The 2-pound fragment traveled more than a mile from Picatinny Arsenal and punched a hole in the roof of Frederick Angle's Jefferson Township home.
The hot piece of metal landed on the bed of Angle's then-10-year-old stepdaughter, who wasn't home. But the family's cat was on the bed and had to be euthanized.
Angle tells The Daily Record of Parsippany the offer is a "kick in the teeth" and he plans to reject it.
Picatinny spokesman Tim Rider says major steps were taken after the 2008 incident to ensure it could not happen again.
Information from: Daily Record, http://www.dailyrecord.com