Following the publication of a report highlighting the deficiencies of the Environment Protection Authority (EPA) in the management of contaminated sites, a number of significant amendments have been proposed to both the Contaminated Land Management Act 1997 (CLM Act) and the EPA Guidelines on the Duty to Report Contamination

PROPOSED AMENDMENTS TO THE CLM ACT

The NSW Government has introduced the Protection of the Environment Legislation Amendment Bill 2014 (Bill).  The Bill, which is currently awaiting second reading debate in the Legislative Assembly, proposes the following key changes:

1.  Financial assurance required for remediation work

Under the amendments proposed in the Bill, the EPA will be able to require financial assurance, in the form of a bank guarantee, bond or other form of security, as part of a new management order issued under the CLM Act.  This will enable the EPA to claim against the financial assurance in circumstances where it completes remediation work or directs remediation work be undertaken on behalf of a third party.  The amount of the financial assurance will be determined by the EPA but cannot exceed the EPA’s reasonable estimate of the total costs of carrying out the remediation work.

In determining if financial assurance is justified, the EPA will consider the:  

  • degree of risk of environmental harm associated with the activities;
  • remediation works required as a result of the activities; and
  • the environmental record of the entity.

The requirement to provide financial assurance will not apply to management orders, approved voluntary management proposals or ongoing maintenance orders (EPA Orders) that are already in force.  However, the EPA could revoke the existing order and issue a new order requiring financial assurance.

2.  Increased penalties

The maximum penalties under the proposed changes will increase significantly with the maximum penalty for a corporation increasing to $1 million and for directors and officers to $250,000 for the following offences: 

  • failure to comply with a management order;
  • failure to report contamination;
  • failure to comply with a requirement of an authorised officer or the EPA; and
  • providing false or misleading information. 

Additional penalties are also issued for each day the offence continues.

3.  New powers granted to Land and Environment Court

In addition to the prescribed penalties set out above, the Land and Environment Court (LEC) will have the power to make further orders including, requiring the entity to:  

  • publicise or notify specific persons of the offence;
  • provide financial assurance;
  • complete a restoration or enhancement project for public benefit; or
  • pay an additional penalty representative of the economic value of the benefit gained as a result of the offence. 

The EPA will also be able to accept undertakings which can be enforced in the LEC. 

EPA DRAFT GUIDELINES ON THE DUTY TO REPORT CONTAMINATION

The EPA has released “Draft Guidelines on the Duty to Report Contamination under the Contaminated Land Management Act 1997 (NSW)” (Draft Guidelines) The Draft Guidelines are intended to update and replace the current guidelines and are currently being reviewed by the EPA following public submissions. 

Duty to report contamination

Currently the CLM Act requires a person whose activities have contaminated land and an owner of contaminated land to notify the EPA if:

  • the contamination is at levels above those specified in guidelines and people have or will foreseeably be exposed to the contamination; or
  • the contaminant has entered or will foreseeably enter neighbouring land, the atmosphere, groundwater or surface water and exceeds the levels specified in the guidelines.

The duty to report arises as soon as the person or land owner becomes aware, or ought reasonably have been aware, of the contamination.  Failure to report contamination is an offence and can result in significant penalties.

The Draft Guidelines incorporate the 2013 amendments to the National Environment Protection Measure for the Assessment of Contaminated Sites (NEPM).  The Draft Guidelines will set new and revised levels for contamination and also incorporate additional substances and exposure pathways.  The Draft Guidelines propose the following key changes:

1.  Asbestos

Under the Draft Guidelines, the EPA must be notified of identified asbestos in, or on, soil if:  

  • friable asbestos is present;
  • the concentration is equal to or above the level identified in the NEPM; and
  • a person has been, or foreseeably will be, exposed to the asbestos fibres by breathing them into their lungs.

2.  Vapour inhalation pathway

The EPA must also be notified if a risk is identified associated with a vapour inhalation pathway in circumstances where:  

  • the individual soil vapour sample is equal to or above the level identified in the NEPM;
  • the concentration of the contaminant will continue to remain above the specified level; and
  • a person has been, or foreseeably will be, exposed to the contaminant or any by-product of the contaminant.

3.  Air quality

While the Draft Guidelines do not include an air quality threshold level, they do recommend the EPA be notified in circumstances where contamination of soil or groundwater affects air quality and there is a risk to people breathing the air. 

WILL IT AFFECT YOU?

The adoption of the Draft Guidelines will revise the statutory reporting thresholds for some contaminants and require reporting of asbestos contamination.  This means that some sites which previously did not attract a duty to report contamination may now trigger that duty.  The proposed changes will affect all entities that:  

  • own or develop land in New South Wales;
  • whose previous or current actions could have caused contamination to land in New South Wales; and
  • are currently subject to an EPA Order.