Wednesday, August 25, 2010

Phase I ESA Standard Revision - ASTM 1527

The ASTM Standard used to define Phase I Environmental Site Assessments (ASTM E 1517-05) is currently undergoing review and will potentially be revised. An ASTM Task Group has been established to conduct this review. As ASTM E1527 approaches its 2013 sunset date, a task group is currently considering whether the Phase I ESA standard should undergo revisions or be re-approved as-is. In recent weeks, the task group has been considering several legal issues and possible changes to the standard's legal appendix. A few of the issues currently being debated include:

Reliance: Given that SBA requires third party reliance on Phase I ESAs performed on properties guaranteed by there 504 and 7(a) loan programs, should the E1527 standard be revised to include better guidance about who can rely on a Phase I report? This has been a particularly controversial issue, as environmental professionals and their attorneys are concerned about being exposed to additional liability when they perform environmental site assessments.

Oil Pollution Act: The Oil Pollution Act (OPA) was amended in 2004 to include a secured creditor exemption and innocent owner protection provided that an OPA regulation very similar to the CERCLA All Appropriate Inquiry (AAI) rule is met. The task group is considering whether that E1527 standard might be expanded to include OPA, especially since the Coast Guard has already said that E1527 would satisfy these requirements.

Indoor Air Exclusion: Since the revision of the E2600 Standard on Vapor Encroachment, there have been many questions about when indoor air problems should be considered RECs during the Phase I ESA process. While the standard currently lists indoor air as a non-scope considerations, there may be instances when contamination encroaching on a property is both a release on the property and an indoor air problem. The task group is considering whether this should be further clarified within the standard.

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