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Brief Counsel

Feedback wanted on NES for soil contamination

16 February 2010

Submissions are due by 5 pm 19 April 2010 on a proposed National Environmental Standard (NES) for dealing with contaminated sites.  The discussion document is available here

The Ministry for the Environment (MfE) will convene regional public consultation workshops on the proposed NES during March.  

What is driving the proposed NES?

New Zealand’s contaminated land legacy is not on the scale of other industrialised countries but MfE considers it significant enough that it needs to be properly identified and assessed.  MfE has criticised council planning controls (district and regional plans) for the assessment, remediation or containment of contaminated soil as being inadequate and inconsistent – and, in some cases, absent.

MfE estimates that city and district councils have identified around 20,000 potentially affected sites.  It says that only a small proportion of these have been sufficiently investigated to determine the presence of contaminants.  The most common activities that have led to site contamination are the manufacture and use of pesticides, production of gas and coal products, production, storage and use of petroleum products, historic mining, timber treatment and sheep dipping. 

What is a National Environmental Standard and how will it apply?

National Environmental Standards are regulations made under the Resource Management Act that prescribe technical standards, methods or requirements.  Once approved by an Order in Council, an NES can set direct controls on land use and other activities.  An NES can introduce standards that can override local plan rules.  .  Potentially, an NES can affect any new designation, application for resource consent for subdivision or development of land, or the review of any existing resource consent conditions.

Scope of the NES

As with other contaminated land regimes overseas, development would be the main trigger for assessment under the NES.  The proposed NES would apply to sub-surface investigations and to the use, development and subdivision of land.  It is proposed to:

  • Set planning controls for district and city council plans for assessing contaminants in soil.  (For example, any proposed development or subdivision where the risk to human health from soil contaminants is assessed as not being acceptable for the intended use or where there is insufficient information to make that assessment would be a restricted discretionary activity)

  • Provide a set of soil contaminant thresholds for 12 priority contaminants, that would define an adequate level of protection for human health, and

  • Ensure that land affected by contaminants in soil is identified and assessed at the time of being developed and, if necessary, remediated or the contaminants contained.

The NES would not apply to assessing and managing effects on other receptors including on or off site ecology, surface water, ground water or amenity values.

Implications

While national consistency would be welcomed by some in an area of resource management law that is fraught at best, we think the proposed NES would have substantial effects on the property industry – developers, land-bankers and investors alike.  The NES would, for example, result in additional investigation and application costs for landowners who seek to develop affected sites.  Technical reports (e.g. Phase Is and IIs) may become more common place in the resource consent application package, with associated time and cost being borne by applicants.  Council resources may become strained due to a lack of in-house expertise to interpret these technical reports, leading to processing delays.  In some cases, the NES may even affect land values, for example where a contaminated site becomes subject to more stringent planning controls under the NES than under the existing district plan rules.

The NES would also have implications for the level of information that councils hold regarding the presence of hazardous substances on land.

In our view, these sorts of issues could drive the topic of contamination closer to the front of land deal negotiations.  Accordingly, risk allocation and price adjustments in property transactions to cover these issues may be commercially sensible in some cases.

Where to from here

MfE is seeking broad participation from stakeholders in the design of the NES.  The proposed NES is a significant step in dealing with contamination issues.  Regulation of some sort has been anticipated for some time since the RMA was enacted.  Given the wide potential implications we urge those affected to engage in the submission process.  Chapman Tripp has expertise in NES and contaminated land laws in New Zealand generally and will be happy to assist with submission preparation. 

For more information please contact the lawyers featured.

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