regulatorybriefs plastics recycling facility existed in that location.” The fire destroyed 400 tonnes of polyvinyl chloride (PVC) plastic and brought to light potential liability issues – the Ontario government was among 14 defendants named in a Class Action case – that prompted the provincial government of the day to abandon plans for a permitting system similar to the one now contemplated in Saskatchewan. “This approach has been touted as a potential model in other jurisdictions, including Ontario, but there was just a whole range of complications that arose here in Ontario,” Winfield notes. Most of the details of Saskatchewan’s proposed system are still to be determined and the government has promised ongoing consultation. “We have engaged industry, communities, non-governmental organizations and First Nations and Métis organizations in discussions over the past 16 months. The overall commitment to a results-based model is high and we will continue to seek feedback and advice from them as we move forward,” Heppner said. For more information see www.gov. sk.ca/adx/aspx/adxGetMedia. aspx?mediaId=1014&PN=Shared NEW RULES EXPAND ONTARIO’S CONTAMINATED LAND INVENTORY Property deals could get more complicated in Ontario when recently announced new standards for allowable levels of soil and groundwater contaminants go into e ff e c t . O . R e g 5 11 / 0 9 u n d e r t h e E nv i ro n m e n t a l P ro t e c t i o n A c t contains amendments to Ontario’s existing regulations for assessing, registering and remediating lands known as brownfields that will trigger requirements for costlier and more time-consuming risk assessments much more frequently than is the case now. “We anticipate we will be getting calls from property owners who are upset when contamination is discovered in the middle of their deals,” says John Willms, a senior p a r t n e r w i t h Wi l l m s & S h i e r Environmental Lawyers and Co-Chair of the Policy and Technical Committees of the National Brownfields Association, Ontario Chapter. “Deal time is when soil and groundwater testing are often done.”
Under current rules, owners/developers conduct a Phase One environmental site assessment (ESA) if there has been any history of activity on a property that could have caused soil and/or groundwater contamination. This will be a regulatory requirement for development approvals and a requirement by lenders and insurers before they will provide financing and/or liability coverage. The Phase Two ESA then gauges the types and volumes of contaminants present. A qualified professional (QP) – typically an engineer or a hydrogeologist – must oversee the work and sign off on the results. I f t h e P h a s e Tw o E S A f i n d s contamination levels within the Ministry of Environment’s (MOE) limits of acceptability, a Record of Site Condition (RSC) can be filed immediately to verify the property complies with standards for redevelopment. If contamination levels exceed the MOE limits, property owners have options to remediate to generic standards or carry out a risk assessment process. A s o f J u l y 1 , 2 0 11 , t h e n e w Regulation will impose stricter standards that significantly reduce the allowable levels of many contaminants. Many properties that previously would have been straightforwardly cleared for redevelopment in a Phase Two ESA will likely need further study and investment. “Changing the standard downward for some of the most common contaminants such as hydrocarbons, benzene and solvents – without changing the physical characteristics of the property – effectively transforms a lot of properties from clean to contaminated,” Willms observes. It should also inspire caution. “The quality of consulting works is critical,” he adds . “With brow nfields w e constantly see people who have underestimated the importance of doing the environmental site a s s e s s m e n t p r o p e r l y, w h o h a v e accepted low bids and who are now in litigation as a result.” Property owners can still obtain RSCs under the current standards until June 30, 2011 and the Ministry of Environment will still recognize RSCs from the earlier era after the new standards go into effect. However, industry observers predict that lenders may already be asking owners/
developers in the initial stages of a project to meet the new standards as a condition of financing. “Whether to use the old or new standards during the transition period will depend on the circumstances of each case,” Willms says. “If a lot of the cleanup has already been done, it may be best to move ahead quickly to obtain the RSC under current rules.” There has been no suggestion that properties complying with current standards for allowable levels of contamination are unsafe or pose risks to human and/or environmental health. Rather, the new standards heighten vigilance at an earlier stage of the assessment process and call for a more rigorous examination of possible outcomes and applicable solutions determined through the specialized risk assessment. “The new standards were developed with the most conservative possible assumptions about a property,” Willms explains. “That would mean the maximum permeability of soil and most shallow depth of the water table etc., but the odds are that very few properties are going to exhibit all those factors. Almost all of the properties that complied with the old standards should pass the test of a risk assessment.” Other amendments in the new Regulation are aimed at streamlining the administrative process and reducing delays in the risk assessment process that have frustrated developers until now. Willms suggests financial institutions are also going to have to amend their ways, particularly as more properties fall into the risk assessment category. “Today in 2010 there is a stigma attached to risk assessment properties that doesn’t exist for properties that comply with the generic [Phase Two ESA] standards. Chartered banks generally won’t loan on risk assessment sites,” he notes. “At the same time, the Ontario government has definitely committed to urban redevelopment and intensification. Either the government is going to have to abandon its agenda or the industry will have to evolve and cope. We believe the brownfields development industry will evolve and cope.” For more information see www.ene. g o v. o n . c a / e n / l a n d / b r o w n f i e l d s / amendments.php. zz
Canadian Property Management | January/February 2010 11