Governor Murphy’s proposed $58.1 billion FY2026 budget recommends $1.81 billion in appropriations for the Department of Environmental Protection (DEP), a decrease of $258.9 million from the FY2025 budget. DEP Commissioner Shawn M. Latourette testified before the Senate Budget and Appropriations and Assembly Budget Committees on the department's budget and provided detailed budget responses to the Office of Legislative Services.
The DEP budget highlights the following items of municipal interest.
Federal Implications
The FY26 budget considers a federal appropriation of $1.13 billion or 62.3% of the department's budget representing a net increase of $46.5 million or 4.3% as compared to FY25. The budget increase is attributed to an anticipated increase in federal grant funding for the Drinking Water State Revolving Fund.
It should be noted, however, that Commissioner Latourette testified that the uncertainty of federal funding and potential cuts will greatly impact the department’s budget specifically on services and enforcement that pose risk to public safety and welfare.
Safe Water and Cleaner Waterways
The Governor’s proposed budget recommends $48 million for Drinking and Clean Water infrastructure. This will be supplemented by $87.5 million in unexpended funding, which will bring the program’s appropriation to $133.7 million for FY26. The recommended $48 million appropriations reduce the spending authority by the $6.6 million that the Legislature added to the FY25 Appropriations Act for this purpose.
The State Constitution allocates 5% of dedicated corporation business tax revenues to water quality point and non-point source pollution monitoring, watershed restoration projects, and stormwater management grants. The proposed allocation for FY26 for water resources monitoring and planning is $15.3 million, decreasing the allocation by 5.3%.
The net $46.5 million increase in the budget is attributable to growth in the federal Drinking Water State Revolving fund grant, which is expected to increase from $175.2 million in FY25 to $222.5 million in FY26.
The budget also proposes a new appropriation of $750,000 to monitor and control Legionnaires’ Disease in public water systems. P.L.2024, c. 66 requires the DEP to create and publish best practices and adopt a monitoring system for the management of Legionella bacteria.
Recreation, Parks, and Forest Wildfire Response
The State Constitution allocates 78% of dedicated corporation business tax revenues to Preserve New Jersey for open space, farmland, and historic preservation. Additionally, a portion of those funds is dedicated to the Green and Blue Acres Programs (68%), the Farmland Preservation Program through the Department of Agriculture, and the Historic Preservation Program through the Department of Community Affairs. The total allocation is approximately $257.5 million.
The Preserve New Jersey Green Acres Fund does not have a budget allocation. It is customary that funding will be provided as a mid-year supplemental appropriation. The FY25 allocation was $250 million.
The FY26 budget proposes an increase in a dedicated, off-budget revenue for the Division of Air Quality for a new $6.5 million grant for the Community Multiscale Air Quality Marine Repower Program and a new $3.9 million grant for the Community Multiscale Air Quality It Pay$ to Plug In initiative. The recommended allocation in FY26 is $27.6 million, or an increase of 60.5% from the allocation of $17.2 million in FY25.
The recommended allocation for Forest Resource Management is $12.3 million, which is an increase of $7 million over the FY25 appropriation.
The budget proposes an increase in DEP’s Forest Fire Service’s Fire Fighting costs from $8.4 million in FY25 to $9.4 million in FY26 to enhance wildfire preparedness and prevention. Additionally, it is recommended that a new unlimited supplemental appropriation be created for this purpose.
It is further proposed that the Replacement Firefighting Foam Grants be reduced by 50% from $250,000 in FY25 to $125,000 in FY26. This is part of a policy of eliminating or reducing discretionary aid. P.L.2023, c.243 created a program requiring DEP to reimburse municipalities for costs they incur in replacing firefighting foam containing intentionally added perfluoroalkyl and polyfluoroalkyl (PFAS) substances; however, it did not provide for funding. The FY26 budget is proposing the use of $7.5 million from special revenue from the Hazardous Discharge Site Cleanup Fund to support a new program for the collection and safe disposal of certain firefighting foam.
The FY26 budget recommends a shift of $8 million for Grants for Urban Parks from the Property Tax Relief Fund to the Preserve New Jersey Green Acres Fund.
It is recommended that a reduction of 50% be made to the Council on Green Jobs, which builds diversity in the clean energy sector workforce. The allocation would be $2 million in FY26.
Solid Waste and Hazardous Waste Management
The State Constitution dedicates annual corporation business tax revenues to brownfields remediation programs, underground storage tank programs, and hazardous waste substance discharge cleanup. The FY26 budget appropriates $21.4 million for brownfields remediation loans and grants to public and private responsible parties; $15.3 million for hazardous substance discharge remediation programs; and $15.3 million for storage tank remediation. The hazardous substance discharge remediation and storage tank remediation programs both have an anticipated decrease of 5.3% from the FY25 budget.
The State Recycling Fund is funded through a $3 per ton fee that is levied on solid waste facilities and collectors for out-of-state disposal. The fee was created to support recycling initiatives, including grants to county and local governments. The State Recycling Fund revenue will increase in the proposed FY26 budget by $640,000 to $28.75 million. That is a 2.3% increase from the FY25 allocation of $28.1 million. The $640,000 increase is made up of two components: $450,000 in State Recycling Fund – County and Local Grants and $190,000 in collections from Recycling Enhancement Registration Fees.