EPA Approves Use of New Phase I Assessment Standard
The United States Environmental Protection Agency (USEPA) has approved an amendment to the Standards and Practices for All Appropriate Inquires (AAIs). Here’s what you need to know in three quick facts:
- Significant changes include REC definition, environmental consultant review criteria, pathways of contamination, and definition of a CREC.
- The new rule allows the use of either ASTM-E1527-13 or ASTM E1527-05.
- Rule is effective on November 13, 2013.
On August 15, 2013, the United States Environmental Protection Agency (USEPA) approved the use of American Society of Testing and Materials (ASTM) standard E1527-13, Standard Practice for Environmental Site Assessments: Phase I Environmental Site Assessment Process to meet the Environmental Protection Agency’s requirement for All Appropriate Inquiry (AAI) for environmental due diligence. The codification of the approval can be found in 40 CFR 312, Innocent Landowners, Standards for Conducting AAIs. Historically, the rule listed the older standard ASTM E1527-05, which was approved in 2005. The new rule allows the use of either ASTM E1527-13 or ASTM E1527-05 to satisfy the AAI requirements. Significant changes in the new Phase I standard include the following:
- Simplification of the definition of Recognized Environmental Condition (REC) to include:
- Releases to the environment
- Conditions indicative of a release to the environment
- Conditions that pose a material threat of a future release to the environment.
- Clarification of when an environmental consultant is required to conduct a review of a governmental agency’s files.
- The identification and analysis of the potential pathways for contamination in soil and groundwater to give off vapors that can migrate into buildings and impact indoor air quality.
- The addition of a definition of a Controlled Recognized Environmental Condition (CREC), which is a REC that has been investigated and is already subject to controls and restrictions.
The revised rule is effective on November 13, 2013. More information on the rule can be found in the Federal Register at http://www.gpo.gov/fdsys/granule/FR-2013-08-15/2013-19764/content-detail.html.
The changes to the Phase I standard will impact the environmental due diligence considerations associated with merger and acquisition transactions. The clarification of the definition of an REC will provide a clearer understanding of environmental risks in a transaction. The new requirements also specify several new requirements for the environmental professional completing the assessment; therefore, it is critical that a prospective buyer work with an experienced and reputable consultant in order to take advantage of the liability protections afforded by the Phase I standard.
Need help deciphering through these changes and updates? EHS Support can assist you with your environmental due diligence needs, please contact our Technical Expert, Bruce Martin at email@example.com or (703) 944-4709.