Posted: October 22nd, 2010 | Author: Bob | Filed under: Wetlands | Comments Off on Court Enjoins Army Corps of Engineers From Extending Regulatory Jurisdiction Over Former Wetlands
On September 28, 2010, the Southern District of Florida awarded summary judgment to New Hope Power Company in its suit seeking to enjoin the U.S. Army Corps of Engineers (ACOE) from applying rules pertaining to its regulatory jurisdiction over certain former wetlands, which had been issued through agency memoranda. The court held that the agency had failed to properly promulgate the rules through the notice-and-comment rulemaking procedures required under the Administrative Procedure Act (APA). The decision has wide import, as it directly affects approximately 700,000 acres within the Everglades Agricultural Area (EAA), and other hydrologically managed lands nationwide for which non-agricultural uses may be proposed. SPR represented New Hope Power Company in the suit.
New Hope owns and operates a renewable energy facility in the EAA, an area of the Florida Everglades that was formerly wetlands but has been hydrologically managed through pumps and drainage systems since the mid-20th century to allow for agriculture. New Hope’s facility, constructed on former sugarcane fields, generates electric power through the burning of non-usable portions of sugarcane as well as wood waste. New Hope recently obtained state and local permits to construct a monofill on neighboring land, currently farmed for sugarcane, where it could place ash from the waste-burning operations, and thereby avoid trucking the ash to a distant landfill.
Existing ACOE regulations under the Clean Water Act provide that a permit is needed to conduct certain activities within wetlands. However, exempt from the definition of wetlands are lands that do not support wetlands vegetation under normal circumstances. The ACOE had in past rulemaking documents explained that “normal circumstances” was not to be read to include properties that had been transformed into dry land. Also exempt from regulations are “prior converted croplands,” lands formerly wetlands but converted to agricultural use. Rulemaking documents previously issued by the ACOE provided that a prior converted cropland could only lose such designation if wetland vegetation returned. In 1993, the ACOE had determined that the land on which New Hope’s power facility is built was prior converted cropland. In addition, the ACOE’s Wetlands Delineation Manual provides that in order to be a regulated wetland, land must exhibit both wetlands hydrology and vegetation, unless one of three types of “atypical situations” apply: (1) an unauthorized activity resulting in the loss of one of these characteristics; (2) man-made creation of a wetland; or (3) natural events.
However, in 2009, the ACOE issued internal memoranda interpreting “normal circumstances” in hydrologically managed lands to mean “pumps off,” and stating that prior converted croplands lost such designation upon a change to non-agricultural use. Based on these memoranda, the ACOE informed New Hope that it would likely need a permit to construct the proposed monofill. New Hope filed a lawsuit challenging the memoranda as legislative rules that the ACOE had failed to promulgate in accordance with the APA. The court agreed, holding that the memoranda extended the ACOE’s regulatory jurisdiction beyond that provided for in existing regulations, and diverged from the Wetlands Manual in deeming lands hydrologically managed with ACOE authorization an “atypical situation” to which the general delineation rules did not apply. The court therefore enjoined the ACOE from applying these new rules.
Posted: October 5th, 2010 | Author: Bob | Filed under: Phase I ESA | Comments Off on Proposed Changes to ASTM Phase II Due Diligence Standard Would Dramatically Increase the Time and Cost for Completing Environmental Due Diligence
This artical reprinted from Holland & Knight Partner, Amy Edwards. Click to orignal.
ASTM continues to move forward with planned changes to the standard for conducting Phase II Environmental Site Assessments (ESAs) (ASTM E 1903). If approved, these changes would impose drastic new obligations on Users (i.e., the parties commissioning the reports) and likely increase the time and cost for completing environmental due diligence investigations. Parties involved in commercial real estate and M&A transactions need to be aware of, and involved in, these ongoing discussions.
The ASTM Standard Guide on the Phase II Environmental Site Assessment Process was first published in 1997 and reapproved in 2002. The current changes have been underway for a couple of years and are proceeding under the auspices of the ASTM E50.02 Task Group. The Task Group has stated that it hopes to make the Phase II process more transparent and consistent with scientifically sound methods, with the goal of making the process more “objective, representative, reproducible, and defensible” (Section 1.1). While all of this sounds good in theory, it will require dramatic changes in the way in which Phase II ESAs are conducted in order to achieve these lofty goals. The proposed changes will require the Phase II Assessor and the User to examine issues that go well beyond CERCLA liability, including looking for the mere presence (not releases) of substances (not just hazardous substances or petroleum products) on the property. The scope of the Phase II ESA will be directly related to the User’s objectives and may require refinement as the investigation progresses. More than one round of sampling may be required to achieve the User’s objectives. The Phase II process would also become much more prescriptive (in particular, see Sections 5, 6 and 7) than it is at the present time if the proposed changes are adopted.
Nature of the Proposed Changes
The proposed changes to ASTM E1903 would require, among other things, that the User and/or the Phase II Assessor do the following:
- confer before initiating the investigation to determine the “question” to be answered (Section 6.4.1 and Section 7.1); the Standard identifies six potential objectives (Section 1.2) that can be addressed in the assessment:
- to assess whether there has been a release of hazardous substances within the meaning of the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA), for purposes including the landowner liability protections under CERCLA
- to provide information relevant to identifying, defining and implementing “continuing obligations” for maintaining CERCLA landowner liability protections
- to develop threshold knowledge of the presence of substances on properties defined as brownfields sites as required for qualifying for brownfields remediation grants
- to provide information relevant to identifying property conditions associated with target analytes that may pose a risk to persons on the property
- to provide information relevant to evaluating and allocating business environmental risk in transactional and contractual contexts, and related due diligence
- to provide information to support disclosure of liabilities and contingent liabilities in financial statements and securities reporting
- prepare a written Statement of Objectives (Sections 5.1.1 and 6.4.1), including a statement of the question to be answered and the hypothesis to be confirmed or refuted by the investigation; the statement must be part of the scope of work, contract or similar instrument
- prepare a written scope of work, identifying the methods and tasks to achieve the User’s objectives (Section 5.1.4 and Section 7)
- identify any predetermined limits on the scope of work because of schedule, cost or budget considerations (Section 5.1.2); in other words, if the User is not willing to spend more than $12,000 on the Phase II ESA, and/or needs the results within 45 days, that limitation must be shared with the Phase II Assessor before the work begins, and must be described in the final report
- develop a conceptual model (Sections 6.4.3 and 7.4); the conceptual model must consider each area where target analytes are present or likely present, in light of the environmental behavior, fate and transport characteristics of those target analytes; the Phase II Assessor must determine how the target analytes are likely to have first entered the environment and infer the locations most likely to be impacted by the target analytes (Section 6.4.3)
- develop a written sampling plan after developing the conceptual model (Sections 6.4.4 and 7.5)
- conduct the sampling (Sections 6.4.5 and 7.6)
- include a Quality Assurance/Quality Control Plan (Section 7.5.7)
- validate the conceptual model by evaluating the sampling results to determine whether the available information is consistent with the conceptual model (Sections 6.4.6 and 7.7)
- in the event of deviations (i.e., the results are not consistent or do not support the assumptions of the conceptual model), revise the conceptual model and sampling plan to meet the objectives of the assessment (Sections 6.4.6 and 7.6)
- interpret the sampling results in light of the conceptual model and the objectives of the assessment in order to develop conclusions, either answering the question or stating why the question cannot be answered (Sections 6.4.7 and 8.1)
- prepare a written report (Sections 6.4.8 and 9.2)
If all of the requirements of the Standard have been followed, the Phase II Assessor is required to put the following statement in the final report:
“We have performed a Phase II environmental site assessment at the property at [address] in conformance with the scope and limitations of ASTM E1903-xx and for the following objectives: [list “statement of objectives” developed pursuant to Section 5.1.]”
What Will These Changes Mean in Practice?
For the User, it will no longer be sufficient to simply request that a Phase II ESA be conducted. The User will need to confer with the Phase II Assessor to explain what it hopes to accomplish in the investigation and should share with the Assessor all of the existing environmental information in its possession. Here is an example:
The subject property previously had an auto repair facility on it and there were a number of suspect sources (dry cleaners, gas stations, heating oil tanks, etc.) in the immediate vicinity of the site.
- What does the User want to know, and which of the six identified objectives is relevant?
- Does the User simply want to confirm whether the auto repair facility has had any releases for purposes of establishing a defense to CERCLA liability? For purposes of allocating business environmental risk in the context of a planned transaction? For purposes of reporting contingent liabilities to the Securities and Exchange Commission?
- Does the User want to confirm whether the nearby dry cleaners, gas stations and heating oil tanks have impacted the property? Does the User need to know this with a reasonable degree of certainty, because it plans to redevelop the property, or does it simply want a present/not present determination?
- Are there any limitations that it intends to impose on the Phase II Assessor because of scheduling or cost reasons? Who gets to determine when “enough” investigation has been conducted?
For the Phase II Assessor, he or she must confer with the User to determine the question to be answered and the User’s objectives for the investigation. The Assessor will need to consider what to do if the User fails to cooperate in identifying the question to be answered or in formulating the objectives or in identifying any limitations on the scope because of schedule, cost or budget considerations. It is certainly not uncommon at the present time for the User to fail to provide information required under the ASTM Phase I ESA Standard (E 1527), whether it is title information, environmental liens, activity and use limitations, litigation, or purchase price. The following are some considerations:
- Why should we expect Users to be more cooperative in identifying the objectives of the Phase II assessment?
- What should the Phase II Assessor do if the User is unwilling to disclose its objective(s) for the assessment?
- How can the assessor prepare a conceptual model and written sampling plan if the User is unwilling to identify the question to be answered? Failure to follow the prescriptive requirements in the Phase II Standard may also result in increased liability for the Assessor.
- What will be the consequence for failing to include each of the mandatory tasks identified under Section 6 of the proposed Standard?
- What if the Assessor fails to include one of the areas where target analytes might be present? Or fails to investigate an area that has been identified as a data gap?
The proposed changes would give the Phase II Assessor little discretion in these areas. See, e.g., Sections 6.4.3 and 7.3. The proposed changes to the Phase II Standard also demand that the Assessor’s sampling results be “accurate and reproducible.” What happens if another Assessor is unable to reproduce the Phase II Assessor’s results?
The revised Phase II ESA standard is currently being balloted at the ASTM subcommittee level. An E50 main committee ballot will be required before the proposed changes can be finalized. Users are underrepresented on the E50.02 Task Group and need to make their views known on these important due diligence matters. If you are not already involved in the ASTM standard setting process, now is the time to get involved in the proposed changes to the ASTM Phase II ESA Standard.
Posted: September 13th, 2010 | Author: Bob | Filed under: Wetlands | Comments Off on WetCollect – Collect and process wetland delineation data in the field
Very cool new software for wetland delineation data collection. Perhaps technology is finally catching on in field ecology.
Posted: September 11th, 2010 | Author: Bob | Filed under: Uncategorized | Comments Off on Regional Supplement to the Corps of Engineers Wetland Delineation Manual: Midwest Region
The latest standard of practice for wetland delineation in the Midwest is available on the US Army Corps of Engineers website.
Posted: September 2nd, 2010 | Author: Bob | Filed under: Phase I ESA | Comments Off on Consider an Environmental Assessment before Foreclosing
Environmental conditions could reduce the property’s value or create a cleanup liability.
Thousands of commercial properties face potential foreclosure as the result of a struggling economy and the pressure of $1.4 trillion of nationwide commercial real estate loans coming due in the next five years. Lenders can take action up front to manage the environmental and financial risk inherent in the foreclosure process.
A lender considering foreclosure on a commercial property should conduct an assessment of the property for environmental conditions that could reduce the property’s value or create a cleanup liability once the lender assumes ownership.
Under the federal Comprehensive Environmental Response, Compensation, and Recovery Act — commonly known as Superfund — property owners and operators are potentially liable for a release of any hazardous substance at their property.
Lenders generally are exempt from Superfund liability on the basis of two provisions. First, the lender does not participate in the management of the facility, but holds “indicia of ownership” primarily to protect its security interest in the facility. Second, the lender acts quickly to divest itself of the facility after foreclosure.
A lender gains additional protection against environmental liability under the “innocent landowner” provision of Superfund by making”all appropriate inquiry” (AAI) into the history and past uses of a property before foreclosing on it.
Hidden conditions lurking?
A Phase I Environmental Site Assessment (ESA) compliant with ASTM International standards and U.S. Environmental Protection Agency AAI rules will provide sufficient information on the environmental condition of a property. An ASTM-compliant Phase I ESA is a risk-management tool that can assist the lender (or user of the report) in satisfying one of the requirements to qualify for protection from potential liability under Superfund.
A Phase I ESA provides legal protection if it is performed before the buyer takes control or ownership of a property. It allows the lender to claim innocent landowner status, providing protection for the lender from environmental cleanup liability under Superfund.
A Phase I ESA must be completed by an environmental professional who meets the educational and experience requirements outlined by ASTM. The environmental professional evaluates the soil, surface water and groundwater at a property — in addition to the physical improvements that have been made to the property and its surroundings — for the purpose of identifying recognized environmental conditions.
A recognized environmental condition is defined by ASTM as the presence or likely presence of any hazardous substance or petroleum product on a property under conditions that indicate an existing release or a material threat of a release of any hazardous substance or petroleum product into structures on the property or into the ground, groundwater or surface water of the property.
A Phase I ESA will identify recognized environmental conditions via site reconnaissance and visual observations; interviews; record, regulatory, map and photograph reviews; and historical usage research. If a lender is seeking liability protection under Superfund, the Phase I ESA report must be prepared no more than six months prior to taking possession of the property.
A defensible Phase I ESA meeting the AAI criteria for liability protection is a critical element of thorough environmental due diligence. Hiring a qualified environmental professional can result in ongoing communication about a property and timely notification of a significant discovery. The cost of a Phase I ESA is typically $2,500 to $3,500, depending on the size and complexity of the property.
Scheduling a Phase I ESA early in the foreclosure process can be decisive in obtaining property access for inspection of a site. The site reconnaissance supplies information about a property that is not available anywhere else, improving the accuracy and completeness of the conclusions and recommendations. Additionally, sufficient time must be allowed for the necessary regulatory and public agency reviews.
Environmental issues besides the hazardous substances and petroleum products addressed by ASTM and AAI rules may be present at a property. Examples include asbestos-containing materials, lead-based paint, moisture intrusion, radon, vapor intrusion and wetlands. While these “business risk” issues are considered outside the scope of the ASTM standard, lenders often find it advantageous to include them in a Phase I ESA.
A Phase I ESA can be used as a risk management tool to provide protection from Superfund liability. It also is often used to identify potential environmental risks at a property such as improper storage and handling of hazardous materials, underground storage tanks, historical dry-cleaning operations, and historical automobile service and/or repair facilities. Such historical operations often involved hazardous substances and petroleum products that frequently resulted in contaminated subsurface soil and/or groundwater due to the lack of environmental regulations governing the use of these materials prior to the 1980s.
If a Phase I ESA reveals recognized environmental conditions in connection with a property, conducting a Phase II Environment Site Investigation may be recommended to examine the conditions in greater depth. This may include a regulatory file review, additional interviews, a subsurface investigation, or other site-specific action.
The potential liabilities created by adverse environmental conditions are an important consideration that lenders should examine as part of the foreclosure process. A Phase I ESA performed by a qualified environmental professional is an effective way to manage the environmental risk of the foreclosure process and potential financial burdens.
Posted: August 27th, 2010 | Author: Bob | Filed under: Phase I ESA | Comments Off on ASTM International Announces First eLearning Course for E1527 Phase I Environmental Site Assessments
Press release date: August 24, 2010
W. CONSHOHOCKEN, Pa., – ASTM International and Environmental Data Resources (EDR) announce an online course offering for ASTM E1527, Standard Practice for Environmental Site Assessments: Phase I Environmental Site Assessment Process.
ASTM E1527 was first published in 1993 and has been revised numerous times since, most recently in 2005. It is one of the most widely published and distributed ASTM standards, and is used in commercial real estate transactions more than 220,000 times each year. Today, the process of performing Phase I Site Assessments is largely driven by the lending industry in advance of closing commercial loans. The purpose of E1527 is to specify environmental due diligence for the objective of achieving landowner liability protections (LLPs) under Super Fund. ASTM has offered an in-person training course on E1527 since 1993 and continues to offer it several times a year at various locations in the United States.
This is the first time that an online technical and professional training course has been offered by ASTM International. The online course features 12 modules of content offered over three weeks and is equivalent to the existing 16-hour in-person course. Participants are able to complete the material at times convenient to them during the three-week time period. Existing course instructors are online daily to facilitate communication, answer questions and participate in forum discussions. Additionally, the instructors will host an online conference call each week to discuss relevant topics and answer any questions that participants may have.
For the remainder of 2010, E1527 online training courses are scheduled for the following dates: Sept. 20, Oct.12 and Nov. 1. Click here to register.
The cost for the course is $895 USD and includes copies of ASTM E1527, course notes, case studies, and information about ASTM and Committee E50 on Environmental Assessment, Risk Management and Corrective Action. Register 30 days in advance and save $100. For more information or to register, go to http://commonground.edrnet.com and choose “commonground University” under the Learn menu.
The in-person E1527 course can be tailored to your company’s needs and brought to your facility by ASTM. Contact Scott Murphy, ASTM International (phone: 610-832-9685; firstname.lastname@example.org) for details. For questions about the online course, contact Lauren Rosencranz, Envrionmental Data Resources (email@example.com).
ASTM International is one of the largest international standards development and delivery systems in the world. ASTM International meets the World Trade Organization (WTO) principles for the development of international standards: coherence, consensus, development dimension, effectiveness, impartiality, openness, relevance and transparency. ASTM standards are accepted and used in research and development, product testing, quality systems and commercial transactions.
Environmental Data Resources, Inc. (EDR) is the leading provider of environmental risk information services and related workflow applications in the United States. As the innovator of the most comprehensive database of environmental and historical land use information, the company provides reports, subscription services and other solutions to help its customers reduce environmental risk. Established in 1991, EDR is headquartered in Milford, Connecticut with regional offices located throughout the United States. EDR is wholly owned by DMG Information Inc., the business information division of Daily Mail and General Trust, plc (DMGT).
Posted: August 27th, 2010 | Author: Bob | Filed under: Wetlands | Comments Off on Growing Season Definition and Use in Wetland Delineation: A Literature Review
Growing Season Definition and Use in Wetland Delineation: A Literature Review
by Karen Malone and Hans Williams
ABSTRACT: The definition of growing season in the 1987 U.S. Army Corps of Engineers Wetland Delineation Manual is derived from the soil biological-zero temperature concept. Lacking direct information on soil temperatures, minimum air temperature thresholds are used as indicators of the beginning and ending dates for the growing season. The 1987 Manual regional supplements allow for field observations of above-ground plant growth to estimate the growing season period. Since acceptance of the 1987 Manual, the growing season concept has been controversial. Soil biological zero does not apply to large areas of the continental United States, minimum air temperature thresholds appear inconsistent with observations of above- and below-ground biological activity, and photoperiodism and thermoperiodism result in local, regional, and annual variations for determining the growing season period based on plant activity. Additionally, the belief that wetlands perform ecological functions year round supports the argument that defining the growing season is irrelevant. A literature review of the environmental factors that influence above- and below-ground biological activity is presented. Recommendations are made on the use of the growing season concept to support jurisdictional wetland delineation determinations.
If you wish to access/download the document (383 kb) in pdf format, the address is: http://libweb.wes.army.mil/uhtbin/hyperion/CRREL-CR-10-3.pdf
Posted: August 13th, 2010 | Author: Bob | Filed under: Phase I ESA | Comments Off on Don’t let environmental problems prevent you from purchasing property
I’m republishing a great article posted in the Oregon Daily Journal of Commerce. I’ll soon be adding information relevant to Illinois customers. If you are in any other state, let me know, and I’ll find out how your state handles this.
“Risk comes from not knowing what you’re doing.”
– Warren Buffett
Many people seeking to purchase property for commercial purposes refuse to consider contaminated properties, because they are concerned about the risk of being held liable for the contamination, or about the time and expense that may be involved in addressing the legal and technical aspects of acquiring such properties. As a result, contaminated properties often are overlooked bargains.
In reality, armed with the proper knowledge, purchasers of contaminated properties will find that it is relatively painless to protect against liability under both federal and state law.
In 2002, the Comprehensive Environmental Response Compensation and Liability Act was amended by Congress to encourage prospective purchasers to buy and redevelop Superfund and brownfield properties (i.e., properties known or suspected to be contaminated).
Prior to this amendment, purchasers of brownfields could be held liable for contamination related to the property unless they could establish that they had no reason to know the property was contaminated. This scenario created an obstacle to the redevelopment of properties that were known to be contaminated.
In order to avoid liability, the party seeking to purchase a known-contaminated property could negotiate a Prospective Purchaser Agreement with the EPA. (A PPA is a legally binding agreement between the government and a prospective purchaser of contaminated property that limits the purchaser’s liability for environmental cleanup).
The 2002 CERCLA amendments, however, allow purchasers to buy a contaminated property and avoid potential liability for existing contamination without the need for a PPA, by qualifying as a “bona fide prospective purchaser.” Therefore, in order to protect against potential federal liability for environmental contamination at a property, a purchaser needs to ensure that it qualifies as a bona fide prospective purchaser (BFPP).
A prospective purchaser of contaminated property can qualify as a BFPP by satisfying the criteria in the provision found in CERCLA statutes.
Pre-purchase criteria include:
- Pre-purchasing “all appropriate inquiry”
- Not affiliating with a liable party
Post-purchase criteria include:
- Taking reasonable steps with respect to hazardous substances on the property
- Complying with any land-use restrictions and institutional controls
- Cooperating with governmental authorities and persons conducting any cleanup
- Complying with information requests and administrative subpoenas
Of these criteria, “all appropriate inquiry” and “reasonable steps” typically pose the most significant concerns.
All appropriate inquiry refers to the requirements for assessing the environmental conditions of a property prior to its acquisition. In 2005, the EPA adopted rules governing what constitutes “all appropriate inquiry.” Although a full discussion of all appropriate inquiry is beyond the scope of this column, a key aspect includes a professional’s environmental site assessment, which includes:
- Interviews with past and present owners, operators and occupants of the facility for the purpose of gathering information regarding the potential for contamination at the facility;
- Reviews of historical sources, such as chain-of-title documents, aerial photographs, building department records, and land-use records, to determine previous uses and occupancies of the real property since the property was first developed;
- Searches for recorded environmental cleanup liens against the facility that are filed under federal, state or local law;
- Reviews of federal, state, and local government records, waste disposal records, underground storage tank records, and hazardous waste handling, generation, treatment, disposal, and spill records concerning contamination at or near the facility;
- Visual inspections of the facility and adjoining properties.
Additionally, a BFPP must take “reasonable steps” with regard to the hazardous substances on the property, including stopping a present release, preventing a future release and preventing exposure to a prior release. If such steps are not taken, the purchaser could lose its status as a BFPP.
The EPA believes that, in most cases, the 2002 CERCLA amendments make PPAs from the federal government unnecessary, because prospective purchasers need only take the steps necessary to qualify as a BFPP. Only under limited circumstances will the EPA still consider entering into a PPA.
In general, the EPA will consider a PPA when: 1, there is likely to be a significant windfall lien and the purchaser needs to resolve the lien prior to purchase, or 2, a PPA is necessary to ensure that the transaction will be completed and the project will provide significant public benefits.
Posted: August 10th, 2010 | Author: Bob | Filed under: Wetlands | Comments Off on Wetland Delineation Training Courses. Online!
This is a great intro for the budding environmental engineer. At some point, you’ll have to get muddy to really understand wetlands though.
Wetland Delineation 1
Wetland Delineation 2
Posted: August 10th, 2010 | Author: Bob | Filed under: Wetlands | Comments Off on New Wetland Delineation Software
We wanted to shine a spotlight today on a new solution from CorpsJD, a newly launched online GIS GPS-Capable Wetland Delineation, Mapping & Reporting Software Service. Built on the Microsoft platform of Windows Server 2008, SQL Server 2008, and Bing maps, and integrated with ESRI’s GIS application, CorpsJD provides a high performance and reliable service that simplifies the environmental assessment and permitting process associated with wetland properties. In the words of CorpsJD, “Imagine if you could instantly load Bing aerial maps and see your property’s aquatic constraints, soil concerns, FEMA floodplains and other state and local environmental variables that determine a properties net worth. That’s CorpsJD. All of this is displayed in a standardized GIS mapping format that’s easy to learn, all at the click of a mouse. Imagine saving 50% of the field time and 80% of the office time on a job you’re doing anyway.” CorpsJD is hosting a series of webinars introducing the new features and functionality of the service. Find out more at http://www.corpsjd.com