FAQ: Do I need a Phase II ESA?

Why is a Phase II ESA Conducted and Do I need One?

When do you and when don’t you need a Phase II Environmental Site Assessment?

When working with people on Phase I Environmental Site Assessments, we are often asked about a Phase II ESA. Let’s talk about times you would, and wouldn’t need a Phase II Environmental Site Assessment.

Many people call us when they need “environmental due diligence.”  We’ve noticed that many people may already know what a Phase I Environmental Site Assessment is (if you do not, click the link to learn more).

However, when considering a Phase II ESA, there are more people who are unaware. It seems many people don’t know what is a Phase II Environmental Site Assessment (if you’re in that category, click on the link to learn more).  For now, let’s suppose you know what both a Phase I and Phase II ESA.  Now we can consider the question of whether you really need one?

So, do you need a Phase II Environmental Site Assessment?

Periodically, but not every time, we need to do a Phase II at a property.  So it depends.  Maybe you will need a Phase II ESA and maybe you will not.  Well, that doesn’t help does it?

Often people think the answer is always yes, but that’s not always the case. Most of our customers want to know why not.  Is it because they’re misinformed or because they needed to get a Phase II ESA in the past?

Here are some things to consider about Phase II Environmental Site Assessments:

A Phase I ESA does not automatically need a Phase II.

People who say differently are not really being candid.  They are trying to steer you in the incorrect direction.  A Phase I ESA is conducted by an environmental professional (who meets certain qualifications).  This professional makes judgments based on the investigation of your property. His recommendations about further testing, sampling, or testing are necessary only when conditions warrant it, based on their findings.  And, all these findings must be backed up by the relevant facts and information. If nothing additional is required, no further work should be done, and the environmental professional indicate as much. Make sure you review the findings if your feeling unsettled about the need for a Phase II ESA.

A Phase II ESA is often a way for environmental professionals to recover lost money on a cheap Phase I ESA.

Many in the “environmental business” who do Phase I Environmental Site Assessments for bargain-bottom prices will make up for it with a costly Phase II ESA. It happens all the time.

You hired the low bidder for a Phase I ESA, and surprisingly they conclude you ‘need’ an expensive Phase II Environmental Site Assessment.  A copy of the Phase I ESA Report goes to the bank or lending institution, and there’s unquestionably no way they’ll let you skip the cost for that extra work.  You’re stuck for the cost.  You have to get further work performed if you want the deal to move forward.  And you’re stuck with whatever is suggested, regardless of the price. You could always abandon the deal, but that’s presumably not what you want. We talk about the dangers of a cheap Phase I Environmental Site Assessment, based on what we’ve seen in the last 25 years. It’s worth reading if you’re learning about Phase I ESA Investigations.

So are you saying I don’t need a Phase II ESA?

No, not all Phase I Environmental Site Assessments will turn into further Phase II ESA work. Nevertheless, there are times when further work is unconditionally warranted. When there are conditions suggestive of present or past releases of hazardous substances or petroleum products to the environment, you should unconditionally get a Phase II ESA Assessment. If there’s the probability of any contaminant releases, then further investigation is completely justified and should be administered to properly ascertain the conditions at the property. It’s up to the environmental professional to determine what, when, and why.

If you do multiple Phase I Reports and the company you hire ALWAYS recommends further Phase II work – that is indicative of a real problem. Perhaps they are being extremely conservative (and perhaps that’s what you want).  But you are likely doing a lot of unnecessary extra work and paying unnecessary fees.

Environmental due diligence must be taken seriously.  It’s no joke and it can get expensive. Your property and your investment are at stake. If you want an honest evaluation of your Phase I or Phase II needs, contact us here.

Share This Story