Reducing Environmental Risk

Top 10 Recognized Environmental Conditions (RECs) To Consider When Buying Property

It is long been common practice for prospective buyers or lessors of real estate to conduct Phase I environmental site assessments (ESAs) as part of their due diligence.

But do you know why?

The Phase I ESA is intended above all to be a comprehensive analysis of the historic use of the property and surrounding properties that preliminarily identifies potential or existing environmental contamination liabilities. The United States Environmental Protection Agency (EPA) has established the “all appropriate inquiries” (AAI) rule that governs the preparation of Phase I ESAs. For a Phase I ESA to be AAI-compliant, and thus qualify for one or more of the landowner liability protections (LLPs) under the Comprehensive the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA, aka the federal Superfund law), your second major reason for undertaking a Phase I ESA, the EPA demands that it be prepared in accordance with specific regulations. Those protections include exemption from Superfund liability for parties who take certain steps, the first of which is to undertake a Phase I ESA.

In conducting a Phase I ESA of a property, the regulatory standard specifies that the goal of the process is for the environmental consultant to identify recognized environmental conditions (RECs) (i.e., “the presence or likely presence of any hazardous substances or petroleum products in, on or at a property …”). If RECs are identified in a Phase I ESA, the standards may require that a more intrusive investigation (i.e., surface and subsurface [soil and groundwater] sampling) be conducted to specify whether soil and groundwater on the property is in fact impacted.

The attorneys at Periconi, LLC, have reviewed hundreds of Phase I ESAs and have the experience analyzing whether additional investigation is warranted when a REC is identified. They have also commissioned and overseen performance of at least 100 Phase II ESAs.

The Top 10 Recognized Environmental Conditions (RECs) Or Potential RECs To Consider In Real Estate Transactions

Whether existing (in service or not) or past:

1. Underground storage tanks (USTs)

2. Leaking underground storage tanks (USTs)

3. Dry cleaners

4. Junk yards

5. Automobile salvage

6. Metal plating facility

7. Industrial and chemical site locations

8. Suspect fill materials found onsite

9. Used chemical or fuel drum storage areas

10. Groundwater or soil vapor impacts at adjacent locations

Contact Us To Discover More

For information about Phase I and Phase II ESAs and RECs, or to schedule a consultation with an environmental lawyer, call 646-733-4487 or email the law firm through this website. Periconi, LLC, is located in New York City.