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A new year begins with due diligence for Phase I ESAs

Monday, January 13, 2014

William Polivka, Compliance and Remediation

Olsson Senior Scientist Ted Hartsig assesses a transformer box as part of a Phase I ESA.For clients seeking answers to whether contamination exists under their newly purchased property, conducting Phase I Environmental Site Assessments (ESA) just got a little more manageable. The American Society of Testing and Materials (ASTM) recently revised one of its standards to make performing Phase I ESAs and understanding the requirements for establishing “due diligence” a little clearer. For Olsson’s staff members who conduct Phase I ESAs, the clarification is welcomed but will have little impact on staff members’ already-high due diligence standards.

On December 30, 2013, the ASTM revised its “E1527-05 Standard Practice for ESAs: Phase I ESA Process” standard. The final standard, referenced as E1527-13, acknowledged that the revisions satisfy the EPA’s “All Appropriate Inquiry” (AAI) rule. The AAI rule establishes the required standards and practices for conducting sufficient due diligence, which is then used to establish defenses for liability under the Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA”).

Some of the more notable E1527-13 changes include the following:

  • A simplified definition of a “recognized environmental condition” (REC)
  • Clarification to the definition of a historical REC (HREC)
  • Introduction of a new definition: a controlled REC (CREC)

To help Phase I ESA practitioners, E1527-13 further defines the term “activity and use limitation” that many practitioners have been using informally since 2004. The document also now defines the terms “migrate” and “migration” as “the movements of hazardous substances or petroleum products in any form, including, for example, solid and liquid at the surface or subsurface and vapor at the subsurface.” Including soil vapor into the migration discussion was significant, as it had received a notable amount of industry discussion and is now an acknowledged potential subsurface concern.

So, while E1527-13 does present refinements and clarifications to the Phase I ESA process, the amendments pose little change to Olsson’s due diligence methods. Olsson will continue to apply its high industry standards to the Phase I ESA process.

The experience of staff members enables them to apply a practical, common-sense approach to answer that ultimate due diligence question: “Could there be contamination on or under my site, and, if so, what do I do?” Before the rule revision, practitioners conducting Phase I ESAs on properties under contract or undergoing new financing had less guidance with respect to potential environmental impacts. This ambiguity left some Phase I practitioners either avoiding the question or defaulting to a conservative determination of “everything is a problem,” with the latter opinion moving straight into more costly Phase II ESA soil sampling and testing. With the new ASTM standard change, Olsson staff members are able to better identify property concerns, which helps clients better quantify environmental risks.

With over 20 offices in multiple states, Olsson may already be providing civil engineering or design engineering services for your projects. Please contact William Polivka at 303.237.2072 or wpolivka@olssonassociates.com to discuss how Olsson can help with your Phase I due diligence services through the final design.

Luke Johnson, associate scientist, tours a shopping center's electrical equipment and trash compactors for a Phase I ESA.

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