New Standards Provide Guidance for Environmental Diligence, Superfund Liability Protections

In recent months, ASTM International ("ASTM") has issued or revised key environmental standards governing the performance of and response to environmental site assessments, with potentially significant impacts for lenders, developers and owners of contaminated property.

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Before contaminated property is sold or remediated, federal and state law and transactional due diligence generally require an environmental site assessment to be conducted pursuant to ASTM standards. Such assessments may be undertaken to preserve the innocent landowner, bona fide prospective purchaser, or contiguous property owner defenses to Superfund liability, which require "all appropriate inquiries" into the environmental conditions on a given site and impose "continuing obligations" to stop, prevent, or limit human exposure to hazardous substance releases.

Under EPA regulations, compliance with ASTM's Phase I site assessment standards (E1527-05 or E2247-08) is sufficient to establish "all appropriate inquiries" for the purpose of these defenses.

After more than two years of review and deliberation, ASTM recently revised its Standard Practice for the Phase II Environmental Site Assessment Process (E1903-11). Phase II site assessment involves the sampling of soil, groundwater or other exposure pathways, typically after a Phase I reveals a likelihood of contamination. While Phase II assessments are not required under Superfund regulations, they can be useful in determining what "continuing obligations" are needed to establish landowner liability protections. Phase II assessments may also be required as part of transactional due diligence or to inform a company's disclosure of its environmental liabilities.

Article continues:  http://blog.sprlaw.com/2011/10/new-standards-provide-guidance-for-environmental-diligence-superfund-liability-protections/