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Exxon Corp. v. Hunt

Citation: 12 ELR 20734
No. Nos. SC 303A-81, 319A-81 TC, 4 N.J. Tax 294, (N.J. Tax Ct., 04/23/1982)

The Tax Court of New Jersey rules that § 114(c) of the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) does not preempt the State of New Jersey from collecting a spill tax, pursuant to the New Jersey Spill Compensation and Control Act (SCCA), to finance hazardous waste cleanup costs and related claims not actually compensated under CERCLA. Initially, the court notes that the phrase "may be compensated" within the meaning of § 114(c) is ambiguous and that, of the legislative history of CERCLA and the purpose and policy underlying its enactment. Next, the court rules that § 114(c) does not preempt state participation in hazardous waste cleanup but merely prohibits double taxation. The legislative history of CERCLA indicates congressional intent to allow states to tax local industries to finance remedial actions not actually paid by CERCLA. This interpretation comports with (1) the Act's prohibition against double taxation, (2) its overriding remedial purpose, and (3) its dependency upon state participation to accomplish its goals. The court also rules that the SCCA is constitutional even if § 114(c) prevents a state tax financing cleanup efforts that could possibly be covered under CERCLA. The SCCA provides that the funds collected pursuant to the state spill tax may be used for purposes that are not within the scope of CERCLA and therefore not preempted by the federal act. The court rejects plaintiffs' contention that the non-preempted areas are peripheral and cannot be severed from the SCCA's overriding goal of financing spill cleanup and costs.

[Other cases addressing the legality of the Spill Compensation and Control Act are reported at 11 ELR 20886, 12 ELR 20184, and 20401; pleadings in related cases are reported at ELR PEND. LIT. 65694, 65695, 65708, 65709 — Ed.]

Counsel for Plaintiffs
John J. Carlin Jr.
Farrell, Curtis, Carlin & Davidson
43 Maple St., Morristown NJ 07960
(201) 267-8130

Counsel for Defendants
Herbert K. Glickman, Deputy Attorney General
8th Floor, West Wing, Justice Complex, CN-112, Trenton NJ 08625
(609) 292-1526