The management of brownfields in Ontario: A comprehensive review of remediation and reuse characteristics, trends, and outcomes, 2004–2015

ABSTRACT

Brownfields remediation and redevelopment continues to be an important issue for policy makers and planners seeking to unlock its many socio-economic and environmental benefits. While technical approaches to assessment and remediation have become rather standardized and governments have largely embraced voluntary programs to oversee their application, the degree of regulatory oversight continues to differ among jurisdictions. This article examines the scale and character of remediation activity in Ontario, Canada over the last decade using records submitted by qualified persons from the private sector. It finds that Ontario’s approach has been quite successful in scale and character in stronger urban real estate markets despite most matters related to cleanup and reuse escaping the direct oversight of provincial regulators. The province’s less-interventionist approach may need some review to address the nature of cleanup techniques being applied and the recent slowdown in cleanup and reuse activity, especially given the growing push toward regional growth management and more effective use of brownfield land resources in both larger urban areas, and smaller ones where greenfields are plentiful and brownfields are less competitive.

KEYWORDS:

• Brownfield
• contaminated
• regulatory oversight
• policy
• program remediation
• urban redevelopment

Introduction

The management of brownfields continues to be an important issue for environmental professionals, planners, land developers, and others keen on assessing, remediating, and reutilizing derelict land. Initial concern over the risks and liabilities associated with contamination that impeded reuse in the 1980s gradually reduced as procedural approaches were introduced by governments to help return these sites to productive use. International, national, and intra-national efforts also intensified in the 1990s and early 2000s, leading to the adoption of relatively similar management approaches throughout North America.

In Canada, the Canadian Council of Ministers for the Environment (CCME) and the National Round Table on the Environment and Economy (NRTEE) first brought together inter-provincial and inter-sectoral stakeholders to review the legal, financial, and environmental aspects of the contaminated sites problem (CCME, 1991, 1993, 1996, 1997; NRTEE, 1996a, 1996b, 1997, 1998). Many of their early studies highlight the critical challenges it caused (e.g., social, environmental), decried the limited regulatory frameworks in place to manage it, and forwarded ideas for how government could better address risks and liabilities. Despite these efforts, however, there was a general sense that mechanisms in place within Canada were lagging behind those of other nations and that limited federal involvement allowed Canadian provinces too much leeway to pursue their own brand of policy (Sheppard et al., 1992; Ford et al., 1994; Therrien and Hill, 1995; De Sousa, 2001).

In Ontario, Canada’s most populous and industrialized province with an estimated 40% of country’s brownfields (ECO Canada, 2007, p. 14), the approach taken by the provincial government, and ultimately formalized into legislation in 2004, can be described as a relatively noninterventionist one when compared with other North American jurisdictions. Simply put, Ontario’s Ministry of the Environment and Climate Change (MOECC) supports remediation efforts by creating standards for Qualified Persons from the private sector to follow when conducting site assessment and remediation for a property owner, and while the MOECC does review records of site condition for administrative and technical errors once site assessment and cleanup actions are complete, it is not typically involved from the start. Ontario’s Ministry of Municipal Affairs and Housing (2007) simultaneously supports remediation activity by providing some general technical assistance, by permitting municipal support (e.g., Ministry of Municipal Affairs and Housing, Bill 51 Planning and Conservation Land Statute Law Amendment Act, 2006), and by implementing aggressive policies to promote urban intensification and curtail sprawl (e.g., Places to Grow Act, Ministry of Municipal Affairs and Housing, 2005, The Growth Plan for the Greater Golden Horseshoe, 2006, Ministry of Infrastructure, 2013).

Based on a comprehensive review of Records of Site Condition (RSC) submitted by property owners to Ontario’s Environmental Site Registry since 2004 that outline assessment and remedial actions undertaken, this research addresses three primary questions: What has been the scale and geographic scope of activity throughout the province? What have been the technical characteristics of this activity? And what has been the resulting land-use change and transactional value?

The evolution of brownfields policy in Ontario

According to the MOECC (Ministry of the Environment and Climate Change, 2015, 1), brownfield properties refer to “vacant or underutilized places where past industrial or commercial activities may have left contamination (chemical pollution) behind.” Prior to the 1970s, individuals residing or operating in the province were essentially able to pollute their property when the activity did not compromise the rights of those off site (Fishlock, 2010, pp. 1–2). The Environmental Protection Act of 1971 marked the beginning of Ontario’s regulatory efforts aimed at protecting the province’s natural resources by prohibiting the discharge of a contaminant into the environment that may cause adverse effects. These provisions were further enhanced in 1985 to require the immediate cleanup of spills and financial compensation for those who suffered personal harm or economic loss (Fishlock, 2010).

The emergence of regulatory challenges associated with brownfields, together with scientific improvement in testing, lead to the development of the MOECC’s Guidelines for the Decommissioning and Cleanup of Sites in Ontario (1989) and Interim Guideline for the Assessment and Management of Petroleum Contaminated Sites (1993). These guidelines continued to evolve as pollution standards for new contaminants were added. While the provinces did work cooperatively with the federal government via the CCME to coordinate standards and policies, each province varied somewhat. The process in Ontario and other provinces did, and continues to, follow norms that are influenced by international standards.

Even though the Ontario government maintains the right to order the cleanup of a property, the MOECC began to favor a voluntary approach wherein a property owner was only required to remediate their property when they opted to. Someone interested in acquiring, remediating, and/or redeveloping a brownfield in Ontario must first ascertain risk by conducting a Phase I environmental site assessment (ESA) that involves a review of historical records and possible interviews and site visits to determine past use and potential risks from chemical processes. If the Phase I ESA identifies concerns, then a Phase II ESA involving physical sampling is carried out to confirm the location, type, and degree of contamination, to recommend cleanup alternatives, and, in Ontario, to outline the methods used to manage contamination to meet standards (i.e., typically referred to as a Phase III in other locales). Standards used in Ontario to assess whether a site is contaminated and to guide cleanup are based on generic levels, wherein they reflect exposure risks considered safe for different land uses (residential/park standards are higher than industrial/commercial ones), or site-specific (risk-based) wherein they reflect risk exposure associated with a particular project at a particular location.

The MOECC began the process of amending its brownfield law and policy in 2001 (Brownfields Statute Law Amendment Act, 2001), with the Ontario Regulation 153/04 (Record of Site Condition Regulation) officially coming into force on October 1, 2004. The main goals were to establish clearer requirements for site assessments, provide some protection from environmental liability, and improve environmental site condition standards. These amendments also made the RSC process more predictable and transparent, obliged property owners to file an RSC when land use changed from industrial or commercial to residential or parkland uses, and outlined the requirements for a Qualified Person (QP) that include professional certification as an Engineer or Geoscientist, 5–8 years of experience, and a minimum of $1 million (CAD) in professional liability insurance (note: a few other professionals can perform Phase I ESAs). Only with risk-based cleanup is the QP required to submit a pre-submission form containing information from Phase I and II results and a public communications plan to the MOECC for approval before conducting and submitting an RSC.

The legislation was amended on July 1, 2011 to require more comprehensive information regarding cleanup and land use and to update standards for almost 120 contaminants. Risk assessment procedures were also amended to give property owners a choice between using a so-called Tier 2 streamlined risk assessment, which allows for simple modifications to the models used by the Ministry to produce their generic standards, or a Tier 3 full risk assessment, which provides the widest range of options for developing standards (MOECC, 2015). The Ministry may also issue a Certificate of Property Use requiring the owner to take specified actions to prevent, eliminate, or improve any adverse effect identified in the risk assessment, or refrain from using the property in certain ways.

During the same period, Ontario’s MMAH led provincial efforts to promote redevelopment through the creation of policy and the provision of technical assistance. The Ministry established the Office of the Brownfields Coordinator in 2005 to facilitate its work and to support municipal activities. The government amended the Planning Act in 2006 (Section 28) to allow municipalities to create Community Improvement Plans (CIP) to help developers remediate sites within Plan areas through the provision of financial incentives (e.g., study grants, loans, tax assistance, tax increment equivalent grants, municipal fee and development charge waivers). MMAH also implemented the Places to Grow Act (Ministry of Municipal Affairs and Housing, 2005), which enables the province to plan for population growth and economic expansion, along with the protection of the environment, agricultural lands, and other valuable resources, in a coordinated and strategic way by devising growth plans for any part of the province. The Growth Plan for the Greater Golden Horseshoe, 2006 (Ministry of Infrastructure, 2013, p. 12), which covers the most populous greater Toronto and Hamilton areas, explicitly notes that the “Plan envisages increasing intensification of the existing built-up area, with a focus on urban growth centres, intensification corridors, major transit station areas, brownfield sites and greyfields.”

It should be noted that Ontario’s regulatory approach to managing brownfields has been particularly influenced by activity in the U.S. As in Ontario, individual states throughout the U.S. devised voluntary cleanup/response programs (VCP) to loosen the prescriptive structures imposed by federal and state Superfund-style legislation (Meyer and Lyons, 2000). Unlike Canada, however, the U.S. federal government remained involved in the development and operation of state voluntary programs by negotiating their content with state governments, signing Memoranda of Agreement (MOA) to endorse many of them, and setting out basic criteria to evaluate them. A key difference between the Ontario vs. U.S. state approach is the degree of government involvement in the acquisition, assessment, cleanup, reuse, and long-term oversight of contaminated properties. A review of some prominent voluntary programs (e.g., Illinois, Michigan, NY State and City, Wisconsin, and New Jersey) reveals that while standards are set by the regulator in all jurisdictions, state authorities typically work more closely with property owners to review and develop assessment and remediation approaches from the outset, while qualified persons in Ontario have much more freedom regarding process to closure.

Literature review

The brownfields literature globally has expanded over the last two decades and includes not only scholarly work, but comprehensive and influential reports by professional associations, non-profit think tanks, and government agencies. Literature in Canada, however, reveals a declining level of interest on the part of both professional and scholarly researchers, with much of it preceding recent policy changes. Scholarly research by Hayek, Arku, and Gilliland (2010, p. 389) focusing on London, Ontario, a city of about half a million people, found more recently that “despite the availability of financial incentives, the overall private sector participation in brownfield redevelopment is low due to barriers such as competition from greenfields [clean sites], risk, cost, negative public perception of brownfields, and complex remediation processes.” A recent report by De Sousa (2015) summarizing interviews with private-sector brownfield stakeholders in southern Ontario found similar barriers, with an emphasis placed on regulatory issues (i.e., time/complexity of risk assessment and RSC procedures), the additional cost, liability, and time associated with brownfield projects, and emerging concerns over real estate demand. It found that private sector stakeholders were driven largely by real estate fundamentals (e.g., profit, market, location) and that many felt the redevelopment of brownfields to be a standard transaction that is viable if the market permits. Interviewees also feared that the time and complexity associated with brownfields continues to scare developers away and that maintaining interest in strong markets and stoking it in weaker ones will require more intervention from governments both indirectly through the improvement of existing regulatory processes/tools and directly through greater funding and technical support.

Research on voluntary cleanup programs for managing brownfields has been much more extensive in the U.S. Early work by the U.S. Government Accounting Office (1997) found that voluntary cleanups were less costly and time consuming overall. Comparative work by Meyer and Van Landingham (2000) found that by late 1999, 47 states had promulgated some form of voluntary program. Most scholarly research on these programs has focused on their application at the state or local level, including, for example, New York and Texas (Page and Berger, 2006), Ohio (Dylewski, 2001), Oregon (Blackman et al. 2010), and Baltimore (Maryland) (Guignet and Alberini, 2010). Work by Wernstedt et al. (2013) synthesizing results from interviews with VCP officials in all 50 states describes the primacy of economic redevelopment in motivating state officials to develop such programs, with improving environmental quality, promoting regulatory reform, easing political pressures, and improving the cleanup process also having key motivating roles. Kim and Miller’s (2015) examination of over 30 years of change in U.S. brownfield policy and programs identifies four major program features including the relaxation and readjustment of regulation, diversification of support programs, a mix of top-down and bottom-up approaches, and database system building.

Robertson (2001) analyzed two specific features on state efforts that are particularly relevant to the present study, including: (1) the application of cleanup standards according to future land use; and (2) the use of licensed environmental professionals to oversee and certify cleanup. The author argues (p. 4) that the first can reduce costs and time delays but may be risky due to the residual contamination externalities left behind, while the second can create efficiencies in agency oversight but in its most extreme form may amount to an “abrogation of government responsibility that could put neighborhoods and people at risk due to the questionable quality of oversight.” While standards based on future land use have become the norm in the U.S., the degree of private consultant authority in cleanup remains contentious. Robinson (2001, p. 75) argued that because of the incentive for profit, privatization as practiced in the Ohio VCP (which was similar to Ontario’s) may limit government accountability, public participation, and the federal government’s confidence in state brownfields oversight. She notes that other states who partner with the private sector retain accountability by limiting environmental consultant work to only the least contaminated sites (e.g., Massachusetts), by hiring consultants directly to expedite state reviews (e.g., Connecticut), and/or by having the state approve assessments, plans and/or cleanups performed by “licensed” professionals (e.g., Arizona, Colorado, Delaware, Kansas, Maine, Missouri).

Periodic updates of state voluntary response programs published by the U.S. Environmental Protection Agency are particularly informative. The most recent report (US EPA 2014) finds that most state programs (44/50) charge an entry fee ($500 to $10,000 USD), slightly under half (24) have an MOA with the US EPA, and virtually all (49) offer liability relief. Twenty-nine state programs offer tax incentives, 37 offer technical assistance, 12 are supported by some type of brownfield redevelopment authority, 4 provide or support the purchase of environmental insurance, and 48 offer an institutional controls program to approve, record, and enforce environmental land use restrictions (US EPA 2014, 133-134). Interestingly, only four states have a program to license environmental professionals (Connecticut, Massachusetts, New Jersey, and West Virginia) and only Connecticut and New Jersey have programs that allow professionals to be responsible for the direct oversight of site investigation and remediation pursuant to standards in lieu of state reviews and approvals with the proviso that the state may conduct an audit. Using data from individual state profiles in the 2014 EPA study, we estimate the average number of sites enrolled in state voluntary programs as of June 2014 to be 763 (mean; median of 345), with 2,624 (mean; median of 256) having completed them. States in the Great Lakes Region (Illinois, Indiana, Michigan, Minnesota, New York, Ohio, Pennsylvania, and Wisconsin), of which Ontario is the sole Canadian province, had an average of 1,340 projects enrolled (mean; median of 783) and 6,647 (mean; median of 4,214) projects complete their VCPs.

There are several noteworthy scholarly studies that examine the nature of remediation and redevelopment taking place in U.S. voluntary programs. In an examination of 116 Baltimore properties in Maryland’s program from 1997 to the end of 2006, Guignet and Alberini (2010) found that most applicants (66%) actually requested a No Further Requirements Determination directly, rather than proposing cleanup. Overall, that program led to the identification and assessment of 1,175 acres of contaminated land in Baltimore that tended to be located in areas zoned as industrial, and away from residential neighborhoods. Interestingly, while most sites in that city were redeveloped into industrial or commercial projects, another study by Alberini (2007) in Colorado found residential development to be most prominent. Winson‐Geideman et al. (2004) found that one-third of the successful participants used caps or other engineering controls as their main remediation strategy and that a quarter remediated to a residential standard in their examination of 312 properties in Cook County, Illinois that had entered that state program.

Methods

For the present study, we gathered data from RSCs completed by QPs and submitted by property owners to Ontario’s Environmental Site Registry. Once a record is submitted and complete, the MOECC issues a notice and has 30 business days to check the record for administrative and technical errors. Then, it notifies the property owner of one of the following outcomes: the record of site condition has been filed; the record of site condition has not been completed in accordance with the regulations; or the intent of the Ministry to conduct a review before the record of site condition can be filed.

Given amendments to Ontario’s legislation, there are two data periods analyzed, one containing RSCs filed between October 1, 2004 and June 30, 2011, and the other from July 1, 2011 when revisions to the RSC took effect to December 31, 2015 (henceforward referred to as period one and two). Each RSC is a PDF report containing information about a property, including ownership, location, environmental condition, contaminants, environmental site assessments, QP profiles, and other supporting documents. Fortunately, staff from the MOECC were able to provide a database version of the RSCs submitted before June 30, 2011. We collected data manually from period two and prepared a spreadsheet.

Despite the regulatory requirements for the data, there are several limitations that should be noted. One of the key limitations is its accuracy. Indeed, as the MOECC itself notes on their website, QPs outside the Government of Ontario submitted the information to the registry and the province is not responsible for its accuracy. In addition, the data is for a property at a point in time, therefore it might be possible that the site, or a portion of it, was assessed and remediated more than once between 2004 and 2015, or that a landowner submitted an RSC after conducting a Phase I ESA for their site while a developer submitted another once they purchased and remediated it. Information about the site’s future use could have also changed. In addition, the MOECC occasionally modifies the way information is presented in the registry or, as was done in 2011, the information available in the RSC, which complicates longitudinal analysis. Thus, the RSC data still provide the best possible information for the present analysis.

Results and discussion

Quantity and land area

Overall, a total of 4,524 RSCs were filed in Ontario between October 1, 2004 and December 31, 2015 (mean ≈ 402 per year), with 3,300 (≈ 489/year) filed during the first period (from October 1, 2004 to June 30, 2011) and 1,124 (≈ 250/year) filed in the second (July 1, 2011 to December 31, 2015). As seen in Figure 1 below, the first few months of the RSC program witnessed only 20 submissions, rising considerably to 315 in the following year and then steadily in subsequent years. The slight drop in 2009 has been attributed to concerns regarding the real estate crash in 2008 and the steep increase in submissions that follows is thought to be a result of applicants seeking to submit their RSCs prior to new regulatory amendments taking effect in July 2011. Although RSC submissions in 2012 bounced back from their decline in the latter half of 2011, they have yet to reach the levels achieved before the new amendments were introduced.

Figure 1. Number of RSCs filed per year (2004–2015) (*Period two commenced July 1).

In terms of geography, most RSCs were filed in the more urbanized Greater Toronto and Hamilton Area, and Ottawa (henceforward GTHA+O) (3,275 vs. 1,249 outside). This represents approximately three quarters (72%) of the total RSCs and likely can be explained by a combination of stronger market pressures and the fact that these are historically the most industrialized parts of the province. Table 1 reveals that the top ten municipalities include Toronto, Brampton, Vaughan, Hamilton, Ottawa, Markham, Mississauga, Burlington, Oakville, and Kitchener. Unsurprisingly, Toronto had the most RSCs filed (1,405) given its high population, rapid population growth, strong development pressure, and history as Canada’s largest manufacturing area.

Table 1. RSC area and quantity by municipality (2004–2015).

Municipality	Total area (ha)	Average area per RSC	Number of RSCs
Brampton	4351	11.76	370
Vaughan	1,724	9.27	186
Toronto	1,124	0.80	1,405
Milton	935	17.98	52
Markham	939	6.52	143
Oakville	745	7.80	94
Hamilton	673	4.49	151
Oshawa	553	7.93	72
Clarington	506	11.51	44
Caledon	411	21.62	19
Kitchener	300	3.33	83
Ajax	301	6.02	50
Mississauga	294	2.31	129
Burlington	270	2.26	117
Ottawa	261	1.82	143

Given the province’s growth management goals, another important quantitative measure relates to the brownfield land area returned to productive use via the RSC program. Overall, 23,689 hectares (58,536 acres) of brownfields were reclaimed from 2004–2015, with 19,175 hectares (47,382 acres) in the first period (≈ 2,841 ha/yr) and 4,514 hectares (11,154 acres) in the second (≈1,003 ha/year). The trend associated with the area of brownfields going through the RSC program per year directly aligns with the trend for the number of RSCs filed per year. The area of brownfields reclaimed in the GTHA+O is also higher vs. the rest of the province over the entire time period (14,595 ha or 62% vs. 9,093 ha or 38%). While the share of sites outside the GTHA+O remains virtually identical during the two-time periods in terms of quantity (28% and 27% of all RSCs), the share of land area halved as rural sites decreased (42% in period one to 22% in period two).

Interestingly, while the city of Toronto filed nearly four times more RSCs than the subsequent municipality, Brampton, this suburb to the north-west reclaimed nearly four times more brownfields than Toronto in area (4,351 ha vs. 1,124 ha). The total area of brownfield land managed in suburban municipalities surrounding Toronto is fairly high because the average site in those municipalities is typically larger, which points to brownfields being important land resource opportunities for suburbs as well as central cities.

Site assessment and remediation

Data on the type of site assessment performed in Ontario reveals that nearly one quarter of RSCs (24%/1,075) only registered a Phase I ESA, with the proportion increasing slightly over the two periods (22–27%). Of the remaining RSCs during both time periods, most (69%/3,127) conducted a Phase I and II ESA, while only 7% (320) conducted a Phase I and II with risk assessment. The share of sites conducting risk assessment did increase somewhat from 6% of total RSCs in period one to 11% in period two when the process was enhanced. The type of ESA performed differed slightly between the more urbanized areas (GTHA+O = 26% Phase I, 62% Phase I & II, 5.5% RA, 6.5% N/A) and those outside (10% Phase I; 70 % Phase I & II; 9% RA), with a greater share of GTAH+O projects only conducting a Phase I ESA.

As mentioned, the Ministry sets site condition standards for approximately 120 different contaminants based on the manner that people, animals, and plants may become exposed to contamination. Analysis of the RSCs reveals that the vast majority of properties requiring more than just a Phase I ESA over both time periods employed a so-called “full depth approach” (89%), meaning that soil quality was restored to a single set of generic cleanup standards, followed by a background approach (8%) wherein standards are based on clean soil, and a stratified (3%) one that involves using two different sets of site cleanup standards at the site (above and below 1.5 m). RSCs filed in the second period include information on pollution impacts, revealing the ten most common contaminants (out of 765 entries) to be petroleum hydrocarbons (PHC, 476 RSCs), metals (415 RSCs), volatile organic compounds (VOCs, 365 RSCs), Polyhydroxyalkanoates (PHA, 269 RSCs), BTEX (benzene, toluene, ethylbenzene, o-xylene, RSCs 256), polychlorinated biphenyl (PCBs, RSCs 131), electrical conductivity (EC 127 RSCs), Sodium Absorption Ratio (SAR, measure of salinity, 122 RSCs), inorganics (111 RSCs), and organic compounds (69 RSCs). Out of 4,524 RSCs submitted in both periods, only 16% (709 RSCs) provide a very brief description of the cleanup approach taken, with the remainder either not requiring cleanup (Phase I ESAs 1,075 or 24%) or not specifying it (2,740 or 61%). The data in Table 2 suggests preference in Ontario for some form of excavation and soil removal (dig-and-dump) with only a small portion undertaking on-site remediation or the use of barriers (caps). Many (276) were also addressed using tailored techniques unique to the project that were not applied more than once.

Table 2. Remediation techniques reported in RSCs (2004–2015).

Remediation technique	N
Excavation and soil removal	256
Excavation and soil removal plus remediation	47
Soil Removal and Backfill	45
Soil and Water Removal	35
Remediation only	19
Barriers	18
Bioremediation	8
Ground Water Monitoring or water removal (w/out soil)	5
Other (unique values)	276
Total	709

Interestingly, RSCs filed in the first period also contained data on the quantity of soil removed, deposited, and/or remediated, which offers a better sense of projects involving soil removal (dig-and-dump) vs. remediation. Of the 2,561 RSCs filed in period one that required more than a Phase I ESA, over half (1,408 or 55%) provided this data. Of these 1,408 sites, 96% had soil removed, 57% had soil deposited, and/or 18% had soil remediated. Of the remediated sites (18% or 257 of the records), 89% also had soil removed from the site, while 60% had soil brought in; although it is impossible to discern whether removed soil was remediated and returned or if it was replaced with clean fill. Of the projects that involved soil removal, 57% also required soil deposit and 17% performed remediation.

Property development considerations

The RSCs also contain an array of data on land use change and transactional value. An analysis of RSCs filed from July 2011 to December 2014 (n.b., information is not available for 2015) reveals that most sites (78%) are owned by a Firm/Corporation/Partnership, or an Individual (6%), while only a small share are owned by the public via a Municipal (3.8%), Provincial/Federal (1.7%), or Educational (0.2%) agency (10% did not providing information, 0.5% other). While similar overall, RSCs filed in the GTHA+O tend to be owned more by Firms/Corporations/Partnerships (81% vs. 68%), and less by Individuals (3% vs. 12%) and Municipalities (3% vs. 6%).

With land use change, the greatest share of RSCs recorded commercial (36.8%) or industrial (22.3%) as their “current” (previous) use, which is expected given the higher likelihood that these uses hosted polluters as well as the province’s requirement to submit an RSC if you convert one of these uses (Table 3). Surprisingly, agricultural/other (18.7%, other is defined as not fitting in the other categories) and residential (14.5%) uses also constitute a considerable share of potentially contaminated sites, followed by smaller shares belonging to community (3.1%), institutional (2.8%), and parkland (1%) uses (0.8% n/a). A comparison of the two-time periods reveals an increase in the proportion of sites previously used for commercial (34.8% in period one to 42.1% in period two) and community (2.2% to 5.7%) purposes, a slight decrease in the share of industrial (23.6% to 18.9%) properties, and little change in the others.

Table 3. Current (previous) use and intended property use of RSCs (2004–2015), and total consideration value (i.e., land, building, fixtures, etc.) by land use.

	Current use (2004-2015)		Intended use (2004-2015)		Total consideration value (972 RSCs, 2011-2015)
Land use	RSCs (n)	RSCs (%)	RSCs (n)	RSCs (%)	Value (CDN$)	% Total value
Commercial	1,663	36.8%	676	14.9%	$187,405,660	2.8%
Industrial	1,011	22.3%	276	6.1%	$136,408,597	2.0%
Agriculture/Other	844	18.7%	31	0.7%	$9,805,507	0.1%
Residential	656	14.5%	3,052	67.5%	$5,374,518,282	80.1%
Community	141	3.1%	168	3.7%	$330,601,476	4.9%
Institutional	128	2.8%	144	3.2%	$402,631,955	6.0%
Parkland	46	1.0%	146	3.2%	$269,450,624	4.0%
n/a	35	0.8%	31	0.7%
TOTAL	4,524	100%	4,524	100%	$6,710,822,099	100%

An examination of previous land uses from a geographic perspective highlights that many brownfields in urbanized areas within the GTHA+O were former agricultural/other properties. While commercial properties are the main previous use in both time periods (35% in period one to 41% in period two), agricultural/other is the second most common (23% to 22%) followed by industrial (19% to 17%) and residential (16% to 13%). Brownfield properties outside of the GTHA+O, on the other hand, have a previous use profile that is more typical in that industrial (37% period one and 26% period two) and commercial use (35% and 45%) dominated in both periods, while much smaller shares were in residential (12.9% and 9.6%), agricultural/other (8.1% and 8.1%), institutional (3.2% and 1.8%), community (2.8% and 8.4%), and park use (0.9% and 0.6%).

Considering intended use, the vast majority of brownfields in both periods are to be converted to residential use (67.5%), followed by commercial (14.9%) and other uses down to agricultural/other (0.7%) (Table 3). The share of residential uses actually increased over the two periods (65% to 74%), along with community (3.1% to 5.3%), parkland (2.6% to 4.8%), and institutional uses (3.0% to 3.7%), while the proportion of commercial (17% to 8.7%), industrial (7.5% to 2.5%), and agricultural/other (0.5% to 0.1%) dropped. The intended property use in the GTHA+O is relatively similar in profile to areas outside, although the public sector uses in the GTHA+O in both the first and second period (community 3.9% to 6.8%, institutional 3.5% to 4%, and parkland 3% to 5.5%) are twice as common as they are outside (community 1.1% to 1.2%, institutional 1.8% to 2.7%, parkland 1.9% to 3%).

RSCs submitted after July 2011 also contain information on property value and land transfer taxes, which provides an indication of the economic value unlocked by the program. While data was not provided for approximately twenty percent of the RSCs (which is a good indicator of those not being transacted), the so-called “total consideration” value of the remaining sites equals $6,710,817,595 or about $1.49 billion per year (CAD). Total consideration includes the value of land, building, fixtures and goodwill subject to land transfer tax, along with the value of all chattels (items of tangible personal property) and other considerations. Organizing the transactions into ranges reveals that the bulk of the transactions are in the three ranges between (CAD) $100,000 and $50,000,000 ($100,001 - $1 million = 17%, $1,000,001 to $10 million = 32%, $10 million to $50 million = 9%), along with another cluster changing hands for under $2 (15%). As Table 3 suggests, the share of the total consideration value aligns closely with the share of intended use, with much of that value (80.1%) going to properties intended for residential use. The only difference relates to intended commercial uses that represent 8.7% of intended use, but only 2.8% of total consideration value.

When geography is considered, the difference in total consideration value is extreme and points to the strong real estate markets that Ontario cities have been fortunate to experience during this period. Indeed, despite there being only three times more RSCs in the GTHA+O compared with outside, the total consideration value is over 20 times higher in the GTHA+O ($6,418,223,548) than outside ($292,594,048) (CAD). While the value of total consideration in the GTHA+O remains relatively steady over the time period, it is interesting to note how the value outside is rising; with 2015 ($156,299,083) being higher than the preceding four years combined ($136,294,965) (CAD). Overall, the average total consideration (CAD) for a single brownfield in the GTHA+O was $7,187,260 compared with $881,307 outside. This rose slightly in 2015 to $7,456,806 (median $2,287,500) in the GTHA+O and significantly $1,313,437 (median $372,500) outside. The province benefits directly from these transactions via the land transfer tax that it charges when land or an interest in land is purchased in Ontario. The total amount of land transfer taxes paid by the RSC properties transacted in period two was $142,668,630 (CAD) (these taxes are based on the total consideration value above and follow the same trends).

Brownfield reuse

Analysis of the RSCs reveals that the amount of brownfield reuse made possible via Ontario’s program has been rather extensive during the time period examined and appears to be in line with neighboring Great Lakes states. Despite the slow start, the number of RSCs filed rose quickly during the first time period. The sharp rise at the end of the first period, followed by a marked drop at the beginning of the second, however, is an indicator of the private sectors’ trepidation over the new strengthened amendments. Positively, the number of projects being conducted during both periods and the high level of participation by private sector firms/individuals does point to a general comfort with Ontario’s QP-driven approach and the liability protections and property development endorsements it provides. It is not possible to discern, however, whether the decline in the number of RSCs filed in period two is a result of the private sector being dissuaded by the regulatory complexity of the new amendments, or is due to the low-hanging fruit having already been developed in strong markets, or both. However, adding more regulatory oversight throughout the assessment and cleanup process, as is required by most U.S. states, would likely be poorly received by Ontario’s development community.

The quantity of RSCs submitted also supports the province’s transition from a mandatory regulatory model focused on getting landowners to clean up pollution to a voluntary cleanup model focused on getting developers to unlock real estate opportunities. Geographic data reveal that the vast majority of redevelopment is taking place in Ontario’s strongest urban and suburban real estate markets. The RSC data also align with claims expressed by private sector stakeholders in Ontario who are attracted to brownfields because of their central location and proximity to amenities and increasingly deterred from greenfields by the province’s growth management policies (Hayek, Arku, and Gilliland, 2010; De Sousa, 2015). This may also help explain the amount of brownfield land reutilized in suburban municipalities where greenfields are also prevalent.

Results pertaining to environmental assessment and remediation also shed light on the approaches taken by property owners to manage their brownfields. Interestingly, nearly one quarter of projects only completed a Phase I ESA and did not require cleanup. This will likely continue to rise over time as less agricultural and more commercial and industrial land is converted to residential use. The results also demonstrate a slight uptick in the application of risk assessment, which could be a sign that Ontario’s amendments are working. Although Robinson (2001) highlights problems associated with cleanup standards and approaches that consider future land use, the limited application of cleanup to a background condition suggests their general acceptance by stakeholders in Ontario, as has been the case in the U.S.

A result generating discussion amongst remediation specialists is the high number of property owners who elect to excavate and remove contaminated soil from sites to a full depth as opposed to cleaning the soil and leaving it on site. While “dig-and-dump” is often preferred by land owners and prospective purchasers because risks and liabilities are perceived to be removed from the property along with the contaminated soil, the pressure is mounting on governments in Ontario to reduce waste going to landfills and to treat contamination on-site via more sustainable remediation techniques. The seemingly low use of barriers and other engineering and institutional controls in Ontario is in contrast with their application in the U.S. At the same time, the market seems to prefer this approach and government attempts to reduce contaminated soils going to landfills and to promote more sustainable cleanup approaches may have a negative impact on redevelopment activity and the sustainability benefits that it generates.

Results on the character of the land uses being developed reflect the strong residential market in Ontario and the willingness of municipalities to rezone and densify property to address brownfield challenges, despite potential criticism related to employment loss and gentrification. A somewhat surprising result is also the high proportion of “agricultural/other” properties being put through the RSC process, which blurs the semantic lines between green and brown fields, although studies such as the seminal work by Noonan and Vidich (1992, p. 248) have noted that vacant rural land and residential property have a 20% probability of contamination. Lastly, the value of land being transacted and the land transfer taxes generated provide a positive indication of the value unlocked by the voluntary cleanup program.

Conclusions

In examining the legislative evolution of Ontario’s contaminated sites policy, it becomes evident that most matters related to the actual assessment and cleanup of brownfields escape the authoritative reach of government. In lieu of onerous government oversite from the outset, the MOECC opted to outsource most assessment and remediation activities to Qualified Persons from the private sector who are guided by clear standards and procedures. As for the MMAH, it has largely laid the foundation for municipalities to support private sector led redevelopment and has put into place strong regional growth management policies supporting brownfields vs. greenfields. Based on an examination of RSC data, Ontario’s approach does appear to be rather effective overall at permitting a high number of brownfield projects to take place for a variety of uses throughout the province, as long as the market permits. The considerable number of sites that have been assessed and remediated via excavation does point to a cautious development community keen on performing their due diligence and to “haul” liability out of the way. The gradual slowdown in the number of RSCs could be pointing to increasing policy, declining brownfield supply, or weakening markets in the province. All of these issues could be addressed through more government investment and additional policy enhancements facilitated through greater inter-ministry cooperation. Concurrently, government agencies in the U.S. facing reductions in brownfields funding might draw insights from Ontario regarding the viability of giving more authority to environmental professionals and to intervening in planning policy to deflect market activity from green to brown fields.

Acknowledgments

Christopher A. De Sousa would like to thank the MOECC and his research assistants Thierry Spiess, Stephanie Mah, and Nick Kohek.

Additional information

Funding

This work was supported by the Social Sciences and Humanities Research Council of Canada under grant number 435-2014-1790.