Waterproofing Pump House Pit

I Live in Northern Ontario.  I am building a pump house and put a 6 foot pit under the pump house where I can put water related equipment.  I plan on insulating the outside of the blocks with Foam board before I back fill.  I should mention that my land is all sand so as far as frost lines go, I am told we really dont have one here.  The ground drains quick.

I plan on pouring a 10 by 10 pad over the pit and building a pump house shed there.

My question is before I put the foam board on the outside of the pit, should I tar the block or add any other type of waterproofing?  The floor of the pit is gravel.

Given the extreme drainage you describe, as well as a gravel floor and foam board around the pit walls, I wouldn't see much point to waterproofing the pit walls.

Is there any chance at all of a flood event that would put water in the pit to damage the equipment?

No more chance of flood then normal.  The lake is across the road, but that was the point of a gravel floor over concrete.  Any water that comes in will quickly drain away.

I wonder about musty smell.  although it is a pit under a shed so not a huge deal.