Phase 1 Environmental Site Assessment Checklist
Most people treat the checklist like a form you fill out and send to a client. It is not a form. It is a roadmap for finding things that will come back to haunt you three years later when someone discovers a leaking underground storage tank that was there before you bought the property. I spent six weeks on a Phase 1 ESA for a former gas station in central Illinois. The chain-of-title search revealed a 1978 deed that referenced a "dewatering agreement" with the county. Everyone had skipped over it. The phrase meant nothing on its face. I spent two days tracking down the original county engineer's notes, which showed that the site had been dewatered because a previous owner had hit a contaminated gravel pit during excavation in 1976. That pit had never been properly. The Phase 1 ESA report caught it. The Phase 2 sampling budget doubled within forty-eight hours. The Phase 1 Environmental Site Assessment Checklist works because it forces you to look at six specific areas that nobody actually enjoys thinking about. These are the areas that matter.Phase 1 Environmental Site Assessment Checklist
1. Property Records and Chain of Title
You need the complete ownership history, going back forty years or to the construction of the first building on the site, whichever is longer. Start with the county recorder's office. Pull every deed, every lien, every mortgage. I have seen consultants skip this step because they found a recent title report online. The online report stopped at 2003. The original purchase in 1988 had been a trust transfer that never appeared in the public database. That 1988 owner had operated a dry cleaning business there from 1989 to 1997. Perchloroethylene was in the soil. The Phase 1 report was incomplete and the buyer was on the hook.2. Physiological Surroundings
Walk the property. Not Google Maps. Walk it. Look at neighboring properties. Is there a current or former industrial operation adjacent to the site? Gas stations, auto shops, manufacturing plants, landfills, land application sites. Check the direction of groundwater flow. If the neighboring property is upgradient and has contamination, it is coming to your site whether you like it or not. I had a case in Ohio where the neighbor was a former furniture factory that used chromated copper arsenate. The treated wood scraps were buried on-site. Six inches of rainfall per year pushed the contamination across the property line. The Phase 1 flagged it. The client still signed the deal. He wanted the building too badly.3. Interviews Talk to the owner. Talk to the occupants. Talk to the neighbors if you can find them. I once got a call from a neighbor who told me that the previous tenant had a small auto repair shop in the back of the building in 1994. She said they used to drain oil into the ground behind the building. The owner had no idea. The EPA had never been called. I added it to the report. The client walked away.
4. Regulatory Database Search
Get the Full Details
5. Physical Inspection
Look for storage tanks, both aboveground and underground. Look for spills, staining, unusual vegetation, and areas where the ground has been disturbed and not properly restored. I once found a set of buried drum lids hidden under a pile of concrete rubble behind a vacant warehouse. The rubble had been dumped in 2005. The drums were from the 1980s. No one had documented their removal. We had to bring in a contractor to carefully excavate around them and sample the soil.6. Report Writing and Conclusion
Your conclusion should be clear. Is the property a Recognized Environmental Condition or not? If you have one REC, the deal is still viable, but the buyer needs to know. If you have three or four, start thinking about liability protection. I have written reports where the client pushed back on calling something a REC because they wanted the deal to close. I do not change my conclusions. I write what I found and let them decide what to do with it. The Phase 1 Environmental Site Assessment Checklist is not expensive to complete, but it requires time. A typical Phase 1 takes between two and four weeks from start to finish, depending on the complexity of the property and the accessibility of records. If you are doing this for a busy commercial real estate transaction, plan for three weeks minimum. Rush it and you will miss something. There is no shortcut. The checklist works because it is thorough. It is not designed to impress anyone. It is designed to keep you from being responsible for a contamination problem that you did not create and did not disclose.
