The New Jersey Department of Environmental Protection’s (NJDEP) groundbreaking Environmental Justice Rules (EJ Rules), codified at N.J.A.C. 7:1C, went into effect on April 17, 2023, following the passage of New Jersey’s Environmental Justice Law (EJ Law) in September 2020 (N.J.S.A. 13:1D-157 et seq.). Given their breadth, complexity, and impact on environmental permitting, it was only a matter of time before the EJ Rules were subject to legal challenges. Those challenges came in the form of two separate appeals in June 2023, when industry groups filed formal applications in the Superior Court of New Jersey, Appellate Division, seeking to invalidate the EJ Rules.
On January 5, 2026, the Appellate Division issued its consolidated decision in both appeals,1 affirming the EJ Rules. In rejecting the broad procedural and substantive arguments raised by the industry group challengers, the Court upheld the NJDEP’s authority to develop rules that interpret and implement the EJ Law. Subject to any appeal to the New Jersey Supreme Court, the Appellate Division’s decision will likely cement the EJ Rules as a baseline requirement for environmental permitting in New Jersey’s overburdened communities (OBC).
As a refresher, the EJ Law supplements existing environmental permitting procedures by creating a framework for the NJDEP to evaluate the environmental and public health impacts that might ensue when the building of a new facility, the expansion of an existing facility, or the renewal of a major source permit occurs or is proposed in whole or in part within an OBC. The EJ Rules delineate each stage of the regulatory process and define key terms left open by the statute, providing the operative framework for permitting decisions in OBCs. You can review our full analysis of the final EJ Rules here, which provides a discussion of key terms and regulatory steps as well as practical implications and applicability.
The NJDEP has already been requiring permit applicants in OBCs to comply with the EJ Rules in accordance with agency guidance. Because the Appellate Division affirmed both the EJ Rules and the NJDEP’s authority to issue such guidance, applicants in OBCs should be prepared to satisfy the environmental justice process when filing permitting applications for covered facilities.
With the EJ Rules intact, the NJDEP retains the authority, in certain enumerated circumstances, to deny permits for covered facilities except where there is a narrowly defined compelling public interest.2 The NJDEP also has the authority to impose site-specific conditions on permits to protect public health and safety. For example, in July 2024, the NJDEP exercised that authority in its determination on the Passaic Valley Sewerage Commission’s (PVSC) permit modification request for construction and operation of a standby power-generating facility in Newark. Because the EJ Rules were not yet published, that determination was made under Administrative Order 2021-25, which, like the EJ Rules, authorized the agency to impose special conditions on permits. After a four-year review, the NJDEP approved the PVSC’s permit modification request subject to 11 special conditions, including the submission of a semiannual environmental justice compliance report.
The Appellate Division’s decision marks the first published result of a challenge to the EJ Rules, with an application for review to the New Jersey Supreme Court and additional appellate challenges potentially to come. Pending any additional challenges, for now the EJ Rules are here to stay.
For additional information on the EJ Rules, special permitting conditions, and environmental permitting in New Jersey, please contact the authors of this client alert.
1 Matter of New Jersey Dep’t of Envtl. Prot.’s April 17, 2023, 55 N.J.R. 661(B) “Environmental Justice Rules,” Adopted Amendments N.J.A.C. 7:1C, et seq., __ N.J. Super. __, A-2936-22, 2026 WL 20879 (N.J. Super. Ct. App. Div. Jan. 5, 2026).
2 We note that the “compelling public interest” analysis expressly excludes the potential economic benefits of a facility.
