Part of Nelson's Tāhunanui Beach has been fenced off after sawdust containing heavy metals, which could pose a risk to humans, wildlife and the environment, was detected.
Wood waste at the back beach was first exposed by erosion last year, with council originally saying it was not considered a pollutant and a decision was made to leave it in place, with regular monitoring.
But recent tests have shown it contains elevated concentrations of heavy metals, including arsenic.
Nelson Mayor Nick Smith said the council had allowed wood waste to be dumped at Tāhunanui Beach in the 1960s, with about 8000 cubic metres of wood waste used as fill for the raised car park after a local sawmill's lease expired. That business is no longer in operation.
Smith said the discovery of the contaminated material was disappointing, and the council had a duty to remove the waste and remediate the land.
"Frankly, I think it was quite reckless to be putting sawdust, let alone treated wood waste in a coastal environment.
"I think it's a symptom of an era where coastal areas were treated as wasteland and where there was not the appreciation of the health and environmental risks of wood treatment chemicals."
Testing in May revealed concentrations of arsenic, chromium, copper and boron exceeded the Australian and New Zealand Environment and Conservation Council sediment quality guidelines and could pose a risk to the environment.
The council then undertook further testing to assess the scale of the contamination.
Last month, tests confirmed timber treatment chemicals found elevated concentrations of copper, chromium, arsenic and boron.
In some instances, levels of arsenic were found to exceed NESCS standard (Ministry for the Environment Resource Management, National Environmental Standard for Assessing and Managing Contaminants in Soil to Protect Human Health) regulations for recreation land use.=
The tests also revealed the presence of dioxins, which are considered toxic and associated with pentachlorophenol (PCP), a known wood preservative that is no longer used in New Zealand.
Council community services group manager Andrew White said the issue was being taken seriously, with fences and signs erected to contain the site on Friday.
"Next week, I will be putting a report to council requesting an unbudgeted expenditure to undertake the options assessment for what we can do with the site in the short term and the long term."
The back beach is a popular off-leash area for exercising dogs, with owners reminded to be vigilant and to prevent their dogs from ingesting contaminated material.
Smith said it was a relatively small part of Tāhunanui Beach which was affected and the risks were low, but the council wanted to take a precautionary approach in dealing with it.
It will not be an easy task, with almost 6000 cubic metres of wood waste needing to be excavated and disposed of.
Councillor Campbell Rollo, who is the liason for the Tāhunanui community, said he met with residents and businesses owners on Friday, many of whom had been concerned about the wood waste over the last year.
"While there was a lot of shock and concern in the room, they were actually reassured it as a small area and they are glad that council is finding a track to move forward and as quickly as it can."
A request for $450,000 to carry out urgent short-term erosion mitigation work at the site to prevent further erosion of the sawdust and work to plan for its removal will be made at a council meeting next Thursday.