Revised guidelines made by the EPA place a heavier burden on site auditors to make their own checks and provide sign-offs, particularly in relation to the management of waste and contamination by hazardous gases and PFAS. Previously site auditors may have relied on information provided to them by clients and consultants.

The NSW Environment Protection Authority (EPA) has finalised an updated version of the Guidelines for the NSW Site Auditor Scheme, issued under the Contaminated Land Management Act 1997 (NSW) (CLM Act). According to the Guidelines, the services of a "site auditor" can be used by anyone who needs an independent and authoritative review of information relating to possible or actual contamination of a site. In conducting their work, site auditors owe a primary duty of care to the environment and the health, safety and welfare of the people of NSW.

As discussed below, the Guidelines contain strict new requirements surrounding site auditors' review of waste management procedures, and the management of contaminants of serious concern.

Other key changes contained in the new edition of the Guidelines include:

  • Site auditors must now ensure that consultants implement a "systematic planning process" surrounding the collection and evaluation of site samples to ensure that defined "data quality objectives" are achieved;
  • Site auditors are now required to notify the EPA where they are commissioned to audit sites impacted by hazardous ground gases, groundwater contamination, off-site contamination, or sites which the EPA is otherwise managing under the CLM Act;
  • Site auditors must check that any proposal for landfarming demonstrates adequate safeguards for the protection of human health and the environment, and also use their professional judgment in determining whether a site that has been previously contaminated with asbestos is suitable for a particular use by reference to a number of current asbestos guidelines; and
  • When certifying that land would be suitable for a given use, subject to a condition requiring the implementation of a particular remediation plan, site auditors must attach the plan to the site audit report and classify the various measures required to be taken in accordance with the framework contained in the Guidelines.

The Guidelines also provide further clarification surrounding the effect of signing a site audit statement, revise annual reporting requirements for site auditors, impose stricter selection criteria on applicants for accreditation, provide an updated human health risk assessment checklist and references to other current applicable contaminated land guidelines such as the National Environment Protection (Assessment of Site Contamination) Measure.

Detailed new waste obligations on site auditors

The Guidelines now require site auditors to undertake a detailed review of the management of wastes generated by the contaminated site they are auditing. Site auditors are now required to check that:

  • waste has been appropriately classified in accordance with the EPA's Waste Classification Guidelines and that an adequate justification for that classification has been provided;
  • waste has been taken to a facility lawfully able to receive it. This requires auditors to examine the environment protection licence or regulatory consent of the receiving facility to ensure that it can lawfully receive the particular class and amount of waste without breaching any limit conditions on its licence;
  • receipts have been provided for waste which has been disposed off-site and these reconcile with internal records as to the total volume of waste generated and transported from the site. In respect of asbestos waste, site auditors must also check the disposal documentation complies with the requirements of the Protection of the Environment Operations (Scheduled Activities and Waste) Regulation 2014; and
  • the conditions of any resource recovery orders and exemptions applicable to waste received from off-site for use on the contaminated site have been, or will be, complied with.

The Guidelines impose stringent new obligations on auditors to ensure that they are independently satisfied as to the appropriateness of waste management procedures. As a result, site auditors will need to work with landowners or developers to ensure that complying procedures are in place as part of the development and implementation of any remediation plan. This is likely to increase the costs associated with obtaining a site audit statement.

Where auditors are not satisfied that appropriate procedures exist or are being complied with, auditors must notify the EPA and direct the waste generator to remedy the non-compliance. Failure to do so could lead to auditors contravening the prohibition on the supply of false or misleading information about waste ‒ a criminal offence under the Protection of the Environment Operations Act 1997 (NSW) (POEO Act). Waste generators, ie. landowners or developers, may be exposed to liability arising from the management, transport or illegal dumping of waste ‒ all offences under the POEO Act attracting significant penalties.

Hazardous ground gases and PFAS contamination now require specific attention

Per- and poly-fluoroalkyl substances (PFAS) have been identified as a significant potential contamination risk, due to their unique surfactant properties, and significant resistance to heat, water, oil, abrasion and other chemicals. The Guidelines specifically require site auditors to check that the site assessment has addressed the possibility of PFAS contamination. The Guidelines direct the auditors to the EPA's 2016 technical guidance "Designing Sampling Programs for Sites Potentially Contaminated by PFAS". Technical guidance on PFAS is likely to be further refined early next year, following the expected finalisation of the PFAS National Environmental Management Plan.

The Guidelines also require site auditors to check that the potential risk arising from hazardous ground gases potentially captured in the pore spaces of soil and rocks under the site has been adequately assessed and considered in designing remediation proposals. There is an obligation on the site auditor to warn landowners of any risks posed by ground gases to occupiers having regard to the proposed use of the site. The Guidelines explicitly require site auditors to ensure that the assessment of the site complies with the EPA's "Guidelines for the Assessment and Management of Sites Impacted by Hazardous Ground Gases".

Where auditors do not have sufficient technical expertise to consider these matters themselves, they should seek to retain an expert support team to address any such issues.

Site Audit Statements

Alongside the new guidelines, the EPA has also approved a new version of the Site Audit Statement form. The site audit statement certification for "suitability for use" audits (section A) will now be split into two categories:

  • Section A1 – determine land use suitability for a specified use; or
  • Section A2 – determine land use suitability subject to compliance with either an active or passive environmental management plan (EMP), sometimes referred to as the site management plan. The EMP describes the nature and location of contamination remaining on-site, how the contaminants will be managed, who will be responsible for implementing the EMP and the timeframes for any specified actions.

Section B of the form has also been amended to specify the purpose of particular site audits eg.

  • to determine compliance with a voluntary management proposal or management order; or
  • to determine the appropriateness of a remediation plan or investigation plan or management plan; or
  • to determine the nature and extent of contamination.

When completing the new form, site auditors must clearly nominate for what purpose their site audit has been commissioned, in the body of the statement.

Implications of the Guidelines for the NSW Site Auditor Scheme

The new edition of the Guidelines took effect on 20 October 2017. It applies immediately to all site auditors and site audits in NSW, and replaces the 2006 version of the Guidelines. As there are no transitional provisions dealing with site audits which are currently on foot, it is not yet clear how the EPA proposes to deal with these sites and whether ongoing audits will need to be redone to address the requirements of the updated Guidelines.

Accordingly, site auditors and owners of contaminated sites (where site audits are currently being undertaken) should familiarise themselves with the new obligations imposed by the Guidelines as soon as possible, particularly the more onerous waste management obligations discussed above. Site owners and developers should also ensure that their proposed waste management plans will satisfy the new audit scheme, and should seek advice if uncertain.

Where the Guidelines increase the obligations on site auditors and consequently the potential liability of site auditors, we recommend that site auditors and developers also reassess both the contractual terms between them and the insurance cover held by the site auditor.

It is common for a site audit to be conducted at the end of the lease as part of the tenant's yield up obligations. As site auditors now have expanded obligations, the potential risks posed by any more expansive assessment (compared to the baseline contamination assessment) will also need to be considered by landlords and tenants.

Finally, as site auditors now have expanded reporting obligations to the EPA, the pros and cons associated with conducting a non-statutory site audit on a potentially contaminated site which has not previously been reported to the EPA (or is otherwise being regulated by the CLM Act) will also need to be weighed up.