Significance and Use
Uses—This practice is intended for use on a voluntary basis by parties who wish to assess the environmental condition of forestland or rural property of 120 acres or greater taking into account commonly known and reasonably ascertainable information. While use of this practice is intended to constitute all appropriate inquiry for purposes of the LLPs, it is not intended that its use be limited to that purpose. This practice is intended primarily as an approach to conducting an inquiry designed to identify recognized environmental conditions in connection with a property. No implication is intended that a person must use this practice in order to be deemed to have conducted inquiry in a commercially prudent or reasonable manner in any particular transaction. Nevertheless, this practice is intended to reflect a commercially prudent and reasonable inquiry. (See section 1.7.)
Clarifications on Use:
Use Not Limited to CERCLA—This practice is designed to assist the user in developing information about the environmental condition of a property and as such, has utility for a wide range of persons, including those who may have no actual or potential CERCLA liability and/or may not be seeking the LLPs.
Residential Occupants/Lessees/Purchasers and Others—No implication is intended that it is currently customary practice for residential occupants/lessees of multifamily residential buildings, occupants/lessees of single-family homes or other residential real estate, or purchasers of dwellings for one's own residential use, to conduct an environmental site assessment in connection with these transactions. Thus, these transactions are not included in the term forestland or rural property transactions, and it is not intended to imply that such persons are obligated to conduct an environmental site assessment in connection with these transactions for purposes of all appropriate inquiry or for any other purpose. In addition, no implication is intended that it is currently customary practice for environmental site assessments to be conducted in other unenumerated instances (including, but not limited to, many forestland and rural acreage leasing transactions, many acquisitions of easements, and many loan transactions in which the lender has multiple remedies). However, forestland and rural acreage transactions may include improvements (including, but not limited to, residential dwellings, barns, sheds, garages, and greenhouses). Areas with such improvements shall be examined during the site reconnaissance as described in Section 9. Inspection of such improvements will normally focus on the exterior of the structures. The environmental professional shall determine, in his/her professional judgment, whether the interior inspections of such improvements are warranted. Factors influencing this determination can include whether: (1) there is specific knowledge of a potential environmental concern, (2) the improvement is accessible, and (3) the inspection is coordinated by the key site manager.
Site-specific—This practice is site-specific in that it relates to assessment of environmental conditions on a specific parcel of forestland or rural property. Consequently, this practice does not address many additional issues raised in transactions such as purchases of business entities or interests therein, or of their assets, that may well involve environmental liabilities pertaining to properties previously owned or operated or other offsite environmental liabilities.
Two Related Practices—This practice sets forth one procedure for an environmental site assessment known as a “Phase I environmental site assessment for Forestland or Rural Property,” “Phase I environmental site assessment,” a “Phase I ESA,” or simply a “Phase I.” This practice is separate from Practice E 1527
Election to Commence with This Practice—The user may commence inquiry to identify recognized environmental conditions in connection with a property by performing this practice when conditions identified in 1.1 are met.
Who May Conduct—Whenever a Phase I environmental site assessment is conducted, it must be performed by an environmental professional, as defined in Appendix X2 (and 40 CFR 312.10(b)), to the extent specified in 7.5.1. Further, at the Phase I environmental site assessment level, no practical standard can be designed to eliminate the role of judgment and the value and need for experience in the party performing the inquiry. The professional judgment of an environmental professional is, consequently, vital to the performance of all appropriate inquiry at the Phase I environmental site assessment level.
Additional Services—As set forth in 12.9, additional services may be contracted for between the user and the environmental professional.
Principles—The following principles are an integral part of this practice and are intended to be referred to in resolving any ambiguity or exercising such discretion as is accorded the user or environmental professional in performing an environmental site assessment or in judging whether a user or environmental professional has conducted all appropriate inquiry or has otherwise conducted an adequate environmental site assessment.
Uncertainty Not Eliminated—No environmental site assessment can wholly eliminate uncertainty regarding the potential for recognized environmental conditions in connection with a property. Performance of this practice is intended to reduce, but not eliminate, uncertainty regarding the potential for recognized environmental conditions in connection with a property, and this practice recognizes reasonable limits of time and cost.
Not Exhaustive—All appropriate inquiry does not mean an exhaustive assessment of a clean property. There is a point at which the cost of information obtained or the time required to gather it outweighs the usefulness of the information and, in fact, may be a material detriment to the orderly completion of transactions. One of the purposes of this practice is to identify a balance between the competing goals of limiting the costs and time demands inherent in performing an environmental site assessment and the reduction of uncertainty about unknown conditions resulting from additional information.
Level of Inquiry Is Variable—Not every property will warrant the same level of assessment. Consistent with good commercial or customary practice, the appropriate level of environmental site assessment will be guided by the type of property subject to assessment, the expertise and risk tolerance of the user, and the information developed in the course of the inquiry. For purposes of this practice, the level of all appropriate inquiry of isolated areas of commercial real estate contained within forestland or rural property shall meet the requirements of Practice E 1527
Comparison With Subsequent Inquiry—It should not be concluded or assumed that an inquiry was not all appropriate inquiry merely because the inquiry did not identify recognized environmental conditions in connection with a property. Environmental site assessments must be evaluated based on the reasonableness of judgments made at the time and under the circumstances in which they were made. Subsequent environmental site assessments should not be considered valid standards to judge the appropriateness of any prior assessment based on hindsight, new information, use of developing technology or analytical techniques, or other factors.
Continued Viability of Environmental Site Assessment—Subject to section 4.8, an environmental site assessment meeting or exceeding this practice and completed less than 180 days prior to the date of acquisition of the property or (for transactions not involving an acquisition) the date of the intended transaction is presumed to be valid . If within this period the assessment will be used by a different user than the user for whom the assessment was originally prepared, the subsequent user must also satisfy the User’s Responsibilities in Section 6. Subject to section 4.8 and the User’s Responsibilities set forth in Section 6, an environmental site assessment meeting or exceeding this practice and for which the information was collected or updated within one year prior to the date of acquisition of the property or (for transactions not involving an acquisition) the date of the intended transaction may be used provided that the following components of the inquiries were conducted or updated within 180 days of the date of purchase or the date of the intended transaction: (i) interviews with owners, operators, and occupants; (ii) searches for recorded environmental cleanup liens; (iii) reviews of federal, tribal, state, and local government records; (iv) visual inspections of the property and of adjoining properties; and (v) the declaration by the environmental professional responsible for the assessment or update.
Prior Assessment Usage—This practice recognizes that environmental site assessments performed in accordance with this practice will include information that subsequent users may want to use to avoid undertaking duplicative assessment procedures. Therefore, this practice describes procedures to be followed to assist users in determining the appropriateness of using information in environmental site assessments performed previously. The system of prior assessment usage is based on the following principles that should be adhered to in addition to the specific procedures set forth elsewhere in this practice:
Use of Prior Information—Subject to the requirements set forth in section 4.6, users and environmental professionals may use information in prior environmental site assessments provided such information was generated as a result of procedures that meet or exceed the requirements of this practice. However, such information shall not be used without current investigation of conditions likely to affect recognized environmental conditions in connection with the property. Additional tasks may be necessary to document conditions that may have changed materially since the prior environmental site assessment was conducted.
Contractual Issues Regarding Prior Assessment Usage—The contractual and legal obligations between prior and subsequent users of environmental site assessments or between environmental professionals who conducted prior environmental site assessments and those who would like to use such prior environmental site assessments are beyond the scope of this practice.
Actual Knowledge Exception—If the user or environmental professional(s) conducting an environmental site assessment has actual knowledge that the information being used from a prior environmental site assessment is not accurate or if it is obvious, based on other information obtained by means of the environmental site assessment or known to the person conducting the environmental site assessment, that the information being used is not accurate, such information from a prior environmental site assessment may not be used.
Rules of Engagement—The contractual and legal obligations between an environmental professional and a user (and other parties, if any) are outside the scope of this practice. No specific legal relationship between the environmental professional and the user is necessary for the user to meet the requirements of this practice.
Scope
1.1 Purpose—The purpose of this practice is to define good commercial and customary practice in the United States of America for conducting a Phase I environmental site assessment of a property 120 acres or greater of forestland or rural property or with a developed use of only managed forestland and/or agriculture with respect to the range of contaminants within the scope of the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) and petroleum products. The property need not be contiguous; however, the non-contiguous areas should have substantially the same general land use and be part of the same transaction. The property may contain isolated areas of non-forestland and non-rural property. As such, this practice is intended to permit a user to satisfy one of the requirements to qualify for the innocent landowner, contiguous property owner, or bona fide prospective purchaser limitations on CERCLA liability (hereinafter, the “landowner liability protections,” or “LLPs”): that is, the practice that constitutes “all appropriate inquiry into the previous ownership and uses of the property consistent with good commercial or customary practice” as defined at 42 U.S.C. §9601(35)(B). (See Appendix X1 for an outline of CERCLA's liability and defense provisions.) Controlled substances are not included within the scope of this standard. Persons conducting an environmental site assessment as part of an EPA Brownfields Assessment and Characterization Grant awarded under CERCLA 42 U.S.C. §9604(k)(2)(B) must include controlled substances as defined in the Controlled Substances Act (21 U.S.C. §802) within the scope of the assessment investigations to the extent directed in the terms and conditions of the specific grant or cooperative agreement.
1.1.1 Recognized Environmental Conditions—In defining a standard of good commercial and customary practice for conducting an environmental site assessment of a parcel of property, the goal of the processes established by this practice is to identify recognized environmental conditions. The term recognized environmental conditions means the presence or likely presence of any hazardous substances or petroleum products on a property under conditions that indicate an existing release, a past release, or a material threat of a release of any hazardous substances or petroleum products into structures on the property or into the ground, groundwater, or surface water of the property. The term includes hazardous substances or petroleum products even under conditions in compliance with laws. The term is not intended to include de minimis conditions that generally do not present a threat to human health or the environment or that generally would not be the subject of an enforcement action if brought to the attention of appropriate governmental agencies. Conditions determined to be de minimis are not recognized environmental conditions.
1.1.2 Two Related Practices—This practice is closely related to Practice E 1527
1.1.3 Petroleum Products—Petroleum products are included within the scope of this practice because they are of concern with respect to many parcels of forestland or rural property and current custom and usage is to include an inquiry into the presence of petroleum products when doing an environmental site assessment of forestland or rural property. Inclusion of petroleum products within the scope of this practice is not based upon the applicability, if any, of CERCLA to petroleum products. (See Appendix X1 for discussion of petroleum exclusion to CERCLA liability.)
1.1.4 CERCLA Requirements Other Than Appropriate Inquiry—This practice does not address whether requirements in addition to all appropriate inquiry have been met in order to qualify for the LLPs (for example, the duties specified in 42 U.S.C. §9607(b)(3)(a) and (b) and cited in Appendix X1 including the continuing obligation not to impede the integrity and effectiveness of activity and use limitations (AULs), or the duty to take reasonable steps to prevent releases, or the duty to comply with legally required release reporting obligations).
1.1.5 Other Federal, State, and Local Environmental Laws—This practice does not address requirements of any state or local laws or of any federal laws other than the all appropriate inquiry provisions of the LLPs. Users are cautioned that federal, state, and local laws may impose environmental assessment obligations that are beyond the scope of this practice. Users should also be aware that there are likely to be other legal obligations with regard to hazardous substances or petroleum products discovered on a property that are not addressed in this practice and that may pose risks of civil and/or criminal sanctions for non-compliance.
1.1.6 Documentation—The scope of this practice includes research and reporting requirements that support the user's ability to qualify for the LLPs. As such, sufficient documentation of all sources, records, and resources utilized in conducting the inquiry required by this practice must be provided in the written report (refer to 8.1.8 and 12.2).
1.2 Objectives—Objectives guiding the development of this practice are (1) to synthesize and put in writing good commercial and customary practice for environmental site assessments for forestland or rural property, (2) to facilitate high quality, standardized environmental site assessments, (3) to ensure that the standard of all appropriate inquiry is practical and reasonable, and (4) to clarify an industry standard for all appropriate inquiry in an effort to guide legal interpretation of the LLPs.
1.3 Considerations Beyond Scope—The use of this practice is strictly limited to the scope set forth in this section. Section 13 of this practice identifies, for informational purposes, certain environmental conditions (for example, threatened and endangered species and non-point source considerations) that may exist on a forestland or rural property that are beyond the scope of this practice but may warrant discussion between the environmental professional and the user about a forestland or rural property transaction. The need to include an investigation of any such conditions in the environmental professional's scope of services should be evaluated based upon, among other factors, the nature of the property and the reasons for performing the assessment and should be agreed upon between the user and environmental professional as additional services beyond the scope of this practice prior to initiation of the environmental site assessment process.
1.4 Organization of This Practice—This practice has 13 Sections and 6 appendixes. Section 1 concerns the Scope. Section 2 relates to Referenced Documents. Section 3, Terminology, contains definitions of terms not unique to this practice, descriptions of terms unique to this practice, and acronyms. Section 4 describes the Significance and Use of this practice. Section 5 provides discussion regarding activity and use limitations. Section 6 describes the User's Responsibilities. Sections 7-12 are the main body of the Phase I environmental site assessment, including evaluation and report preparation. Section 13 provides additional information regarding non-scope considerations (see 1.3). The appendixes are included for information and are not part of the procedures prescribed in this practice. Appendix X1 explains the liability and defense provisions of CERCLA that will assist the user in understanding the user's responsibilities under CERCLA; it also contains other important information regarding CERCLA, the Brownfields Amendments, and this practice. Appendix X2 provides the definition of the environmental professional responsible for the Phase I environmental site assessment, as required in the “All Appropriate Inquiry” Final Rule (40 CFR Part 312). Appendix X3 provides an optional User Questionnaire to assist the user and the environmental professional in gathering information from the user that may be material to identifying recognized environmental conditions. Appendix X4 provides a recommended table of contents and report format for a Phase I environmental site assessment. Guidance Documents X5 and X6 provide guidance to address the evaluation of threatened and endangered species and Clean Water Act non-point source considerations, respectively.
1.5 The values stated in inch-pound units are to be regarded as standard. The values given in parentheses are mathematical conversions to SI units that are provided for information only and are not considered standard.
1.6 This standard does not purport to address all of the safety concerns, if any, associated with its use. It is the responsibility of the user of this standard to establish appropriate safety and health practices and determine the applicability of regulatory limitations prior to use.
1.7 This practice offers a set of instructions for performing one or more specific operations and should be supplemented by education, experience, and professional judgment. Not all aspects of this practice may be applicable in all circumstances. This ASTM standard practice does not necessarily represent the standard of care by which the adequacy of a given professional service must be judged, nor should this document be applied without consideration of a project's unique aspects. The word “standard” in the title means only that the document has been approved through the ASTM consensus process.
