In the shadow of Montague Gold Mines – how historic pollution is haunting big plans for developing Port Wallace
This is a story, an earlier version of which was published in the Halifax Examiner in March 2020, about the toxic legacy from historic gold mines in Nova Scotia, which its citizens will be paying many millions of dollars to try to clean up, and how the contamination at just one of these sites – Montague Mines in Halifax Regional Municipality (HRM) – is still affecting us today.
This, the second in a series of three articles about historic gold mining that is coming back to haunt Nova Scotia, looks at how contamination from an old gold mining site is affecting plans for a large new subdivision planned in HRM. Part 1. can be read here.
For a few years there, things were chugging along well for Clayton Developments’ ambitious plans for a large new residential subdivision on hundreds of acres of woods and wetlands in Port Wallace.
At first glance it looks like an ideal place to put in a new subdivision. At least I imagine it does through a developer’s eyes.
Located between the Waverley Road and the Forest Hills Extension, Port Wallace is not far from Burnside and Dartmouth Crossing, and there is good highway access to the Halifax airport. And the development site appears to be a lovely natural setting through which Barry’s Run flows, close to Lake Charles and Shubie Park.
Even if a few residents in adjacent communities had expressed concerns about several possible negative effects of the new subdivision, it looked as if nothing would get in the way of Clayton’s master plan for Port Wallace.
And then something did. But I’ll get to that.
First some background.
Potential for development … and for problems
HRM originally identified Port Wallace as a potential development area in its 2006 Regional Plan. Since then, it has undertaken a barrage of studies to assess its potential for development, and also potential problems.
A study by AECOM in 2013 looked at the possible effects that a subdivision in Port Wallace would have on the Shubenacadie Lakes sub-watershed.
At the heart of that sub-watershed is Lake Charles, which is close to the Port Wallace lands slated for residential development. The AECOM report noted that Lake Charles is particularly important in the lakes system, being the headwater lake that discharges both north and south:
Historical reports suggest that approximately 60% of its discharge flows north to William and on to Lakes Thomas, Fletcher and Grand. The remaining 40% of the discharge from Lake Charles flows south to Lakes Micmac and Banook and ultimately to Dartmouth Cove in Halifax Harbour.
AECOM also found that “the primary human activity impacting water quality is changes to land use resulting from development within the subwatershed.” (This should come as no surprise to anyone who has watched the deterioration of water quality in Dartmouth lakes as subdivisions have mushroomed around them and homes have crowded their shores over the past half century.)
The report referred to the problem of “nutrient loading” in lakes, caused by the conversion of forested land to residential property and the installation of septic tanks. It observed that “future high density development” in Port Wallace would require “stormwater management” to control the quantity and quality of runoff water. Without stormwater management, AECOM predicted a 40% increase in suspended solids in Lake Charles, and cautioned that further analysis was needed to verify these predictions.
AECOM concluded that, “Port Wallace could be developed while maintaining acceptable lake water quality provided that stormwater is effectively managed.”
With that box ticked, in March 2014, Council formally initiated the “Port Wallace Secondary Planning” process to assess the site, prepare infrastructure plans and land-use planning documents, and engage the public with the formation of the Port Wallace Public Participation Committee.
The Port Wallace “project area” comprised lands owned by the Conrad Brothers, including its large quarry. But the relevant area for this article is more than 500 acres of Port Wallace land east of Montague Road between the Waverley Road and Highway 107 (Forest Hills Extension), which includes Barry’s Run.
In February 2016, a Land Suitability Assessment Report assessed six primary features – forested areas, watercourses, wetlands, slopes, contaminate sites, heritage & cultural assets – to “explore where development should and should not occur” on the Port Wallace lands.
And in May that year, HRM completed and presented the Port Wallace Master Plan Area: Pre-design Transportation Baseline Study.
Shaw makes its move
The Shaw Group, through its subsidiaries, had also been busy.
On June 5, 2014, HRM senior planner, Paul Morgan, gave a presentation in Port Wallis United Church, called “Port Wallace: Planning for Growth.” It said that Port Wallace was one of six areas slated for development in the 2016 – 2031 Regional Plan, and this was an “opportunity for a fully-services, mixed use, complete residential community.”
On the same day that the HRM planner was making his presentation, a company called 3276441 Nova Scotia Limited was signing an option agreement with Frank Whebby Limited and W. Eric Whebby Limited to purchase 12 parcels of lands in Port Wallace. According to the agreement:
The parties acknowledge that this Option shall expire on the earlier of (i) the first January 15th following the receipt of the Secondary Plan and Capital Cost Contributions by Halifax Regional Municipality Regional Council and Halifax Regional Water Commission or (ii) April 30, 2017, whichever is earlier …
A month later, 3276441 Nova Scotia Limited changed its name to Port Wallace Holdings. It shares an address and many board members with Clayton Developments, a subsidiary of The Shaw Group.
Then in January 2016, Clayton Developments and Port Wallace Holdings acquired a new president.
Enter Richard Butts
The new president wasn’t just anybody. He was very much somebody.
He was Richard Butts, who had just left his position as HRM Chief Administrative Officer (CAO), which he had held since 2011. At the time of its appointment, some questions were raised about his controversial record as deputy city manager in Toronto, as Tim Bousquet reported for The Coast (in pre-Halifax Examiner days).
When Butts announced in December 2015 that he was leaving HRM to join Clayton Developments as its president, Bousquet was again quick on the Butts beat, this time in the Halifax Examiner, writing:
Butts jumping from City Hall right into the presidential office at Clayton Developments raises serious questions of conflict of interest and undue influence.
In fact, there is no restriction on municipal employees taking jobs at companies they regulated at City Hall. It’s a recipe for corruption, or at least ineffective regulation: if bureaucrats know they can go to work for the developer whose application they’re considering, the incentive is to cut corners, give favours, and stamp approvals with a wink and a nod.
It is certain that while acting as Halifax CAO, Butts, now head of the company planning a large residential development at Port Wallace, would have been intimately acquainted with development plans for the area, for which HRM had commissioned several studies and invested a lot of resources.
Minutes of the Council meeting from back in March 4, 2014, show that Butts brought forward the staff report that included the “public participation program for Port Wallace for the Master Infrastructure Plan Study and Secondary Planning Strategy for Port Wallace.”
Tony Mancini is the councillor for Harbourview-Burnside-Dartmouth East, which includes the Port Wallace lands. I sent him an email asking when Clayton Developments first put forward its proposal for Port Wallace. He replied that the conceptual designs for the Port Wallace Holdings lands in HRM files date to early 2016.
Which, of course, is also when Butts joined Clayton Developments and Port Wallace Holdings.
Mancini also told me that he supported the motion put forward in early January 2020 by HRM Councillor Shawn Cleary for a staff report on a possible “cooling off” period for elected and senior officials.
However, when asked whether he had any concerns about the Clayton Developments proposal, given that the president of the company is the former HRM CAO, Mancini replied, “I don’t have an issue.”
Clayton’s Master Plan for Port Wallace
In November 2016, 11 months after Butts joined Clayton Developments, the company gave a public presentation of its “Port Wallace Master Plan,” a “concept plan.”
Just in case anyone doubted that the developer meant business, in the presentation, it boasted that, “To date, Clayton has developed eight master planned communities throughout Halifax Regional Municipality.”
There were schematics that showed the schedule and plan for the Port Wallace subdivision, which would eventually accommodate “2,716 household units = 7,600 people,” and take up to 15 years to complete.
The presentation showed that Clayton was not planning an access road to the proposed subdivision until year six of its construction, at which point there would be an exit from the Forest Hills Extension (Highway 107).
After that, local residents began expressing concerns about the plan.
In June 2018, Brian Palmer, a professional engineer living in neighbouring Montebello, made a presentation to the Harbour East – Marine Drive Community Council, in which he outlined his concerns about the effect the subdivision would have on traffic in that part of the city:
Clayton’s development proposal would see all traffic for construction and initial 2,500 new residents forced to use existing and very inadequate roads for at least the first 6 years of development.
Palmer wanted a Highway 7 interchange to be part of the first phase of the project.
Another engineer, Doug Skinner, prepared a detailed critique of the Port Wallace development plans, saying “the roadway capacity and traffic projections indicate that this area is not suitable for a development” with the population density there would be were the entire subdivision built. Skinner recommended that, “no approvals be awarded to any phase of the project” until a transportation solution is found “to provide SAFE travel at the peak traffic rates projected for full build.”
At a public participation committee meeting in June 2017, local resident Marina Hamilton presented her concerns – shared by 13 other people – about the damage that a proposed trail could have on wetlands and privacy, and about the safety risk of traffic accessing the subdivision from Waverley Road.
The January 2018 Master Infrastructure Study prepared for HRM by consultants CBCL highlighted many potential issues with the planned subdivision – including transportation infrastructure, sensitive wetlands and possible mine tailings contamination in the area around Barry’s Run, lack of capacity to deal with wastewater, and the critical need for stormwater management (although the study also determined that no stormwater elements had been identified that “considered to warrant capital cost contribution or shared developer cost”).
These did not appear to deter Clayton /Port Wallace Holdings, the major developer (others being named as Conrad, Unia, and Whebby).
Port Wallace Holdings buys the lands
In February 2018, Port Wallace Holdings purchased the lands in the area that it had optioned from the Whebby family in 2014. Port Wallace Holdings now owned 22 parcels in the area. It took out a mortgage for the lands of nearly $12 million with former owners Frank and W. Eric Whebby, and another Whebby firm, Blue Chip.
Butts signed on behalf of Port Wallace Holdings, of which he was president.
On March 21, 2018, the CAO Jacques Dubé (who filled the position after Butts left for Clayton) submitted to Halifax Council another report, this one called the “Port Wallace Master Infrastructure Study, Urban Service Area Expansion, and Plan Amendment Request to Council.”
It outlined potential costs of the project for HRM and Halifax water estimating its share would be 35.5%, and 64.5% for the developers. The total for transportation, water, wastewater, (there was no cost listed for stormwater), joint utility crossing was estimated at $31 million. In small print underneath the table was the note that all estimates shown were Class D (+/- 45%). There was also a note that Halifax Water would be undertaking a capital project that would reduce the joint utility water crossing for the developer.
Council then recommended that staff proceed with the preparation of the Port Wallace Secondary Plan.
So far, so good for Butts and Clayton, and their Port Wallace project.
But there was one potential hitch, one that had been there all along, although the gravity of it HRM seemed to recognize only in 2018. The problem was an innocuous little stream called Barry’s Run.
When it gave the go-ahead for the preparation of the Port Wallace secondary plan in March 2018, Council had also asked staff to report back with further information from Nova Scotia Environment “regarding development activity in the vicinity of Barry’s Run.”
The land adjacent to Barry’s Run had been acquired in 1976 by the former city of Dartmouth, and it ran right through the middle of the Port Wallace Holdings lands.
Barry’s Run was one of two waterways in the Port Wallace area that were once part of control structures for the Shubenacadie Canal. The other was Mitchell’s Brook that originates in Montague Mines and Lake Loon, and drains into Barry’s Run, which in turn discharges into Lake Charles and the Shubenacadie Canal system.
This wouldn’t pose a problem to the proposed Port Wallace subdivision were it not for two inescapable realities.
The first is that upstream from the 527 acres slated for a residential subdivision is the historic gold mining site of Montague Mines and mine tailings contaminated with arsenic and mercury.
As Council was informed on November 19, 2018, “the mine tailings were historically discharged into Mitchell’s Brook, which flows to the wetlands at Barry’s Run.”
The second problem is that Barry’s Run is “located at the centre of the Port Wallace project area.” Indeed, Council learned that sediments contaminated by the historic mine tailings had also been found in Lake Charles, which is 2.5 kilometres from Montague Mines.
Staff advised Council that because of the contamination, in July 2018, Nova Scotia Environment had advised HRM that a phase I and a phase II Environmental Site Assessment would likely be required, “to properly inform future decisions with respect to the proposed development in the Port Wallace area.”
The initial estimated cost of the site assessment work would be $100,000.
And as reported in Part 1 of this series, in July 2019 the province announced it was budgeting nearly $48 million to clean up two historic gold mine sites, one of them being Montague Mines.
The next month, Dillon submitted to HRM the environmental site assessment report for municipally-owned properties along Mitchell’s Brook and Barry’s Run, which are flanked by the lands slated for development by Clayton Developments and owned by its subsidiary, Port Wallace Holdings.
The news was not good at all.
The contamination extended downstream to Barry’s Run, right in the heart of the proposed subdivision.
So what would HRM and Clayton developments do? How would this historic gold mine pollution affect the Port Wallace project?
Continued in Part 3.