The controversial Climate Superfund Act, in all likelihood, will not advance in this legislative session.
But it will likely get new life when the 222nd legislative session begins Tuesday, albeit with a different name.
What is certain, however, is the bill, which seeks to retroactively penalize New Jersey companies $50 billion for legally providing fossil fuels that are essential to residents' survival and prosperity, may still have a mountain to climb from a strictly legal standpoint.
In key written and verbal testimony to the Senate Budget and Appropriations Committee this week, New Jersey Civil Justice Institute President Elissa Frank raised the three main obstacles – among others - which may be difficult to overcome.
One right off the top is its conflict with the federal Clean Air Act.
“Congress enacted the Clean Air Act to create a comprehensive national framework for regulating greenhouse gas emissions, delegating primary authority to the United States Environmental Protection Agency,” Frank told lawmakers on Thursday.
“States may play a cooperative role, but they do not have the authority to regulate out-of-state emissions or impose liability for global atmospheric conditions. This bill attempts to do just that, which creates a direct conflict with federal law.”
Frank also noted that the bill raises “serious due process concerns” with its retroactive approach.
“The bill retroactively penalizes businesses for activities that federal and state governments not only permitted but affirmatively encouraged for decades as part of national energy policy,” Frank said.
“Imposing massive liability now, after the fact, on a narrow subset of New Jersey companies upends settled expectations and does so in an arbitrary and disproportionate manner, particularly while ignoring the vast majority of global greenhouse gas emitters.”
According to the U.S. Energy Information Administration, New Jersey contributes just 1.7% of the United States’ GHG emissions and only 0.3% of worldwide emissions.
Frank also noted the bill runs afoul of the federal interstate commerce clause of the U.S. Constitution.
“By imposing liability for lawful extraction and refining activities that occurred outside of the state of New Jersey, the bill attempts to regulate conduct beyond the state's borders in violation of the U.S. Commerce Clause,” she said.
“Greenhouse gas emissions are global by nature, and this bill improperly assigns responsibility for worldwide emissions to a handful of in-state businesses.
Frank noted that NJCJI advocates for “a fair, predictable, and efficient civil justice system that supports investment, job creation, and critically, affordability for, for New Jersey families and businesses.”
And the Climate Superfund Act, which was suddenly renamed by sponsors without any explanation to the "Polluters Pay to Make New Jersey Affordable Act" on Thursday, likely didn’t pass legal muster in other smaller details, according to Frank’s written testimony.
“This bill is legally deficient, constitutionally suspect, and guaranteed to embroil our courts in prolonged and costly litigation, diverting judicial resources and undermining the predictability of New Jersey's civil justice system,” Frank said.
WATCHING OTHER STATES
Both New York and Vermont have voted for similar Climate Superfund laws, and the federal Department of Justice filed lawsuits last May against both states seeking to invalidate their statutes and block enforcement, citing them as "lawless overreach.”
Also last year, the U.S. Chamber of Commerce and the American Petroleum Institute filed a federal lawsuit against the state of Vermont, the first state to enact a climate Superfund law even though the state does not produce or refine fossil fuels.
Decisions on those lawsuits could be coming in the first half of 2026. And other states will be watching.
Last year, Climate Superfund bills in California, New Hampshire, and Virginia stalled. Other states like Massachusetts, Maryland, Connecticut, Hawaii, Oregon, Rhode Island and Tennessee also did not take action last year, despite consideration of the rule previously.
Presumably, they’re waiting on the outcome of the Vermont and New York lawsuits.
“Each state’s case has, or will have, unique circumstances,” NJBIA Deputy Chief Government Affairs Officer Ray Cantor said. “But what’s important to remember is that for all the ideological grandstanding or costly cash grabs that are attempted, the validity of these laws will come down to the courts.
“And we do expect they will have a long way to go to pass legal muster.”
