Due Diligence in Due Time...

By: Jim Bricker – JSD Senior Planner/Project Planner

Don’t endanger your project by waiting until the last minute to rush through the environmental due diligence process which can result in serious (and expensive) consequences. It’s not just a matter of being aware of the existing conditions and recent land uses on your project site, but it is also critical that you learn and assess how the previous site use was managed; what is happening (and has happened) next door; and what is happening (and has happened) on property that is uphill from your site.

Important things to remember:

  • On previously investigated sites, residual contamination may have been capped and permitted to remain. The conditions of these permits are that the site stays undisturbed by grading and excavation. However, keep in mind that regulatory standards may change over time with the continued development of more sophisticated analytic techniques.  Think in terms of the emerging concerns about Perfluoroalkyl and polyfluoroalkyl substances and Perfluoro octane sulfonic acid (PFAS and PFOS).
  • Some contaminants can migrate over significant distances away from the original location of the spill/leak/dump site, often mixing and flowing with ground water or “floating” on top of the ground water. This may happen over time but also can be a more rapid process.
  • Over time, some types of hazardous materials will morph from a liquid or solid into a vapor when it comes into contact with groundwater. This will then percolate upwards (and horizontally) through the soil following a path of least resistance, such as a utility or service line trenches, with the potential of seeping into basements.

In addition to investigating a property’s physical opportunities/constraints, environmental records, and local zoning/building codes, it’s important to understand that thorough environmental due diligence also involves asking questions on: the site’s development; current/historical uses of the site and surrounding neighborhood; and if there have been any historical “incidents” on-site or in the vicinity. This could include:

  • Was the site was filled land? If so, what was the source and characteristics of the fill material that was placed on the property?
  • What is, or was, the standard practice by the current or previous business at the site? (Example: How did employees of the auto repair shop dispose of waste oil and solvents?  Did they contract with a professional waste hauler or simply pour it down the floor drain?)
  • Is, or was, there a business using hazardous materials during their routine operations? It’s important to know what has happened on the property or nearby (example: Did a dry cleaner occupy one of the tenant spaces in the shopping center that is, or was, across the street?)
  • Was there an emergency response incident which involved hazardous materials or the use of fire suppression foam?

As an owner, future owner or lease holder, if a complete investigation was not done and the issues are not addressed in the purchase agreement, you may be liable for clean-up costs regardless if it was pre-existing or migrated onto the site from another location.  These costs could exceed the value of the property and the liability can attach to anyone in the chain of title (unless a liability exemption applies).

Investigating and knowing the potential environmental risks, PRIOR to making a decision to acquire, plan, and develop a site, is a critically important consideration for effective due diligence.