Overview

Financial assurance is financial security (cash and non-cash) to guarantee you can cover the cost of complying with environmental objectives.

We also require financial assurance so that there are funds for:

  • future clean-up and remediation of contaminated sites
  • operation or maintenance of a private water or sewage treatment facility (until assumed by a municipality)
  • alternate water supplies (to replace those that are contaminated)
  • preventing adverse effects

Financial assurance submissions can include financial assurance evaluations, re-evaluations, and financial assurance funds.

Read more in the Environmental Protection Act.

When to submit financial assurance

You must provide financial assurance when required for an environmental approval and other ministry legal instruments, including:

Submit financial assurance

Evaluation (for first-time approvals/legal instruments)

We may require an evaluation of financial assurance before issuing a legal instrument.

To submit, you have to:

  1. determine if financial assurance is required
  2. calculate financial assurance and prepare a proposal
  3. send your evaluation proposal with your application package by mail to:

    Financial Assurance and Brownfields Services
    Client Services and Permissions Branch
    Ministry of the Environment, Conservation and Parks
    135 St. Clair Ave. West, 1st Floor
    Toronto, ON M4V 1P5

Re-evaluation

Documents for your financial assurance re-evaluation must be submitted by the due date found in your legal instrument.

To submit, you have to:

  1. calculate financial assurance and prepare a proposal
  2. send your re-evaluation proposal by email or mail it to:

    Financial Assurance and Brownfields Services
    Client Services and Permissions Branch
    Ministry of the Environment, Conservation and Parks
    135 St. Clair Ave. West, 1st Floor
    Toronto, ON M4V 1P5

More help for landfill applicants

Inflation and discount rates for landfills (2012–2021)

Time from expected year of closureInflation rateNominal discount rate footnote 1Real discount rate footnote 2
0–30 years3.27%2.17%-1.10%
≥ 31 years3.27%6.27%3.00%

Contingency costs

To calculate Regulation 232/98 contingency costs for landfills, use:

F = $0.50 × W × (I2 ÷ I1)

where,

  • F = the amount of financial assurance for contingency items
  • W = the number of tonnes of waste that have been deposited at the landfill site at the time the amount of financial assurance is calculated
  • I2 = the most recent annual average Non-Residential Building Construction Price Index for Toronto (NRBCPIT) at the time the financial assurance is calculated. At the time of this update, the most recent annual average (2021) NRBCPIT is 122.1
  • I1 = the 1997 annual average NRBCPIT = 50.2 (Statistics Canada has changed the reference year for this index to 2017 = 100. When computing the Regulation 232 contingency financial assurance amount, an equivalent index value for 1997 has been interpolated to use with the new index.)

Payment

Your financial assurance funds must be submitted by the due date found in your legal instrument. You can provide financial assurance in a few ways. All original (no copy permitted) financial assurance payment documents must be sent to:

Financial Assurance and Brownfields Services
Client Services and Permissions Branch
Ministry of the Environment, Conservation and Parks
135 St. Clair Ave. West, 1st Floor
Toronto, ON M4V 1P5

Cash

Up to a maximum of $10,000.

Certified cheque, bank draft or money order

These must be made payable to the Ontario Minister of Finance and issued by a financial institution branch located in Ontario.

Irrevocable letter of credit

This letter must be:

  • from a financial institution named in Schedule I or Schedule II to the Bank Act (Canada)
  • issued by a financial institution branch located in Ontario

An irrevocable letter of credit is a document issued by a bank or credit union agreeing to pay money to a beneficiary, on behalf of the bank’s customer, if certain events take place.

No modifications to the letter of credit template will be accepted.

You must submit the original letter of credit to the ministry.

Get the irrevocable letter of credit template

Surety bond

A bond is licensed under the Insurance Act. A surety bond is a document issued by a surety company on behalf of a second party (principal) guaranteeing, to pay money to a beneficiary, on behalf of the principal, if certain events take place.

A surety bond must be issued by a financial institution branch located in Ontario.

No modifications to the surety bond template will be accepted.

You must submit the original surety bond to the ministry.

Get the surety bond template

Returning financial assurance

Financial assurance is not a penalty.

We will hold onto it as long as there’s a potential need for it in the future and it’s not required to prevent adverse effects specified in your legal instrument.