Phase I Environmental Site Assessment

Phase I scope

Environmental assessments for property transfers focus on the potential for environmental liability based on historical and current uses of the property and nearby properties. Because significant business and risk management decisions rest on the data generated, they require extreme care and diligence.

ESI performs the initial investigation to identify potential areas of contamination, covering on-site hazardous waste contamination, off-site contingent liabilities (Superfund), and on-site regulatory compliance. A Phase I assessment involves some or all of the following:

• Site walkthrough
• Surrounding area walkthrough
• Historical aerial photograph review
• Review of chemical use and storage records
• Historical document review
• State, county, and local record review
• Asbestos sampling (if requested)
• File search
• Personnel interviews

Based on the information gathered, ESI prepares a report summarizing the findings and providing professional opinions on the potential for an environmental problem at the site. As necessary, ESI recommends additional work and provides associated cost estimates.

Four components of proper due diligence

Records review. ESI obtains and reviews reasonably ascertainable records from standard sources to help identify recognized environmental conditions, including federal NPL and SEMS (formerly CERCLIS) listings, the RCRA facilities list, pertinent state and local agency records, and a selected commercial database. The historical review can include aerial photographs, city directories, fire insurance maps, and interviews with people familiar with the property and adjoining area.

Site reconnaissance. Experienced site assessment personnel visually and physically observe the site and adjoining properties, with specific attention to evidence of spills, storage tanks, possible sources of PCBs, and indications of improper use of hazardous substances. A comprehensive checklist guides every reconnaissance.

Interviews with owners and occupants. ESI uses a checklist to complete an in-depth interview of the key site manager and representatives of the major occupants, and contacts pertinent local agencies who may have knowledge of the site.

Report. We present findings and conclusions in clear, concise language, work diligently to close out all issues, and provide well-written opinions on the recognized environmental conditions at the property.

ESA Plus

Some clients require due diligence beyond the ASTM guideline, for example to obtain a security rating from a Wall Street rating agency or to meet Fannie Mae, Freddie Mac, or HUD requirements. Our ESA protocol includes options to evaluate mold, wetlands, lead-based paint, lead in drinking water, asbestos, radon, ozone-depleting substances, and regulatory compliance.

ESI has experience with most major lending institution and investment banking criteria, including ASTM E1527, Fannie Mae, Freddie Mac, and Standard & Poor's, and with client-specific scopes of work and reporting formats.

Phase I update certification

Under the ASTM Phase I standard, a Phase I report is generally valid for up to 180 days. ESI conducts Phase I updates at reduced rates to identify possible changes in site conditions and surrounding properties. In most instances, ESI will also certify our reports for third-party use.

Transaction Screen (ASTM E1528)

A Transaction Screen is a reduced scope of work from the Phase I assessment, designed to develop information about the environmental condition of commercial real estate. It is not always appropriate for a client's needs, but in consultation with our clients, ESI may identify opportunities to meet a client's risk management profile with this process. Transaction Screens include:

• Site reconnaissance
• Limited historical search (Sanborn or fire department)
• Limited database search
• Owner/occupant questionnaire
• Report