N.J. agrees to settlement with Exxon over contamination

New Jersey has reached a $225 million settlement with ExxonMobil Corp. over the oil giant's decades-long contamination of 1,500 acres of land, the state's acting attorney general said Thursday, a deal that faces fierce opposition among Democrats and environmentalists who wanted the state to stand by its demand for billions in damages.

The announcement came the same day the state's former top environmental regulator accused Gov. Christie's chief counsel of interfering in the litigation and pushing aside career prosecutors in the process.

The proposed settlement is expected to be published in the New Jersey Register on April 6, after which it would be subject to a 30-day public comment period. It must be approved by a state judge.

Officials called it the "single largest environmental settlement with a corporate defendant in New Jersey history."

Acting Attorney General John Hoffman said that in addition to paying the settlement, Exxon had already agreed to remediate its contaminated refinery sites in Linden and Bayonne at its own expense.

The settlement "ensures the continuation of the ExxonMobil-funded remediation work at these contaminated sites, and it holds the company financially accountable," Hoffman said.

Lawmakers and environmentalists had already criticized the settlement, as terms leaked to the press ahead of the official announcement Thursday.

In an op-ed published Thursday in the New York Times, Bradley M. Campbell, the former commissioner of the New Jersey Department of Environmental Protection who authorized the lawsuit against Exxon in 2004, called the settlement a "disgrace" and an "embarrassment to law enforcement and good government."

He said former colleagues in state government had told him that Christopher Porrino, the governor's chief counsel, "elbowed aside the attorney general and career employees who had developed and prosecuted the litigation, and cut the deal favorable to Exxon."

Hoffman's office said Thursday that "the litigation and settlement negotiations, as with all such cases of this magnitude, were conducted" by the attorney general's office in coordination with the Department of Environmental Protection and the Governor's Office.

He said "settling the case rather than continuing to litigate provides a predictable, fair outcome for the people of New Jersey."

The allegation of interference by Christie's office comes as state lawmakers have vowed to scuttle the settlement in court and hold a public hearing to determine what happened.

"If what is alleged took place, then this is much bigger than any kind of litigation and it's a subject matter for Paul Fishman," Senate President Stephen Sweeney (D., Gloucester) said on a conference call with reporters Thursday, referring to the U.S. attorney for New Jersey.

First, Sweeney cautioned, "We've got to find out if what's alleged is true."

The allegation also raises questions about the independence of the attorney general's office. Although Hoffman has led the office for more than a year, Christie has not nominated him to be confirmed by the Democrat-controlled Senate.

Christie previously tapped his former chief of staff, Kevin O'Dowd, for the post. But the nomination didn't proceed in the wake of the George Washington Bridge lane-closure scandal, which erupted in January 2014. O'Dowd wasn't accused of wrongdoing but left the administration last year to work for Cooper University Hospital.

The 2004 lawsuit alleged that, for decades, Exxon's plants and refineries in Linden and Bayonne contaminated the state's wetlands, marshes, and creeks.

The case finally moved to trial last year, and all that was left to determine was what Exxon owed in damages; state prosecutors had sought $8.9 billion.

The judge was apparently close to issuing a ruling. But in January, the state asked the judge to delay a decision so that settlement talks could proceed, the New York Times reported last week.

Environmentalists have accused Christie, a Republican considering running for president in 2016, of quickly securing the settlement so he could divert money to the state's general fund.

Under the appropriations bill he signed in June, the first $50 million the state obtains "in natural resource, cost recoveries and other associated damages" must be deposited into a fund for hazardous discharge cleanup.

But the law says all money obtained beyond that shall be diverted to the general fund. Democrats had sought to allocate half of such money -- beyond the initial $50 million -- to environmental programs, but Christie vetoed that language.

Hoffman said Thursday the state wouldn't receive settlement monies until fiscal year 2016 at the earliest. The funds would be allocated in accordance with the appropriations act for that fiscal year, which begins July 1.

Records filed with the Internal Revenue Service show Exxon donated $500,000 to the Republican Governors Association in 2014, when Christie chaired the group and raised record sums to help elect GOP governors across the country.

Exxon has said it has long contributed to the organization.

Christie's office didn't immediately respond to a request for comment.

Under the proposed settlement, the state maintains its claims against Exxon for contamination at other sites, the attorney general's office said.