At Hearing on Highlands, N.J., Area, Watersheds Preservation Battles Profit.

Byline: JAN BARRY

Apr. 23--TRENTON, N.J. -- When it comes to safeguarding North Jersey's major source of clean water, there is an ideal strategy, and then there is reality.

The ideal, proposed by the governor's Highlands Task Force, is to buy and preserve a large swath of watersheds in the Highlands mountain region that supply water to half the state. The reality was a jampacked Statehouse hearing room Thursday where supporters and opponents loudly skirmished over how much land should be saved from development by proposed legislation.

"Builders and farmers may be forced out of business and into bankruptcy," Assemblyman Alex DeCroce, R-Morris, said to thunderous applause by construction industry supporters who filled much of the room.

Speaking directly to the boisterous builders, Sen. Bob Smith, D-Middlesex, chairman of the Senate environment committee, countered: "We won't have a housing industry in New Jersey if we don't have a clean water supply."

The bill, S-1/A-2635, called the Highlands Water Protection and Planning Act, would restrict major development on environmentally sensitive lands near reservoirs and feeder streams in the Highlands. The region stretches from Mahwah in Bergen County through large portions of Passaic, Morris, Somerset, Sussex, Warren, and Hunterdon counties.

Supporters of the bill, including leaders of statewide and local environmental groups, called for quick action on legislation that was drafted on the basis of reports by the recent task force, two earlier state commissions, and two U.S. Forest Service studies of the region. Governor McGreevey is pressing legislators to pass a bill for his signature by July 1.