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January 01, 2007

Ontario MOE proposes Brownfields Changes

Would limit “reopeners”, civil liability for municipalities, but no protection from civil claims for property owners.

After extensive stakeholder consultation, the MOE is finally proposing amendments to its Brownfields laws and regulations.

Some proposed changes, including clarification of various “reopener” provisions will be welcomed by property owners and developers. Municipalities will gain civil immunity for issuing building permits based on incorrect RSCs.

Many stakeholders will be disappointed that nothing has been done to limit exposure of property owners to civil lawsuits. Also controversial is the proposal to eliminate horizontal severances – a legal technique that appears to offer potential to encourage lenders to finance Brownfields projects.

Proposals for changes and clarifications to Brownfields laws were posted for discussion on the EBR on January 16, 2007. Click here for the EBR posting. The proposed changes are sponsored by the ministries of Environment, Municipal Affairs and Housing, Northern Development and Mines and the Attorney General.

Changes to the Environmental Protection Act, the OWRA and the Records of Site Condition would address:

  • Clarification of “reopeners”. Changes would allow owners, purchasers and lenders more certainty about exposure to clean-up orders when:
    • there is incorrect information in an RSC;
    • there is offsite migration. New rules would detail requirements for more extensive investigations and an additional QP certification to protect persons not responsible for the causing or permitting the contamination. (Presumably, an owner or former owner who was the original polluter would continue to be liable for offsite migration.) Additional rules would apply where the RSC use is “less sensitive” than the surrounding land uses. The RSC regulation would be amended to clarify what concentration of offsite contamination would trigger the reopener. For example, if a use is industrial, but there is a residential neighbour, the reopener would not apply if the contaminant concentration migrating offsite does not exceed the residential standard. If there is only industrial property in the vicinity, the reopener would not be triggered unless offsite migration exceeded the industrial standard;
    • there is a change of use after an RSC property has been sold – protection for pre-change owners continue;
    • there is non-compliance with risk management measures, only the person who contravenes the CPU or risk management order would be subject to orders;
    • there is non-compliance with soil management regulations – if the MOE makes soil management rules, only the person who contravened them would lose protection.
  • Clarification that, prior to RSC, persons who conduct site remediation are not considered to occupy or have charge management or control.
  • Civil Liability Protection: Municipal
    • proposal to amend EPA to provide immunity from civil claims against municipalities and others issuing building permits or making planning decisions, if the lawsuit arises from inaccuracy in a filed RSC;
  • Horizontal Severances To Be Eliminated For Brownfields
    • proposal to limit horizontal severances and title transfer to mineral rights only (currently horizontal severances do not require Planning Act approval);
  • Civil Liability Protection: Escheats
    • proposals to amend Proceedings Against the Crown Act and Escheats Act to protect governments from civil claims in certain situations, and to protect government funds expended on securing or improving a property;
  • Regulatory framework amendments are also proposed to:
    • govern pre-review of RSCs (pre-filing audits);
    • promote consultation on changes to the regulation governing QPs; in the interim, amendments may be proposed to govern registration and re-qualification; and appeals to ERT regarding a decision made to issue, remove or suspend an aspect of a QP’s qualification;
  • Technical amendments proposed are:
    • authority to amend RSC at request of owner to correct inaccuracy;
    • permitting order notices to remain on the ESR despite compliance with the order, until a new and accurate RSC is filed (this authority already exists for emergency orders);
    • requiring owners filing an RSC to retain reports for a prescribed period of time;
    • prescribing conditions governing on-site management of soils on properties after an RSC has been filed (currently MOE can only restrict soil management on stratified and RA properties).