Alexandra: This is the first of the three webinars. Don't forget to register for the other two. On November 5, Resource Development in Nunavut and on November 12, Current Trends and Climate Change Regulation and Mitigation. Today's webinar will cover three hot topics. The first, COVID-19 and its Impact on Local Government, followed by number two, a Discussion of Environmental Law Issues and Insolvency Matters, and finally number three, the Recent Ontario Environmental Assessment reform. There'll be a change to ask questions at the end of each topic. You can submit questions at any time using the Q&A button at the bottom of the screen. Next slide, Shannon.
Now for the first hot topic, COVID-19 and its Impact on Local Government. Jennifer King will be speaking with Jody Johnson, Director of Legal Services at Halton Region. It is my pleasure to introduce Jen King, a partner at Gowling WLG with a practice in environmental law and its intersections with indigenous, constitutional, municipal and land use planning law. Jen is a litigator and is called to the Bar in both Ontario and Nunavut. This September she appeared before the Supreme Court of Canada, representing the Canadian Public Health Association in the carbon pricing reference and for the past eight months she's also been advising clients, intermittently, about the legal implications of COVID-19. I'll turn it over to you, Jen, and I'll let you introduce Jody.
Jennifer: Thank you, Alex. So we're lucky to be joined today by the Director of Legal Services at Halton Region, Jody Johnson. Jody is a municipal law expert with a breadth of experience in municipal government. She started her career as Municipal CAO and clerk at French River. She's been an advisor to the Ministry of Municipal Affairs and Housing. She practiced as a partner in municipal law in private practice and is now the Director of Legal Services at Halton Region, as I mentioned. During the pandemic Jody has been a frequent guest on Municipal World COVID-19 podcast and if you aren't already aware of it I highly recommend it. Halton, like all municipalities and I know that there is a number of people in the audience today who are working at municipalities as lawyers, in-house and otherwise, and municipalities have had to carry on with your regular municipal business while often serving on the front lines in the pandemic response. I know Alex said that we would be taking questions at the end, but I highly recommend that if you have any questions as we're going please post your questions, and I will ask them of Jody. Jody, I think today we're going to have a conversation about how COVID-19 has impacted virtually every aspect of the operations of municipalities. Can you give us a few specific examples of how COVID-19 has impacted municipalities early in the pandemic, and perhaps, in some ways it might have been unexpected.
Jody: Absolutely and thanks for having me. This is a nice conversation to have with you. I know you and I have chatted several times about all things COVID and municipal over the last couple months. One of the biggest impacts, I think, is the restrictions on in person activities that have occurred at varying rates during COVID and municipalities, very quickly back in the early spring, having the opportunity through some change of legislation to consider having meetings held virtually and to look at amending their procedural bylaws, very quickly, to permit that and pivoting to hold meetings over platforms like this, and other platforms, and then looking at the implications of things like delegations and statutory public meetings and consultations on holding EA public information centers, all of those things it was a huge change for many municipalities who hadn't been doing that before. There was always an opportunity to consider some limited electronic participation in council meetings prior to COVID. But there's been two legislative amendments throughout COVID, one to allow temporarily and now more permanent applicability of this. So that's been a real game changer, I think, for a lot of municipalities. That combined with how we offer services and how things are happening in all of our communities. I've seen some real innovation across the Province with different municipalities offering services virtually, offering things like building inspections virtually and electronically. How recreation services are offered, and where I live and work out here in Halton one of our conservation authorities, very quickly, dealing with crowds of people coming to enjoy outdoor spaces and quickly implemented an online electronic reservation system, for example.
Jody: and figure that on the fly.
Jennifer: So, you've kind of mentioned a couple of things that maybe we'll dig into a little bit more as we talk. I think today we've been asked to talk about the hot topics related to COVID-19 and municipalities. As we've also discussed before, municipalities are creatures of statute. So they're subject to and powered by Provincial laws. Can you tell us a little bit more about how Provincial or even Federal laws responding to the pandemic response have impacted local governments? You already mentioned a couple of legislative amendments that have allowed for virtual council meetings. What are some other examples of how Provincial laws and Federal laws have impacted municipalities?
Jody: Sure. Federal laws perhaps not as much. We've seen some things, for example, under the Quarantine Act and the intersection of perhaps enforcement and policing and looking at that end of things with the Federal perspective. But really Provincially, at least here in Ontario legislation, how the Emergency Management and Civil Protection Act and now the Reopening Ontario Act and the regulations and orders that have been issued by the Province under those pieces of legislation have really impacted a variety of municipal operations. From looking at things like redeployments. Looking at things like how, for example, municipal child care and all child care is run. Municipalities in many areas, and particularly in some of the single tier and upper tier municipalities, with long term care and things like paramedic services and how those are delivered. Not to mention Public Health which we can get into in a couple of minutes. But staying on top of those orders has been almost a full-time job for many municipal lawyers and municipal professionals. My binder is quite full of the orders and changes that have occurred over the last eight or nine months.
Jennifer: Great. Municipalities are not only, I apologize I have an echo there, are not only creatures of statute they also are governments themselves and have been regulating during the pandemic in some innovative ways. You already mentioned Conservation Halton and how they've been addressing some of the increase in demand but can you tell us a little bit more about some of the ways in which municipal governments have been responding to the pandemic, perhaps in innovative ways. I know that we have attendees from across Canada so not everybody might be aware of what an upper tier or lower tier municipality is, Jody, but generally I know that you have a sense of what municipalities have been doing across Canada with things like masks and other topics that are hot topics for all of us.
Jody: Yes. Masks and outdoor dining and the use of sidewalks and right of ways for dining have been big ones. Before we get into masks, important, I think particularly for attendees who are not from a municipal ... to sort of understand the placement of Public Health in this context. Here in Ontario we have 36 separate health units. Of those health units 22 of them are what we call independent health units where they cover multiple municipalities in geographic areas and they will have a separate board, kind of like a conservation authority that we might be used to with representation from a number of different municipalities, and the Medical Officer of Health is employed by and reports to the Board of Health. We call it that independent health unit. We've got seven regional health departments where the Medical Officer of Health and the health unit are effectively in-house to the municipality. Then Halton, the council as a whole sits as the Board of Health. Then we have seven health units that are tied to single tier municipalities that aren't a region or an upper tier level of government. So, you've got a whole variety of different things happening in terms of the delivery of public health service. For masks, masks have taken up a lot of time for a lot of people, well before the Province put in place any regulations dealing with masks in public places and at work places. Sometimes when people think of masks they think, "Oh. Its a bylaw." That is true. Several municipalities where under the Municipal Act in Ontario municipalities have the authority to enact bylaws for the health, safety and wellbeing of the municipality and residents and many of the mask bylaws that we see, requiring masks in indoor public places and requiring people to wear masks, have been enacted by council. But we've seen two other things happen as well. We've seen medical officers of health issue orders under the Health Protection and Promotion Act, the HPPA, there's section 22 which provides for cross orders. We saw that first in the Wellington Dufferin Guelph Health Unit where the requirement to wear a mask was put in place by that type of order. Then the third thing we've seen is some medical officers of health have issued instructions under regulations that have been put in place by the Province. First under what I call, EMCA, the Emergency Management and Civil Protection Act, and now the Reopening Ontario Act. There's regulations for municipalities and areas in Stage 2 and in Stage 3 and one of the provisions in those regulations requires people to comply with guidelines, instructions and recommendations from Public Health. So those medical officers of health in some areas had the mask requirement put in place by the Medical Officer of Health. Like the Chief Building Official, the Medical Officer of Health is a little bit independent in that regard. It's not like council is saying you are going to issue this order or you are going to issue these instructions or building inspector, you are going to give this permit. It's an independent statutory function. So you've got a whole bunch of things going on in different areas. I can understand why the public might find that a little bit confusing.
Jennifer: Right. So you've had different municipalities in Ontario dealing with masking in different ways. It's changed over the course of the pandemic based on the Provincial laws and directions that you've been getting. It's been interesting to see every different municipality deal with this in different ways. I think we're going to expect it to continue to change over the winter. You mentioned Conservation Halton and public spaces and one of the things that everyone on this call will be aware of is the increased demand for public space, green space, in the summer beaches, we're all missing that right now, and parks, Conservation Halton. How have different municipalities been dealing with that? I know Innisfil had an issue with their public beaches this summer and the increased amount. How do you do that safely?
Jody: We've seen different responses by municipalities across the country to that kind of issue. People leaving sort a more dense urban areas heading out to where there are beaches and open spaces. You mentioned Innisfil. We saw our friends on Wasaga Beach deal with this. We've seen some of our municipal friends down along Lake Erie dealing with this as well and Goderich and, again, there's a variety of tools municipalities have available. Whether it's their owners of a parkland at the waterfront and there are limiting access to those spaces. Some municipalities put in place provisions where you had to provide identification that you were a local property owner or a local resident to access those spaces. Other municipalities tried to regulate attendance through things like regulating parking. Limiting parking or ... or eliminating parking within a reasonable vicinity of those kind of spaces. Not without controversary in a lot of places and the tension between people wanting to get out. The tension of local business owners saying, "Look, I'm happy to have some people come. I'm struggling. An out of town visitor might pick up some takeout and might buy gas and might do different things." So it is a real tension but municipalities have had some regulatory tools at their disposal that they've used to try to regulate some of those activities and try to ensure that the access was there without causing those crowding situations. We did see some of those situations where enforcement staff were brought in. We saw the municipalities had police checkpoints at access to beaches and public areas. It ... an easy situation.
Jennifer: That access to public space is going to continue to be an issue and I know that different municipalities have been dealing with increasing access to public space for people, both from the perspective of businesses to allow them to keep open, and then to allow people to get out. So there's been increase of patios and sidewalks, active transportation lanes that have been opened. A lot of this has been happening at the municipal level, right?
Jody: Yes. It has. We've seen in many municipalities the encouragement of the expansion of those outdoor dining spaces and many municipalities have regulated the use of sidewalks and right of ways for a long time. In terms of whether it's through a licencing regime. Whether it's through some sort of permit regime to allow some of those spaces to be used. We're going to, perhaps, see what happens with that in the cooler weather as people are still, in some areas, not permitted to dine indoors. They're being encouraged to dine outdoors in other areas. I heard in the City of Toronto a couple of weeks ago, the Mayor at a media event saying, "We're going to have to reduce the use of those right away because we have to have somewhere to put the snow when we plow the snow."
Jennifer: Fair point.
Jody: ... attention as well.
Jennifer: Right. So thinking of that, obviously the pandemic isn't over. We're doing this. Every webinar I've seen we talk about how we're doing this by webinar and not in person. If this was last year we'd all be in person and be eating snacks as we talk about these topics. So what do you see next for municipalities? As we're heading into the winter and even into the spring, is there anything that we've learnt from the first wave? I don't know whether we can say that it's even where we are on the waves. What have we learnt about how to approach the winter and what do you see municipalities doing over the next few months?
Jody: Hmm. That's a really good question and I know some municipalities have been looking at the winter city experience in other parts of the world in trying to look at what they can import for themselves. We've seen some innovation in terms of we're going to work cooperatively with fire and building to make sure we can think about how safely and effectively can use outdoor heaters or some sort of warming device and fire, that too becomes a challenge, but I think we're going to see some of those cooperative discussions. One of the other issues I know you and I have chatted about is the waste issue. Whether it's mask, gloves or otherwise and that became an issue early on for some municipalities with people carelessly disposing of masks, and early on gloves, and some of that was in store parking lots, which became a store owner issue, but we've seen it in the context of waste collection, waste pickup. Recently saw, I think it was in the City of Niagara Falls, they had their volunteer community clean up and they were telling volunteers, "Please don't pick up masks if you see them. Pick up other types of waste but don't touch masks." In Halton we've put out some messaging to people reminding them how to safely dispose of things like masks and tissues and not putting them in the organics or the recycle. Making sure you wrap them in the garbage to protect the workers from any potential chance that they might come into contact with those items. There's a lot of ... for municipalities to consider.
Jennifer: Yes. I think that's something that before you told me about it, and before I heard it about on the Municipal World podcast, it wasn't something I was thinking about when it comes to wearing masks and those mask policies. How is it going to affect waste? The other thing that you've mentioned recently is about also how they're using our waste, and the sewage system, to track COVID at the municipal level. Can you tell us a little bit about that?
Jody: A little bit because I'm not an expert in that area, by any means, but I've been sort of following along, seeing some of the interesting things that have been happening. I think the City of Ottawa is probably one of the most prevalent. There was a study, an ongoing study, and testing of waste water samples. I think between the University of Ottawa and the Children's Hospital of Eastern Ontario and it's measuring for virus and what that sort of rate is in the waste water. They're posting it every day, I understand, on the City's website to be able to use it as a bit of a indicator to say there is this much COVID present in these areas of the City. I think that's something we may see more municipalities looking at is a bit of a predictor in what may come. That might be interesting and sort of cooperative opportunities for municipalities and their waste water folks and systems and cooperate opportunities with hospitals and research institutions.
Jennifer: Right. So, we've got a few more minutes so I encourage people to start posting some questions if you have additional ones. We've got a couple. I wanted to ask a little bit about, even further ahead, about recovery. I know I've been reading about and we've been talking about issues about municipalities and funding because of how COVID has impacted actually revenue streams for municipalities. Really there's a lot of news coming out about infrastructure funding and green recovery or recoveries. So, can you tell us anything about that as we're looking forward, ahead, even further than hopefully when the vaccine comes out?
Jody: Yeah, for sure, and I think we could do a whole three hour discussion just on the ... and funding pressures that are there and early on the municipal associations, Provincially as well as Federally through the Federation of Canadian Municipalities, put information to the other levels of government, Provincial and Federal, in terms of the assistance that was going to be required for municipalities. There's been a number of different funding streams announced. We've seen come out over the last number of months and, yes, there has been a focus on infrastructure. There was some Provincial legislation here in Ontario introduced quite recently, within the last week, to help facilitate some of that infrastructure development. Particularly in the area of transit and well known transit areas. We'll see what happens with that. Funding coming for social services. There's going to have to be I think a look at how we deliver social services. How we deliver shelter space. How we deliver long term care. How we deliver living type assisted housing. Just because COVID has taught us the importance of some private spaces, separation. How we're sharing washroom facilities, kitchen facilities, I think that may be capital intensive over the next number of years. So we may have municipalities looking at that as well.
Jennifer: Right. So there's lots of opportunities as much as, I think municipalities have bearing out the brunt of a lot of the work here, and I can say as a resident of Toronto that I appreciate so many efforts that the municipalities have made as we've moved through this pandemic. We do have a question from Bob Waldon. It related to infrastructure. So really, in rural areas there is less access to internet sometimes. How can that be accommodated when we're dealing with this new virtual world?
Jody: That is a really tough one. He's right in the question. There are areas of Halton where even a relatively urban area like Halton, we've got large swaths of rural areas without necessarily the strongest and best internet coverage. One of the priorities for our region has been advocacy in the area of rural broadband and in connectivity and I know there's been opportunities and discussions at the Federal level, particularly through FCM, around the advocacy in this area and there is certainly, I think, some intake right now for broadband expansion and for some of that infrastructure. But that's critically important. I think if COVID's taught us as a society, sort of one thing, the importance of being able to connect no matter where you live in Canada. Whether it's municipal services for school, for work, and I know there's a lot of work being done in our area and others on that issue.
Jennifer: Great. Well, thank you. I know that you have to go and I really appreciate the time that you've spent with us today. This has probably raised more questions than answered. I think when we were talking about preparing for today your comment was that we were ready for a three hour law school class. I really appreciate you taking the time to share your expertise with us. I do encourage everyone, again, to watch the other podcast that Jody has been participating in. I've been finding it fascinating just watching how the issues come up. I know that the participants today are from right across the country. Many different backgrounds but really the municipal issues around COVID are relevant to all of us. Thank you very much, Jody.
Jody: You're welcome. Thank you for having me. I've been telling you for a long time the municipal government is where it's at, Jennifer, so I'm glad you were able to highlight that and thanks for letting us chat about these issues.
Jennifer: Thanks, Jody. Bye.
Jessica: Good afternoon. My name is Jessica Boily and I am an environmental litigator in the group in Toronto. Our second session this afternoon is an update on environmental issues in insolvency matters. This has been a hot topic since 2019 when the Supreme Court released the decision in Redwater. But it's one that's made even more topical by the economic situation since COVID. I'm joined today by Natalie Mullins, a partner in the environmental group and a certified specialist in both environmental law and civil litigation. Natalie's practice deals with contaminated sites litigation, and she's been counsel on many of the leading contaminated sites cases, including those we're discussing today. We're also joined by Haddon Murray, a commercial litigation and insolvency partner in our Toronto office. Natalie and I both work with Haddon frequently when our environmental clients encounter insolvency issues or vice versa. As a team we've been helping our clients grapple with the issues we're going to discuss today. We're hoping our experience can offer a few key takeaways for those who are joining us this afternoon. So Haddon, we can move to the next slide here, going to put you in the hot seat first. So in 2019, as I mentioned, the Supreme Court released the Redwater decision. This is something that both insolvency and environmental lawyers have been dealing with since. Can you tell us a little bit about the case?
Haddon: Sure. Thank you very much Jessica. Redwater was an energy company in Alberta that was regulated by the Alberta Energy Regulator and it became insolvent, got put into receivership and bankruptcy by it's senior secured creditor. The receiver wanted to disclaim certain non-producing wells that were held by Redwater and then sell the producing wells and distribute the money to the creditors. But the Alberta Energy Regulator took the position that the environmental obligations that Redwater had to abandon and remediate the non-producing wells had to be satisfied prior to any distribution of funds or prior to them approving the sale of the producing wells. One of the key issues in the Redwater case was whether the remediation orders were provable claims in a bankruptcy or whether they were regulatory obligation. So a provable claim in a bankruptcy is like a monetary claim that's going to be disclaimed, sorry I shouldn't say disclaimed, be discharged in a bankruptcy proceeding so it will be dealt with in the course of the bankruptcy. Whereas a regulatory obligation, an obligation to do some work, continues through the bankruptcy and is not stayed. So the issue here is that if the government made an order saying, "You owe us $5 million dollars." that would certainly be a provable claim and that claim would be dealt with in the insolvency proceeding but the remediation order was to do work. Was to perform remediation work and the question was although there's a price tag involved in doing that work does that make it a provable claim or does it not? This has come up previously in a case called Abitibi Mill Water and the Supreme Court had established a test for that. But when the Supreme Court heard the Redwater appeal they sort of refined the test. They said they did not change it but that they just explained more about what it meant. The critical part of this test, for the purpose of Redwater who's one of the critical parts, was the first question was, "Was the Regulator acting as a creditor?". Now prior to the Redwater decision anytime a Regulator took an enforcement step it was just presumed it counted as acting as a creditor and so that that first stage of the test was easily satisfied. But what the Supreme Court said was that if the Regulator is acting in its regulatory capacity for the benefit of Canadians, more generally, then in that case it's not acting as a creditor. It's acting as Regulator. This really blew the doors open in terms of the sorts of situations where a regulatory order would be considered regulatory, and not a provable claim in an insolvency, which has the effect of giving a super priority to that regulatory order because it's not stayed through the insolvency proceeding.
Jessica: So that sounds like really great results if I'm the Alberta Energy Regulator or any Regulator. But what are insolvency professionals think about the result of this case?
Haddon: I cannot speak for the insolvency bar as a whole but I think it's fair to say that there's been quite broad criticism for the decision and, for what it's worth, I'm among the critics. I think that on the face of the decision it seems like it is a strong assertion of the polluter pays but I disagree with that analysis. I think that when we say polluter pays I think what we must mean is that the costs of the economic or environmental damages are visited on the people who are engaged in the effort, who stood to profit from the business and also who are the people who are in a position to take steps to avoid that kind of damage. In a bankruptcy or receivership that person is gone. The trustee or the receiver now takes over the company and, most importantly, the shareholders who used to have an economic interest in the profit of the company have no interest anymore. It all falls to the creditors. So what this does is it effectively makes the creditors the guarantors of the environmental obligations of the debtor. In the Redwater decision the Supreme Court made a big deal of the fact that the senior secured creditor who is going to take the loss here had some insight into the business operation of the debtor and could have asked that it do different things. I mean there's a whole other issue in terms of lenders desire to get involved with the business actions of debtors and whether they take on liability doing that. But I think that what's important to remember is that often in insolvency proceedings it's not your senior secured lender who's going to bear the loss. It's unsecured lenders who may have no ability to effect what the company's doing and really have no insight into what's going on. That's a big problem for this decision.
Jessica: What the Supreme Court held in this case is going to be applied outside of this narrow context of Redwater of Alberta oil wells but I'd like to ask Natalie what kind of situations we might see this case applied in, in Ontario, in the environmental context?
Natalie: Well I have to start off by saying that this issue of whether environmental obligations survive a company's insolvency is not new and it actually comes up quite a bit in my contaminated sites practice. Where it comes up, Jessica, is in the context of remediation orders and preventative measure orders issued by the ministry under the Environmental Protection Act related to contaminated properties. Even before Redwater though I saw the ministry take the position that its environmental orders have that super priority. I can give an example of where our client had become a judgment creditor some years ago and we had an argument with the Ministry about this very issue. So to give you a bit of background, my client had sued its neighbour for contaminating its property with gasoline. Migrated over the property line and spent years in litigation and was ultimately successful after a really lengthy trial. The client got awarded a multi-million dollar judgment based on the cost to clean up its property. When it went to collect though, instead of paying, the defendant company filed for bankruptcy. The Ministry, who'd been standing in the background, was concerned that the contamination wouldn't get addressed under the circumstances. So they issued a remediation order against the bankrupt company and then took the position that all the estate assets should be paid towards the property remediation, which essentially would have left nothing for the creditors, including our client. It's important to note that my client wanted its money from the estate because it already had substantial out of pocket costs related to addressing contamination on the property. This is a few years ago and so pre-Redwater but the Ministry was able to rely on the previous case law that applied the same framework that the Supreme Court of Canada revamped in Redwater. In particular the Nortel case which also concerned a Ministry remediation order issued after the company filed for CCAA, and in Nortel, the Court of Appeal found that the Ministry did have that super priority. The reason was that it was not sufficiently certain the Ministry would perform the required remediation itself. In my case, we challenged the Ministry's position that it had a super priority and ultimately the issue settled so we don't have a court determination. But in circumstances our client kind of got lucky because the Ministry, which it can do, also named the directors and officers of the bankrupt company. Without going into the detail we kind of got the best of both worlds because we got remediation work done and then we got a significant payment out of the estate. Had Redwater been decided at the time though it probably would have provided the Ministry with a lot more confidence in its position and we might not have achieved the same result.
Jessica: Talking about remediation orders, can you give us sort of a quick overview who might be at risk of being named in a remediation order, like the one you were just talking about?
Natalie: Sure. Almost anyone who has touched a contaminated site is at risk of a remediation order or, as the court likes to call it, anyone with a nexus to contaminated property or a once contaminated property. The principle of polluter pays, that Haddon was talking about earlier, in my view is a bit of a fallacy. It's not how the legislation's applied in practice. The reality of contaminated site cases is that the actual polluter is often long gone because we're typically dealing, in these cases, with historic contamination. Pollution that happened decades, sometimes centuries, ago. When the polluter's not around to fund the clean up the government then casts a really wide net to try to capture someone, anyone, to pay other than itself. In the example I just gave you where the Ministry had included the company's officers and directors, one of those directors was an 80 year old woman, who was really just a director on paper and the mother of the owner of the company. It seems unfair but in the reality fairness and fault don't matter when it comes to these types of orders. Slide 5. I put up the relevant sections to take you through the Environmental Protection Act. Section 17 and 18 are what provide the Ministry with the power to issue remediation and preventative measure orders. So the first one, 17, talks about fault. Targets the polluter. Those who are responsible for contaminations have to clean it up. But the section becomes somewhat redundant because of how section 18 has been so broadly interpreted. Section 18 is the no fault section. It provides for preventative measure orders, which can include remediation, and they can be made against anyone who owns or owned, or has or have had, management or control of an undertaking of property. Importantly, in section 18 the concept of fault and fairness, those are irrelevant. You're subject to a section 18 order by virtue of your status and that status is either current or prior owner, manager or controller of a property or undertaking. Once you have that status you don't have a defense. It doesn't matter if you didn't cause or permit the contamination. That's not available to you to argue. I've put up a list of some of the people who have been subject to these types of orders just to show how very broad in scope they can be. Some of the people named here might be a bit shocked. We've had real estate agents be named in orders, lenders, municipalities, parent companies, officers and directors as I've already mentioned. So it can be pretty broad.
Jessica: Natalie, you've mentioned that the Ministry of Environment has been taking this position that it's regulatory orders get super priority, even before Redwater, but how are we expecting the Ministry to react now that they have the Redwater decision?
Natalie: I think the Ministry will use Redwater as additional ammunition to argue that its regulatory orders have to be fully complied with despite of insolvency and before the estate assets can be distributed. But I don't think the Ministry will change its practice of naming as many potentially responsible parties as possible in its orders. Just to ensure that the work gets done and in case it's wrong about the case. Redwater. Ultimately Redwater hasn't been considered by any Ontario court or tribunal. In addition to that I think the Ministry will certainly use it in negotiating results with estate trustees and receivers. If we could flip to the next slide. I just want to further illustrate the point. Slide 6. Thank you. So in the Northstar, which is also the Baker case, first on the list up here, the court determined that the Ministry was a regular creditor because it had started to conduct the remediation work itself. That rendered the order monetary in nature. So the Ministry had to stand in line with the other creditors. So what the Ministry did in that case was it turned around and named the company's officers and directors. Seventeen of them. Some of them named in the order had no connection to the polluting activity or the property at the time it was polluted. That didn't matter. What mattered was that they had control over the corporate funds. There's two other cases I just wanted to go through very briefly to illustrate again who can be exposed. So in Kawartha Lakes it was a city who was actually recipient of someone else's contamination which was migrating through the city's property into a lake. But the polluter had run out of money to pay for the remediation so the Ministry ordered the innocent land owner, who was a city and a victim, to pay because that contributed to the purpose of the Environmental Protection Act. Of course we have Hamilton Beach, our most recent case on the issue, which confirms that these no fault orders can require work, not only on the properties in which you have ownership management or control, but on any property where a contamination has migrated. So it's really broad. I should mention though that if you're subject to a remediation order, and you're one of multiple parties named, the Redwater decision could actually work to your advantage. So, for example, if you're a municipality and you're named in an order for having historically owned a manufacturing site that's now contaminated, say that there's two additional parties to the order and they're the current orders of the property. Say that one of those orderees goes bankrupt. Well Redwater could mean that they still have to pay their full share of the work required under the order. If it wasn't for Redwater then the other orderees, the municipality and the other owner, would be left holding the bag and they could sue for recovery in civil court but then they would be a regular creditor so they would only get cents on the dollar. Whereas if Redwater applies then the work gets paid for 100%.
Jessica: Haddon, Natalie's now told us this really broad set of people who can be impacted or named by a section 18 order. But taking it back to the insolvency context who can we expect to be impacted if a party subject to these types of orders does become insolvent?
Haddon: The effect of the law that's been discussed, the Redwater decision and some of the previous law as Natalie pointed out, if you think of the most distant relationship to the property, of having a nexus to the contaminated property, and takes it one step further and says, "That person is a creditor." If that decision were to drive them insolvent, which it could, their creditors now pick up the tab for it. The creditors may have very little to do with the operation of that business which in turn may have very little to do with the fault of the pollution and the contaminated property. I think, broadly speaking, if we can go to the next slide, there's a number of differences of creditors that you'd want to consider. This is obviously an oversimplification but at the top you have your secured creditors. These are often sort of lending institutions who conduct some sort of due diligence prior to lending money. That was the situation in Redwater. They're usually company to the best circumstances to know what the debtor company is doing and have some visibility about their operations. Then you have unsecured lenders who are intentionally lending but they have a real wide range in terms of how much visibility into the company's operations or how much control they have over the company. So on one end of the spectrum you'd have sort of shareholder loans coming from shareholders. Obviously they should have a good sense of what's going on at the company level. On the other hand, if you think about a credit card company, credit card debt, the bank on a credit card isn't keeping track of what the company's doing. It's much more automated than that so that would be very limited visibility and very limited control over what the company's doing. The next step down, I think you'd probably start feeling more sorry for people as we go, are trades, suppliers and landlords. Landlords obviously mean landlords, not over the contaminated property but if you were a landlord of a different site, not related to the contaminated site. Trades and suppliers are creditors in the sense that they often have net financing payments. So they'll have invoice that goes out and there'll be 30 days or 60 days to pay that invoice. Over that 60 day period they're effectively financing the operation of the debtor and often a debtor's reach insolvency they stretch those periods out. 120 days or longer and in those situations trades and suppliers often end up with significant debts up to date of insolvency. Obviously they often have little to no control over what the company's doing. Also their insight to what the company's doing either. They're just working their own business supplying to the company. The last we have here is unintentional creditors. They're always the people who are in a very tough situation in any insolvency. So employees for unpaid wages, vacation pay or commissions, pensioners in respect to pension shortfall or judgment creditors. Let's say you got into an accident and the company was involved in the accident. You're injured, you sue and you get a judgment against the company. These are people who never wanted to be in a lender relationship with the company. They aren't able to price the risk that they're taking into their loans or anything like that. They're not part of a commercial enterprise. For them they're really stuck in the situation and the effect of the Redwater decision is that the environmental order gets paid ahead of them.
Jessica: So it sounds like that last category, as you say, is a bit stuck but for the other categories of creditors that you mentioned is there any due diligence that can be done to help mitigate some of this risk that we've just talked about?
Haddon: Yeah. So if you're in the intentional creditor category, in some situations the answer unfortunately is no. There'll be situations where you're going to lend to a company that has a lease over a property or is involved, some nexus to a property, and nobody has any idea that there's any sort of environmental issues at that property at the time and you lend. So there's very little that you could have done to protect yourself. But there will be circumstances where you can take steps to protect yourself and so having appropriate due diligence questions would be helpful. So you're going to want to look for red flags when you're lending money or entering into a relationship where you're going to have this sort of debtor/creditor relationship. Thinking about the sort of industry that the debtor is in. Whether that's the sort of industry that gives rise to environmental claims. Thinking about the property that the debtor either owns or leases and whether there's previous uses for that property that could give rise to environmental claims. Whether there's any sort of reporting or history that you know of for the property, whether there's been any history with the Ministry. Whether that was prior orders or investigations. Any reports on spills. Then looking into whether or not there's any sort of environmental testing that's been conducted on the property, and look at that sort of testing, or if you're very concerned conducting testing prior to lending if it is a very significant loan.
Jessica: Back to Natalie. I think that's a great list of red flags to look at. Do you have any sort of technical or environmental law perspective on some of the detail that lenders might be expecting to see here that would indicate a red flag?
Natalie: Yeah, just building a bit on what Haddon said. I'd be looking for historic manufacturing operations, of the company itself, or on property that the company's somehow acquired. Former manufacturing facilities are what I mainly see coming back to haunt clients. Then there's obviously types of operations you should be keeping an eye out for like dry cleaning, auto repair, gas station facilities, just to name a few of them. To be clear you should be looking not just at the property itself or the company operated or that it owned, but the surrounding lands that may have impacted, kind of going back to my Kawartha Lake example. As Haddon said, check the company records and the specific reports you'd be looking for are environmental site assessments, typically called Phase 1's and Phase 2's. Look for use of hazardous substances by the company or use of underground storage tanks. Sometimes we find communications with the Regulator in some files. Like letters or orders for things relating to contamination spills or releases of the property. I should also point out though sometimes these flags are obvious, but as Haddon alluded to, sometimes they're buried. I have cases where we have a company who's the party to a Ministry clean up order because one of its predecessors, through a series of amalgamations many decades ago, had owned a property that's now contaminated in this tiny town and the ownership was for a short period of time, and then our client inherited this company and the liability that went along with it. It would have been really difficult to flag the risk during due diligence. It took litigators searching through historic property and ownership records and leases, interviewing witnesses, etcetera, to figure it out. So the due diligence required to determine whether exposure exists might not be practical or feasible in every circumstance. It could be like finding a needle in haystack. Of course it doesn't mean you don't do it. You have to try but importantly you have to know what you're looking for.
Jessica: Thanks, Natalie. So, we'll take some questions now if anyone wants to put them in the Q&A. I did see one that came in about whether the sections 17 and 18 that we've been referring to are under the Environmental Protection Act, which they are, but we should just clarify that it's not just the Environmental Protection Act where this might come up. Natalie, I know you do a lot of work with gas stations that are regulated by the TSSA so I suppose there might be orders.
Natalie: Yeah, and the Ontario Water Resources Act, as well. You can be subject to an order for offsite migration of contamination.
Natalie: Mainly the Environmental Protection Act though. They kind of all work together.
Jessica: Okay. I'll just wait to see if there's any other questions that will come in. I know one question that has come up is so now we have this Redwater decision. Are there any circumstances now where we wouldn't have a regulatory order? Where it would go back sort of to the older case law to say that a Regulator is actually acting as a creditor? Or is it pretty much that any order that's outstanding at the time of the bankruptcy is going to be dealt with in this sort of super priority way?
Haddon: Sure. I can take that one. Hard to say for sure in the sense that the Redwater decision hasn't been considered in Ontario, as Natalie said, but very likely in a situation where the government steps in to do work it would then have an indemnity claim against the polluter or the polluting property and that claim, if it was against the debtor, would be a monetary claim because the government's done the work. One thing I want to point about this is that it creates sort of a problematic incentive. First of all, if pollution is small, if the issue isn't that big it wouldn't force the government's hand to step in and start cleaning it up so in that instance it's easier for the government to say, "This is a regulatory order. We aren't doing the work or it's not certain that we would do the work. The work falls to you. You have to fix this." Whereas if it's a huge pollution problem then it's easier to say, "Obviously the government's got to step in a do something about this." and as soon as they do they really have a monetary claim, an indemnity claim, for the cost of the work they did. That is a provable claim. So it creates a problematic incentive that way. The other problem with it is that it incentives government not to step in early, and do work early that they think is necessary, because as soon as they start doing that work they see the possibility of their claim being a monetary claim and not a regulatory claim. To the extent that cleaning things up earlier is beneficial it disincentives that sort of action. I think that's another issue that sort of arises with this law.
Jessica: Thanks, Haddon.
Natalie: It probably also motivates the Ministry to name more people in its order so it doesn't have to step up and do the work and keep broadening the scope of section 18, back to my point about how broad that section already is.
Jessica: We have one last question about the broad application of these EPA provisions. This question is the broad application seems to be unfair on innocent parties. I mean I think that's what we've been saying for many years. Is there any pushback against the Ministry on this?
Natalie: Unfortunately, sorry did you want to take that?
Jessica: We've been litigating these issues and unfortunately, in many cases, the courts have not sided with innocent parties but have sided with the Ministry on how to interpret the EPA. It's obviously difficult because as these issues come up you have to have the right case to actually litigate and take to the Environmental Review Tribunal, and then appellate courts, so things don't always get decided in the way that you might want. I don't know if you have anything to add to that, Natalie.
Natalie: No. You got it right. We know from the courts that fairness is irrelevant.
Haddon: The problem it has, and the legislation has a lot of power to deal with your property basically, and to a large degree the remedy for that is at the ballot box. The courts tend to look at these and say, "The government's allowed to legislate to do that and that's what the provision says and so we're going to let them base the consequences on anyone with a nexus to the property." I think that plays very well often, not to be too political about this but, as I say I think a lot of people read these decisions and think this is a really good decision for environmentalism. I want to be clear. My position on this isn't that it's not important that we have environmental remediation. The question is really who is at fault and who should bear the cost of that. Environmental protection is a public necessity. It's a public obligation. At some point, obviously, when you have a polluter who's done the pollution, then having them pay makes a lot of sense. But at some point it becomes a public obligation that we shouldn't be visiting on the people who are just unfortunate enough to be the creditors of a company that went under. So that's really where the pushback comes from in my perspective.
Jessica: Thanks, Haddon. Well, thank you both. I think we'll leave it there and move onto the last hot topic which is the recent Ontario environmental assessment reforms. It's my pleasure to introduce Rod Northey. Rod is the head of Gowling WLG's environmental law practice group and in his 30th year of private practice. He has extensive experience in both Federal and Provincial EA's. He was a member of the expert panel appointed to carry out a Canada wide consultation and review of Canada's environmental assessment process and is also the author of the 'Guide to the Canadian Environmental Assessment Act'. So thanks, Rod. I'll let you take it away.
Rod: Thank you very much, Jessica. So I'm going to speak to a surprise amendment of the Environmental Assessment Act that occurred in the summer. They're not small amendments. To describe the presentation as a rewrite and I think it's important to describe it as a rewrite. The Act was initially enacted in 1975. There were significant changes 1996. These changes are as important, at least as important as the '96 changes, so this is a big deal. Next slide. So, I'm going to give you the context then for what occurred, and I'll give you a bit more detail in a moment, but the first thing to note is you didn't see the Act amended through a Bill called to amend the Environmental Assessment Act. Instead it was buried in an omnibus bill under the heading of 'COVID Economic Recovery Act' and Environmental Assessment Act changes are in Schedule 6 to that Act. Now, the reforms did not come totally out of the blue. The EA reform process could be said to have started even under the previous government with some speeches by the Minister looking for some input on reform. But perhaps the most important thing to what occurred in this summer was a 2019 discussion paper, by the same government as now, which talked about modernizing the Environmental Assessment Program and identified a four part vision of modernization. The first is alignment between the level of assessment and the level of risk. Second, elimination of duplication between environmental assessment and other planning and approval processes. The third process, efficiency through shortened timelines and force electronic access to environmental assessment information, public participation. In 2019 the government started to implement that new vision through amendments to various class environmental assessment approvals. Now Bill 197 though is really the big deal to this. It focuses on the first two parts of this four part vision. Getting the alignment right and eliminating duplication. Next slide, please.
So I'm going to cover this in four parts. What are the purposes of this amendment, COVID and modernization, we'll talk about briefly. Then I'm going to get into what really happens here on the ground or as affecting any of you that are involved in EA processes. Changes to individual environmental assessment which is now going to be renamed 'Comprehensive EA'. Changes to class sectoral environmental assessments now renamed 'Streamlined EA' and then changes specific to the waste management and transportation sectors which I'll come to at the very end. So next slide.
So, the stated purpose. Well, the most important thing to say is whatever the stated purpose this is kind of one of those political acts of don't listen to what we say, watch what we do. These amendments have nothing to do with COVID. So, that's point one. Then we get to the question of modernization. Are these amendments really about modernizing something? Really I would say, and if you go back to the previous slide, the most important aspect of a modernization might be to go digital, and that's what the discussion paper of 2019 previewed. These amendments don't do that. So we don't really see in this much to do with modernizing and nothing to do with COVID. So what really are we seeing? The effects of these forms, they're important. They will narrow what environmental assessment applies to and they will significantly reduce regulatory oversight. Meaning who gets to look at what proponents do with EA's, or in particular, class EA's sectoral EA's. The process has started now but it's also important to say this will be a multi-year process of transitioning from where we were pre-July to a future where we have these new parts that I have discussed a minute ago and I'm going to come back to. So first topic.
Then we'll go now to the second topic. This is dealing with the changes to what we used to call, for decades, are called individual EA. Now we have a new name for this. This is now comprehensive EA. Comprehensive EA, I'm going to give a bit of history here. Initially in 1975 Ontario EA had one approach. Everything in was subject to the requirements of a section 5(3). In the early 1980's Ontario began to approve class EA's, particularly for the municipal sector. Thereafter Ontario EA was considered to trigger individual EA and class EA's although the Act didn't reflect these distinctions. In 1996 Ontario amended the Act to formally recognize a distinction between part II EA's, individual EA's, part II.1 class EA's. In 2001 Ontario created a whole new set of approvals called sectoral EA's which arose entirely through Environmental Assessment Act regulations. So where we are now with that three part approach to EA is that we're going to get rid of individual EA, major projects will be subject to comprehensive EA, and I'm going to get to what happens with class and sectoral EA's in a moment. So, comprehensive EA. This is a very odd term. This is back to don't listen to what we say, watch what we do. Comprehensive's not really appropriate. Ever since 1996 the major EA's in Ontario have gone through a terms of reference process requiring approval by the Minister, and ever since the late 90's after some litigation it became very clear that one of the advantages, or purposes of a terms of reference phase, was to remove EA from being comprehensive and instead scope it to things desirable. Either representative of the sector or of the specific proponent. This approach, these reforms of 2020, do not get rid of terms of reference. So it is a puzzling use of the term comprehensive to say that an EA is comprehensive when by scoping you can take it away from being comprehensive. But that's where we are. So that's a first puzzling point. It's not really comprehensive. You still have the ability as proponent to seek and obtain ministerial approval to scope the EA. Next slide.
The big deal here is how does individual EA or comprehensive EA get triggered? The old approach was, as I outlined a few slides ago, was everything in unless exempted. Now they're moving away from that. Now we are going to try and go to a project list approach. If you're on the list you're in. Now importantly it's not a complete approach meaning the Minister still retains the discretion to designate a specific project, under EA, and equally proponents in the circumstances of their choosing could voluntarily decide to do. An individual EA. Now, the key question then is, what is on this list? On September 11, so the Act was introduced in early July, passed in late July, September 11 we are getting some inkling now of what this project list will look like. It's posted on the Environmental Registry and this then explains what they think will be subject to comprehensive EA when implemented. So I'm going to give a couple of policy points allegedly behind this where it says, for example, that in order to decide what's on the list the Ministry had regard to the projects level of risk as judged by its potential for causing significant effects. Those that are familiar with Federal environmentalist assessment will find this list, and this whole term of art of significance, very, very familiar. These criteria come straight from Federal EA. These are the six criteria Federal EA uses or has used to define significance. So the magnitude of effects geographic, extent, duration, frequency, reversibility, possibility of occurrence or also known as likelihood. That's really trying to grab into the Federal framework and bring it into Ontario. The second alleged reason for what's on this, which is puzzling too, but is elimination of duplication with other legislation policies or processes. I'll come back to why that's a bit odd. Three, there is the idea of aligning thresholds with Federal impact assessment. What that means is, for those familiar with the Federal IAA, and it's project lists you will see in many, many cases that Federal EA's trigger by a scale of project above a certain tonnage per day if it's a processing kind of facility, or a mining facility, etcetera. So the Federal project list uses thresholds. Ontario's speaking of trying to deal with aligning those thresholds. All of it comes through a new project list regulation. Next slide.
What do we have in that ERO posting? Well, we have the bulk of things that are proposed. For the rest of things already subject to individual EA. Projects in now, I describe here under the Electricity Waste Management and Transit Project regulations. Secondly, we have projects reference but not covered by the Ministry of Transportation Class EA. Freeways, expressways, greater than 75 kilometers in length, and then thirdly, according to the Ministry posting, projects related to conservation. Flood, erosion control and conservation, without much detail as to what it is that makes those subject to individual EA but that's not a grand category of things. Second topic. Project gaps related to aligning with Federal IA. A novel idea is that intra, meaning within the Province, intra-Provincial railways, can now on this list trigger Provincial EA. That has never happened in my knowledge but it could now happen. It would be very interesting to see what thresholds get used. Federal IA is triggered for railways that are inter-Provincial above a certain length. And then, thirdly, not unimportantly, Ontario is requesting feedback on mining projects. Which as Ontario advises are subject to Federal IA and here's where we get puzzling. In order to implement one project, one assessment. So let's just stop on this for a second. Federal IA triggers EA, or environmental assessment of mining projects right now and has so for decades. Ontario has not triggered assessment of mining projects. So, it is a very odd idea that under a banner of reducing duplication we're going to designate mining projects under Ontario environmental assessment. In other words duplicate Federal and then we're going to put them together into some one project, one assessment. This is a very odd notion of Federal/Provincial relations. A very odd notion of policy. In a rational Universe, given that mining is really a Provincial topic in constitutional terms for the most part with some Federal effects, mining should have been in decades ago and there really shouldn't be Federal impact assessment for most mines. But we are not in that rational Universe so who knows whether this is a multi-phased transition but Ontario's talking about bringing mining in when it has never historically been in under Ontario EA. Who knows where that will go? With that I'm going to leave this topic, topic two, and go to topic three.
So, moving then from individual, comprehensive EA, whatever term you wish to use, now we go to really the big deal here. Because most assessments in Ontario, vast majority of assessments, are done under class EA's or sectoral EA's. These changes proposed here to that whole regime, or really two regimes, are going to have the greatest impact. Let's cover then what they're dealing with now. So Bill 197 amends the EA Act to create a new part II.4, called streamlined EA, which is going to deal with everything now subject to class environmental assessment and sectoral environmental assessment. What does the Act mean by streamlined? Well, we can't really tell and I'll tell you why in a second. But in relation to the statutory context what is important about a streamlined EA there is no terms of reference phase and there's no provision for a hearing. Now, what's the minimum standard for streamlined? The answer to that is we don't know because the Act simply says that will be determined in future regulations. So a very big deal here is that we have a new regime. You can go look under this new part II.4, not yet implemented, but it will as time goes by have bigger and bigger implications as more and more of the class EA's and sectoral EA's come under this new streamlined EA category. There will not be any future approvals for class or sectoral EA's. Alright. So that's sort of the trigger part of the administration aspect of this. But there is right now a very big implication. An immediate implication of what's occurred in this space. So next slide please.
It's under the topic of, well we've used many terms, but the initial term in the 1980's was things called a bump up. Meaning the move from a class EA up to an individual EA which used to be triggered in by terms in the class environmental assessment approvals. It also now applies to sectoral EA's. So there's been a change in terminology over decades. We've moved from bump ups to when we formally introduced class EA into environmental assessment in the 90's, the formal term went from bump up to a part II order. The meaning of that is a class EA as a part II.1 assessment and an individual EA is a part II assessment so you're changing the status from a part II.1 project to a part II project. Love all that detail. Then we have sectoral EA's which weren't under any part of it, as I said earlier, because they're introduced by regulations, but they too made provision for some kind of elevation to get from being a sectoral EA only to an individual assessment. Now, here's the big deal. When this all happened there were a lot of very broad criteria for what could trigger a bump up. You could talk about what the scale of the project wasn't appropriate. Its impacts weren't appropriate. Impacts on the whole array of things bio-physical, socio-economic, etcetera. A whole array of things could be part of your reasoning if you were a resident group or an affected party, a municipality upset by a Provincial project, etcetera, etcetera, a whole number of reasons for why you could request an elevation from a class or sectoral EA to individual assessment. No longer. In the class EA context the only valid argument trigger for a bump up now is impact on an indigenous rights, or alleged impact. That is a huge deal. Across Ontario. That effectively means the vast majority of projects subject to class EA have no bump up, no elevation, and standing back a bit meaning no Provincial scrutiny available for a project subject to a class EA. If you're a municipality who doesn't like bump up requests at all you will be very happy. If you're in some other spaces you may be very happy to. I do need to remind. I've used the word in this fourth bullet, class EA elevation requests are limitless because it is still the case for the sectoral EA's. Electricity projects, waste management projects, their terms of art for elevation are in guides. Those have not been amended by this. One might anticipate they will be, and when the new part of the Act dealing with streamlined EA comes into force, the only ground for an elevation in that part is indigenous rights. So for those sectoral EA's we have a bit of a transition from now until then, but really the upshot of all of this is, for these kinds of EA's there will now not be any Provincial scrutiny except for impact on indigenous rights. I'll leave that slide. Thank you. Next topic, last topic.
Changes to specific sectors. I'll be quite brief here. But the two things that are worth noting, probably the most important change is those affecting the waste management sector. There are two places where the new Act has amended things. There's a new section 6.01 in part II for current individual EA's and then under the new part II.3, not yet in force, section 17.5. What they do is introduce, out of nowhere frankly, a new restriction on landfill waste management projects subject to individual EA. The amendments require that going forward a proponent will need to show municipal support for the landfill, if the landfill is within three and a half kilometers of any approved land for residential uses, in a settlement area. Effectively, in more plain English, that means any landfill within 3.5 kilometers of an urban boundary, or even a settlement area boundary is going to need the consent of that settlement, or the municipality in which that settlement's located. That municipal support means a council resolution. This is a very big deal. Effectively looks like a municipal veto on landfilling anywhere near a residential area. This does not apply to any other sectors in the waste sector. It doesn't apply to any other kinds of projects, public or private. This is something that was certainly part of the political discourse leading up to this but not really in place anywhere else. I don't think we really appreciate what it means or why exactly it happened here, aside from some political considerations, but I think time will tell what that means. I'm happy to talk more about that in questions. Then the last part of this, just to conclude, is then changes. Next slide please.
Is just to detail these changes to transportation EA's. These are all EA's involving the Ministry of Transportation as the proponent. There's some changes to individual EA's, in particular, the GTA West EA and the Bradford Bypass and then changes to a number of class EA's where the MTO has changed some element of the design of what's gone on, post a class EA and these changes from July allow the Ministry to escape going to an addendum process re: starting the class EA or resuming it, they are now effectively exempt. So that's the overview of that. That concludes my presentation, subject to any questions that may arise. Thank you.
Alexandra: Thank you, Rod. I'm just going to look at the questions to see if any others have come in. There's someone asking here, Aubrey Sherrat is asking, do you have a sense of how, if it all, these changes will affect how indigenous groups are consulted in these projects?
Rod: Well, let's deal with the easiest part of that is that for the class or sectoral EA's that are underway, which I have said earlier is the vast majority of projects subject to EA in Ontario, the impact on indigenous rights or even alleged impact, is a ground for an elevation to the Minister. So this will certainly highlight to any proponent anywhere in the Province doing a class or sectoral EA that they need to improve their focus on any impact of their project on indigenous rights or indigenous communities. So I'd say, yes, I imagine this will have very important changes and make proponents really zero in on a possible impact on indigenous rights whereas the practice, I think in the past, has not been terribly observant of that. I think in remote Ontario there's been much more engagement on that level. This will require Province wide engagement. So I think it will increase it, and certainly now that all the other players in this do not have such rights, one might anticipate that the consultation budgets, etcetera, and all that's going on will now focus exclusively so a lot more attention on the ground to what is happening and how indigenous communities are affected. So I think this will have big impacts. Much more engagement. Hopefully not too much engagement to create consultation fatigue but let's see what happens. So, yes, I think it certainly will affect that.
Alexandra: Thanks, Rod. We have another question from Melissa. Can you describe how the process works when the government is the proponent? She didn't specify what level of government but presumably any level of government.
Rod: Well, yes. I mean the context for environmental assessment in Ontario since it began in the 70's was very differently applicable to governments compared to the private sector. So I'll start with that which is that assessment since the beginning has really been a public sector exercise, public sector proponents since 1975 and then expanded in 1980 to municipalities and other bodies like conservation authorities. It is generally been driven by a public sector or a government proponent and focused that way. I think where that really gets highlighted is the degree to which the Ontario process is focused on alternatives. Ontario has historically had a huge focus, an enormous focus on alternatives to alternative methods, because there's been a view that with a government proponent, that has powers to expropriate land, the government should be able to pick a much wider variety of sites or routes than a private sector proponent that is limited to its lands. So EA has from the get go always been very much focused on that ability of government to pick sites more broadly then the private sector. That has over time withered considerably as the focus of the Act has moved away from just being public sector to designating more private sectors, like the electricity sector, waste management sector where those sectors don't have, on the private side, the freedom to pick sites everywhere and that's a zero ... specific project sites from the get go. So one of the big tensions here, that's really still not evident yet in what we've got is, is this change, this modernization, really a stand-in for getting rid of the large review of alternatives that Ontario's traditionally focused on, individual and class EA's, towards a focus on projects which is much more like the Federal process and alternatives are secondary and you focus on impact. We don't know the answer to that yet. But I do think, and I said this in an article I wrote on this reform as it came in in July, it's very troubling to think that Ontario's not going to treat the issue of alternatives seriously because that has been the focus of it from the outset. That is what distinguishes it. What is a preferred alternative and it really doesn't have a test for approval that's all that rigorous. The real test is been is this the best alternative out of your options. That's really how it's worked out, so if we get away from looking at alternatives, it's very hard to see what exactly Ontario EA is doing.
Alexandra: Thanks, Rod. We don't see anymore questions so I might ask my own question. I think you talked about it a little bit earlier but if you could go back to the municipal, essentially veto, on waste management landfills, I guess, mainly.
Rod: Yes. It's not all waste management. It is waste management landfills. Landfills are the topic. And your question, sorry.
Alexandra: Sorry. You said you would talk a little bit more about it if you had time. What that means.
Rod: Yeah. Well I think this is a really important debate because some 20 years ago when landfills were a very big topic across the entire Greater Toronto Area, and the Province was itself trying to be the proponent of landfills, there is a huge debate under the heading of a willing host idea. Should a landfill, especially dealing with municipal waste, be allowed to be cited in a municipality that did not want it. The history of this is important. For example, Metro Toronto, bit of a relic here you've got to know your history, but Metro Toronto had the power to go put a landfill anywhere in Ontario and no other municipality did and Metro Toronto used that power to go put a landfill up in Vaughn, in York region. That triggered an enormous political tension between Vaughn and Metro Toronto. So when the Province stepped in to deal with this with Interim Waste Authority in the early 90's there was a big debate about how does this whole thing about municipal support work? So for a number of years we had this debate about willing hosts, should that be the direction? That evolved into Kirkland Lake being a possible chosen site for a landfill because it was a willing host and wanted Metro Toronto's garbage. This is all about retracing an old debate but it has, just to say this isn't a novel idea, but it is problematic in a couple of ways. I guess we'll just see how this goes. It's problematic in that why is the landfill the thing that gets the municipal veto? Is it because waste has some unique attribute that no other facility in Ontario has? That is a bit difficult to understand and to sell. A second possible thing that is important is, is the landfill dealing with the municipalities own waste? So one of the paradox to this is that in the 90's and before the waste sector was predominantly a municipal or public sector space. It is no longer a public sector space. It is a private sector space, predominately, not entirely but predominately. So we have this odd situation now where municipalities, by and large, aren't taking care of their waste in their own boundaries and now they have veto on anybody else coming into their boundaries when they're not dealing with their own waste. I must say, regardless, it's somewhat perplexing. I don't know how one easily resolves it but there are really two stages to this that are interesting. One is should you be obliging municipalities to take care of their waste and if they are they get a veto. When it's meaning to say that if I'm a responsible municipality, and I have a long term regime for managing in my boundaries, then I should be able to say no more waste. Because I'm covering the obligations raised by my own residents or our residents. I could see something behind that but that isn't what this is doing. So I am not entirely sure, at this early juncture, with this novel policy what is going on other than some populous politics for one sector and nothing else.
Alexandra: Thanks, Rod. I think I'm a bit worried about where any of the waste will go at this point but I guess we'll have to see. I don't see anymore questions right now. So, and we're getting close to our time. So I think I'll just say thank you very much. That was really informative.
Alexandra: Thank you to all of our speakers and to all of you for attending this webinar. Don't forget to register for the next two Environmental Law Year in Review webinars. November 5, Resource Development in Nunavut and on November 12, Current Trends in Climate Change Regulation and Mitigation. We'll be sending out a reminder by email to register shortly so don't worry if you lost the original invitation. I hope you all have a good afternoon. Thanks.