What’s the Deal with REAL?

The Resilient Environments and Landscapes (REAL) rule proposal – a key regulatory update under the NJ Protecting Against Climate Threats (NJ PACT) initiative – will have a significant impact on land use development in the state.

By Jim Pytell, Managing Editor On Dec 5, 2025

In January 2020, Gov. Phil Murphy signed Executive Order No. 100, launching the New Jersey Protecting Against Climate Threats (NJ PACT) initiative. This statewide regulatory reform effort directs the New Jersey Department of Environmental Protection (NJDEP) to update and strengthen environmental regulations to both reduce greenhouse gas emissions and increase the state’s resilience to the impacts of climate change.

On August 5, 2024, the NJDEP published its long-anticipated Resilient Environments and Landscapes (REAL) rule proposal, representing a key regulatory update under NJ PACT. The sweeping 1,044-page REAL proposal sought to update New Jersey’s land use and environmental regulations to account for future climate change impacts like sea-level rise and flooding. 

Key features of the original REAL proposal included imposing an additional 5 feet of Climate Adjusted Flood Elevation (CAFE) above FEMA flood levels in areas subject to tidal flooding, creating new Inundation Risk Zones (IRZ) in coastal areas projected to face tidal inundation by 2100, and changing stormwater, wetlands, and coastal development standards statewide. 

While the proposal’s intention is laudable on the surface, it was not met without pushback on multiple fronts including from shore towns, developers, and business groups, who expressed concerns about predictability, transparency, and economic impact. 

This pushback led to the NJDEP issuing a Notice of Substantial Change to the proposal this past July, outlining revisions and requiring an additional round of public input before the rules can be finalized. The 60-day comment period for this amended proposal ended in September, and at press time, the NJDEP has indicated that it aims to adopt the REAL rules by late 2025, or January 2026.

New Jersey Business & Industry Association (NJBIA) Deputy Chief Government Affairs Officer Ray Cantor, who led the campaign against the REAL rules when they were first proposed, says the changes proposed by NJDEP will still wreak havoc on affordability in the state and hurt economic development overall. 

Predicting Sea Level Rise

Projected sea level rise (SLR) has been, and remains, the critical issue of NJDEP’s proposal.

“The most onerous of these proposed changes is that of SLR,” says Cantor, “While we agree that the state should consider SLR and climate change projections in their coastal regulations, what the Murphy administration proposed goes far beyond any rational proposal.”

Initially, the NJDEP based its regulations on an assumed 5-foot sea level rise by the year 2100. Cantor says that the data point NJDEP relied on was from a 2019 study that said there was a 17% chance of such SLR occurring based on a moderate emission scenario, even though no other climate study forecasted that much. 

The NJDEP then reduced its elevation standard as part of the updated rule to 4 feet over the next 75 years, it said, due to new modeling. But Cantor says there is still no science showing the need to raise the level another 4 feet over current standards.

“This remains an extreme measure that is out of step with mainstream climate science on what is likely to happen,” says Cantor. “At the end of the day, it still uses low confidence assumptions, based on models, predicting events 75 years from now and at a 17% confidence level. … It will have devastating economic impacts to coastal and river communities and their residents, and exacerbates the affordability crisis while making it harder to build affordable housing.” 

Key Considerations

Peter L. Lomax, president of the Lomax Consulting Group, describes the NJ PACT REAL rules as one of the most significant regulatory shifts in New Jersey’s environmental and land use policy in decades. 

“No other state in the union is proposing such drastic changes,” Lomax tells New Jersey Business Magazine. “They fundamentally link development standards to projected climate conditions, immediately extending regulatory reach to areas that may or may not experience predicted impacts 75 years into the future.”

He adds that for the regulated public, understanding the scope and intent of these rules is essential for making informed investment and design decisions.

“Businesses should recognize that NJ PACT substantially expands the extent of regulated flood hazard areas,” Lomax says. “The combination of the IRZ and CAFE means that more properties, especially along the coast and tidal tributaries, will now be subject to stricter elevation, design, and permitting standards.”

Also of note, the NJDEP has committed to reviewing and updating its sea-level rise and precipitation data every five years. Lomax says businesses would be wise to view compliance not as a one-time task but as an ongoing process of adaptation. 

Other Concerns

Another area of concern involves permitting delays and administrative complexity. “NJDEP review staff are already managing unprecedented workloads. With new requirements for impact assessments, alternatives analyses, climate-based risk reviews, and the infusion of discretionary interpretation provided for in the proposed rules, many clients expect longer timelines and greater uncertainty in approval schedules,” Lomax explains.

Separately, there was also concern that the original proposed provisions of the PACT rules would impact certain towns’ abilities to meet affordable housing obligations, though the amended version includes language explicitly naming affordable housing as a “compelling public need” that could win exemptions to some flood rules. Cantor, however, says that this flexibility update was “meaningless.”

“First the department claims it is unsafe to locate such housing in flood hazard areas, and then claims to be providing flexibility if a developer can show that it is safe through a hardship waiver,” Cantor explains. “We have no confidence in the waiver process given how hard it is to obtain one even under the current state of the law.” 

Another key provision of the PACT proposal treats stormwater removal requirements the same for urban development as it does for newer development in rural areas. 

Cantor says that a regional stormwater approach is much more likely to result in the benefits the department claims it is seeking, compared to the site-by-site enhanced standard currently proposed.

Lomax adds that projects involving simple resurfacing or small-scale reconstruction may now qualify as “major development,” requiring extensive stormwater management systems and reviews that were previously unnecessary. 

“This adds cost and complexity to projects traditionally handled at the municipal level,” he says.

The Need for Predictability and Transparency

Lomax says that across all sectors, the unifying theme is uncertainty – about cost, timing, and long-term regulatory stability. “Clients are seeking predictability and transparency as they adapt to an evolving climate policy landscape that aims to be increasingly restrictive over time,” he says. He also adds that the rules’ impact will extend beyond the state’s coastal towns.

“These proposed rules would shrink where and how construction can take place, not just in coastal zones, but in urban areas such as Newark, Hoboken, and Camden, and not just for homes and businesses, but also for critical public infrastructure projects like roads, bridges, and stormwater drainage/sanitary sewer systems,” Lomax says.

Cantor is urging the NJDEP to start over with stakeholders. “Given all the problems with these rules, the lack of credible science to justify its conclusions, and the overall negative impact of these rules in general, we urge the department not to adopt the rules but to re-engage stakeholders and work toward a solution for our resiliency challenges,” he says.

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