ENVIRONMENTAL SITE ASSESSMENT FACTS
These facts are intended to provide general
information of current interest. However it is
provided with the understanding that the information
is subject to change at any time and will not be
applied to a specific situation without first
contacting the appropriate authorities regarding the
specific, current requirements and seeking the
advice of an appropriate professional.
Purpose
This Fact Sheet provides a overview of
Environmental Site Assessments (ESAs) presents
background information on the reasons for conducting
ESAs, and discusses the terminology and scope of
ESAs so that environmental professionals may gain a
better understanding of the process of conducting
ESAs.
Background
During the past two decades, environmental
regulations have been developed that impact many
aspects of our daily lives and the way we conduct
business. The catalyst for these regulations has
been "the protection of human health and the
environment". For the most part, these regulations
are developed at the federal level and implemented
by federal, state, and local officials, with
penalties for violations including fines and
criminal punishment.
The body of environmental legislation and
associated regulations have resulted in many
businesses, financial institutions, building owners,
and tenants involved in property transactions being
named as potentially responsible parties (PRPS) who
may be liable for the entire cost of remediation of
the property. Environmental regulations may also
target the individual as a PRP. In order to minimize
this liability exposure, it quickly became apparent
to these entities that a professional review of
current and past property uses was necessary. Early
on, this method of limiting liability was recognized
as a "due diligence" process under the Comprehensive
Environmental Response, Compensation, and Liability
Act (CERCLA, a.k.a. Superfund, 40 CFR Part 300).
Although this process was intended as a Superfund
defense, the ESA has become the de facto method of
conducting environmental due diligence for
commercial property transactions. Today, lending
institutions generally require that an ESA be
conducted on all commercial real estate transactions
above a threshold dollar amount established by the
lender.
The two major federal environmental statutes,
CERCLA and the Resource Conservation and Recovery
Act (RCRA), -while not requiring that a site
assessment be conducted, provide for severe
penalties for those who own or control contaminated
properties, as well as those who contaminate
properties. CERCLA deals primarily with property
which is suspected of, or known to be contaminated.
This legislation enables the federal government to
respond to actual or threatened releases or
hazardous substances, to abate these releases, and
to recover damages from PRPS. Many contaminated
properties identified as Superfund sites have become
mired in litigation as multiple PRPs involved in the
cleanup of these sites battle to determine their
share of responsibility. Some of these parties may
have long ago removed themselves from using the
property or contributing to its impairment or may
not have been involved in any illegal activity at
the time of the property's contamination. However,
under CERCLA, those companies may be just as liable
for cleanup costs as the most recent perpetrator of
environmental contamination.
RCRA deals primarily with the present-day
activities on a property, and addresses waste
generation, treatment, storage, and disposal. In
addition, underground storage tanks (USTS) are
regulated under Subtitle I of RCRA.
Terminology
Terminology related to ESAs can be very
confusing. The various aspects of environmental
inquiry into the history of a property have been
assigned different terms by industry practice,
regulatory structure, and professional
organizations. The result is that while someone
working in State A may refer to one particular scope
of work services as preliminary site assessment,
someone else in State B may refer to the same scope
of services as a phase I site assessment. Still
others may refer to the same activity as an
environmental audit. An environmental site
assessment typically involves researching a property
for potential or real liability issues, and focuses
on identifying potential or known environmental
impairment. An environmental audit, also known as a
regulatory compliance audit, is a separate and
distinct activity. The audit typically involves
assessing the facility's operations to determine if
they are in compliance with applicable regulations.
In general, the following definitions are used in
most locations throughout the United States to
describe the ESA practice: TOP
Transaction Screen
The American Society for Testing and Materials
(ASTM) has published a procedure for conducting a
minimal environmental investigation known as a
transaction screen, which is performed on low dollar
value properties and/or on properties where an
owner/operator believes that environmental
impairment is not likely to be a factor (ASTM
Standard Practice for Environmental Site
Assessments: Transaction Screen Process, E 1528-96).
This level of ESA typically involves having owners
and operators of the subject property complete a
transaction screen questionnaire, perform a site
visit to ascertain the subject property's and
adjoining property's uses, and perform a search of
government records and historical sources.
Transaction screens are often designed to be
conducted by someone other than an environmental
professional, and the process does not require the
information gathered to be presented in a formal
report, or that any conclusions or opinions be
provided. TOP
ASTM Phase I Environmental Site Assessment
The Phase I ESA developed by ASTM (Standard
Practice for Environmental Site Assessments: Phase I
Environmental Site Assessment Process, E 1527-97)
addresses only contaminants within the scope of
CERCLA and petroleum products. This level of ESA
typically involves an environmental professional
performing a site visit to ascertain the subject
property's and adjoining property's current and past
uses and physical, geologic, hydrogeologic,
hydrologic, and topographic setting; performing a
search of federal, state, and local government
records and other historical sources; and conducting
interviews with owners and operators of the property
and state and local government officials. The level
of detail of each task of the Phase I ESA is greater
than the corresponding task in the transaction
screen. In addition, the ASTM Standard requires that
all findings be presented in a written report and
that the opinions and conclusions of the
environmental professional be provided to the user.
TOP
Other- Phase I Environmental Site Assessments
Other Phase I ESA protocols have been developed
using the ASTM document as a foundation, but have
gone beyond the inclusion of CERCLA contaminants and
petroleum products to address other environmental
issues such as asbestos-containing materials, radon,
lead-based paint, and wetlands, etc.
Phase II Environmental Site Assessment
This level of ESA enables the environmental
professional to conclude whether the property is
environmentally impacted, or that it is unlikely the
property has been affected. Although a Phase II ESA
standard has not yet been published, this process
typically includes sampling and laboratory analysis
of different media as deemed necessary based on the
findings of the Phase I ESA, including but limited
to building materials, indoor air, soils, ground
water, surface water, and ambient air. The data
gathered is compared to existing environmental and
human health standards to determine the site's
environmental and public health risks and potential
remediation strategies. Occasionally it will be
possible to conduct a Phase II ESA that consists
only of a data search or a 'file review' at a
regulatory agency that will enable the environmental
professional to conclude that it is unlikely a
property has been environmentally impacted.
Additional Environmental Actions
Following the Phase II ESA, further studies may
be required to determine the extent of any
environmental impact, to explore alternative methods
of abatement/remediation, and to develop cost
estimates of the various abatement/remediation
alternatives. Upon completion of these studies,
abatement/remediation activity is often initiated,
TOP
Scope of Work
In general, the scope of work for an ESA can vary
according to the needs of the parties involved. The
scope of work for an ESA often includes but is not
limited to:
-
Site History
-
Groundwater Contamination
-
Hazardous Waste/Hazardous Materials
-
Wetland Issues
-
Storage Tanks
-
Chemical Storage, Use, and Handling
-
Contamination from Off-Site Sources
-
Asbestos
-
Radon
-
Lead
-
Polychlorinated Biphenyls (PCBS)
-
Pesticide/Insecticide Contamination
-
Standards and Protocols for Conducting
Environmental Site Assessments
-
The following organizations have developed
standards or protocols for conducting
environmental site assessments:
-
American Society for Testing and Materials (ASTM)
-
Association of Engineering Firms Practicing in
the Geosciences (ASFE)
-
Hazardous Waste Action Council, American
Consulting Engineers Council
In addition to protocols and standards mentioned
above, many state legislatures and state bar
associations have developed site assessment
standards which must be met when addressing
environmental concerns in those states. It is
important for the environmental professional to be
aware of any state and/or local requirements that
may apply. This list is by no means exhaustive, and
many other standards may be available or in
development.
