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U.S. Department of the Interior - Office of Policy, Management and Budget
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Chapter 17: Northeastern New Jersey Wetlands


Physical Description: Northeastern New Jersey consists of a six-county area that coincides with the Passaic River Basin and parts of the Rahway, Raritan, and Hackensack River Basins. Because of the region's geologic history and resultant landscape diversity, a wide variety of well preserved wetland types occur, ranging from the highlands to the Hudson-Raritan Rivers estuary. (See Figure XVII-1.) Densely populated, Northeastern New Jersey is strongly influenced by its close proximity to the New York City metropolitan area and its location on the major north-south corridor of transportation on the East Coast.



Characteristics and Functions: Northeastern New Jersey wetlands

  • Serve as natural storage areas for flood waters, thereby reducing flood peaks, slowing water velocity, and regulating flow to downstream areas;
  • Filter pollutants from urban runoff that could otherwise enter aquifers and surface waters that supply drinking water;
  • Prevent erosion and filter silt from the water;
  • Host 9 endangered and 4 threatened State species and occasionally host bald eagles and peregrine falcons (both listed federally as endangered);
  • Provide habitat for hundreds of resident and migratory wildlife species;
  • Provide extensive sporting and recreational opportunities, including consumptive and non-consumptive activities involving fish and wildlife;
  • Are largely privately owned and are protected, in part, through recent State regulatory controls, the effectiveness of which is as yet uncertain.

Original Acreage: Known to be much larger than the present stock, but historic data are too incomplete for an accurate estimate.

Current Acreage: In 1976, 69,173 acres remained in the six-county Passaic River Basin.

Trends: Only disparate information exists. Early wetland inventories were partial in nature focusing on a particular area or type of wetland. Between 1953 and 1973, two coastal counties (Union and Essex) lost 100 percent of their tidal marshes and the two others (Bergen and Hudson) lost over 50 percent. Morris County which contains 58 percent of Northeastern New Jersey's remaining wetlands is subject to the greatest development pressure.

Factors Adversely Affecting Wetlands

The purposes for which wetlands have been converted have changed over time in Northeastern New Jersey. The region's agricultural sector was displaced by low density housing and by highway, airport, landfill, and port facility construction that often took place in wetland areas away from population centers. Today highway construction, commercial and industrial building, higher density residential development, and flood control efforts are the major activities affecting wetlands.

The driving force behind current expansion is the growth of the New York metropolitan area's population and economic activity, and the desire of some firms and employees to relocate away from the high-density, high tax-rate, high cost central city areas. The State of New Jersey is the most densely populated of the United States averaging 986 people per square mile. Eastern New Jersey averages 5089 people per square mile, over five times the State average. The resulting strong demand for land in the region has pushed wetland prices to between $90,000 and $200,000 per acre in some areas.

From all indications, growth will continue and even accelerate.1 The area's proximity to major transportation arteries fosters development. Developers are building on tracts of land, including wetland, that were considered marginal for development in past years, but in many areas are now the only available open space.

Highways, buildings, and flood control separately and in combination adversely affect wetlands. Highways were often built in wetlands to minimize land acquisition costs and disruption to existing development. Today highways crisscross the area and are being extended and widened. This expansion destroys wetlands through filling, by isolating wetland areas, and by disturbing hydrological regimes.

Highways also induce additional growth. A substantial amount of induced development and concomitant wetland loss may take place even before construction starts, as developments locate along proposed routes in anticipation of a new highway project. Once built, the highway attracts more intensive growth. The development of the region could not have taken place without the superhighway network that has evolved. The expansion of that network to reduce travel time and costs continues to threaten the remaining wetlands.

The filling of wetlands for urban development -- residential and commercial projects as well as infrastructure such as public buildings, sewage treatment plants, and airport expansion -- destroys a number of important hydrologic and environmental functions. Replacing wetlands with structures reduces water absorption, increases flooding, and alters hydrological flows. Storm runoff, with little vegetation to filter it, becomes laden with urban pollutants as it eventually wends its way to the ocean. Northeastern New Jersey drains into the Hudson-Raritan Rivers estuary, one of the three most polluted estuaries in the United States. To exacerbate this threat, more than half of the 109 Superfund sites in New Jersey are adjacent to wetlands.

Calls for greater flood control arise once structures are built in floodplains and converted wetlands. Construction of levees and channels for flood control destroys additional wetlands. Once provided, the flood protection induces more development, prompting more wetland conversion.

Urbanization in Northeastern New Jersey has aggravated the flooding problems in an already flood-prone region. The high population density, a wet climate, and substantial reduction in the uplands and wetlands available to hold moisture combine to produce recurring disasters. According to the Army Corps of Engineers, one of the most serious flood control problems on the East Coast occurs along the Passaic River. Federal disasters were declared in 1968, 1971, 1972, 1973, twice in 1975, and again in 1984. Average annual damages throughout the Passaic River Basin amount to $77.8 million. The New Jersey Division of Water Resources estimates that a flood equal to the worst on record, occurring in 1903, would cost about $1.5 billion due both to losses in water retention capabilities and the increase in building and property values within the floodplain.

To protect property, the Corps has proposed the $1.306 billion Dual Inlet Tunnel Diversion Plan. The plan proposes acquisition by the Corps of 5,200 acres of wetlands for flood water storage. The State, which is the local sponsor, has an agreement with the Corps to continue to protect 6,300 acres of floodplain wetlands from development. An additional 9,500 acres of wetlands are currently protected as parkland within the central basin. Governor Whitman has expressed serious reservations regarding construction of the Tunnel.

Dissatisfied with the protections provided by 404, then New Jersey Governor Kean requested and obtained State legislation, the New Jersey Freshwater Wetlands Protection Act of 1987. While the law exceeds the stringency of the Federal provisions by broadening regulatory controls to cover nearly all activities affecting wetlands and by providing upland buffer zones, it does contain some loopholes that lessen its effectiveness. Many development proposals have been grandfathered under the new State legislation, and several proposals which have not met Federal standards under the 404(b)(1) Guidelines have been permitted by the State. In addition, the State's appeals process allows an additional (and political) avenue for developers to seek permitting of wetland fills. Currently, the State and EPA are drafting an agreement for State assumption of the 404 program. The draft assumption proposal contains no provision for endangered species review by the Fish and Wildlife Service. With three federally listed species dependent on wetlands in New Jersey, the Fish and Wildlife Service asked EPA to initiate consultation under section 7 of the Endangered Species Act to ensure that federally listed species continue to receive protection under a State-assumed 404 program.

Federal Programs and Projects

The particular pattern of suburban development in Northeastern New Jersey, situated as it is on the outskirts of the nation's largest metropolitan area, would probably have occurred to a lesser degree in the absence of Federal incentives. The rapidity and extent of westward expansion in the region, however, was influenced by direct Federal grants for highways, tax incentives for commercial and residential developments, and Federal flood control efforts.


Highways constructed with financial assistance from the Federal Government have had a major impact on the region's wetlands. The future spread of development in Northeastern New Jersey depends on the continued extension and widening of the highway network, so that commuting time from residential to commercial locations remains reasonable. The east-west Interstate Highways 80, 280, and 78, and the north-south Interstate Highways 287 and 295, together with the State-funded New Jersey Turnpike and Garden State Parkway, are the backbone of the network. In general, the Federal Government pays 90 percent of the cost of interstate highway construction and 80 percent of the cost of other Federal-aid projects.

The Federal Highway Administration (FHWA) has different policies for mitigating projects depending on whether the affected wetlands are publicly or privately owned. The Department of Transportation Act of 1966, as amended, restricts the FHWA from approving any project which utilizes publicly owned park, recreation, and wildlife refuge lands unless there is no feasible or prudent alternative and unless the FHWA takes all practicable measures to minimize harm. The FHWA must consult with the Department of the Interior in making this determination, and mitigation, including wetland replacement, generally must be acceptable to the Department of the Interior before a "no objection" is given to the FHWA. Most remaining wetlands in Northeastern New Jersey, however, are privately held and receive a lesser degree of protection under FHWA policies.

Until 1991, the FHWA mitigation policy for privately held wetlands suffered from several major weaknesses:

  • The FHWA acre-for-acre replacement policy did not adequately take into account the qualitative differences between wetlands. Because all wetlands are not identical and are difficult to create, wetland functions were seldom fully replaced under this policy. The FHWA had a preference for mitigating losses by enhancing or creating wetlands within the highway right-of-way. Wetlands counted toward mitigation within the highway right-of-way are often less valuable than wetlands located away from roadways. The narrow ribbons rarely conform to the shape of the original wetlands and severely limit opportunities for construction of flood water retention basins. The traffic causes direct loss of wildlife as well as indirect effects from noise and pollutants such as lead, cadmium, and copper. Even when States qualified for Federal-aid highway funding to mitigate wetland losses outside the highway right-of-way, the regulations provided no assurance that the mitigation wetlands were comparable to those lost. Further, State departments of transportation sometimes counted certain uplands as replacement habitat for wetland losses, further reducing wetland replacement.
  • The FHWA allowed mitigation only for wetlands directly affected by a project, even though the indirect effects of highway development often exceed the direct effects.

In April 1990, the FHWA issued an environmental policy statement, committing itself to fully funding mitigation measures necessary to satisfy Federal law. Also, the FHWA regulations governing mitigation of privately owned wetlands were changed in 1991 to remove the acre-for-acre replacement policy and require replacement with equivalent wetland value. These changes have improved mitigation planning for wetland losses associated with federally-funded highway projects in New Jersey.

One important issue which has not been resolved by FHWA's new mitigation policy involves persistent differences in interpretation between FHWA and FWS regarding what constitutes a significant impact to wetlands and what mitigation measures are appropriate. Before the State highway authorities can make commitments and decisions about the design and location of a proposed project with significant environmental impacts, the FHWA must issue an Environmental Impact Statement (EIS). Although the FWS comments on and makes recommendations regarding proposed projects during the EIS process, the FWS and the FHWA often disagree about whether an impact is significant and if it is significant, what mitigation measures should be undertaken. Following issuance of an EIS, State authorities make resource commitments and decisions which often severely limit the opportunities to avoid or minimize wetland losses during any subsequent Federal review, e.g., the 404 regulatory process.

Urban Development  

The Federal Government encourages residential developments (irrespective of the type of land) by tax provisions such as the deductibility of mortgage interest payments and the exclusion of imputed rental income in the Federal individual income tax code. At the same time, owners of wetlands who refrain from development receive no tax benefits, and local governments that restrict wetland development forego an increased tax base. The tax benefits for development combined with the absence of benefits for conservation skews the incentives towards development.

National tax policy also promotes commercial development. Corporations receive accelerated depreciation and investment tax credits. The construction of new office buildings, for example, follows a cyclical pattern over time, but in the early 1980s changes in the Federal tax code significantly stimulated such construction. Changes in the taxes on real estate, already considered to be subject to favorable treatment, led to one of the biggest office development booms in the Nation's history. Average annual office completions jumped from a stable, 20-year level of 12 million square feet prior to 1981 to over 30 million square feet thereafter. Of primary importance were changes that significantly reduced the number of years over which commercial real estate could be depreciated. The "paper" loss generated by these depreciation policies can be used as offsets against taxable income from other sources. New ownership devices also permit passive investors to take advantage of the tax shelter that office construction provides.

In addition, flood insurance and disaster relief lessen the risk of development in flood-prone areas, and in conjunction with Federal loan guarantees and interest subsidies promote development in these areas.

Flood Control 

For the most part, flood control in New Jersey consists of poorly coordinated, inadequate measures sponsored by local government. The measures taken are primarily construction of levees and channelizing or deepening existing river beds. The flooding problem in Northeastern New Jersey, particularly in the Passaic River Basin, is severe and growing worse.

As part of the Passaic River Flood Control Program, the Corps has proposed building the Dual Inlet Tunnel Diversion Project. The proposal includes both structural and non-structural flood control measures. Structural elements would consist of (1) a 20.1 mile long, 39 foot wide tunnel with two inlets from the Pompton River to Newark Bay; (2) several new or improved segments of levees and floodwalls along the Pompton, Rockaway, and Passaic Rivers to direct flood flows; (3) channel modifications; and (4) locating new levees at the fringe of development but back from the stream to help reduce some of the effects on wetlands. Simultaneous nonstructural measures such as acquiring 5350 acres for natural flood storage areas have been proposed but no commitment to such measures has been made.

This project would dramatically alter the hydrologic regime of the region, and would affect or destroy 750 acres of wetland and stream habitat. These effects would occur during construction, but improper operation of the tunnel (leading to either permanent flooding or insufficient seasonal inundation) could affect many additional acres of wetlands. Although the Final Environmental Impact Statement (FEIS) was released in April, 1988, impact assessment has not been completed. Assessment will continue during Phase II of the project design, during which the FWS will review the proposed mitigation.

As with all Federal flood control projects, the Tunnel would be heavily subsidized. As of 1990, the Federal share of the construction cost was estimated to be $969 million and the non-Federal share, $337 million. Governor Whitman has expressed serious reservations regarding construction of the Tunnel. 

Status and Prospects  

It is difficult to distinguish the wetland losses in New Jersey that resulted from Federal programs from those that would have occurred anyway. Direct Federal payments for highways and flood control have undoubtedly spurred the commercial and residential development of the region. They made the development technically feasible and they substantially lowered its cost. In the absence of these two programs, development in the region certainly would have been slowed substantially.

It is clear that some of the benefits associated with highways in Northeastern New Jersey extend beyond the region, and hence, the projects legitimately should receive some Federal funding. The cost sharing is such, however, that considerable subsidization is involved. Unlike highways, the non-regional benefits from flood control are more difficult to identify. Since, on average, Federal taxpayers bear 75 percent of the cost of constructing flood control projects, the projects are heavily subsidized and the financing is quite distorting.

Correcting the cost-sharing ratios for flood control and highway projects to reflect the distribution of benefits would have an important, beneficial effect on both development and the environment in Northeastern New Jersey. It would improve both equity and efficiency.

The same effect probably cannot be obtained by restricting the other Federal programs which affect wetlands in Northeastern New Jersey. The demand for space is too strong and the high price of dry land too high for development to be deterred much by marginal changes in economic incentives. All privately-held wetlands in Northeastern New Jersey face severe threats from development and are likely to disappear within the next 50 years under the current regulatory climate and acquisition efforts. A much more rigorous enforcement of the Section 404 permitting process by the Corps or EPA or a strong State regulatory program would be required to slow the process.

The New Jersey Freshwater Wetlands Protection Act of 1987 establishes two new permit programs, one to strictly curtail activities in freshwater wetlands (i.e., filling, drainage, tree cutting, placement of obstructions, etc.) and one for the regulation of the discharge of dredged or fill material into the open waters of the State. In addition, the Act establishes "transition areas" (buffers) for freshwater wetlands of exceptional or intermediate resource value. The Act became effective on July 1, 1988, too recently to assess its effectiveness. Similarly, the effects of a proposed State-assumed 404 program are also unknown. The FWS has statewide concerns regarding compliance with the Endangered Species Act and protection of endangered species, particularly threatened plant species in southern New Jersey wetlands. Consequently, the FWS has asked EPA to initiate consultation under Section 7 of the Endangered Species Act to ensure that federally listed species continue to receive protection under a State-assumed 404 program.

Because of the significant flood control benefits wetlands provide, it might be cost-effective to acquire or to purchase easements to maintain a sizable portion of the remaining stock of wetlands in Northeastern New Jersey, most of which is privately held.2 The region continues to develop and the flood problem becomes ever more serious as the water retention capacity of the land is lost. At the same time, more construction is occurring within the floodplains of the region's rivers, escalating the damage likely to result from flooding. The development pressure is so intense that a comprehensive strategy will be required if Northeastern New Jersey's remaining wetlands are to be conserved.


  1. Public Works Subsidies:

    Require that cost-sharing ratios for new Federal flood control and Federal-aid highway projects reflect the distribution of benefits between regional and national interests.

    By correcting a serious distortion in economic signals and incentives, this change in project financing would have an important, beneficial effect on both development and the environment in Northeastern New Jersey. The change would be an improvement in both equity and efficiency.

  2. Regulation:

    In conjunction with State and local jurisdictions, develop an integrated regulatory program to ensure that no types of wetland conversions are exempted because of peculiarities in the wetland protection laws and regulations.

    Wetlands continue to be lost under Section 404 in large part because of jurisdictional limitations. Although the New Jersey Freshwater Wetlands Protection Act addresses a number of gaps in the Federal program, grandfathering under the Act will result in further losses. Moreover, vigorous enforcement efforts under the new Act have yet to be demonstrated.

  3. Mitigation:

    Require that a mitigation plan accompany any proposal for authorization of any new project and that all Federal agencies mitigate fully and concurrently for wetland alterations stemming from construction of Federal or federally supported facilities.

    The systematic application of the CEQ's mitigation principles3 would yield considerable progress toward the goal of no net loss of wetlands. The principles call for mitigation to proceed in the following sequence: (1) avoid adverse impacts, (2) minimize unavoidable adverse impacts, and (3) compensate for unavoidable impacts through replacement. Mitigation should occur prior to or concurrent with other project features and should be routinely monitored for effectiveness. Congress already requires concurrent mitigation for all Corps' projects (Water Resources Development Act of 1986).4

  4. Acquisition:

    Consider acquiring critically important and vulnerable wetland complexes either by direct purchase of land or easements or through cost sharing with the State of New Jersey or local municipalities.

    Although Northeastern New Jersey wetlands serve a host of values, most critical economically is the flood control derived from undeveloped wetlands. Floods along the Passaic River are among the most costly in the nation. Structural flood control efforts have proceeded incrementally. Structural measures have a tendency to pass flooding problems along to unprotected areas. Further, the illusion of protection often leads to additional floodplain development. All this suggests the logic in nonstructural measures. A long-term wetland acquisition plan should be undertaken as a primary aspect of a coordinated flood control program.


Congressional Budget Office. 1989. Reducing the Deficit: Spending and Revenue Options. Washington, DC, 400 pp.

Chezik, Michael. 1989. Update on the New Jersey Freshwater Wetlands Protection Act. Memorandum from Bureau of Freshwater Wetlands, Division of Coastal Resources, Department of Environmental Protection, State of New Jersey to Fish and Wildlife Service, U.S. Department of the Interior. Trenton, NJ, May 4, 4 pp.

Peterson, Don. 1989. Federal Highway Administration's Consideration of Wetlands in the Planning of Federal-Aid Highways. Memorandum from Fish and Wildlife Service to Office of Policy Analysis, U.S. Department of the Interior, Washington, DC, April 14, 4 pp.

Rosenberg, Richard. 1987. The Impact of Federal Programs on Wetlands in Northeastern New Jersey. Background Report. U.S. Department of the nterior, Office of Policy Analysis, Washington, DC, 39 pp.


1 Surprisingly, from 1970 to 1980, population growth slowed significantly in New Jersey. Indeed, for all of the northeastern counties except Morris it was actually negative. This proved a temporary phenomenon except for Essex County. Essex is experiencing a decline in population as people emigrate to the more undeveloped counties, such as Morris. As one might expect, the less developed counties contain the most important wetlands.

2 The two largest remaining wetland complexes in the Passaic River Basin are the 4275 acre Great Piece Meadow owned by various private parties and the 3100 acre Troy Meadows owned by Wildlife Preserves Inc. The latter has indicated the need to sell soon.

3 Defined in NEPA regulations (40 CFR 1508.20).

4 Although it is a Corps project, proposals for the Dual Inlet Tunnel Diversion Project do not now include firm commitments for prior or concurrent mitigation.

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For more information on the impact of Federal programs on wetlands,
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