IN THE MATTER OF LANDIS SEWERAGE AUTHORITY NJPDES PERMITNO. NJ0025364-46537(NEW JERSEY DEPARTMENT OF ENVIRONMENTAL PROTECTION), A-2382-15T4

Background

Landis Sewerage Authority operates a wastewater treatment plant discharging to groundwater and required an NJPDES permit; DEP calculates annual NJPDES fees to recoup program costs.
DEP published 2014 and 2015 NJPDES fee reports in the New Jersey Register, with one-month comment periods; Landis submitted written comments and testified at public hearings both years.
DEP invoiced Landis $104,667.11 for FY2014 (majority for groundwater discharge) and $85,319.72 for FY2015; Landis paid uncontested portions and requested recalculations for contested portions, which DEP denied.
Landis requested administrative hearings and stays of payment; DEP suspended contested invoices pending review but ultimately denied administrative hearing requests in January 2016, reasoning Landis was challenging promulgated rules rather than application.
Landis appealed the denial, arguing DEP misapplied regulations in fee calculations (minimum fee timing, use of Landis-reported data, overhead/fringe factors, inclusion of uncollected fees) and that due process required more specific answers and a hearing given a >500% fee increase in 2014.
The Appellate Division affirmed, holding Landis failed to timely challenge the adopted fee rules and did not identify material factual disputes requiring an adjudicative hearing.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Landis was entitled to an administrative (adjudicatory) hearing on the 2014–2015 permit fees	Landis argued DEP misapplied regulations in calculating fees and drastic fee increase warranted a hearing	DEP argued fee adoption was legislative/rulemaking, Landis had opportunity to comment and failed to timely challenge adoption, DEP may deny hearings when challenge targets rules not application	Denied — DEP properly exercised discretion to refuse adjudicatory hearing because fees were promulgated rules and Landis failed to timely appeal
Whether DEP failed to recalculate the minimum fee annually as required by regulation	Landis maintained DEP should have updated minimum fee since 2007	DEP interpreted regulation as not requiring annual recalculation and acted within discretion	Held for DEP — no abuse of discretion and no adjudicative facts in dispute
Whether DEP improperly used permittee-reported data or incorrect overhead/fringe factors in fee computation	Landis claimed DEP ignored its self-reported MRF data and used an inaccurate 2014 overhead/fringe factor	DEP used its published formulas and disclosures; calculations were part of rulemaking and Landis did not show specific erroneous data points	Held for DEP — Landis did not identify material factual errors requiring hearing
Whether inclusion of uncollected past fees in the fee base required adjudication	Landis alleged uncollected prior-year fees were rolled into 2014–2015 calculations	DEP's published reports showed calculation breakdowns and did not support Landis' assertion; Landis failed to pinpoint where uncollected fees were used	Held for DEP — insufficient evidence of material factual dispute

Key Cases Cited

In re NJPDES Permit No. NJ0025241, 185 N.J. 474 (2006) (distinguishes when adjudicative hearing is required and when rulemaking suffices)
In re Application of Modern Indus. Waste Serv., Inc., 153 N.J. Super. 232 (App. Div. 1977) (APA prescribes hearing procedures when required)
Fanelli v. Dep't, 174 N.J. 165 (2002) (right to administrative hearing generally must be grounded in statute or constitution)
Christ Hosp. v. Dep't of Health & Senior Servs., 330 N.J. Super. 55 (App. Div. 2000) (same principle regarding hearing rights)
N.J. Builders Assoc. v. Sheeran, 168 N.J. Super. 237 (App. Div. 1979) (agency actions presumed reasonable; hearings reserved for disputed adjudicative facts)
High Horizons Dev. Co. v. Dep't of Transp., 120 N.J. 40 (1990) (trial procedure reserved for disputed facts, not pure law or policy issues)