Phase I Environmental Site Assessment ASTM Standards an Overview

Phase I Environmental Site Assessment ASTM Standards that classifies recognized environmental conditions (RECs) on reagent l property to estimate environmental risks linked to the property. 


It is also called "Phase I ESA" and is an integral part of the real estate due diligence process. Phase I process is essential to make sure you know the property's actual value and assure there is no soil or groundwater contamination from previous use or from neighboring sites that may be impacting the property's value or limiting its use due to regulatory-mandated cleanup, or in some. 



The current (E1527-13) version of the ASTM Phase I standard, used by EPA and the states to determine whether sufficient environmental due diligence phase 1 has been conducted for a purchaser to utilize CERCLA defenses, is scheduled to be updated this year. While the revised standard has not been finalized, several possible changes of potential significance have been proposed.


The critical areas of the phase i environmental site assessment astm standard where we anticipate significant revision include:


  1. Addition of a new "non-scope" section - Non-scope provisions are those areas of environmental inquiry that, while potentially helpful to a prospective purchaser, are not explicitly required for the purchaser to use the CERCLA defenses. The new non-scope section will focus on "emerging chemicals of concern," including Perfluoroalkyl Substances (PFAS). Considering the EPA's increasing focus on PFAS and the likelihood of more regulations respecting PFAS, having a section to discuss potential PFAS contamination at a Site would provide pertinent information to potential buyers and creditors.


  1. Modifications to the protocol for historic searches - Currently, the standard requires a historic search of the subject property itself. The revisions suggest that this should be expanded to include the subject property and surrounding properties. While broadening the area of inquiry may be helpful to purchasers in terms of providing them more information about nearby properties, for sellers, expanding inquiries to adjacent properties is problematic because it provides an opportunity for consultants to identify offsite concerns that need further testing or evaluation. Expanding concerns to offsite properties also impacts purchasers who are financing the transaction because the heightened inquiry into offsite properties raises issues of concern for lenders that the purchaser may need to investigate further through Phase II testing.


  1. The new standard may require an analysis of how data gaps may affect the ability to identify RECs and may require discussing how data gaps may be addressed through other resources. Currently, data gaps are routinely ignored unless flagged as significant.


  1. Standards for identifying RECs at service (gas) stations or dry cleaners may change. For historic cleaners and service stations, this includes recognizing that contamination is reasonably likely to be present, despite the lack of any spill or release documentation. It will most certainly result in recommendations by consultants that all properties formerly associated with dry cleaning operations or service stations on-site (or offsite) undergo Phase II testing.



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