Soil taken from an old service station site in Daylesford and deposited at a nearby property is contaminated, the Environmental Protection Authority has confirmed.
An EPA officer travelled to the town to inspect three properties and conduct soil tests last week, as part of an active investigation following community concerns.
The investigation includes a service station site on the Midland Highway, where construction works are currently being undertaken to upgrade the existing service station workshop, retail area and fuel station into a modern Metro Petroleum service station.
In addition to this site, the EPA is also investigating two properties at which soil from the service station site was deposited: a property being developed on Table Hill Road and another property on Ballan-Daylesford Road.
The developer of the Table Hill Road property, who has asked not to be named, acknowledged last week that his contractors required more soil for their build.
Wanting to source it locally, they did so from the Midland Highway site but the developer said his contractors were assured the soil was clean.
The EPA has since confirmed soil testing on deposits at the Table Hill Road property have come back as 'category c', meaning some industrial waste is present.
Speaking to The Courier this week following the news that the soil is in fact contaminated, the developer said it was "very distressing and upsetting" news for him.
Calling it an "unfortunate and naive mistake", he said both he and his contractor were working with the EPA to remove the contaminated soil.
"The EPA is in contact with the duty holder to ensure they manage the soil and its clean up in accordance with EPA approvals," the EPA spokesperson said.
Meanwhile, soil deposits on the Ballan-Daylesford road did not show contamination.
Daylesford resident Patrick Jones, who first contacted the EPA with his concerns, lives near the Table Hill Road site. He said he and his neighbours were "pretty happy" that the EPA had acted on their concerns.
The EPA investigation is continuing.
The service station developer was contacted for comment.