Phase I Environmental Site Assessments- Why Are They Necessary?
So, you found a property that you want to purchase—congratulations! But then, you hear the words ‘Phase I Environmental Site Assessment’ and you think, “What now?”
In November 2005, the EPA issued the final All Appropriate Inquires (AAI) Rule—Environmental Site Assessments (ESA), Phase I Investigations—that established specific regulatory requirements for landowner liability protections.
An ESA is typically required for certain types of properties by lenders, banks or local municipalities. The purpose of the ESA is to determine if there is a contamination of the property that may affect the environment or the people using the property. You see—an ESA can protect the purchaser of a property and limit liability by discovering environmental concerns prior to the purchase of a property. Sophisticated commercial real estate purchasers and their lenders require Phase I Environmental Site Assessments when arranging a property loan, just as they require a title search.
Three Main Steps to the ESA Process
- Site Inspection
This is a thorough visual assessment of the property, including the interior, exterior and property lines. Current or prior activities that may have contributed to contamination of the soil or groundwater are identified. This inspection also includes observing adjacent and nearby properties that may have handled hazardous materials. These include:
- Gas stations
- Industrial facilities
- Dry cleaners
- Residential heating oil tanks
- Illegal dumping at abandoned properties
- Records Research
Checking maps and directories can reveal known releases of hazardous substances at or near the property. Historical records can also help to determine whether previous uses may contaminate the site (i.e., a restaurant that was once an auto repair shop). - Interviews
Interviewing previous owners, property managers, or tenants can provide important information about how the property was used; however, supporting documentation is often required.
Quality and Competency are Key
The Phase I ESA must be conducted by an environmental professional who has obtained specific education and certification. While it might seem logical to buy a Phase 1 Investigation as a pre-defined and itemized package to achieve cost savings, pre-planning and generic procedures are not the key to a proper environmental site assessment. Investigators using a pre-defined, tightly budgeted process can’t afford to pursue the unique aspects of a property, and this kind of generic, pre-planned procedure is antithetical to a proper Phase I ESA.
At NORCON, our site assessment and investigation services adhere to the latest EPA and ASTM guidelines and standards, and we possess an in-depth knowledge of industry regulations. The results of a NORCON investigation are more likely to result in discovery of potential problems during the pre-purchase assessment process, and are more likely to hold up in court if contamination is found during post-purchase.
Even more, NORCON offers clients the technical environmental expertise to determine if historic pesticides are present, and our team has the proven ability to address the problem with a practical solution. In New Jersey, the NJDEP Green Acres Open Space Acquisition Program requires New Jersey governments to complete a preliminary assessment prior to receiving program funding. To date, NORCON has completed more than 30 preliminary assessment reports (PAR) for a variety of municipal and county entities according to state requirements.
From initial site characterization through final regulatory approval, NORCON works with you every step of the way.
Have additional questions? Let’s talk! Call us at (201) 230-8800.
