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What is a Phase I Environmental Site Assessment ?
A Phase I ESA (also known as a Level I Evironmental Site Assessment) is a comprehensive document
prepared for any real estate Property and is considered the first step of due diligence to identify potential or existing specific
environmental contamination liabilities. The Phase I ESA report addresses not only the underlying environmental aspects of the
Property (groundwater, geology, wetlands, floodplain, etc.), but also the historical use of the property and adjacent properties.
However, a Phase I ESA does not includes the actual collection of physical samples or chemical analyses, although collection
of radon, asbestos, and/or lead samples can be collected at the same time for convenience, and added to the report.
When should a Phase I Environmental Site Assessment be used ?
Several actions may trigger a Phase I ESA for a real estate Property, the most common being:
Leaking underground storage tanks (USTs) are one source of environmental contamination liability, and the demand for this
type of Property assessment increased dramatically in the 1980's following judicial decisions related to liability of property
owners to effect site cleanup.
Interpreting the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA), the U.S. courts
have held that a buyer or lender may be held responsible for remediation of toxic residues, even if a prior owner caused the
contamination. Performance of a Phase I ESA on a Property, according to the courts’ reasoning, creates a safe harbor for such
a new purchaser and their lender(s).
In 1998, the Superfund Cleanup Acceleration Act of 1998 required purchasors of commercial property to perform a Phase I study
meeting the specific standard of ASTM E1527-05. Residential property purchasers need only conduct a site inspection and chain
of title survey.
What does a Phase I Environmental Site Assessment include ?
A Phase I ESA includes an inspection of the property, historical use research, analysis of local groundwater conditions, review
of nearby known environmental liabilities that may be impacting the value of the property throughout land used limitation, potential
cleanup costs or civil or tort liability, due to offsite migration of contamination. The Phase I ESA may also include surface water
quality and sometimes issues related to toxic uptake by biota, identification of possible asbestos- or lead-containing building
materials, inventory of toxic substances stored or used on site; assessment of mold and mildew; and evaluation of other indoor
air quality parameters such as radon.
Specific components of a Phase I ESA include:
Who can perform a Phase I Environmental Site Assessment ?
A Phase I ESA should be performed by a qualified environmental professional experienced in geology, subsurface contaminant
movement, and soil and groundwater sampling procedures. Typically, a Phase I ESA will be performed and/or directed by a
person having a minimum of a Registered Environmental Assessor I (R.E.A. I) certification, and preferably a Professional
Geologist (P.G.) or Professional Engineer (P.E.) Certification.
What standards control the performance and scope of a Phase I Environmental Site Assessment ?
The American Society of Testing and Materials (ASTM) established the following two standards, or practices, for Phase I ESAs
in commercial real estate transactions to standardize "Environmental Due Diligence":
Links to Phase I Environmental Site Assessment-related Information:
How much does a Phase I Environmental Site Assessment Cost ?
The cost to perform a Phase I Environmental Site Assessment is based on the location, size, and number of buildings
on the Property.
Please contact us by phone at 207-838-3168 to speak with a knowledgeable member of our team.
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