For Immediate Release
July 15, 2010 Contact: Jeff Tittel, NJ Sierra Club Director, 609-558-9100
Sellout Deal Approved State House Commission Violates Public Trust
Trenton - The State House Commission today approved a lease of public lands for the Tennessee Gas Pipeline, agreeing to a deal that rips off taxpayers, violates public trust, and sacrifices environmentally critical lands. The Commission approved a 24-year lease that allows Tennessee Gas to use public lands for a pipeline for the meager sum of $185,000. This is just another example of the State House Commission giving away public lands for development for pennies on the dollar without listening to public input.
"This is the worst deal on land since the Indians sold Manhattan Island. Not only is this a violation of public trust because the lands will be used for a pipeline, but the amount of money received violates public trust as well," said Jeff Tittel, New Jersey Sierra Club Director.
The $185,000 price is not per year, it is for the entirety of the lease. At a time when New Jersey is in a fiscal emergency the state is giving away this land, basically for free.
"This is a deliberate attempt by the DEP to violate the public trust by going around the law with a sweetheart 24-year lease. Who is DEP working for - the people of New Jersey or the Tennessee Gas Company?" Tittel said.
The state of New Jersey is using a loophole in the law that undermines the public and state's ability to get real market value for the property. By leasing the land for 24 years, the state trying to get around the Rooney-Ogden bill, which requires two public hearings, public notice and increased scrutiny. Most significantly, if the state were to lease the property for 25 years, an examination of the intended use of the property being diverted for private use would be necessary. That phrase is critical because the State of New Jersey can then charge free market value for the pipeline, not an appraisal based on open space.
"The lease is for 24 years but the pipeline will last for 50 years. The last lease was for 50 years. This is just a scam to get around the law," Tittel said.
In doing appraisals, the state of New Jersey failed to do due diligence. In fact, the company that completed the appraisal formerly worked for utilities, including Tennessee Gas. The state is buying the property in the areas around the pipeline for one price and diverting the land for far less. The state helped buy the Woggish property in Ringwood in 2009 for $46,000 an acre but the lands being diverted are only valued at $3,000 an acre. The average property purchased in the Highlands Preservation Area was done so for approximately $25,000 an acre. Camp Todd in Oakland went for $105,000 per acre in 2005. Morris property in Ringwood was purchased for $100,000 an acre; Facciglia for $86,000 an acre. Yet the state believes that with a pipeline on these properties, each acre is only worth $3,000.
"This is worse than a giveaway; it's a rip-off," Tittel said.
The state is not being adequately compensated for lands that will be destroyed during development of the pipeline. Tennessee Gas will use 17 acres in the Hamburg Mountain wildlife management area. The pipeline will use 3 acres and 14 acres will be a staging area. The state will not receive any compensation for the 14 acres although they will be degraded by construction.
There is little confidence that the state government can adequately manage this lease. An audit released earlier this week by the non-partisan Office of Legislative Services shows yet again the state is not doing its job when it comes to leases on public lands.
The Office of Leases is responsible for handling all leases of the Division of Fish and Wildlife and the Bureau of Parks and Forestry. A 2009 audit reveals that 112 of the 236 leases on the Land and Building Asset management are expired. More than half of the leases reviewed could not be validated for fair market value. Some leases on state lands to utilities go back to the 1930s, collecting only a dollar an acre. Audits in the past have exposed the same problems that still exist now.
The pipeline will cut a 23-mile trench through the Highlands, impacting dozens of state parks and one of the region's most environmentally-sensitive areas, including the watersheds of North Jersey's largest water supply reservoirs. 2.5 million people get their drinking water from the Peqquanock, Monksville and Wanaque reservoirs. This is only the first half of the project. It was stopped at Monksville because the company needs permission to go through a reservoir. The pipeline will disturb and destroy more than 230 acres of critical lands in the Highlands, cutting through numerous Category One streams, exception resource value wetlands, critical forest habitats, habitats of threatened and endangered species, and conservation priority areas as designated by the Highlands.
It will cut through the state's only 50,000 acre hardwood forested area that is in tact. This region is home to hundreds of different threatened, endangered and rare species. The pipeline will cut through several parks throughout the state including Hamburg Mountain Wildlife Management Area, Wallkill National Wildlife Refuge, Long Pond Ironworks State Park, Ringwood Manor State Park and many others. The pipeline will also destroy an additional 500 acres during construction to create roads to bring in the necessary equipment. Furthermore, the massive digging during this project will result in a high amount of silt entering these critical waterways and reservoirs.
The Tennessee Gas Pipeline Company has agreed to buy land for mitigation but this will replace only 20 acres of parklands while this 23-mile scar impacts thousands of acres. Replacement lands do not include areas impacted by road construction or heavy equipment damage. "This is like taking a box-cutter to a line of 100 parked cars and only fixing one of them," Tittel said.
In addition, the replacement lands are in the Highlands Preservation Area and have limited or no development potential. You can't mitigate for what you destroy by taking lands that are already undeveloped and cannot be developed.
The Sierra Club is also concerned that the gas in the pipeline would come from drilling in the Marcellus Shale, in Pennsylvania and New York. Development of those gas fields will hurt the environment in the Poconos and the Catskills, polluting the Delaware River and affecting New Jersey's water supply. This is only one of seven possible pipelines cutting through New Jersey for Marcellus shale.
Kara Seymour, Program Assistant NJ Sierra Club 145 W. Hanover Street Trenton, NJ 08618 609.656.7612 (f) 609.656.7618 <http://www.newjersey.sierraclub.org/> www.newjersey.sierraclub.org
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