Myth: A Phase I ESA covers everything.Myth debunked: Not quite. A standard Phase I ESA does not address some serious contaminants such as asbestos, lead-based paint, and mold. These are covered under a separate Hazardous Materials Survey.
Myth: If I get a clean Phase I report, I’m free from any environmental liability.Myth debunked: Not exactly. A Phase I ESA compliant with ASTM regulations does indeed satisfy the EPA’s requirement that a buyer take “all appropriate actions” to determine if a property is compromised. However, the buyer is also responsible for performing a title search for any liens, property use restrictions or any other evidence of environmental issues.
Myth: Any contamination is a deal-breaker.Myth debunked: Not anymore. Regulations were updated in 2013 to make it possible to clear a property with a “recognized environmental condition” for unrestricted use under certain conditions when the contamination is deemed to be sufficiently contained and controlled.
Myth: Any building inspector can perform a Phase I ESA.Myth debunked: Not so fast. Environmental due diligence must be performed by an “Environmental Professional” trained under ASTM standards. It is also critical for inspectors to be aware of any state or local site assessment requirements. These requirements are often different from federal ASTM standards. Most authorities recommend hiring an experienced environmental consulting firm. The environmental assessment will be relied on by buyers, sellers, investors, lenders and insurers. The risks are high, and there’s no need to make them higher by using an inexperienced consultant. For more information on who can conduct a Phase II ESA, check out our blog post here. Surprised? We thought so. By the way, Essel Environmental Engineering and Consulting offers environmental services for the full real estate cycle, including disposition, acquisition, property management and real estate development. For more information visit www.esseltek.com or give us a call at 1-800-595-7616.