FAQ: How Much Does a Phase I Cost?

What is the cost of a Phase I ESA?

How much does a Phase I Environmental Site Assessment cost?

People often call or email asking questions about the Phase I ESA process.  For most people, they’ve not needed one, purchased one, or even heard of Phase I before. On the other hand, there are people that purchased a Phase I ESA before but want to make sure they’re not getting tricked or deceived on a new one.  A question that regularly comes up at some point in the process is simply what’s the cost of Phase I Environmental Site Assessments?

This is completely understandable when you consider how much of a nuisance it can be when buying (or refinancing) anything, particularly an expensive commercial or industrial property.  We realize that in a realm of fiscal constraints and shrinking resources pricing is a key issue.  As a result, the cost of a Phase I ESA is a critical concern to know.  Money is important, and customarily quite tight throughout closing time for a property.  Therefore,  knowing the potential cost of Phase I Environmental Site Assessments can be key to ensuring you can close without any problems, on time, and within budget.

The biggest obstacle we’ve encountered is that too many ‘environmental professionals’ like to bounce around the cost of a Phase I ESA, and will only unveil the actual cost of their Phase I ESA at the very end of the process.  Our clients who have dealt with companies like this usually describe the feeling as ‘sticker shock’, akin to dealing with a shoddy used car salesman.  Indeed, we can’t stand that trick either.  Let’s clear the air and openly consider what impacts the average cost or price of a Phase I Environmental Site Assessment.

Average Costs & Prices of Phase I Environmental Site Assessments

If you’re looking for a quick answer, here it is.

Plainly put, the average cost of Phase I Environmental Site Assessments is approximately $1,500 on the low side and $6,000 or more on the high side. Any cheaper and you start to forfeit quality. More expensive and you’re likely looking at Phase I from a very large, complicated company.  Practically speaking a Phase I ESA will cost about $2,000 to $4,000 on average for residential, vacant, commercial, and smaller industrial facilities.

Of course, the price is going to depend on many variables and the specific issues of your project, but as a general rule of thumb, you can expect to pay about that much for a Phase I prepared by a qualified & professional environmental professional.  Anything cheaper and you’re probably going to get a bit of trash, or stuck with the need for further work in the form of a Phase II  Report (see below).  Any more costly and you’re probably overpaying.

What do Phase I Environmental Site Assessment costs include?

As we just discussed, there’s ordinarily a large variation in Phase I Environmental Site Assessment costs. Many people are intimidated when they learn that, but like any other service, there are a lot of factors involved.

For example, if you call up a car repair person and say that you need to bring your car in to get fixed, how much?  Or if you called a landscaper and want a new garden, how much?  Most likely, these companies will say it depends, let’s decide what you need before we give you a price that may be too low or way too high.  Quoting the cost of a Phase I ESA is very similar, and before someone gives you a price, there are factors to consider. Despite who you end up preferring to conduct a Phase I Report for you, below are the key factors that influence the costs of a Phase I ESA.

Location influences Phase I Environmental Site Assessment pricing.

When it comes to estimating Phase I ESA costs, the location of the property is going to affect the price.

The price of Phase I Environmental Site Assessments depends on your property.

There are a few reasons for this, and to understand why you need to understand what a Phase I Environmental Site Assessment is. One key thing you should understand is the “research” part of the report.  This part of the investigation involves reviewing historical records, documents, and reviewing information at governmental offices, if necessary.

There are services that virtually every Phase I ESA provider uses to streamline this process, but there is still is a lot of information to sort through, and the time spent doing this research influences the Phase I Environmental Site Assessment costs. So think about this, if you’re engaging us to work on a piece of property in the middle of nowhere, there probably isn’t much us to filter through because not much historical information exists (if there are no improvements to the property, there’s no paperwork) and the probabilities are that the adjoining and nearby properties are going to be similar as well  (little to no development means little to no paperwork – most of the time).  This means less time will be involved in the process. Since time is money, less time is less money.

On the other hand, if you hire us to handle a Phase I Report on a property in a highly industrialized area of a big city, we’re to have reams of data to investigate.  In fact, we often work in large cities and receive historic information about properties and land use going clear back to the 1870s.  That’s over 140 years of paperwork to review, often disseminated over hundreds of pages.  Then consider going to a town hall, county offices, and/or getting information via FOIA requests, and we could be involved with thousands of pages of data.  Naturally, that takes plenty of time and drives up the expense of a Phase I ESA.

Travel affects Phase I Environmental Site Assessment prices.

If you hire an environmental professional and he has travel a large distance, you will naturally anticipate a greater price for a Phase I ESA.  For example, for us to complete a one Phase I report in Chicago when we’re located in Indianapolis, we would need to fly and rent a car just to get to the property. Conversely, if they hired someone from Chicago or another nearby city, that person will not have the same travel costs.

Plainly put, the mileage between your provider & the property will impact travel costs, and travel costs will increase the price of a Phase I Environmental Site Assessment.

The number of properties influences the cost of a Phase I Environmental Site Assessment.

Clearly, the more properties involved in a Phase I Report, the greater your overall project costs will be. But, like most things, there’s usually a discount when you buy multiple items. For example, consider that person from Chicago needs to get six Phase I reports. When you factor in the travel costs and employ them equally to all six properties, you’re Phase I ESA costs will be lower.   Then if you use a local provider those costs will be even less, but the point is that with multiple reports, costs are spread across multiple sites, creating a lower cost per report.

Depending on the characteristics of locations, and who you’re chosen for your reports, some environmental firms will lower the price slightly for jobs that include multiple properties.  Meaning, one Phase I ESA report might cost $2,000, two might cost $3,500, three might cost $7,000, for example.  This is not always the case, particularly for jobs with properties that are geographically isolated, or complicated properties, but it’s unquestionably something to consider when you investigate Phase I Environmental Site Assessment prices.

Non-scope items raise the cost of Phase I Environmental Site Assessments.

This issue doesn’t occur often, but sometimes clients request non-scope items for some types of properties, and that will impact the Phase I ESA cost.

If you’re don’t know what non-scope items are, here is an explanation.  What is required to be included in a Phase I ESA Report is prescribed by ASTM standards.  These standards say you have to do A, B, and C, and meet specific qualifications to conduct a Phase I. Those A, B, and C items are what must be included for the report to be considered a proper Phase I.  Those are scope items. Anything not specifically necessary, per the ASTM standards, is a non-scope item.

For example, some of our clients use us to prepare Phase I reports at industrial facilities.  These clients might have us conduct an environmental audit at the same time because we’re already on-site and looking around. An audit is a non-scope item in this case and will raise the price of a Phase I Environmental Site Assessment. Sometimes a property with commercial or residential units will ask about other services, such as wetlands delineation reports, mold testing, lead-paint testing, etc. These are non-scope items and will raise the cost of a Phase I Environmental Site Assessment as well.

Phase I Environmental Site Assessment costs are dependant on the property’s physical features.

This is similar to where the property is located.  The price of a Phase I Environmental Site Assessment will reflect the expected amount of energy of the project. So if you have a very complicated industrial property located over 50 acres with 12 different buildings or structures, you will pay a greater price for a Phase I ESA. If you’re getting a Phase I on a small parcel of vacant land, the Phase I will be much less expensive.

Nevertheless, this is only a generalization because sometimes smaller properties have more issues or intricacies than larger properties. This links back to what we discussed above about your property’s location and its history, which will impact the records that need to be reviewed. If your small parcel of vacant land is located in the middle of an industrial area in Indianapolis, it’s going cost more. While Phase I Environmental Site Assessment prices can be based on property size, there’s usually much more to consider.

The environmental experts impact the price of a Phase I Environmental Site Assessment.

Often, and in our opinion it’s a big issue for folks who are only buying a Phase I on price.

When a Phase I Report is completed on your property, it must be done by an environmental professional.  This “environmental professional” needs to meet strict qualifications that are put forth in the same ASTM standards that prescribe what must be included in a Phase I Report.

But unethical Phase I providers cut corners.  Experts often hear that someone is getting a low-cost Phase I ESA and is completing all of it on their own.  As long as the “environmental professional” supervises the process, it meets the rules described in the ASTM standards.

Thus, you could have a college intern who got a 30-minute overview of what to watch for during your site investigation. You might have another staff person write your report while never stepping foot on your property.  Unfortunately, as long as the “environmental professional” supervises (Note: there’s not any strict definition of what overseeing means) your report is completed as per ASTM standards.

So you can see that is a huge problem.  There’s is a complete lack of accountability, and yes, you get a cheap Phase I ESA but you might end up with a report that’s not worth the risk.

When Lougheed Engineering conducts a Phase I ESA, our environmental professionals are directly concerned with each step of the process. They’re in the field joining in with the site investigation, they’re drilling through documents & reviewing regulatory records, and they’re composing the actual reports.

Frankly put, if your Phase I is completed by green, inexperienced engineers, or even interns or non-professionals, it may be cheap in the beginning – but not in the long run.  But, if you have a knowledgeable, experienced environmental professional conduct the Phase I Report, it might be a bit more expensive. But, in the long run, you’ll not face the risk of a poorly conducted report.  Again, with thousands of dollars at stake over a potential environmental liability, you don’t wnat to cut corners over a few hundred dollars.

How quickly you need a Phase I finished changes the cost of a Phase I ESA.

If you need a Phase I done pronto, anticipate paying a higher price. Some customers wait until the last minute and need a Phase I done ASAP.  This is sometimes is doable, sometimes it is not.  While getting a job done in a rush and at the last minute might be plausible, expect to pay an “expedited” charge to get it done. Like many other experts, if we need to put other work off, change calendars, plan for last-minute travel, work overtime, or drop everything, we naturally have to charge an extra fee to cover these costs.

Ordinarily, we divide down turnaround into a 10-business day, 20-business day, and 30-business schedule. The 30-business day schedule time is our standard turnaround time, while the 14 and 20-business day project terms are our “expedited” project turnaround times. When we estimate the price of a Phase I Report, we consider the other factors outlined above to determine the rush project fee.

A cheap Phase I ESA is often the forerunner for a very expensive Phase II ESA.

A tactic used by unethical professionals is to get their foot in the door cheap, get you on the hook then require a very expensive Phase II Report.  Some environmental professionals will quote you a very inexpensive Phase I ESA price. In fact, we’ve heard of people quote Phase I ESA prices under $800. That’s a bargin, right!? Not at all.  Quite the opposite.

These cheap Phase I ESA Reports will almost always dictate a very expensive Phase II ESA since there might be contamination on the site.  They recommend a Phase II Report whether you actually need one or not. The issue is that these recommendations are made even if there’s scarcely any indication of RECs at a property. If you’re unsure what RECs or a Phase II are check these links out:

You might consider taking the risk and not doing the recommended Phase II ESA.  However, if you are using a financing institution to purchase the property, you may be required to get a Phase I Report.   If a bank or lending institution sees a recommendations to get a Phase II, even if you don’t need it, they will require that you get a Phase II, or the bank will not give you the money.

The difficulty is, Phase II expenses can vary a lot.  We’ve seen costs between $6,000 to well over $125,000. It all depends on your property and what may or may not be indicated and being examined. So if you get an $800 Phase I and you need to spend another $30,000 on soil & water sampling, because your environmental professional recommended you do so  (and just so happens to also own a testing company), you’re required to pay the $30,000 because you assumed you were getting a big bargain at first.

For more information on this topic, here is an article that goes into more in-depth:

Summary:  The average prices & costs of Phase I Environmental Site Assessments.

As discussed above, the factors to take into consideration certainly should and often do change the price of a Phase I ESA.  You should be very leary of somone who quotes a Phase I for a flat price, not taking into consideration the particulars of your job.   You should be very cautious about going with the low bidder.  And, if a provider is more expensive they should have a good reason why.  More high-priced doesn’t inevitably mean better.

No matter who you choose, be ready.  If conditions warrant you may need a Phase II ESA investigation – depending on what is found during the Phase I ESA. That means extra costs you usually can’t avoid.

You’ve got a lot depending on this report.  Experts profoundly suggest you don’t decide this solely on price alone, but rather on what are your real goals and objectives.   As well as, the expected integrity and professionalism of the environmental consultant choose.

As the proverb says, “you get what you pay for”.   We hate to wrap this up by saying “it depends,” but a Phase I Environmental Site Assessment price really does depend on many things.

If you’re in the market for environmental due diligence or would like some information as to what you should expect to pay for some, click here to get a quick quote or to discuss your needs.