that in some ways the proposed settlement is even bigger than the “Bridgegate” scandal.

There also is no requirement that any of the natural resource funding would be directed at Linden or Bayonne. Of the $225 million now proposed, $40 million would go toward attorney fees and just $50 million would be directed toward environment restoration. Of concern is that the remainder of the money legally can be diverted by Gov. Chris Christie to balance the state budget.

It should be noted, though, the proposed $225 million settlement is on top of Exxon’s legal obligation to clean up the site, which is expected to cost more than $4.5 billion. There also is no dollar cap on this remediation of the sites in Linden and Bayonne.

“There is no requirement that any of the natural resource damage funding would be directed at Linden or Bayonne,” the environmental groups said, adding that of the proposed $225 million, $40 million would go toward attorney fees.

“The rest of the settlement would be siphoned into the General Fund, which has led the New Jersey legislature to propose a constitutional amendment for all environmental settlements to be dedicated to environmental restoration projects,” the lawsuit noted.

Also noteworthy, the proposed $225 million settlement can be used as a tax write off, and experts report as much as a third of the settlement could be essentially voided in the form of tax breaks, which many critics have said gives the appearance that environmental pollution is simply a cost of doing business.