Why pollution liability brokers should pay attention to this auditor general report

The Ontario government should re-visit a rule that leaves polluters off the hook for hazardous spills that cost less than $10,000 to clean up, the province’s auditor general suggests.

In 2016, the Ontario environment ministry [now called the Ministry of the Environment, Conservation and Parks] made a new policy stipulating it would not to attempt to recover hazardous spill response costs if they are estimated to cost less than $10,000.

In a report released Nov. 22, 2021, auditor general Bonnie Lysyk is recommending the ministry re-assess that threshold.

Ontario – like most other jurisdictions – has a “polluter pays” rule that generally requires anyone with charge management or control of a property to pay for the cleanup and remediation of hazardous material spills.

In Ontario, the $10,000 cost recovery threshold is significantly higher than that used by other provinces and Ontario municipalities, the auditor general noted in the value-for-money audit on hazardous spills.

British Columbia for example has a $175 minimum for spills cost recovery.

Using another example cited in the auditor general report, the City of Guelph, Ont. issues invoices to recover costs related to cleanup for any spill that requires more than two hours of its Environmental Protection Officers’ time or when the City needs to bring in an external contractor to help with the cleanup.

“Spill response activities that incur significant costs, such as the use of laboratory services and spill response equipment, have not been calculated and disclosed to Environmental Officers” the office of the auditor general said.

There were more than 73,000 hazardous spills reported in Ontario between 2011 and 2020, but the government tried to recover its response costs just three times, the auditor general said.

“Even in those three, it went after only about half of the $1.3 million spill response cost it incurred.”

Sometimes the province will issue clean-up orders against individual directors and officers. A case in point is a 2012 Ontario Ministry of the Environment order against 13 former directors of Northstar Aerospace Canada.

In Cambridge, Ont., Northstar used to make parts for military helicopters such as CH-47 Chinook, AH-64 Apache and UH-60 Blackhawk. The Cambridge site was found to be contaminated by trichloroethylene and also by contaminants from a different property in the same area.

Meanwhile, Northstar had been granted protection under the Companies Creditors Arrangement Act. so the ministry issued a cleanup against 13 individual directors and officers. Those individuals unsuccessfully appealed to the Environmental Review Tribunal for a stay on the MOE remediation order. Instead of applying for judicial review of the ERT ruling, they settled.

Feature image by iStock.com/Phototreat