The USEPA Office of Inspector General (OIG) recently completed a review of 35 All Appropriate Inquiry (AAI) reports that were submitted to USEPA Regions 1, 5, and 9 as part of the Regions’ Brownfields Grant programs to answer the question “Are Brownfields grantees meeting EPA’s AAI Rule requirements to investigate and disclose environmental conditions and are purchasers/owners maintaining continuing obligations at brownfields properties?” The results of the OIG review were released on February 14, 2011 in a report titled “EPA Must Implement Controls to Ensure Proper Investigations Are Conducted at Brownfields Sites.” Due to “priority issues” the OIG identified during their review, the question of continuing obligations was not addressed during this review by the OIG.
The AAI regulations under CERCLA (“Superfund”) are found in 40 C.F.R. §§ 312.1 through 312.31, and became effective on November 1, 2006. An AAI investigation, which is also often referred to as a Phase I Environmental Site Assessment (ESA), is one of eight elements of the Bone Fide Prospective Purchaser (BFPP) liability defense available under CERCLA. An AAI investigation is also a requirement for CERCLA Contiguous Property Owner and Innocent Land Owner liability defenses. The purpose of an AAI investigation is to identify “conditions indicative of releases or threatened releases of hazardous substances.” Certain components of the AAI investigation must be performed or updated within 180 days of the acquisition of the commercial or industrial property.
Although it may appear that the applicability of the OIG review is narrowly focused and only applies to USEPA Brownfields Grant sites, it should be noted that the CERCLA All Appropriate Inquiries Regulations are the same for both USEPA Brownfields grant sites and for private sector properties where a Phase I ESA using American Society of Testing and Materials (ASTM) Standards is being performed to obtain the liability limitations available under CERCLA. As noted by USEPA on its Brownfields and Land Revitalization web page (http://www.epa.gov/brownfields/aai/):
“EPA now recognizes both ASTM International's E1527-05 "Standard Practice for Environmental Site Assessments: Phase I Environmental Site Assessment Process" and ASTM E2247-08 "Standard Practice for Environmental Site Assessments: Phase I Environmental Site Assessment Process for Forestland and Rural Property" as compliant with the All Appropriate Inquiries Regulation. Either of these ASTM International Phase I standards may be used to satisfy the statutory requirements for conducting all appropriate inquiries under the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA).”
All 35 AAI reports reviewed by the OIG had been prepared using the ASTM E1527-05 Standard. Based on its review, OIG concluded that none of the 35 AAI reports “contained all the required elements to document that AAI was done in compliance with federal requirements.” Specifically, the OIG stated the reports lacked one or more of the following AAI elements:
- Environmental Professional (EP) Statement of Qualifications. All of the 35 reports failed to include the required statement to certify the qualifications of the EP. 16 of the 35 reports included deviations from the required qualifications statement, which consisted of either no statement or the statement was abbreviated or modified. The remaining 19 reports generally contained the three required sentences, but included inconsistent wording. For example, use of the terms “we” or “our” when only one EP signed the qualifications statement.
- EP Signature(s). Nine of the 35 reports were not signed by the responsible EP.
- EP Statement on Data Gaps. Seven of the 35 reports did not include a statement of data gaps.
- EP Opinion Statement (in Conclusion section). All of the 35 reports failed to include the required EP opinion statement in the Conclusion section. While most of the reports included these statements, the statements deviated from the required wording in the ASTM Standard.
The OIG is concerned that modifications or departures from the use of the required language might be indicative that the EP did not actually perform of oversaw the AAI investigation. Furthermore, discrepancies in the opinion statements and missing statements for data gaps suggest that the work was not performed adequately to identify recognized environmental conditions (RECs). Hence, potential threats to human health and the environment might not be recognized.
While the OIG’s report only reviewed AAI reports prepared for the USEPA under its Brownfields program, the conclusion that 100% of the AAI reports were deficient and did not meet the requirements of the CERCLA All Appropriate Inquiries Regulations is troubling. In particular, it calls into question whether private sector AAI reports being prepared using ASTM E1527-05 are being prepared in full compliance with the requirements of ASTM E1527-05 and the CERCLA All Appropriate Inquiries Regulations. If for nothing else, the OIG report should serve as a warning to both those entities using and those preparing AAI reports to take a greater degree of care in ensuring that AAI reports are prepared in compliance with the ASTM Standards and the CERCLA All Appropriate Inquiries Regulations.
The OIG report is very brief and is only 25 pages long. The report can be downloaded from http://www.epa.gov/oig/reports/2011/20110214-11-P-0107.pdf.
This article was authored by Greg Tieman, Acacia Environmental Group LLC. For more information on the author see here.