Phase I & II ESAs FAQ

  1. What is involved in obtaining a Phase I ESA from KEM?
  2. Who can conduct Phase I ESA under the EPA law?
  3. What are the differences among these terms?
  4. What is the cost of a Phase I ESA?
  5. How long does it take to conduct a Phase II ESA, if that becomes necessary?
  6. Must I sample beyond the borders of the property during the Phase II Assessment?

What is involved in obtaining a Phase I ESA from KEM?

The requirements for a Phase I ESA include:

  • interviews with past and present owners, operators and occupants;
  • reviews of historical sources of information;
  • reviews of federal, state, tribal and local government records;
  • visual inspections of the facility and adjoining properties;
  • consideration of commonly known or reasonably ascertainable information; and
  • assessment of the degree of obviousness of the presence or likely presence of contamination at the property and the ability to detect the contamination by appropriate investigation.

Once KEM has the address of the property, a complete property history, including Sanborn fire maps, aerial photos and title history is ordered. KEM also obtains a listing of actual and potential sources of pollution within a one-mile radius of the property. After these items are obtained, KEM makes a physical visit to the property/building to conduct interviews and a visual assessment of existing environmental conditions on the property and on adjacent properties. Within 2 weeks after the site visit, KEM produces a complete report of the Phase I ESA and delivers the report electronically to the client.

Who can conduct Phase I ESA under the EPA law?

According to the All Appropriate Inquiries or AAI Rule (40 Code of Federal Regulations, Part 312), only individuals with the appropriate college degree and the required work experience in environmental assessments can conduct Phase I ESA investigations and reports. If the assessor does not meet the qualifications of an Environmental Professional, then the report will be invalid and will not qualify the owner for the Landowner Liability Protection (LLP). LLP is the main reason for conducting a Phase 1 ESA.

What are the differences among these terms?

  • Environmental Site Assessment (ESA) – A commonly used term to describe the general process for evaluating the environmental condition of a property. Includes Phase I and Phase II.Also used in state law to establish requirements for lenders that want to qualify for a state liability exemption.
  • All Appropriate Inquiry (AAI) – The federal code for conducting a Phase I ESA in order to preserve a Superfund liability defense and to qualify for federal brownfield grants, as well as state grants and loans that use federal funds. Equivalent to ASTM Standard E 1527-05.
  • Environmental Due Diligence – An older, more general term used to describe environmental site assessment.
  • Transaction Screen (TS) – A transaction screen is conducted for a parcel of commercial real estate where the user wishes to conduct limited environmental due diligence (less than a Phase I ESA). If the driving force behind the environmental due diligence is a desire to qualify for one of the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) Landowner Liability Protections (LLPs), this practice should not be applied. The TS does not include comprehensive historical research.

What is the cost of a Phase I ESA?

Phase I ESAs can generally be performed for a fee between $1,500 and $3,000, depending on the size of the building or property.

How long does it take to conduct a Phase II ESA, if that becomes necessary?

When a Phase I ESA report finds a “Recognized Environmental Condition,” a Phase II Environmental Site Assessment report is typically recommended in order to screen the soil and/or groundwater for potential significant environmental liabilities. This timing of the Phase II ESA is generally governed by the availability of a drilling company to conduct the subsurface sampling. Most often, this work can be scheduled within 1-2 weeks after notice to proceed from the client. Obtaining analytical results takes about 1 week from the date of the sampling, and then a final Phase II ESA report is produced within 2 weeks. Typical total time = approximately 4 weeks.

Must I sample beyond the borders of the property during the Phase II Assessment?

Sometimes sampling beyond the property boundary may be necessary if a discharge of hazardous substance from the property may have led to an environmental impact elsewhere. Typically, this would occur in instances where a gasoline station or a dry cleaning establishment is, or was previously, on the property. If the property had any other discharges as a part of previous uses, sampling beyond the property borders may be necessary. It should be noted that access to conduct a subsurface survey beyond the borders of the subject property needs to be granted before drilling activities can be conducted.