On December 6, 2012, The Nova Scotia Department of Environment (NSE) released Draft Ministerial Protocols (the "Draft Protocols") related to contaminated sites. The release of the Draft Protocols has been eagerly anticipated.
The adoption of Ministerial Protocols is the last step in a three-step overhaul to the regulatory regime affecting contaminated sites in Nova Scotia. The first two steps involved amendments to the Environment Act which came into effect October 1, 2012, and the passing of new Contaminated Sites Regulations (the "Regulations") which are slated to come into effect July 6, 2013.
This overhaul to the contaminated sites regime is much needed. The current regime is unclear in terms of the potential liability faced by landowners (and other persons responsible), and standards with respect to acceptable cleanup levels are often applied inconsistently. As the Nova Scotia Law Reform Commission noted in its December 2009, report Contaminated Sites in Nova Scotia, this uncertainty results in both an environmental and economic cost:
Fears of uncertain liability discourage landowners and
developers from cleaning up contaminated sites. The lack of
contaminated site clean-up means a risk of significant adverse
consequences to human health and quality of life, as well as to
environmental well-being. This also has economic costs, as
potentially useful land lies underused or not used at all.
(Contaminated Sites in Nova Scotia, p. 1)
As noted, the adoption of Ministerial Protocols is the third and final step in a series of changes that will significantly reform the contaminated sites regime in Nova Scotia. Of the three steps, however, the adoption of Ministerial Protocols is arguably the most significant. While the amendments to the Act and the passing of the Regulations created a framework for the management of contaminated sites, they left a substantial amount of "work" to be done by the Ministerial Protocols. The recently released Draft Protocols – while not final – provide a much clearer picture of the procedures and standards that will likely be put in place for reporting and remediating contaminated sites under the Regulations.
NSE is accepting comments on the Draft Protocols until January 15, 2013. Comments can be provided by emailing gov.ns.ca. NSE has produced a comments submission form as well as a list of "directed questions for consideration" to facilitate the consultation process. These two documents and the Draft Protocols themselves are available online, attached to an NSE produced slide show overview of the Draft Protocols.
The Draft Protocols in context: linking the Protocols and Regulations
Once the Draft Protocols are finalized and formally adopted by the minister of environment, they will become law. Section 3 of the Regulations states: "All Ministerial Protocols are incorporated by reference into these Regulations."
Seven protocols are contemplated:
- Notification of contamination protocol;
- Limited remediation protocol;
- Phase I ESA protocol;
- Phase II ESA protocol;
- Remediation levels protocol;
- Remedial action plan (RAP) protocol; and
- Confirmation of remediation protocol (not yet released).
As noted above, the Draft Protocols fill in much of the detail that is lacking in the Regulations. The Regulations, broadly speaking, impose two duties on a person responsible for a contaminated site: (a) the duty to notify; and (b) the duty to take remedial measures. The Draft Protocols add specificity and substance to these duties.
For instance, the duty to take remedial measures requires that a person responsible for a contaminated site undertake either "limited remediation" or "full property remediation". The tables below demonstrate how key steps in each remediation stream refer to or rely on corresponding Draft Protocols:
Protocols relevant to limited remediation:
Limited remediation requirements as set out in the regulations
Corresponding ministerial protocol(s)
Protocols relevant to full property remediation:
Full property remediation requirements as set out in the regulations
Corresponding Ministerial Protocol
Implications of the Draft Protocols
The Draft Protocols are a long-awaited step towards creating a more certain and transparent contaminated sites regime in Nova Scotia.
However, with this certainty come some drawbacks: in particular the potential for increased expense for persons responsible and greater exposure to law suits for site professionals. We provide some observations regarding potential implications of the Draft Protocols below.
a. Increased reporting of contaminated sites & more properties remediated
The Regulations, in conjunction with the Draft Protocols, include provisions that will likely cause increased reporting of contaminated sites, and therefore an increase in the number of properties that undergo remediation.
First, the Regulations and Draft Protocols make it clear when a site will be considered a contaminated site such that reporting/notification is required. The Draft Protocols - in particular the notification of Contamination Protocol - include specific standards and risk factors against which Contamination can be measured. It will be easier for "persons responsible" to determine when they are legally obligated to report contamination.
Second, the Regulations impose a reporting duty on site professionals (Regulations, Section 7). Currently site professionals have no obligation to report contamination directly to NSE. When the Regulations come into force – July 6, 2013 – site professionals will be legally obligated to report certain types or amounts of contamination that they discover in the course of their work.
The "duty to notify" provisions of the Regulations, in conjunction with the clear standards set out in the Draft Protocols, will therefore act as a trigger for widespread reporting of contaminated sites and an increase in the number of properties undergoing remediation.
b. Increased reliance on site professions
The role of the site professional throughout the notification and remediation process, as set out in the Regulations and Draft Protocols, is significant.
First, the role reserved for the site professional under the new system is significant. Most of the notification and remediation duties set out in the Regulations can only be carried out by a site professional. Under the notification of contamination protocol, it is the site professional that makes the key determinations of whether notification is required. The site professional will also make all decisions relevant to the remediation process, is the only person able to prepare and submit ESAs, RAPs, and is the one who must certify that the information in the record of site condition or declaration of property condition is accurate.
Second, the credibility and reliability of the outcomes of remediation is backstopped by the expertise and integrity of the site professional. If the contaminated sites regime purports to provide a level of assurance or certainty to prospective property purchasers, investors, or developers, this assurance or certainty is only as good as the record of site condition or declaration of property condition certified by the site professional. It is the site professional who declares that remediation has been performed to the chosen levels in the remediation levels protocol.
This latter point is amplified by the fact that one of the two main outcomes available through the remediation processes defined in the Regulations does not have a clearly defined benefit. As noted above, remediation under the Regulations must be either limited remediation or full property remediation. The full property remediation results in a declaration of property condition, which in turn leads to a limited form of protection from enforcement measures under the Act (see Regulations, Section 17).
The outcome of the other remediation process, the limited remediation stream, has no such statutorily defined protection. Instead, the benefit of completing this process and filing a record of property condition, presumably rests in the certainty/assurance that the record of property condition will provide to others regarding the cleanliness of the property. This certainty/assurance, in turn, is undergirded by the expertise and integrity of the site professional overseeing the remediation.
c. Greater certainty for persons responsible for contaminated sites
The greatest benefit of the Draft Protocols is the certainty and clarity they provide to persons who own, occupy, invest in, or develop contaminated sites. Those persons want to know their potential liabilities related to a contaminated site and, if potential liabilities exist, what their duties are in relation to the contaminated site. They also want to know what the outcome of remediation will be at the end of the day.
Whereas the previous contaminated sites regime was unclear and at times appeared to be applied inconsistently by NSE, the new regime appears to formalize the process from beginning to end.
Certainty regarding notification: Previously, it was not clear when a contaminated site was in fact a contaminated site such that notification was required. The definition of "contaminated site" in the Act provides at Section 3(l):
"contaminated site" means:
||Unless otherwise defined by regulation, a site with concentrations of a contaminant or contaminants that exceed standards prescribed or adopted by the minister that has caused, is causing or may cause an adverse effect, or|
||A site designated as a contaminated site by the minister pursuant to Section 87;|
Until the issuance of the present draft proposals, there have been no "standards prescribed or adopted by the minister". Likewise, the minister has rarely, if ever, designated a site as a "contaminated site" pursuant to Section 87.
As discussed briefly above, the notification of Contamination Protocol makes it clear when a site will be considered a contaminated site such that notification is required. Specifically, notification will be required when there is free product present on a site, or if the site has both an exceedance of the Tier 1 Environmental Quality Standards (EQS) tables and the presence of a "risk factor" (both the tier 1 EQS tables and the specific "risk factors" to be considered are included in the notification of contamination protocol).
Certainty regarding actions required to complete remediation:
The Regulations create clearly defined steps that a person responsible must undertake to complete remediation of a contaminated site. The Draft Protocols, in turn, set out clear standards that must be met at each step of the process in order for that step to be satisfied.
The ESA related Draft Protocols define in detail the contents of ESAs, and the number of ESAs that must be submitted to NSE. Similarly, the remedial action plan protocol defines in a detailed way the contents of a RAP, and although not released yet it is expected the confirmation of remediation protocol will do the same for the confirmation reports required under Section 13(1) and Section 15(1) of the Regulations. Neither of these have been defined in any detail (or at all in the case of the confirmation reports) to date under the Act.
In theory, therefore, the Draft Protocols should provide persons responsible and their site professionals a high degree of clarity regarding what they must prepare and submit to the minister in order to satisfy the mandatory remediation process outlined in the Regulations.
Certainty regarding acceptable remediation levels:
The Draft Protocols, by setting out clear measures of remediation, will enable persons responsible to determine when a property or site has been remediated to a level acceptable to NSE. This is perhaps the most significant aspect of the certainty provided by the Draft Protocols.
The remediation level protocol provides for remediation to different standards depending on the circumstances. The standards vary from the most conservative Tier 1 EQS level, to the less stringent Tier 2 standards which may employ Pathway Specific Standards (PSS) or Site Specific Target Levels (SSTLs), and/or standards that include ongoing site exposure management measures. Each standard is clearly described in the remediation levels protocol and defined in tables appended to that protocol.
By providing accepted standards for varieties of contaminants in different land-use scenarios, the remediation levels protocol has the potential to simplify and encourage site remediation for other contaminants such as heavy metals, PAHs (polycyclic aromatic hydrocarbons), VOCs (volatile organic compounds), etc., in the same fashion as the Atlantic RBCA standards did for hydrocarbon contaminants.
The Draft Protocols also clearly set out the degree of regulatory closure that will result from remediating to a given standard. In general terms, there are only two types of closure: conditional and unconditional. Conditional closure can be achieved by remediating to the Tier 1 EQS or by a strict application of Tier 2 remediation levels (i.e. the Tier 2 "default parameters" are complied with and not removed or modified, as is permitted under certain of the less stringent remediation options).
In spite of the above, it is not clear what degree of security "closure" or "conditional closure" will provide to a person responsible. The only statutory protection from ministerial enforcement action that is outlined in the Regulations results from completion of the full property remediation process and filing a declaration of property condition. The Regulations make no mention of "conditional" or "unconditional" closure. The Draft Protocols likewise do not indicate what benefits are achieved by remediating to standards that result in "unconditional" versus "conditional" closure.
However, the same criticism could be levelled at the Atlantic RBCA process, which has generally worked very well and has received very good public acceptance. Despite the lack of a "bulletproof" shield from liability involved in the RBCA process, there have been negligible instances of reopening the remediation of sites which have cleared the process.
Certainty regarding timelines:
The Regulations set out timelines for notification, and for completion of remediation. Unless an extension is granted, the remediation – whether limited remediation or full property remediation – must be completed within two years from the date on which the minister was first notified.
Relative to the time that is often taken to remediate a contaminated site under current practice, the two year timeline may seem short. It seems there is a reasonable chance that NSE will provide extensions on a regular basis. However, the intention of the Regulations is clear, and it may also be that persons responsible will be forced to dedicate more focus and resources towards remediation than has been the case in the past. This has the potential to decrease the regulatory lag time in restoring contaminated sites to useful states.
d. Increased burden and expense for persons responsible
There is a potential downside to the level of detail and comprehensiveness in the Draft Protocols. The Draft Protocols may result in a more costly process for the person responsible who is required to prepare and submit, through the person's site professional, the various ESAs, RAPs, confirmation reports, and records of site condition/declaration of property condition.
The Draft Protocols suggest there may be more cost and effort involved in determining whether contamination exists on a site (i.e. to confirm whether notification is required). Further, certain of the ESA protocols appear to require a more in-depth form of ESA that might normally be produced in the course of remediation. Finally, there are simply more forms for the person responsible (through the site professional) to prepare and submit: the confirmation report and record of site condition/declaration of property condition are new to the Regulations.
These factors may all increase the expense to the person responsible. On the whole, the new Regulations and Draft Protocols appear to download much of the work involved in assessing contaminated sites, creating RAPs, and confirming site closure, to persons responsible and their site professionals. It is the site professionals who now provide the stamp of approval throughout the process, rather than NSE.
The Draft Protocols, if adopted, and if implemented consistently, have the potential to introduce greater certainty in responsibility for remediation of contaminated sites and the standards to which contaminated sites need to be remediated.
The Draft Protocols will eliminate uncertainty about appropriate quality standards for contaminants other than hydrocarbons which has inhibited remediation by leading to regulatory delays, unnecessary expenses and inconsistent imposition of standards. This is beneficial. It would have been preferable if the standards were incorporated into the Regulations themselves, but they are a step forward.
Similarly, the new regime could have provided greater encouragement to persons seeking to remediate contaminated sites (including innocent third parties), by including a strong exclusion of liability, but there is some comfort afforded in the new regime that will come into force July 6, 2013. Much will depend upon the manner in which NSE adheres to the spirit of the regime.
Finally, the new regime will involve a significant transferring of responsibility from government regulators to private sector site professionals. For property owners this has an attendant additional cost which may be partially offset by the elimination of regulatory lag in responding to filings.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.