Cessnock City Council has been fined $15,000 for breaching its Environment Protection Authority Licence.
The EPA says the council failed to maintain a dam, which allowed contaminated water to be discharged into the environment from the Cessnock Waste and Reuse Centre on Old Maitland Road.
The dam is used to collect and treat dirty water at the premises, but inspecting officers found the council had failed to physically check the levels, where contaminated water was discharging through the spillway.
EPA Director, David Gathercole says the water in the dam was far too high.
“The equipment used to measure dam levels appeared to be installed incorrectly, giving a false indication that the dam levels were lower.
“These breaches run the risk of creating large-scale pollution events which can be destructive on both the environment and community,” Mr Gathercole said.
The $15,000 penalty is the largest fine the EPA can issue.