Natural Resource Damage Assessment: Methods and Cases

A. New Jersey
The Department of Environmental Protection (DEP) is the designated trustee for New
Jersey’s natural resources. At the time of our survey, the Office of Natural Resource Damages
(ONRD) was responsible for implementing the NRDA program to address and ensure that PRPs
compensate the public for injuries to natural resources; that office is now named the Office of
Natural Resource Restoration (ONRR). The New Jersey Legislature has declared groundwater to
be one of the resources most vulnerable to contamination by hazardous discharges. Groundwater
is an important natural resource for New Jersey. It is a major source of water for drinking and
irrigation, and provides non-consumptive ecological services such as prevention of salt water
intrusion, maintenance of freshwater wetlands, and base flow to surface waters.
In addition to the Federal statutes previously discussed (notably OPA and CERCLA),
there are multiple state statutes establishing the DEP’s authority to require the investigation and
restoration of natural resource injuries. These include the Water Pollution Control Act, the Spill
Compensation and Control Act, the Industrial Site Recovery Act and the Brownfield and
Contaminated Site Remediation Act in addition to the Public Trust Doctrine under which the
State is responsible as the trustee of the State’s natural resources to manage these resources.
These statutes specify that PRPs should compensate the public for the loss associated
with injuries to natural resources by paying monetary damages the State, committing to restore
the injured resources to their former state, or engaging in restoration projects elsewhere in the
watershed that achieve similar restoration benefits. The federal court has stated that “while it is
not irrational to look to market price as one factor in determining the use value of a resource, it is
unreasonable to view market price as the exclusive factor or even the predominant one… natural
resources have values that are not fully captured by the market system” (NJDEP, 1999). The
New Jersey Legislature also recognizes that the public value of a resource is distinct and could
exceed the private value.
At a minimum, NRDs include restoration costs and the cost of assessing the damages.
Restoration costs are the costs of actions that return natural resource services to their baseline
condition sooner than natural recovery. Assessment costs are the “reasonable” costs of
performing the damage assessment; those expenditures must be commensurate with the
estimated amount of damages. NRDs could also include interim losses. NRDs do not include
punitive damages; thus, they do not depend on the conduct of the PRP.
The DEP promulgated a document titled Technical Regulations for Site Remediation
(New Jersey, 1999) which provides a mechanism for assessing the natural resource injuries
required as part of the site remediation process. This chapter summarizes the 1999 policy and
regulations, though some amendments to these regulations have been made recently. The
assessment process involves a baseline ecological evaluation and an ecological risk assessment.
The baseline assessment involves identifying if there is a contaminant of ecological concern at
the site, if there are environmentally sensitive natural resources at or near the site and if there is a
pathway that would link the contaminant with an environmentally sensitive natural resource. If
these three criteria are met then an ecological risk assessment is required to evaluate the
likelihood that adverse ecological effects to natural resources have occurred or may occur as a
result of the discharge. The ecological risk assessment is used to identify the impact of the
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