EPA to Issue Revised Phase l Environmental Site Assessment Standard

Environmental Site Assessments (ESA) have become a regular part of real estate development in the United States. The requirements for performing a proper ESA, or at least for identifying what counts as an actual problem condition and how to respond appropriately, have been a bit of a moving target for industry insiders to puzzle out. The EPA is working to clarify some of the misconceptions and strengthen environmental protections by issuing new standards pertaining to ESAs. The revised standards are merely proposed at the moment, and the EPA aims to publish the revised standards by the end of 2021. Continue reading for an overview of the proposed changes, and call a licensed underground storage tank (UST) remediation and removal professional if you need assistance with a damaged or contaminated UST.

What’s the Significance of the Phase I ESA?

According to the EPA, when a community has concerns about a given site and whether it is environmentally contaminated, a site assessment will be conducted. The site assessment process may entail a Phase I Environmental Site Assessment, Phase II Environmental Site Assessment, as well as additional assessment activities. Should evidence of contamination be discovered in a Phase I ESA, further site assessments will be conducted; if no evidence of contamination is found, the owner can proceed with reuse or redevelopment.

The standards for conducting an ESA are set by the American Society for Testing and Materials (ASTM). The stated purpose of the ASTM Standard E1527-13 Phase I ESA process is “to define good commercial and customary practice in the United States of America for conducting an environmental site assessment of a parcel of commercial real estate with respect to the range of contaminants within the scope of the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) (42 U.S.C. §9601) and petroleum products.”

The lofty purpose of a site assessment is to “help the community understand the property conditions” and identify potential threats to human health or the environment. For landowners and developers, in practice, the Phase I ESA is extremely important in determining who may be liable for environmental contamination. Conducting a Phase I ESA prior to purchasing a property satisfies the prerequisite for obtaining liability protection under CERCLA, the federal Superfund law, for prior contamination. If a buyer conducts a Phase I ESA before buying, and contamination of the region is discovered down the line, the owner may have a defense against liability in recognition of their due diligence.

Phase I ESAs, in fact, are conducted in the majority of the 5.6 million industrial and commercial real estate transactions across the country every year. The proposed revisions will affect most commercial real estate transactions in the future, so they are important to understand.

Proposed Revisions

The EPA is releasing new ASTM standards for conducting Phase I ESAs. The revisions include a number of minor/administrative changes, as well as a few more substantive alterations. Some of the more important substantive changes include the following:

• The Phase I ESA must specifically discuss the importance or relevance of any gap in data.
• If there are new exposure pathways, such as vapor intrusion, they must be identified and considered for any Historic Recognized Environmental Condition (HREC).
• The new rule requires owners to ensure that the current onsite conditions satisfy the current regulatory risk-based closure standard for any Controlled Recognized Environmental Condition (CREC) discovered onsite.

The revisions also clarify the definition of a Recognized Environmental Condition (REC). The appendix of the new draft standard breaks down the definition of a REC in greater detail and includes a logic diagram to help the industry understand how to apply the various REC terms (CREC, HREC, de minimis conditions, etc.). The proposed changes might also require the same level of historical research for adjoining properties that is required for the subject property. In short, the new rules are significant, and real estate developers should familiarize themselves with the rules before conducting their next ESA.

Call the Qualified Remediation Pros at Lutz for Your Underground Storage Tank Issues

If you discover a UST at your construction worksite or if you have to respond to a UST spill on your property, you need experienced help from trusted advisors with years of underground storage tank experience. For comprehensive, assured assistance dealing with a UST on your property, call Herbert Lutz & Company in Florida at 954-971-5222, or in New Jersey at 908-862-8888.