A significant factor in a commercial real estate sale can be determining the environmental impact on a site through a qualified engineering firm.
There have been recent changes to the Environmental Management and Protection Act, 2010 (EMPA) I think are worth pointing out, but by no means am I an environmental engineer.
When in doubt, contact the experts for a full interpretation. These are just my observations.
When does this start?
EMPA changes came into effect on June 1. It’s important to understand EMPA works with the Saskatchewan Environmental Code, which requires property owners to manage environmental impact within their sites.
The code is a results-based regulatory system that provides the standards environmental engineers use to measure soil contamination. These code standards change frequently, but the reporting and remediation requirements in EMPA have only recently changed.
Is a new report required?
You don’t necessarily need to rush out and grab a new Phase I report if yours is older than June of this year.
Most of the changes to EMPA, from my research, surround contaminated land. If this doesn’t apply to your property, take a deep sigh of relief.
The words we seek for the cleanest bill of health on a Phase I report are “No further investigation required.” This hasn’t changed at all.
It’s important to keep in mind, however, that each financial institution will have its own guidelines stating how old a Phase I report may be. Typically, they’ll accept Phase I reports completed within 18 months as long as a Phase II report wasn’t required.
Five changes impacting contamination
As mentioned, the changes primarily impact land identified through Phase II to include some level of contamination. These changes include:
* A new duty to report a discharge and discovery of contamination. This applies to property owners, anyone making a discovery while conducting work onsite, and any municipal agency or law enforcement that becomes aware of a discovery or is investigating same;
* A new process to transferring responsibilities of impacted sites wherein the Ministry of Environment wants to make sure the party assuming responsibility can afford to follow through on reclamation and fully understands what it is taking on;
* New discretionary power from the Ministry of Environment to order owners and occupiers to report impacted sites;
* A new process for conducting site assessments and developing corrective action plans if required;
* A new impacted sites registry being developed.
From what I understand, many of the changes build on existing requirements under the old version of EMPA. It’s not quite clear how some of the more vague points will be interpreted over time, including the set-up of this registry.
The registry aims to provide information on contaminated sites, including site conditions, corrective action plans, sites assessments and environmental protection orders. The registry will supposedly be available to the public online, but how or when that takes shape is unclear.
As the new and improved EMPA is still in its infancy, it will be interesting to see how things shake out within the “greyer” areas of the act. The implications, however, would appear to have risen for sites affected by contamination.