NORTH WILDWOOD – A drawn-out legal battle between this seaside city, desperate to achieve shore protection no matter who or what got in its way, and a state agency that stood up to local officials it claimed were disregarding its authority and proper procedure by implementing unauthorized coastal reinforcement projects looks to be ending.
Mayor Patrick Rosenello told the Herald a settlement resolving all litigation on the matter has been drafted — by attorneys for the city and the state Department of Environmental Protection – that he has agreed to. Taxpayers had been footing the bill for both parties’ legal fees as well as the court costs in the matters, which spanned multiple divisions of the court system and the state Office of Administrative Law.
In accordance with the terms of the proposed settlement, relayed to the Herald by Rosenello since the full draft of the agreement has not yet been made available publicly, the city will pay a total of $1.7 million to resolve $12.8 million in fines the DEP had levied for the city’s unapproved work.
North Wildwood will also agree to ask a judge to dismiss its $21 million breach-of-contract lawsuit against the DEP, which was set to go to trial in Cape May County Superior Court Dec. 9. Ordinarily, given the circumstances, that dismissal would be with prejudice, meaning those claims could never be brought back in front of the court.
According to the mayor, the city has also agreed to remove the Lou Booth Amphitheatre, an outdoor venue on the beachfront off Second Avenue that dates to the 1970s, replacing it with vegetation.
He said North Wildwood also agreed to reconfigure a section of oceanfront bulkhead it installed without state permission near Fifth Avenue, where the steel wall angles out toward the Atlantic Ocean.
Additionally, the city will plant vegetation in a barren patch of land off Hereford Inlet, between the seawall and Anglesea Drive, near Cherry Avenue, according to Rosenello.
Some $1 million of the $1.7 million is for the funding of shore protection efforts directly impacting North Wildwood, Rosenello said, adding it’s money the city would have spent that way regardless. The other $700,000 will go to a general fund the state maintains for environmental projects across New Jersey.
While the mayor acknowledged there are no new commitments from the state with regard to shore protection projects for North Wildwood, he said eliminating the litigation and any adversarial posture that had existed between the two sides is significant to getting joint projects with the DEP off the block. Projects that have long been in the works include a $20 million seawall extension along the oceanfront and the Five Mile Dune project.
“The litigation and the outstanding NOVs (Notices of Violation) were a significant hindrance to the seawall extension project. It’s very difficult when you’re suing an agency to then be moving forward on a joint project,” he said.
“Remember, that project has a $10 million federal grant, a $6.5 million state grant and a couple million dollars from the city. When you have outstanding NOVs and an active lawsuit, it’s very difficult to move a project like that forward. This settlement will get that project back on track quickly.”
A resolution authorizing Rosenello and City Clerk W. Scott Jett to execute the settlement agreement with the DEP — referred to officially as an administrative consent order — which the North Wildwood City Council was to vote on Tuesday, Nov. 19, was tabled and therefore not put to a vote.
“My understanding is that we did not have a final version of the order from the state,” Jett wrote in an email to the Herald explaining why the resolution was pulled from the agenda.
In an interview after the meeting, Rosenello affirmed the settlement is still on track and said the resolution is something the city feels good about, especially in the wake of Gov. Phil Murphy’s intervention, which led to a dredging project completed in summer that pumped 750,000 cubic yards of sand onto the island.
The mayor acknowledged the $700,000 is punitive, but insisted the other $1 million the city will pay as a result of the settlement will actually cost it nothing and help fund a long-anticipated project that North Wildwood will benefit from.
“Our cost share, that we agreed to in 2022, is actually being credited towards the penalty. So, I don’t look at [that portion] as a penalty, right? Because it’s putting sand on our beach,” Rosenello told the Herald Wednesday, Nov. 20.
Under North Wildwood’s form of government, the mayor is the city’s de facto chief executive, and he has not faced any resistance from the council, which has unanimously voted in line with the mayor’s recommendations in all aspects of the city’s legal battle with the DEP.
The agreement “basically comes out of the governor’s intervention last spring, because when the governor got involved, he had stipulated that he wanted a global settlement to everything. The NOVs, our lawsuit, and – most importantly to me – shore protection,” Rosenello said.
Following the summer of 2022, the city and the state were at loggerheads over if and when to implement more structural shore protection measures. The city wanted a bulkhead in front of its beach patrol headquarters at 15th Avenue and planned to connect it to another section of bulkhead it had installed, without the DEP’s blessing, which ended between 12th and 13th avenues. The DEP said no (though a year later the agency changed its mind).
After being denied, North Wildwood gave the DEP the proverbial chin flick. The city had ordered supplies to build the bulkhead the DEP had just denied the permits for, which were stockpiled at the construction site. Rosenello had called the DEP a “failed government agency” and said the city would do what he felt it needed to do, with or without state approval, in letters to the agency.
In December 2022, the state took the city to court, asking a judge to prevent the city from installing the steel structure.
“In blatant disregard of the department’s written direction to refrain from installing a permanent steel bulkhead, NWW has defiantly stated in two separate letters that it intends to do so,” lawyers for the DEP wrote in December 2022 court filings.
In February 2023, the city filed a counterclaim seeking $21 million, charging the DEP failed to uphold contractual agreements to provide shore protection.
“The DEP has, for reasons which remain unjustifiable, stifled North Wildwood’s ability to adequately protect itself and ameliorate the devastating effects of beach erosion which has decimated North Wildwood,” a lawyer for the city wrote.
Soon after, the DEP fined North Wildwood $12.8 million, mostly related to its unauthorized shore protection efforts. The city appealed those fines, requesting a hearing in the Office of Administrative Law.
According to a spokesperson for that office, no hearing has been held on the matter, and none is scheduled.
In Superior Court, a judge in 2023 granted the DEP’s request for an injunction but declined to dismiss North Wildwood’s counterclaim. Discovery in that lawsuit took place over this past summer, and the two parties were back in front of a judge Wednesday, Nov. 13, for the first time since April, though that pretrial conference was held over Zoom and off the record in chambers, according to court officials.
A significant factor in the settlement was the governor’s intervention in the matter last spring. Murphy, a Democrat, had directed the state Department of Transportation to step in and perform an emergency beach fill, much to the delight of North Wildwood.
In public comments on the matter, the governor did not enthusiastically support DEP Commissioner Shawn M. LaTourette’s handling of the matter and sympathized with Rosenello, a Republican.
The mayor credited Murphy for the settlement.
“The commitment by the state to shore protection for North Wildwood is … generational, when you look at the projects and the amount of money that’s going to be invested by the state,” the mayor said. “Legalizing all the things that we did, moving things so that they are more consistent with good shore management practices, I think is the right thing to do.
“I don’t really know what more we could ask for, quite frankly. I think it’s a fair settlement. At the end of the day, the number one priority is shore protection for North Wildwood. That has always been number one, and we are getting that in a very, very significant way.”
The DEP could not be reached prior to publication to confirm terms of the settlement agreement.
Contact the reporter, Shay Roddy, at sroddy@cmcherald.com or 609-886-8600, ext. 142.
