Part 1: The “User”
This is the first in an occasional series intended to address some of the most often asked questions about Phase I Environmental Site Assessment (ESA) reports
By: Nate Weismiller
We often get asked who, or what entity exactly is the “user” of a Phase I ESA report. As defined in ASTM E1527-13 (section 3.2.98), the “user” is:
The party seeking to use Practice E1527 to complete an environmental site assessment of the property.
The ASTM standard goes on to state that the “user” may include, without limitation, any of the following:
- a potential purchaser of property
- a potential tenant of property
- an owner of property
- a lender
- a property manager
A “User Questionnaire” is included in Appendix X3 of the ASTM E1527-13 standard, and is intended to permit the “user” of the Phase I ESA report to satisfy one of the requirements to qualify for one of the Landowner Liability Protections (LLPs) on CERCLA liability. As provided in Appendix X3, the questionnaire is relatively short and consists of the following:
- Did a search of land title records identify any environmental liens filed or recorded against the property?
- Are you aware of any Activity and Use Limitations (AULs) in place or filed against the property?
- Do you have any specialized knowledge or experience related to the property?
- Does the purchase price being paid for the property reasonably reflect the fair market value of the property?
- Are you aware of any commonly known information about the property that would help to identify environmental concerns?
- Based on your knowledge and experience related to the property, are there any obvious indicators that point to the presence or likely presence of contamination at the property?
Although completion of the “User Questionnaire” is an often overlooked part of the Phase I ESA, its completion is one of the components necessary for the report to be considered complete. Lenders or property owners are often reluctant to complete the questionnaire in the mistaken belief that they can be found liable if the Phase I ESA identifies environmental concerns. In fact, the opposite is true. Completion of the questionnaire allows lenders, property owners, or any other potential “user” to qualify for one of the LLP protections on CERCLA liability. So, even if you do not have any information regarding the property, the best course of action is to mark “unknown” on the questionnaire and return it to the environmental professional.