4. EXPECT TO FIND CONTAMINATION
The purpose of the site assessment is to obtain useful information for business decisions. It is naive to buy a cheap assessment in the hopes that it will be "clean". It is silly of many buyers, lenders, and property managers to accept any site assessment provided that it is presented with a title and in a glossy cover.
To meet the appropriate level of inquiry and establish consistent standards for environmental diligence in commercial real estate, the American Society of Testing and Materials (ASTM) has established standards for industry practices. The ASTM standards established a pre-screening Phase I assessment process, and a complete protocol for a Phase I assessment as well as guidance for Phase II studies. ASTM Standards on Environmental Site Assessments for Commercial Real Estate. ASTM standards and guidance are universally recognized among the commercial and lending communities.
A Phase I site assessment is a preliminary survey that consists of a site visit, an examination of the site’s history, and a state and federal file review for regulatory history. A site assessment of this preliminary sort is fine for a rough-cut, to identify the presence of potential hazardous wastes, but it is not a determination with much certainty.
If questions concerning possibilities of contamination still exist following the initial assessment, then further investigation, often termed a Phase II site assessment, which involves subsurface explorations as well chemical screening and analysis, should be performed. Additionally, site assessments should consider groundwater contamination, since it is the most important variable, affecting the extent of liability and the cost of remediation. Off-site contamination maximizes liability and cost.
A properly done site assessment should include a physical survey, specifically: topography, geologic setting, surface and groundwater flows, building and utility layouts, and the condition of all above and below-ground buildings and other structures, along with tanks and piping. The assessment also should include the permit and enforcement history of the property, and a determination of prior waste disposal, as well as industrial, commercial, or agricultural uses. Additionally, potential purchasers may wish to engage their site assessor to expand the scope of their initial assessment to include asbestos, lead paint, and radon.
The ASTM standards do not have legal standing, but are an attempt to summarize an industry wide approach for engineers, when performing site assessments. Many states that have a hazardous material release prevention and response law, like the Massachusetts Oil and Hazardous Material Release Prevention and Response Act, Massachusetts General Laws ch. 21E, have established content guidelines for Phase I assessments, once a property has been entered into the state Superfund system. To some extent, the state assessment guidelines and the ASTM standards are duplicative, but the ASTM standards are generally considered more basic. Massachusetts 310 C.M.R. § 40.0483, for example, mandates that Phase I preliminary assessments for the purpose of satisfying the state Superfund law, contain: general disposal site information, a disposal site map, a disposal site history, site hydrogeological characteristics, information on the nature of the contamination, an evaluation of the migration pathways and exposure potential, as well as an evaluation on immediate response actions. Commercial lenders and potential purchasers generally require only an assessment that follows the ASTM site assessment guidelines.