Pre-Purchase Due Diligence: Are you adequately screening for Business Environmental Risks along with your standard Phase I Environmental Site Assessment?

You’ve probably been through a Phase I with an environmental consultant before, and while it seems like a straightforward process, there are additional Business Environmental Risks (BER) that most property purchasers want to consider.

A BER is defined in ASTM 1527:13 as “a risk which can have a material environmental or environmentally-driven impact on the business associated with the current or planned use of commercial real estate.”

A standard Phase I does not evaluate BERs and treats these as out-of-scope items. So unless you specifically authorize additional review beyond the standard Phase I, you leave your transaction open to costly BER surprises.

These surprises can include that your newly-purchased property has asbestos-containing materials, mold, lead in drinking water, radon, or land use restrictions prohibiting future development such as the presence of wetlands, endangered species, or cultural and historic resources.

Industrial Property BERs

For our clients purchasing industrial properties with active facilities, there are additional BERs to consider. Operational compliance with air, stormwater, and wastewater regulations are an important consideration in the overall purchase price. For example, an inadequate stormwater treatment system or lapsed air permit can spell trouble in terms of fines or capital investment requirements for a new operator-owner. A pre-purchase review of needed permits to support a facility expansion or change of industrial activities is also critical to determining the investment value of the target property.

SoundEarth’s cross-functional due diligence team has deep understanding of compliance requirements for both operating and former industrial sites. Our team is available to help make sure that you get the critical BERs evaluated for your target property—before you seal the deal.

Common Business Environmental Risks

The list below identifies BERs that ASTM considers out-of-scope for Phase I ESAs.

– Asbestos-containing building materials

– Biological agents

– Cultural and historic resources

– Ecological resources

– Endangered species

– Health and safety

– Indoor air quality unrelated to releases of hazardous substances or petroleum products into the environment

– Industrial hygiene

– Lead-based paint

– Lead in drinking water

– Mold

– Radon

– Regulatory compliance

– Wetlands


Author: Annika Wallendahl

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With TRI Data Facing Increased Scrutiny, Companies Should Consider an Audit to Ensure Compliance

Fotolia 68898096 Subscription Monthly M oil and gas refineryThe EPA’s Office of Inspector General (IG) recently issued a management alert related to inaccuracies in EPA’s publicly-available toxic substance release data. The IG discovered discrepancies between EPA’s public data and the internal data that the agency submitted to the IG related to the total number of pounds of toxic chemicals released between 2013 and 2017.

EPA collects data on toxic substance releases in part through the Toxic Release Inventory (TRI) program, through which industrial facilities report on their emissions and releases of chemicals and other hazardous substances.

Companies that submit TRI reports should take note of the IG’s audit and subsequent actions. In recent years, we’ve seen EPA take a more proactive approach in identifying and flagging errors found in TRI reports. With the IG’s audit ongoing and EPA itself facing scrutiny, the agency will likely increase its efforts to ensure that the data it receives via TRI Reports is accurate and sufficient.

In many cases, EPA has compared TRI reports to other submitted reports like emissions inventories and SARA 312 reports. When EPA comes across discrepancies in the pollutants emitted and/or the rate or volume of the pollutant, the agency will often give the source time to explain the discrepancy. However, oftentimes this investigation turns up more questions, so it’s best to stay ahead of the game and off of EPA’s radar.

It’s commonplace to treat annual reporting as a status quo procedure, which can lead to out-of-date emissions factors and faulty calculations. A third-party audit of your TRI report can help unearth these issues and ensure that you are meeting the latest regulatory requirements related to toxic substances. Have a third party look at the emissions factors to ensure they are the most accurate to use. Consultants can also compare all of your reports to ensure that process changes, changes to raw materials, and regulatory updates are all captured to ensure your facility is reporting the most accurate information.

SoundEarth frequently assists industrial facilities through the full process for TRI reporting. We help clients determine if a facility meets the requirements to submit a report, manage report preparation and data calculations, and review existing reports to ensure they stand up to recent regulatory changes.

If you have an existing TRI report or are currently working through your 2019 report, or if you’re unsure if you need a TRI report in the first place, contact Chris Kitchen or Annika Wallendahl. As a reminder, the deadline to submit 2019 TRI Reports is July 1.

Washington is Cracking Down on Respirable Silica Exposure. Is Your Company Prepared?

In April 2018, Washington State adopted a rule that further regulates employee exposure to respirable crystalline silica (RCS), following OSHA’s publication of a similar—but less stringent—rule in 2016. Washington’s rule went into effect for the construction industry in October 2018 and will go into effect for occupations outside of construction on July 1, 2019.

Many companies are familiar with OSHA’s version of these rules and the general issues surrounding employee exposure to RCS. But with tighter regulation looming in Washington, here’s what you should know.

AdobeStock 32650255 concrete silica dustFirst, A Brief Introduction to RCS and Its Health Effects

Crystalline silica is a mineral found in stone, soil, sand, concrete, brick, paints, plaster, and other materials often used in construction and industrial activities. It becomes respirable when those materials are cut, ground, drilled, crushed, or otherwise manipulated in a way that creates dust.

Inhaling dust that contains crystalline silica particles can lead to several health issues, including silicosis (an incurable lung disease), lung cancer, pulmonary disease, and kidney disease.

Who is at Risk for RCS Exposure?

According to OSHA, 2.3 million people in the U.S. are exposed to silica in the workplace. Industries with high exposure risk include construction, refining, mining, and manufacturing.

Washington State Regulation of RCS

Washington State’s rule is similar to the federal rule, but more stringent in some ways. In addition to setting standards on what concentration of RCS employees can be exposed to, the rule also lays out specific requirements related to:

  • Required assessment of employee exposure to RCS, including personal air sampling.
  • Exposure control methods, which define engineering controls and work practices related to 18 specific work tasks with high RCS exposure risk, including use of certain tools.
  • Required respiratory protection for employees.
  • Housekeeping/cleaning practices to minimize exposure risk.
  • Medical surveillance.
  • Training and recordkeeping.

What This All Means in Practice

Not only should companies operating in Washington consider a review to ensure that they are in compliance with the new rule, but there are permitting issues at hand as well. New permits may be required if a company is installing pollution control devices in response to the rule, or additional reporting on related emissions may be necessary.

SoundEarth frequently helps clients assess regulatory compliance related to RCS exposure and advises on needed workplace adjustments, permitting considerations, and other related issues. For more information on RCS regulation, how it might affect your business, and what you can do to protect your employees and your business interests, please contact Corey League, Chris Kitchen, or Annika Wallendahl.

The South Sound Environmental Managers Forum

SoundEarth covered the risks of RCS and the details of the new regulations at a recent presentation in our Tacoma office. This presentation was part of a series of events we host monthly, called the South Sound Environmental Managers Forum, aimed at providing timely information on topics affecting environmental professionals and providing an open dialogue and networking opportunity amongst industry peers. If you’re in Tacoma or the surrounding areas and work in a capacity similar to an environmental manager, please join us for the next Forum! Email us for more information.

SoundEarth Hosts First South Sound Forum; Summary of Dangerous Waste and Community Right-to-Know Reporting

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Last Friday, SoundEarth hosted its first-ever South Sound Environmental Managers Forum in Tacoma. The idea behind this series of monthly events is to provide not only short, timely presentations on topics that affect environmental managers and their facilities, but also a place where they can share advice, ideas, concerns, and solutions with their peers away from the facility.

For our first round, we talked about Dangerous Waste and Community Right-to-Know Reporting. Here’s a peak at what we covered:

What is Solid Waste? What is Hazardous Waste?

We clarified RCRA’s definitions and the differences between listed hazardous waste and characteristic hazardous waste. In particular, here are the rules specific to listed waste that you should note:

Mixture Rule: A waste mixture that includes a RCRA-listed hazardous waste is automatically a RCRA-listed hazardous waste and carries the listing with the mixture. The chemical concentrations in the waste are irrelevant.

Derived from Rule: “Once a RCRA-listed hazardous waste, always a RCRA listed hazardous waste.” Waste generated from treatment, storage, or disposal is derived from a RCRA-listed hazardous waste. Ex. If listed waste is incinerated, the ash still carries the listed waste code even if the chemicals were destroyed during incineration.

Contained-in Rule: If you are disposing of soil or groundwater contaminated with a listed dangerous waste, you must manage the entire volume as if it were dangerous waste until it no longer contains the dangerous waste or is de-listed. Under Ecology’s contained-in policy, Ecology may determine that your contaminated soil or groundwater no longer contains a listed dangerous waste or is below risk-based levels.

Washington-Specific Waste Rules and Reporting

The “Dangerous Waste Regulations” are Washington State’s own set of rules that are more stringent than their federal counterparts, so we clarified the definitions of state-only dangerous waste and state-only special waste.

We also summarized what goes into Washington State’s Dangerous Waste Annual Report and who is required to submit one. There have been recent changes to the reporting system and to the requirements of the report. Most importantly, you should know:

  • Every site with an active EPA/State ID Number must submit a dangerous waste annual report to the Department of Ecology
  • Report Due Date: March 1
  • No extensions are given!
  • Submit all reports electronically through TurboWaste
  • 84-page guide for RY2018 available

Emergency Planning and Community Right-to-Know Act

The key purposes of EPCRA are to protect public health, safety, and the environment from chemical hazards; to create a partnership between, state, local agencies, tribal nations, and industry; to plan for emergencies and disasters; and to provide important information for first responders.

There are four reports that fall under EPCRA:

  • Emergency Response Planning
  • Emergency Release Notifications
  • Hazardous Chemical Inventory Reporting (Tier Two)
  • Toxics Release Inventory (TRI) Reporting  

This month, we covered Tier Two reports, their requirements and who is subject to them (tip, they’re also due March 1).

Next month, the South Sound Environmental Managers Forum will cover TRI Reports.

If you’d like more information on any of the above or are interested in receiving a copy of the presentation materials, please email us. Similarly, if you’re in Tacoma or the surrounding areas and work in a capacity similar to an environmental manager, please join us for the next Forum! Email us for more information.

Site Investigations, Remediation & Closure

SoundEarth provides a full suite of services to deliver development-ready sites from due diligence through regulatory closure. Our integrated services approach ranges from collecting data and developing the remediation cost estimates to implementing the final approach during construction. SoundEarth works with clients to transform a contaminated site into a clean site ready for development.

Our staff members have performed thousands of Phase I Environmental Site Assessments for private and public agency clients who required a thorough understanding and interpretation of the site, as well as a detailed presentation of anticipated remedial costs prior to purchasing or redeveloping a property.

A comprehensive understanding of environmental impacts associated with past, present, and future land uses allows our clients to strategically negotiate reductions in cost or to evaluate the feasibility of property redevelopment in conjunction with remediation.