Conducting Phase I Environmental Site Assessments (ESAs) must navigate the complexities of fees versus liability to provide crucial services. Balancing these aspects is essential for mitigating future liabilities while ensuring thorough assessments during due diligence.
Environmental consultants face significant risks during Phase I ESAs. The potential environmental liabilities discovered often exceed the fees and profits from these assessments. Inadequately performed ESAs or overlooked environmental issues have led to substantial financial consequences for firms, sometimes amounting to hundreds of thousands of dollars. This highlights the importance of thoroughness and accuracy in these assessments to mitigate risk and protect the environment, the borrower or lender, and the consulting firm.
According to LightBox EDR’s historical data[1], the average fee for a Phase I ESA rose 11% from 2018 to 2023, with costs ranging between $1,400 and over $7,500. These variations reflect factors like the assessment’s complexity and the property’s characteristics.
Report writing consumes the most hours in Phase I ESA-related tasks, LightBox EDR reports. The average hours per report across all aspects is twenty-five. A $75/hr. Consultant preparing the report costs $1,875, compared to $150/hr. Consultant at $3,625, not including profit and direct costs like travel, historical research fees, and regulatory fees. Investing more in a comprehensive ESA may be more cost-effective than missing a significant environmental issue.
Choosing a sub-$3,000 consultant for a Phase I ESA, regardless of the property’s apparent simplicity, could increase risks. Even straightforward properties can present unforeseen environmental challenges, affecting assessment accuracy and the project’s timeline and cost.
Firms conducting Phase I ESAs must adhere to professional standards like ASTM E1527-21 or local standards. Failing to meet these standards can lead to liability for missed or inadequately assessed environmental conditions.
The cost of a Phase I ESA reflects the required research and analysis, including a review of historical records, site visits, and potential environmental risk evaluation. Costs vary based on the expertise needed, especially for properties with complex histories or significant environmental issues and legacies.
Despite having professional liability insurance and contractual limitations of liability, firms can face significant business disruptions due to the time and expenses involved in litigation from oversights or inaccuracies in assessments.
Paying more for a Phase I ESA often results in a more comprehensive assessment. Higher fees enable exhaustive research, advanced technology use, and specialist engagement, leading to a thorough understanding of the property’s environmental status.
The fee for a Phase I ESA should align with the property’s specific complexities and risks. Industrial properties or those with hazardous material histories require more intensive assessment and review than simpler sites. However, low-risk sites can also reveal hidden environmental issues during assessments.
For example, a Phase I ESA on a rural property without apparent issues can become complex due to external factors like a neighboring gasoline tank leak. Such situations highlight the need for comprehensive and well-funded assessments to evaluate a property’s environmental status accurately.
The unpredictable nature of environmental risks emphasizes the importance of thorough and adequately funded Phase I ESAs to identify and address such risks effectively.
The implementation of ASTM E1527-21 in February 2023 introduced new considerations. This standard clarifies All Appropriate Inquiries (AAI) requirements and brings more precision to the assessment process. It mandates historical records for industrial properties, specific photographic and mapping requirements, and land title records detailing environmental liens or Activity/Use Limitations.
A notable update in E1527-21 is the approach to emerging contaminants. Until classified as a federal CERCLA hazardous substance, emerging contaminants like PFAS and PCB-containing building materials are optional in Phase I ESAs. This standard evolution reflects the dynamic nature of environmental assessments, where the cost of a Phase I ESA is a strategic decision to mitigate liability risks. Consequently, contaminants like PFAS and PCB-containing building materials, while not mandatory, can be included as a ‘non-scope consideration’ at the discretion of the Phase I ESA user.
While higher costs often lead to more thorough and reliable Phase I ESAs, balancing these costs with the property’s specific needs and risks is vital. The goal is a comprehensive understanding of environmental risks and conditions that support cost-effectiveness.
Investing more in a Phase I ESA is an investment in quality, risk management, and long-term cost-effectiveness, benefiting both the client and the consulting firm.
Phase I Environmental Site Assessments References:
SCS has a group of national experts working with all offices in North America to provide in-depth knowledge based on decades of experience supporting clients’ environmental needs. These resourceful people provide a wealth of information and guidance to support sustainable solutions in the industries SCS works in and with other professionals. Clients depend on the combination of SCS professional expertise, SCS leadership, and our roster of National Experts who consistently bring value to each solution. With the expanded leadership, SCS’s third generation can create even more sustainable solutions to environmental challenges. The firm announces its newest national experts as follows:
Anaerobic Digestion – Erik Anderson, PhD, is a Senior Project Manager. He has 14 years of engineering and process design experience in the renewable fuels sector, including anaerobic digestion, pyrolysis to syn-gas generation, and zero-liquid discharge technologies. He has worked on projects from initial concept development through front-end engineering design and construction management. His work includes modeling renewable energy technologies for economic comparison or life-cycle analysis. He is the inventor of several U.S. patents related to bioenergy and served as commissioner on the National Biodiesel Accreditation Committee from 2014-2021.
Brownfields Grants – Melissa Schick’s expertise includes preparing successful brownfields grant applications, helping public and private-sector clients navigate state and federal brownfields redevelopment and voluntary cleanup programs and closeout requirements, implementing and completing brownfields redevelopment projects, coordinating and communicating with all stakeholders.
Clean Air Act & NSPS – Josh Roth, PE, is a Project Director with the Landfill Gas (LFG) practice, serving on many LFG engineering projects involving LFG remediation system design, emissions inventories and air permitting, migration and odor control, ambient air sampling and reporting, LFG and CER due diligence projects, GHG emission mitigation and reporting, field sampling and assessments, and general emissions control projects. Roth regularly publishes and presents at industry and regulatory events, often appearing in client webinars, and leads one of SCS’s internal “University” training sessions monthly.
Elevated Temperature Landfills – Bob Dick, PE, works on civil and environmental engineering projects related to solid waste management. He has worked on over 25 major landfill multi-task assignments and performed over 150 landfill gas projects – some of the toughest in the US. His work involves landfill gas migration control, odor control, emissions control, Clean Air Act compliance, energy recovery and utilization, and carbon credit monetization. Dick is part of the SCS team that developed technical standards for the largest waste operator in the U.S. to implement in active and future disposal cells to prevent the formation of ETLF conditions in landfills. He incorporates these standards into the best management practices of landfill management teams globally.
Odor Management – Paul Schafer. Many of today’s waste management strategies and facilities lower GHGs. They, along with agricultural production, can emit odors. SCS has two National Experts to address industrial needs. Schafer leads Ambient Air Monitoring Services and plays key roles in significant national monitoring efforts. He has in-depth experience in interfacing with regulatory agencies regarding the performance of monitoring systems, source emission tests, and odor assessments, as well as with federal and state agencies regarding monitoring programs and air quality impact assessments, particularly for agriculture.
Odor Management – Patrick Sullivan, BCES, CPP, REPA. Sullivan is SCS’s National Expert for Clean Air Act (CAA) programs and leads the firm’s GHG, Sustainability, and CAA services. With over three decades of experience, he is often sought after to mitigate odors and analyze potential exposure for solid waste and industrial facilities. Sullivan is also a Senior Vice President and Principal-in-Charge for air quality permitting and compliance projects, GHG emissions, and climate change. Pat is a Harvard-degreed scientist, a Registered Environmental Property Assessor, Board Certified Environmental Scientist, a Certified Permitting Professional in the South Coast Air Quality Management District, and an accredited Lead Verifier under the California Air Resources Board (CARB) AB 32 Greenhouse Gas (GHG) programs.
Sustainable Planning – Steven Stewart, PE, PMP. Stewart is responsible for project development and client account manager for those with a sustainability focus. He has more than two decades of experience within the Environmental Consulting and Manufacturing Industry, providing strategic thinking related to project planning, regulatory strategy, and developing sustainability initiatives. Stewart leads projects related to energy efficiency measures, GHG reduction, carbon sequestration, water reuse and stewardship, and solid waste minimization and recycling programs. He has managed and performed permitting and compliance audits, developed environmental management systems, long-term environmental planning, and environmental sustainability capital projects. His background includes serving as Environmental Manager and Capital Projects Portfolio manager at a large steel manufacturing facility.
Over the years, SCS expanded and hired many talented people. They guide the firm, maintaining the founders’ focus and culture of adopting their clients’ environmental challenges as their own and fostering a culture of success for employees and communities.
The firm has won multiple awards for helping clients minimize waste generation, effectively managing recycling, collection, and disposal operations, renewable energy, safely cleaning up contaminated properties, protecting wastewater and groundwater, and cutting GHG emissions.
These employee-owners are most proud of the difference they make for their clients and communities as trusted partners. SCS clients entrust the firm with managing more than 35 million metric tons of anthropogenic CO2e greenhouse gases yearly. SCS collects and beneficially uses or destroys enough to offset greenhouse gas emissions from 7.4 million passenger cars annually. That’s more than any other environmental firm in North America.
Partial reprint of EPA’s Announcement dated January 11, 2024
WASHINGTON – The U.S. Environmental Protection Agency on Thursday announced a proposal to strengthen Clean Air Act standards for large facilities that burn municipal solid waste. If finalized, the updated standards would reduce emissions of nine pollutants, including smog- and soot-forming sulfur dioxide and nitrogen oxides, by approximately 14,000 tons per year, improving air quality for overburdened communities living near these facilities. These proposed standards reflect current technologies available to control pollution in a cost-effective fashion.
The proposed standards would apply to 57 facilities with 152 units that have the capacity to combust more than 250 tons per day of municipal solid waste. Nearly 4 million Americans live within 3 miles of these large facilities, which are disproportionately located in low-income communities and communities of color.
The proposed standards are based on emission levels achieved by the best controlled and lower-emitting sources, and limit emissions of nine pollutants: particulate matter, sulfur dioxide, hydrogen chloride, nitrogen oxides, carbon monoxide, lead, cadmium, mercury, and dioxins/furans.
The Clean Air Act requires EPA to evaluate these standards every five years in order to take into account developments in pollution control technologies and techniques. EPA last revised these standards in 2006.
After accounting for compliance costs of the rule, EPA estimated the net present value of health benefits from the proposed rule, due to reductions in particulate matter and ozone alone, to be up to $14 billion over 20 years. Reductions of mercury, lead, and other hazardous air pollutants required by the proposal are expected to result in additional unquantified economic and public health benefits.
EPA will accept comment on the proposal for 60 days after publication in the Federal Register. EPA will hold an informational webinar and will announce details on its website shortly.
Additional Resources:
Talk with SCS Engineers professionals at the 2024 Solid Waste Operator Conference on February 21 at the St. Cloud Holiday Inn and Suites in St. Cloud, MN.
The conference is a joint effort of the Minnesota Chapter of the Solid Waste Association of North America (SWANA) and the Air and Waste Management Association’s (AWMA) Upper Midwest Section and is focused on safe and effective operations of solid waste facilities in compliance with all applicable regulations. The conference will also emerging issues affecting the management of these facilities. Topics will include:
Click for more conference details and registration information.
We hope to see you there!
SCS Engineers is participating in the Kennesaw State University’s STEM Job, Internship, Co-Op Fair, February 27-29 at the Marietta, Georgia, campus.
This event is a great opportunity for students to speak with SCS about an internship or career in engineering or STEM.
SCS is an employee-owned, award-winning environmental engineering, consulting, and construction firm with offices nationwide. We are seeking a wide variety of dedicated, hard-working professionals with Science, Technology, Engineering, and Mathematics (STEM) backgrounds.
SCS Engineers is participating in the 2024 K-State Engineering Expo on February 13-15, 2024, at the Engineering Complex.
This event is a great opportunity for students to speak with SCS about an internship or a career in engineering or STEM.
SCS is an employee-owned, award-winning environmental engineering, consulting, and construction firm with offices nationwide. We are seeking a wide variety of dedicated, hard-working professionals with Science, Technology, Engineering, and Mathematics (STEM) backgrounds.
SCS Engineers is participating in Michigan State University’s Big 10 Engineering – Diversity & Inclusion Career Event (Virtual) – 2024 on January 23.
This event is a great opportunity for students to speak with SCS about an engineering or STEM career.
SCS is an employee-owned, award-winning environmental engineering, consulting, and construction firm with offices nationwide. We are seeking a wide variety of dedicated, hard-working professionals with Science, Technology, Engineering, and Mathematics (STEM) backgrounds.
SCS Engineers is participating in the University of Florida’s Engineering School of Sustainable Infrastructure & Environment (ESSIE) Evening with Industry, February 27, Stephen C. O’Connell Center.
This event is a great opportunity for students to speak with SCS Engineers about engineering and STEM careers. This biannual fair continues to be a niche event, serving students and alumni seeking Civil, Coastal or Environmental internships and employment opportunities. ESSIE undergraduate and graduate students, as well as our ESSIE alumni are welcome to attend.
This event is free to all ESSIE students and alumni.
SCS is an employee-owned, award-winning environmental engineering, consulting, and construction firm with offices nationwide. We are seeking a wide variety of dedicated, hard-working professionals with Science, Technology, Engineering, and Mathematics (STEM) backgrounds.
Join SCS Engineers stormwater professionals, including our National Stormwater Expert, Jonathan Meronek, at StormCon 2024, August 27-29 at the Grand Sierra Resort and Casino in Reno, NV.
StormCon 2024 is the stormwater industry’s premier event connecting stormwater and surface water managers, erosion control specialists, and engineers from around North America for idea-sharing, information exchange, and networking. Featuring a multi-track conference program led by top leaders in the industry, StormCon 2024 provides exceptional opportunities to learn, engage and build key contacts. Topics this year may include:
The StormCon 2024 conference provides plenty of networking opportunities, certification courses, and an exhibit hall.
Click for more conference details and registration information.
Meet SCS Engineers professionals at the Environmental Bankers Association’s 2024 Annual Conference February 6-8 at the Catamaran Resort Hotel and Spa in San Diego.
The conference features networking opportunities, exhibitors, and numerous educational sessions.
Click for more details and registration information
We hope to see you there!
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