Federal Budget Bill hides major changes in Environmental Assessment Law
The federal budget bill tabled on March 29th 2010 includes buried changes to the federal environmental assessment regime. Bill C-9 is sweeping omnibus legislation, coming in at over 900 pages and 2000 sections.
While the majority of the proposed amendments are to financial statutes necessary to implement the budget, many are not. The changes to the Canadian Environmental Assessment Act (CEAA), are among those not tied to the budget. These amendments substantially change the environmental assessment process and would side-step court cases holding government accountable for administering the requirements of the existing legislation.
A precedent for burying environmental amendments was set in 2009, when the Budget Implementation Act reduced the number of projects for which environmental assessments under CEAA could be triggered. Amendments to the Navigable Waters Protection Act allowed the Environment Minister to establish classes of works or waters to be exempted from permitting and environmental assessment requirements. Six weeks after the Act received Royal Assent, the Environment Minister issued an Order exempting all “minor works and waters”. (See the ELC’s previous blog)
CEAA is among the most important pieces of environmental legislation in Canada. It often provides for more public participation and detailed review than provincial assessment legislation and in many cases covers projects not subject to provincial assessment at all.
Bill C-9’s proposed amendments would change CEAA itself. Unlike the amendments from last year, these changes will be entrenched and not subject to ordinary legal challenge. Even though CEAA Regulatory Advisory Committee, which includes environmental groups, other levels of government, First Nations and industry, has not met since 2008 to evaluate the functioning of the Act. These changes would also come just in advance of the mandatory five-year review of the legislation due this summer that would involve a range of citizen interests and stakeholders. Accordingly, the context of Bill C-9 suggests a reluctance to engage in a transparent discussion of the future of CEAA.
Even before the Bill was tabled, legal observers including West Coast Environmental Law issued notice that the federal direction would weaken environmental protection.
The changes to section 15 and section 21 of CEAA would directly circumvent the recent ruling of the Supreme Court of Canada in MiningWatch Canada v. Canada (Department of Fisheries and Oceans) from January 2010. This was the end of over a decade of legal action by environmental groups to enforce CEAA’s terms. The Supreme Court of Canada held that under the current version of the Act the Minister could not:
- Remove aspects of a project from an assessment;
- Change the level of assessment by doing so; or
- Avoid public consultation on the scope and factors to be considered in a comprehensive study.
Understandably, environmental groups are widely unhappy and have asserted that Bill C-9 is “gutting the law.”
The proposed amendments, found in sections 2152-2171 of Bill C-9, include:
- The Minister could eliminate aspects of any projects from any assessment.
- Exemptions for infrastructure projects that receive federal funding.
- The Canadian Environmental Assessment Agency would be responsible for most comprehensive studies.
- The National Energy Board and the Canadian Nuclear Safety Commission would take over comprehensive study assessments for large energy projects.
- A new definition of “water body” that would exclude tailings ponds, sewage facilities, and constructed agricultural features.
- The Minister would no longer be obligated to consider a mediation or review panel for large projects.
1) The Minister could eliminate aspects of any projects from any assessment.
The amendments in Bill C-9 giving the Minister more powers are not limited to “large projects.” The addition of section 15.1 to CEAA would give the Minister (and his or her delegates) the power to remove aspects of a project from the “scope” of any assessment. This does not change the content of an assessment, it changes which aspects of projects will be assessed. The Minister may extend this power to responsible federal agencies at any time.
In other words, in any project (large or small) the Minister would have the discretion to determine that some aspects of a project are not assessed for their environmental effects and no mitigation is put in place for those aspects of the project. This power also allows the Minister or delegated responsible federal agencies to eliminate aspects of entire classes of projects. Because specific aspects of a project trigger a comprehensive study, it would arguably be possible for the Minister to exclude those aspects and by doing so reduce the level of the assessment to a screening-level assessment only, even for a large project. It is unclear how this section will interact with the new powers for the CEA Agency to commence a comprehensive study under the proposed section 11.01(1).
Bill C-9 provides no guidance about how the Minister would use this discretion. In tandem with this, Bill C-9 would amend section 21 of CEAA to eliminate public consultations on project scoping and the content of comprehensive studies.
2) Infrastructure projects that receive federal funding would be exempted from environmental assessments by the Act itself
Bill C-9 would add Schedule 3 to CEAA, which lists a number of types of infrastructure projects. The Bill would also add section 7.1(2) to the Act. This new section would provide that no environmental assessment is required for projects or classes of projects listed in Schedule 3 if they are also funded by one of the listed federal infrastructure plans in s. 7.1(2). This section does not apply to projects in national parks, reserves, historic sites or canals.
Projects for which there could be no environmental assessments described in Schedule 3 include federally funded transportation routes, transit systems, waste disposal and water treatment facilities.
Cabinet first attempted these exemptions in 2009 by adding infrastructure projects to an existing Exclusion List Regulation and creating the Adaptation Regulations to avoid required assessments prior to federal funding. Whether CEAA gave Cabinet the power to make these regulations is contentious and the subject of a judicial review in the pending case of Sierra Club v. Canada. Both parties have filed their arguments, but parts of the case may become moot if Bill C-9 passes. Bill C-9 repeals the contested regulations and puts the exemptions directly in the statute. This will make the exemptions more difficult to remove in the future and could avoid judicial scrutiny of the validity of last year’s regulations.
3) The Canadian Environmental Assessment Agency would be the responsible federal authority for most comprehensive studies.
Established in 1994, the CEA Agency came into being to prepare for CEAA coming into force in early 1995. Under CEAA the Agency’s role is to “advise and assist the Minister”. The Agency promotes various objectives and “administers” the environmental assessment process. However the role of the CEA Agency is largely “administrative” and even then, this administrative role is confined largely to administering the CEAA public registry and providing support to review panels.
The CEA Agency does not currently enforce the Act, conduct assessments, nor ensure any of the Act’s requirements are met. These responsibilities lie exclusively with the Minister and responsible authorities (federal departments).
Bill C-9 would allow the CEA Agency to commence and be responsible for comprehensive studies. Comprehensive studies under CEAA are the type of study required for listed types of projects that are likely to have significant adverse environmental effects (such as large industrial projects). This is the most thorough initial type of federal assessment. Comprehensive studies provide for mandatory public consultation on the scope of an assessment and the effects of a project and require the cumulative effects of and alternatives to the project to be assessed. They also provide for public consultation on whether a project should be referred to a mediator or review panel.
Under amendments to section 11.01(1) of CEAA the CEA Agency would “commence” (in other words supervise and review) the comprehensive study assessment only if the National Energy Board or the Canadian Nuclear Safety Commission are not a responsible authority. In other words, the CEA Agency would be responsible to ensure the completion of all large assessments that did not involve specific federal energy project triggers. There would be no change to the responsible authority if a screening level assessment were required. Federal departments such as the department of Fisheries and Oceans will continue to conduct screenings. Under Bill C-9 the CEA Agency would replace other federal departments for comprehensive studies, mediations and review panels.
Notably, the provisions providing for key public consultation components of comprehensive studies would be eliminated in Bill C-9 by the replacement of sections 21, 21.1 and 21.2. Therefore, although the CEA Agency now commences these studies, the public consultation on the scope and components of the comprehensive study are eliminated and replaced with a more ambiguous public consultation requirement.
This new role for the CEA Agency leaves unanswered questions about how it will perform the duties and functions previously assigned to specialized federal departments who may have already scoped the project to preclude a comprehensive study. These changes also appear to make the exercise of these new powers by the CEA Agency discretionary.
4) The National Energy Board and the Canadian Nuclear Safety Commission could be allowed to take over comprehensive study assessments for large energy projects.
The changes to section 11.01(1) also provide that the CEA Agency will not conduct a comprehensive study assessment where a National Energy Board (NEB) or Canadian Nuclear Safety Commission (CNSC) permit is required. It is important to understand that not all environmental assessments conducted by the CNSC and NEB are comprehensive studies. There is no change under Bill C-9 to the many screening level assessments involving these bodies.
The current system provides a two-step assessment for any NEB or CNSC approvals that are listed in the regulations to CEAA as requiring an environmental assessment. First, the NEB and the CNSC are responsible for ensuring that an environmental assessment is conducted under CEAA. In many cases, other federal agencies that require permits will also perform this role in conjunction with the NEB or the CNSC. In any environmental assessment, they must determine if there are likely to be significant adverse environmental effects.
Once this is done, the NEB and the CNSC may have their own approval process under the terms of their own legislation. In the that process they may consider an array of environmental, technical, health and social issues depending on their own mandate, for example, whether or not a large inter-provincial transmission line is in the public interest in the case of the NEB, or whether the health, safety and environmental effects of a new nuclear power plant are “reasonable” in the case of the CNSC.
Bill C-9 makes two changes to CNSC and NEB projects. First, it adds the powers for both the NEB and the CNSC to create participant funding programs. This appears to be intended to replace participant funding normally awarded where a review panel is conducted. From this it can be inferred that instead of referring an assessment to a separate review panel, the Boards will conduct major project assessments themselves as part of an approval proceeding. Such a proceeding may or may not be a hearing, and the public as a whole may or may not be permitted to participate. Any funding or participation process would be subject to the CNSC and NEB legislation and rules.
Second, Bill C-9 provides that the NEB and the CNSC and not the CEA Agency will conduct comprehensive study assessments that require permits from the NEB or CNSC. It is also anticipated that the CEA Agency will not provide support for these assessments.
The result of these proposed amendments will be that potentially incompatible mandates and process requirements will have to be fulfilled by the NEB and the CNSC simultaneously, and without the expertise or oversight of other federal agencies. It may also mean that there is no true “public” consultation in these comprehensive studies since the board’s other decision-making processes have other requirements and processes for participation than those provided for in CEAA. This proposed change leaves many unanswered questions about the role of other responsible authorities, and whether or when there will be a public hearing process before these two boards for large energy permit applications.
5) The definition of “water body” would be added and exclude tailings ponds, sewage facilities, and constructed agricultural features.
“Water body” is a new term for CEAA. The proposed definition is identical to that currently in the Exclusion List Regulations. The definition in the Comprehensive Study List Regulation and Inclusion Regulation, in contrast, excludes tailings ponds and sewage facilities but is silent on agricultural facilities. The effects of this amendment are to be determined but it will almost certainly allow for less environmental assessment in the vicinity of existing projects.
6) Bill C-9 eliminates the Minister’s obligation to consider referral to mediation or review panel for large projects.
The current section 21.1(1) provides the Minister with an obligation to decide whether or not the federal agencies responsible for large projects should conduct a comprehensive study or whether the project should be subject to a mediation or review panel. The amendments to CEAA provided in Bill C-9 eliminate the old section 21.1(1) and replace it with a section that would not require the Minister to consider referring a large project to a mediation or review panel. Reference to the Minister’s referral power is also deleted elsewhere (s.23(3)(c), s.26). However, the power of the responsible authority to request a referral from the Minister in sections 25 and 28 of CEAA remains in place. The effect of these changes is that although the Minister may still refer a project, this is possible only where the responsible authority requests it. It can be anticipated from this change that fewer referrals to these processes will occur and the unique opportunities these two processes offer for the public to be informed and to present evidence regarding projects will also become more limited.
Bill C-9 is currently before the federal House of Commons, in second reading. It is not yet known if the Bill will be sent to committee. It is currently expected to pass. Comments or questions on the Bill should be directed to your federal MP.