Wombarra residents say they warned before the Seacliff housing estate was approved that removing trees and topsoil could cause serious runoff which could threaten properties and damage the environment.
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The residents say water testing they commissioned has revealed high concentrations of particles in the water flowing directly into the sea.
The result for Total Suspended Solids was 9850 mg/L, resident David Roach said.
Wollongong City Council fined the developer, Wombarra Vista Pty Ltd, for polluting the environment but residents say this amount will make little difference.
Runoff prevention equipment was put in place after the rain had started but it came too late and was insufficient to prevent the pollution getting to the rock shelf.
The sediment clogs the gills of fish and reduces light penetration which effects natural ecosystem processes
- Dr Ian Wright
Water scientist Ian Wright, from Western Sydney University, examined the tests and warned of environmental damage.
"If contaminated run-off like this is discharged into intertidal and marine waters, the fine sediment blankets the aquatic habitat smothering plants and animals," Dr Wright said.
"The sediment clogs the gills of fish and reduces light penetration which effects natural ecosystem processes such as photosynthesis."
After meeting with local politicians, residents nearby the development are demanding more action from environmental regulators.
"Residents warned in their submissions [prior to approval] that removing trees and top soil from the site could cause serious run-off from the development which could threaten properties and cause environmental damage," Mr Roach said.
A spokesperson for the Environment Protection Authority said Wollongong City Council was the regulator here because the developer was not operating under an EPA licence.
"The EPA has been liaising with Wollongong City Council about this matter and has offered to assist if needed," they said. "EPA understands council has been managing this issue. They have fined the site operator and required a series of measures be implemented.
"The Wombarra site is not operating under an EPA licence and therefore falls under the regulatory control of Wollongong City Council."
The Mercury's questions to the contractor, Menai Civil, have not received any response.
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