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Phase 1 Environmental
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Phase 1 Environmental Site Assessment Requirements:

Our Phase 1 Environmental report adheres to the American Society for Testing & Materials E-1527-13 standard. This report complies with United States Environmental Protection Agency 40 Code of Federal Regulations Part 312. Our reports conducted in Canada adhere to CSA Standard Z768-01 for Phase 1 Environmental Site Assessments.

A national leader in the environmental assessment industry!

With our team being located within virtually every major city in the U.S., we are able to complete Phase 1 Environmental reports economically and fast! Over 5,000 projects completed and we have never had a report rejected by a lender and we have never been sued for errors or omissions. We do carry $2 million Professional Liability/Errors & Omissons insurance, as well as, $1 million in auto insurance, so you are protected when you hire AAI to conduct your report and visit your property.

Having provided due diligence services on over $2 billion in real estate and business transactions, AAI has gained insightful judgment in providing our clients with our excellent services. Our extensive experience helps our clients make informed decisions regarding existing or potential environmental liabilities, when they are purchasing or leasing a property or business.

Our reports are regularly accepted for SBA loans and include the required reliance letter.

What is performed in a Phase 1 Environmental report by AAI:

  • historical building permits review
  • historical aerial photograph review
  • historical Sanborn Fire Insurance Map review
  • historical city directory review
  • historical topo map review
  • local environmental oversight agency interviews
  • analysis of local hydrogeologic conditions
  • government environmental database review
  • inspection of subject property and surrounding areas
  • interviews with owners, occupants and neighboring tenants (for abandoned properties)
  • a detailed professional site plan
  • digital photographs with descriptions
  • inclusion of the Statement of Qualifications of assessors
  • conclusions regarding significant environmental liabilities using risk-based analysis
  • recommendations.

New Phase 1 Environment standard items from ASTM Standard E-1527-13:

As of December 31, 2013 EPA finalized a rule that the new ASTM Standard E-1527-13 is as a standard by which parties may comply with the "All Appropriate Inquiries" Rule, 40 CFR Part 312. EPA indicated that it does intend to propose an amendment to 40 CFR Part 312 removing reference to the E1527-05 standard. EPA does recommend that the new standard be used.

The new standard does not have any substantial changes to the previous standard. Items such as vapor intrusion and regulatory file reviews are something that our company has conducted previously as part of a “common sense” approach to identifying potential significant environmental liabilities based on proper scientific analysis of available information that helps determine the potential for releases into the soil and/or groundwater at a property. The new standard includes the following clarifications and revisions.

  • A new term has been added called "Controlled Recognized Environmental Condition (CREC), " which is a recognized environmental condition resulting from a past release of hazardous substances or petroleum products that has been addressed to the satisfaction of the applicable regulatory authority (for example, as evidenced by the issuance of a no further action letter or equivalent, or meeting risk-based criteria established by regulatory authority), with hazardous substances or petroleum products allowed to remain in place subject to the implementation of required controls (for example, property use restrictions, activity and use limitations, institutional controls, or engineering controls).

    This is typically associated with industrial properties that have been cleaned up to the satisfaction of the oversight agency, but have residual contamination and cannot be redeveloped for residential due to this "controlled" condition.

  • A new simplified definition of a "Recognized Environmental Condition (REC)" is “the presence or likely presence of any hazardous substances or petroleum products in, on, or at a property: (1) due to any release to the environment; (2) under conditions indicative of a release to the environment; or (3) under conditions that pose a material threat of a future release to the environment.”

  • The new standard more clearly states that vapor intrusion contaminant pathway should be considered and states that ASTM E-2600 is not a requirement for a Phase I ESA. Again, this common sense approach has been already previously been performed by our company due to the potential significant liabilities that vapor intrusion into a building can create due to worker exposure, property devaluation and use limitations due to the presence volatiles in the soil and/or groundwater beneath the subject property. We will continute to consider vapor intrusion/encroachment as a potential liability due to the release of VOCs into the subsurface on or nearby to the subject property.

  • The User requirement of doing a judicial records review (through the clerk’s office) should be conducted by a Title professional. The User or Client continues to be responsible for having a title company search deeds for liens and activity and use limitations.

  • If the subject property or any adjoining property is identified in government records search, pertinent regulatory files and or records associated with the listing should be reviewed at the discretion of the Environmental Professional. If in the EP’s opinion such a file review is not warranted, the EP must provide justification in the Phase I report. As an alternative, the EP may review files/records from an alternative source(s) (for example, on-site records, user provided records, records from local government agencies, interviews with regulatory officials or other individuals knowledgeable about the environmental conditions that resulted in the standard environmental record source listing, etc.). Summary of information obtained from the file review shall be included in the Phase I report and EP must include opinion on the sufficiency of the information obtained. Again, this is something that our company has previously done to identify any potential significant environmental liabilities from known releases on or nearby to the subject property.

  • The new standard also includes minor revisions to the User Questionnaire.

Phase 1 Environmental Assessment items in ASTM Standard E-1527-05:

Additional Scope of Work Required by 40 CFR Part 312 for Phase 1 Environmental report.
  • Codified into federal law (40 CFR Part 312) on November 1, 2005.

    The new standard was approved by the EPA on December 31, 2013.
  • ASTM Standard for the rule is: ASTM E-1527-05.

    The new ASTM Standard is ASTM Standard E-1527-13.
  • Defines the term Environmental Professional (EP) and establishes qualifications for those performing Phase 1 ESAs (hold a current Professional Engineer or Professional Geologist license or registration from a state, tribe, or U.S. territory (or the Commonwealth of Puerto Rico) and have the equivalent of three years of full-time relevant experience OR 4 year Baccalaureate degree in any engineering or science field with five years of full-time relevant experience OR ten years of full-time relevant experience).

  • In addition to interviewing current owners and occupants of the subject property, an interview with past owners and occupants must be conducted as necessary [Section 312.20(e)-(f)].

  • Interview with neighboring or nearby property owners or occupants must be conducted if the subject property is abandoned.

  • Previous use of the property needs to be described from the present back to when the property first contained structures or was developed for residential, commercial, agricultural, industrial or governmental purposes.

  • More information requested from the User of the report (person for whom the report is being prepared).

  • United States Environmental Protection Agency (EPA) rule requires identification of records of Activity and Use Limitations (AULs) and Environmental Cleanup Liens.

  • In addition to the review of federal and state records, the ESA must include a review of (all) local and tribal records within the required search distance of the Property.

  • Visual inspection of the subject property and adjoining properties is required (limited exemption with specific requirements if the subject property cannot be inspected).

  • EPA rule looks at the relationship of the purchase price compared with the fair market value of the property which may indicate contamination at the property.

  • Data gaps must be identified with the significance of the data gap with regard to the ability of the EP to identify conditions indicative of releases and threatened releases.

  • Shelf life of Phase 1 Environmental report is specified as one year with some updates required after 180 days.

    A copy of the published EPA rule can be downloaded by clicking the following link:
    Download the EPA Rule for Phase 1 Environmental Site Assessments.

Phase I Environmental Advice

The Phase 1 Environmental Site Assessment report is a specific study for the presence or potential presence of hazardous substance or petroleum product releases into the soil and/or groundwater, as well as, into structures, which can migrate through the floor to the subsurface. The Phase 1 ESA report does not include the study of building materials or building systems. To obtain a proper Phase I Environmental Study, you should hire a geologist, engineer or scientist with knowledge of soil science, groundwater hydrology and regulatory conditions.

Many "home inspectors" and "building inspectors" are providing "expert" Phase I Environmental reports without the abovementioned educational and work background. A survey of building materials typically falls within an asbestos or lead-based paint survey or an assessment of the building systems by a Property Condition Assessment, prepared according to ASTM Standard E-2018-08. This assessment should be conducted by a Professional Engineer or Architect. Building materials are specifically excluded from the Phase I Environmental Site Assessment standard. Understanding soil science, contaminant hydrogeology and extensive experience in remediation provides the ideal background for being able to conduct the proper risk analysis for ongoing or previous environmental cleanups in the area of the subject property. This understanding is essential to help identify and properly analyze potential offsite sources for a problem with the subject property, such as: Vapor Intrusion.

Finding a qualified Environmental Professional to conduct a Phase I Environmental report is easy and is recommended. Whether you hire AAI or another qualified consultant, this is the best course of action. Hiring a building inspector or home inspector to conduct a Phase I Environmental Assessment is analogous to hiring a roofer to install a water well. The knowledge and scope of work are two different disciplines and if the "expert" starts discussing the building materials, you may want to seek out a Professional Geologist or Engineer. The price is typically the same and you are getting a study and report from a professional in the field of environmental consulting. Hiring an established company has many benefits, including: the ability to rely on the report by lenders, future updates to the report, experienced professionals, a reliable company that will be around to stand behind its reports, etc. The value of the report is based on the ability of the client to rely on the report in the future.

Standard for Phase 1 Environmental Site Assessments

Since the Phase 1 Environmental ASTM Standard is copyrighted, we cannot post a copy here. However, you can read a summary by clicking the following link and you can purchase a copy at the American Society of Testing & Materials, as well.

American Society for Testing & Materials Standard E-1527-13 Standard Practice for Environmental Site Assessments: Phase 1 Environmental Site Assessment Process

AAI's reports performed throughout Canada adhere to CSA Standard Z768-01 (November 2001), Phase I Environmental Site Assessment.

Environmental Desktop Review report

For some low-risk properties, a more affordable Environmental Desktop Review may suffice for your real estate transaction.

AAI has completed over 5,000 reports completed throughout North America!

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What is the purpose of a Phase 1 Environmental Study?

The purpose of the Phase 1 Environmental Audit is to determine if "Recognized Environmental Conditions" exist at a subject property. The following definition of Recognized Environmental Conditions is from the ASTM Standard for Phase I Environmental Site Assessments.

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 per the ASTM Standard E-1527-05 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, ground water, 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 and 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.

AAI Environmental Corporation

Our Phase 1 Environmental reports have been universally accepted by lenders. All of our environmental site assessments are fully insured and certified.

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Additional Phase 1 Environmental Report Information

SBA Loan Environmental Due Diligence Reports

AAI also has extensive experience in performing Environmental Due Diligence reports for Small Business Administration (SBA) loans for a variety of properties, including: gas stations, retail centers, commercial properties and industrial properties. AAI includes the reliance letter required by the SBA for free. The SBA's Standard Operating Procedures (SOP 50-10(5)) for 7A and 504 loans that went into effect in August of 2008 are essential for approval of your loan application. These new procedures have specific standards that must be adhered to for certain industries with potential for environmental liabilities. AAI Environmental will make sure your due diligence reports adhere to these requirements. Otherwise, your loan could be rejected. When applying for a commercial mortgage, hiring a consultant with experience in conducting these environmental reports is important for your new or existing business venture.

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AAI has extensive experience in conducting Phase 1 Environmental Site Assessments on service stations, dry cleaners, industrial properties, retail centers, auto repair facilities, agricultural properties, office buildings and residential properties throughout North America, including Canada and Mexico. We bring a vast amount of project experience in conducting environmental assessments. This experience is invaluable for making the correct evaluation of potential issues on properties. Good judgment comes with experience.

The History and Origins of Phase 1 Environmental Site Assessments
(otherwise known as: Phase I Environmental reports, Phase One ESA, Due Diligence)


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Phase 1 Environmental sample

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Lender-approved and trusted, AAI Environmental Corporation's Phase 1 Environmental Site Assessment reports have been universally-accepted in every state in the union. Fast, accurate, economical and fully-insured reports are certified by an EPA-compliant "Environmental Professional."

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Phase 1 Environmental consulting, as well as, Phase 2 and 3 Environmental Site Assessments.
NEPA Studies, Property Condition Assessments, Expert Witness, Due Diligence, UST closure, Remediation, Oilfiled Assessments.

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Phase 1 Environmental News

A new ASTM standard E-1527-13 Standard Practice for Environmental Site Assessments: Phase I Environmental Site Assessment Process went into affect as of December 31, 2013.

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AAI Environmental Corporation
#1 choice in Phase I Environmental Site Assessments

Good judgment comes with experience.

Our clients range from large companies to homeownes and include the following companies:

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Phase One Environmental Consultants

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AAI Environmental Corporation is also one of the nation's leaders in due diligence and NEPA reporting for proposed cellular, radio and television broadcast towers.

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How much does a Phase 1 Environmental investigation cost?

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Recognized Environmental Conditions

Recognized environmental conditions per ASTM Standard typically include but not limited to: former gas stations, dry cleaners, long-term light-industrial, industrial, agricultural and other previous uses. Signs of potential releases of chemicals can be heavy staining, improper storage of chemicals, underground storage tanks, dry cleaning plants, clarifiers, etc.

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When does Phase 1 Environmental require a Phase 2 Environmental Study?

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Questions about a Phase 1 Environmental report? Call us toll free: 888-221-0297. If you need to get a quote for a Phase 1 Environmental report cost, please click here.

Frequently Asked Questions about Phase 1 Environmental

List of Recent Phase 1 Environmental reports

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From Los Angeles to the Bay Area to San Diego to Oakland to San Francisco to Seattle to Denver to Dallas to Houston and to New York to New Jersey to Miami and Orlando, as well as, Nashville, Atlanta and New Orleans, AAI conducts Phase I Environmental Site Assessment reports throughout the country regularly, also including cities like: Louisville, St. Louis, Oklahoma City, San Antonio, Charlotte, Raleigh, Cleveland, Columbus and Cincinnati. and Knoxville, Memphis and Chattanooga. We have your area covered if you are within the United States, including Puerto Rico. We have also completed reports in Canada and Mexico. We are a proven company that gets the job done, no matter where the location.

What are common uses where issues are found in a Phase 1 Environmental Assessment?

Common uses where environmental concerns are found in a Phase 1 Environmental report include:

  • Service stations
  • Manufacturing facilities
  • Dry cleaners
  • Industrial sites
  • Longterm auto repair
  • Oil and gas well drilling and production
  • Former agricultural crops
  • Refineries
  • Underground storage tanks
  • Other sites with releases of chemicals into the subsurface.

These uses don't necessarily always create Recognized Environmental Conditions, as it depends on how long they have been in operation, secondary containments, housekeeping, proper monitoring, and other factors. A general rule of thumb is if these types of facilities have been in operation for long periods of times, the more likely will RECs be found during a real estate transaction. When a REC is found in the Phase 1 Environmental Assessment, it will typically trigger a Phase 2 Study, which requires soil and/or groundwater sampling to determine if there is a significant environmental liability in the subsurface.

We have completed thousands of projects in Tennessee, Texas, California, New York, Florida, Georgia, Washington, Colorado, Missouri, Kentucky, North Carolina, New Jersey, Ohio, Alabama, and every other state. Rest assured that your report will be completed on time and within budget.