However, Kiama council said it remained the responsibility of the state government to remediate the site before the council buys the Bonaira Street property as part of a $58million Blue Haven redevelopment.

Kiama council plans to buy the 3.3-hectare hospital site from the Illawarra Shoalhaven Local Health District and build a new nursing home and hostel for the council’s Blue Haven aged care facility, replacing the current Havilah Place nursing home and hostel.

The proposed development would result in all hospital buildings demolished except for the heritage-listed Barroul House.

The health district would retain about 2000 square 

metres of the site for a new building catering for outpatient services.

The discovery of asbestos in areas of fill on the site complicated negotiations regarding the site’s purchase.

The $58million project has attracted an $8million commitment ($4.8million for the council and $3.2million for the health district) from the state government through the $100million Illawarra Infrastructure Fund.

A council report said an 

assessment had identified the presence of asbestos, in the form of fibro fragments, in several areas of the site. “Given the nature of the proposed redevelopment, which will involve disrupting virtually the whole site, it is considered the areas will need to be managed by the removal of the contaminated soil,” the report said.

“While there are some options for potentially burying some of the material on site, this is not considered a viable solution as it is likely this could be viewed poorly by the community, as well as leaving council with the ongoing legacy of needing to have a management plan to cover any areas where asbestos is contained.”

Council general manager 

Michael Forsyth said the council would have some more detailed costings for the remediation by the end of this week.  

“Then we’d need to have discussions with the state government over those costs,” he said.

“This is the last sticking point really, the contamination issue and who’s going to actually meet the costs of that.

“We’ll then have to go and have some further discussions with the state government on the final outcome.” 

Concerns have been raised by the Kiama Hospital Auxiliary that it has not been properly publicised that the proposal would result in the closure of inpatient beds.

Meanwhile, the proposal to sell eight residential lots at the southern end of the hospital site has been labelled “inappropriate” by nearby residents.

The Kiama Residents Against Sell off of Hospital land (KRASH) will host a community meeting on Tuesday, October 28, at Kiama Leagues Club from 7.15pm. 

The council endorsed plans for the hospital site in July. 

The council estimates the sale of the eight residential lots will generate a net return of $1.2 million, which will assist with cash flow during the project.