Seminar 15 - Trending Topics in Environmental Law:

What Every Deal-Maker, Developer,Landlord and Tenant Needs to Know

Lawrence W. Falbe, Esq.Partner

Quarles & Brady LLP300 N. LaSalle St., Suite 4000

Chicago, IL 60654-3422312-715-5223

lawrence.falbe@quarles.com

Robert H. Crespi, Esq.Member

Wolff & Samson PCOne Boland Drive

West Orange, NJ 07052 973-530-2060

rcrespi@wolffsamson.com

Agenda

• Due Diligence Overview• Updates to the ASTM Phase I Standard • Vapor Intrusion• Construction Stormwater Permits• Contaminated Building Materials• Wetland Definitions & Guidance• Q&A

Part 1:Due Diligence Overview

Due Diligence Overview

Environmental due diligence is the first line of defense for parties in property or business transactions to avoid the unintentional assumption of environmental liability.

Conducting robust environmental due diligence allows a party to:– Avoid entering a transaction with unacceptable environmental risks– Negotiate to allocate liability of a known environmental risk– Establish eligibility for certain statutory defenses to environmental

liability– Mitigate risk through insurance or other strategies

Understanding the Players• Seller’s Side - how do I protect myself from future liability?

• What the Seller Wants• To leave all environmental liabilities with company or shift them to buyer• Not to have any surprises!

• Buyer’s Side - how do I investigate a property and define environmental problems?

• What the Buyer Wants• To have liability only for post-closing matters• Not to have any surprises!

• Lender’s Side - how do I make sure my collateral isn’t impacted?• What the Lender Wants

• To avoid environmental liabilities interfering with debt repayment or value of collateral

• Not to have any surprises!

Due Diligence Overview

The goal of due diligence is not to eliminate 100% of the environmental risks...

The goal really is to identify and reduce those risks to an acceptable level, dependent on your organization’s

(or client’s) internal risk management comfort level

Due Diligence Overview

Objectives of Due Diligence:• Evaluate known potential risks• Identify previously unknown risks• Quantify all risks identified and consider options for

managing risks

Once due diligence is completed, the final stage is to contractually allocate risks

between the parties…

Due Diligence Overview

Drivers for Performing Due Diligence:• Typically, not fear of enforcement; • Rather, drivers are often economic:

• Will remediation be necessary once discovered?• Will development plans be delayed or made impossible due to

contamination?• Will financing become impossible?• Will environmental stigma make it harder to divest the property

later?

Due Diligence Overview

Common Objections to performing Due Diligence:• Cost• Timing• Fear of killing the deal

Remember: You can buy the same amount of environmental liability for $1 as you can for

$1 million...

Typical Environmental Concerns• Leaking Underground Storage Tanks• Midnight Dumping• Prior Industry (solvents, paints, hydraulic fluid, petroleum)• Dry Cleaners• Asbestos-containing materials; radon; lead in paint and water• Wetlands, ecological resources,

endangered species• Industrial hygiene, health and safety• EMF/high voltage power lines• Adjacent sites / Landfills• Current On-site Operations• Vapor Intrusion

Typical Environmental Concerns

Types of contaminants:• Metals (plating operations, foundries, other industry)• Chlorinated solvents (dry cleaners, degreasers)• Petroleum (leaking underground storage tanks, spills)

Affected media:• Soil• Air• Groundwater• Surface Water

• ASTM Phase I Environmental Site Assessment (ESA) ASTM Practice E1527-13

• Customized Mini Phase Is• ASTM Transaction Screen E1528-14• Phase I + (customized add-ons/non-

scope considerations)• Compliance Audits• Phase II Invasive Testing

Investigations

Types of Environmental Assessments

Understanding Environmental Liability

• What are you liable for and how do you reduce the impact?

Many people don’t realize that a purchaser/lessee/operator of contaminated property can be held liable, even though they are not responsible for contaminating the property at issue.

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• CERCLA (a/k/a Superfund)– Comprehensive Environmental Response, Compensation

and Liability Act – a Federal statute that applies to any release of hazardous substances at a facility.

– Liability can be asserted against: 1. The current owner or operator of a facility; 2. The past owner or operator at the time of a release; 3. The person who arranged for hazardous substance

disposal; and/or4. The transporter of hazardous substance to the facility.

Understanding Environmental Liability

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Statutory Defenses to Environmental Liability (most important to the “Buyer”)

• Innocent Landowner – Must prove that contamination was caused by 3rd party with whom purchaser has no contractual relationship and “all appropriate inquiry” was performed (cannot have prior knowledge of RECs).

• Bona Fide Prospective Purchaser – Avoids CERCLA liability IF all appropriate inquiry performed, disposal on site took place before date of purchase and appropriate care exercised with respect to any discovered contaminants (prior knowledge OK).

• Contiguous Property Owner – Avoids CERCLA liability for neighbors whose property is contaminated by the offending property.

Understanding Environmental Liability

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• Statutory defenses are great…

• But consider…• What happens if you buy some contaminated

property and can establish a defense… but the original “polluter” is long since gone or is judgment-proof…

YOU STILL OWN CONTAMINATED PROPERTY!

Understanding Environmental Liability

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Other important environmental laws:• Resource Conservation and Recovery Act (RCRA)

• “Cradle-to-Grave” statute designed to govern the generation, identification, storage and disposal of hazardous waste.

• No private cause of action for a cost recovery claim under statute, but citizen suits may be asserted against any party for any release of hazardous wastes that currently pose endangerment to health and environment.

• Attorneys’ fees may be available.

Understanding Environmental Liability

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• State Environmental Statutes and Common Law Claims• Criteria for proving claims are same or less

burdensome than criteria for proving CERCLA or a RCRA claim and remedies can be more expansive.

• State “baby Superfund” laws.• Common law causes of action such as public and

private nuisance, trespass, strict liability.• Common law CAs can sometimes be pre-empted by

state or federal law.

Understanding Environmental Liability

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Selling Contaminated Property• What to do first? Determine:•Nature and extent of contamination.• Current use of property.• Property’s relation to nearby properties.• Enforcement action threatened?• Sensitive environmental areas nearby?– Site investigation / Phase I?– Remediate before selling?

Nuts and Bolts of Due Diligence

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Buying Contaminated Property• The Key to Safely Purchasing Contaminated Property —

Manage the Risk.• If the risk can be defined, it can be dealt with in the

context of the deal.• Even a great cleanup plan can’t turn a bad real estate

deal into a good real estate deal.• Some deals will just not make sense — right time may be

later…• First step is typically the Phase I ESA.

Nuts and Bolts of Due Diligence

Phase I / Phase II Overview

• Phase I Environmental Site Assessment (“ESA”) – due diligence of a piece of property, short of any physical sampling. The purpose of a Phase I is to identify “Recognized Environmental Conditions” (RECs) or indicate that no RECs are present.

• ASTM E1527-13 sec. 3.2.78 defines recognized environmental conditions as “the presence or likely presence of any hazardous substances or petroleum products in, on, or at a property: (1) due to release to the environment; (2) under conditions indicative of a release to the environment; or (3) under conditions that pose a material threat of a future release to the environment. De minimis conditions are not recognized environmental conditions.”

Phase I / Phase II Overview

• Phase II ESA – environmental due diligence which includes physical sampling (generally of a limited nature) of the site. For example, a Phase II ESA may include laboratory analysis of soil, groundwater and/or surface water, for certain contaminants. A Phase II ESA may also include testing for the presence of lead-based paint, asbestos-containing materials (“ACMs”), and volatile organic compounds that may pose a risk of harm due to vapor intrusion.

Phase I History

• Phase I ESA standards were first developed in 1993 by the ASTM (formerly the American Society of Testing and Materials), in order to standardize the level of inquiry to be necessary to constitute, “all appropriate inquiry into the previous ownership and uses of the property consistent with good commercial or customary practices” so the user can claim the “innocent purchaser defense” under Superfund. Phase I ESA standards have been revised over the years by ASTM (maximum eight year shelf life). Prior to E1527-13, the standard was E1527-05 and several others before that beginning in 1993.

What’s the procedure for a standard Phase I?• An environmental professional performs historical research using a variety

of sources: old aerial photographs, city directories, fire insurance (Sanborn) maps.

• Environmental databases (usually EDR) are used to identify any issues with the property or adjacent land (e.g., LUST databases, NPL sites, RCRA waste generators)

• Freedom of Information Act (FOIA) requests are made to U.S. EPA, state EPAs, local government agencies (municipal, fire protection, etc.)

• Interviews with current/former site owners, government officials, etc.• A visual “site reconnaissance” is performed• Chain of Title (COT) information (and possibly judicial records) reviewed to

search for environmental liens and Activity and Use Limitations (AULs)

Phase I Procedure

“Non-Scope” Considerations– Biological agents– Asbestos-containing materials; radon; lead in paint and water– Wetlands, ecological resources, endangered species– Cultural and/or historic resources– Industrial hygiene, health and safety– Indoor air quality (unrelated to a release of hazardous substances)– Mold– Regulatory Compliance

Phase I Procedure

What a Phase I is NOT• A “clean” Phase I is NOT a guarantee that a site is clean.• A Phase I may NOT reveal every possible environmental problem on the

property, nor does it define the extent of the problem, if any.• A Phase I is NOT a compliance audit.• A Phase I does NOT necessarily guarantee that a property purchaser will be

able to claim a defense against future environmental liability.• A Phase I does NOT have eternal life.• All Phase Is are NOT created equally.

Phase I Procedure

What’s “all appropriate inquiry” and how does it relate to the ASTM Phase I practice?• Prior to 2002 (the Brownfield Revitalization Act), “all appropriate inquiry”

was not defined in CERCLA to enable establishment of the regulatory defenses to liability.

• Most professionals used the ASTM Phase I and Phase II Standards … because there was no regulatory guidance.

• Now… AAI is the official rule (adopted 2005, effective Nov. 1, 2006), and ASTM revised its Phase I standard to comply with the AAI rule.

• Current standard is ASTM E 1527-13

• Copyrighted document available for purchase from ASTM.

• They guard this zealously!

All Appropriate Inquiry

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• Final Rule for “All Appropriate Inquiry” 40 CFR part 312• Inquiries expanded to past owners or occupants of site, or neighbors if

prior owners unavailable; former practice usually limited inquiry to current owners.

• AAI must be done by an Environmental Professional (“EP”)- may be PE, PG, or have experience.

• EP may use professional judgment in determining search radius for potential environmental problems from other sites in the area.

• “Catchall category”: EP must consider “commonly known” information about the property (rumors?).

• AAI must be performed within one year prior to acquiring property and certain elements (interviews, site inspection, lien search, etc.) must be performed or updated within 180 days prior to acquisition. (40 CFR 312.20)

All Appropriate Inquiry

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AAI Cont.• Must identify “data gaps” discovered during the investigation and

address them when possible.• Must consider if purchase price reasonably reflects the fair market value

of the property (i.e., has it been discounted for contamination?)• AAI may be conducted by one party and transferred to another under

certain circumstances.• No disclosure obligations created by the rule (but states or other

authorities may have relevant requirements)

All Appropriate Inquiry

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What happens after the Phase I? That depends…• If the Phase I reveals one or more recognized environmental conditions

(RECs), more work is (probably) needed

• Generally a Phase II is the next step• Remediation may need to be performed• Possibly pursue an NFR/NFA Letter• Due Care may need to be taken later

Post- AAI

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What’s “Due Care”?• Continuing duties on part of owner once a release is identified in the

course of due diligence.• To achieve/maintain CERCLA defenses, owner must comply with CERCLA

requirements for taking steps to prevent or stop a release, and prevent exposure once a release has occurred.

• Technically not part of AAI.• Be wary of potential costs!

Post- AAI

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How to work a cleanup into the deal?• Cleanup before closing or after?• Who will have the responsibility?• Will an NFR/NFA Letter be obtained?• How can you insure cleanup will be done?• Escrows/holdbacks/baskets/caps• Indemnities• Insurance?

Post- AAI

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• All Appropriate Inquiry still applies

• U.S. EPA has stated that tenant that conducts AAI prior to AAI can achieve Bona Fide Prospective Purchaser status

• Conducting Due Diligence can help set a baseline against claims of tenant harm later

• Also, Due Diligence can warn of any potential development roadblocks or costs (e.g., encountering contamination when redeveloping or renovating)

• Lease should provide for due diligence period, or conduct DD prior to lease under separate access agreement

• Lease should clearly indemnity tenant for pre-lease liability (including business interruption if possible) or any issues not caused by tenant (or at least those caused by landlord)

Due Diligence as a Tenant

Part 2:Updates to the ASTM Phase I Standard: What’s Changed?

• Simplified definition of Recognized Environmental Condition• A new term, Controlled REC (CREC) was added for closed RECs that

are managed under an Activity Use Limitation (AUL). This limits the definition of an HREC to closed RECs that have been completely resolved (“clean closure”) with no restrictions.

• Less discretion on agency file reviews; now required or consultant must explain why such a review is not warranted.

• Consideration of the vapor intrusion pathway is now explicitly required (but use of ASTM E 2600-10 not mandated)

Recent ASTM Changes to Phase IDifferences between E 1527-05 and E 1527-13

3.2.78 recognized environmental conditions—the presence or likely presence of any hazardous substances or petroleum products in, on, or at a property: (1) due to release to the environment; (2) under conditions indicative of a release to the environment; or (3) under conditions that pose a material threat of a future release to the environment. De minimis conditions are not recognized environmental conditions.

* New definition not limited to releases only to the ground, ground water or surface water to take into account vapor intrusion.

Revised Definition of REC

• Prior definition of an “Historic Recognized Environmental condition,” (HREC) has been revised so that it now refers to a past release that has been addressed to the satisfaction of the applicable regulatory authority without subjecting the property to any required land use restrictions. The new standard also adopts the term “Controlled REC” (or “CREC”) to refer to a past release that has been addressed to the satisfaction of the applicable regulatory authority, but which is subject to the implementation of required land use controls.

Revision of HREC and New Definition of “CREC”

New Definition of “CREC”• 3.2.18 controlled recognized environmental condition—a recognized environmental condition

resulting from a past release of hazardous substances or petroleum products that has been addressed to the satisfaction of the applicable regulatory authority (for example, as evidenced by the issuance of a no further action letter or equivalent, or meeting risk-based criteria established by regulatory authority), with hazardous substances or petroleum products allowed to remain in place subject to the implementation of required controls (for example, property use restrictions, activity and use limitations, institutional controls, or engineering controls). (See Note 2.) A condition considered by the environmental professional to be a controlled recognized environmental condition shall be listed in the findings section of the Phase I Environmental Site Assessment report, and as a recognized environmental condition in the conclusions section of the Phase I Environmental Site Assessment report. (See Note 3.) [emphasis added]

• NOTE 2—For example, if a leaking underground storage tank has been cleaned up to a commercial use standard, but does not meet unrestricted residential cleanup criteria, this would be considered a controlled recognized environmental condition. The “control” is represented by the restriction that the property use remain commercial.

• NOTE 3—A condition identified as a controlled recognized environmental condition does not imply that the environmental professional has evaluated or confirmed the adequacy, implementation, or continued effectiveness of the required control that has been, or is intended to be, implemented.

Revised Definition of “HREC”• 3.2.42 historical recognized environmental condition—a past release of any hazardous

substances or petroleum products that has occurred in connection with the property and has been addressed to the satisfaction of the applicable regulatory authority or meeting unrestricted use criteria established by a regulatory authority, without subjecting the property to any required controls (for example, property use restrictions, activity and use limitations, institutional controls, or engineering controls). Before calling the past release a historical recognized environmental condition, the environmental professional must determine whether the past release is a recognized environmental condition at the time the Phase I Environmental Site Assessment is conducted (for example, if there has been a change in the regulatory criteria). If the EP considers the past release to be a recognized environmental condition at the time the Phase I ESA is conducted, the condition shall be included in the conclusions section of the report as a recognized environmental condition. [emphasis added]

So, what’s the controversy?

• Under the new definition of CREC, an Activity and Use Limitation (AUL), engineering control (e.g., engineered barrier) is assumed to be in place and functioning, but the EP is not required to make any finding that such is actually the case. Thus, a client may assume that a “Controlled REC” is actually under control, when in fact it is not.

Revision of HREC and New Definition of “CREC”

• E1527-13 affords less discretion to the EP on conducting agency file reviews

• E1527-13 states that regulatory agency files reviews SHOULD be done

• If reviews are not performed, the EP must explain why such a review is not warranted.

Agency File Reviews

• Consideration of the vapor intrusion pathway is now explicitly required (but use of ASTM E 2600-10 not mandated)

• Prior versions of E1527 noted “indoor air quality” as a non-scope consideration, which some interpreted as investigation of vapor intrusion

• New definition of “migrate” refers to movement of hazardous substances or petroleum in any form including “vapor in the subsurface.” (sec. 3.2.56)

• Industry anticipated this change for several years, and many consultants already were adding VI investigation to the Phase I scope anyway

• This will likely increase average costs of due diligence as more Phase IIs are recommended to investigate potential VI issues

Vapor Intrusion Now an Included Pathway

Which ASTM Practice (-05 or -13) Applies?

• After ASTM E1527-13 was first released, USEPA indicated that for an indeterminate period, it would allow both ASTM E 1527-13 and the previous version, ASTM E 1527-05, to constitute AAI to qualify for CERCLA liability protections. As of October 6, 2014, USEPA finalized a rule clarifying that going forward the newly approved ASTM E 1527-13 standard will be the only acceptable standard for Phase I ESAs to qualify for AAI.

• As was originally proposed, the final rule requiring exclusive use of ASTM E 1527-13 for AAI has a delayed effective date of October 6, 2015 to allow completion of investigations currently being conducted under the old standard.

• Although exclusive use of ASTM E 1527-13 will not be required for another year, it is best practice to discontinue reliance on ASTM E 1527-05 and to begin using only the new standard going forward.

Part 2:Special Focus: Vapor Intrusion

Definition of Vapor Intrusion (VI)

Vapor intrusion is the migration of volatile chemicals from the subsurface into overlying buildings. Volatile chemicals in buried wastes and /or contaminated groundwater can emit vapors that may migrate through subsurface soil and into air spaces of overlying buildings. (USEPA 2002)

Why Worry about VI?

• Vapors can accumulate in dwellings or occupied buildings to levels that may pose short-term or long-term safety hazards, and/or health effects.

• Average person drinks 2 liters of water per day• BUT – the Average person inhales 20,000 liters of air a day • Because of this health concern, VI can pose an economic risk

to retail development

How does it work?

• Pressure-driven flow– Building underpressurization• Stack Effect• Wind loading• Ventilation systems• Barometric pressure

– Diffusion through cracks

Factors Affecting VI

• Source Characteristics• Soil or groundwater• Concentration and location• Biodegradability• Soil Characteristics• Air permeability, moisture content, surface cover• Building Construction• Foundation type (basement, slab-on-grade, etc.)• Foundation openings (crack size)• HVAC system, air exchange rate• Depressurization

• E 2600-10: Standard Practice for Assessment of Vapor Intrusion into Structures on Property Involved in Real Estate Transactions– Addresses VI arising from contaminated soil and groundwater specifically as it

relates to real estate transactions

– Provides guidance on the VI Assessment (VIA) process, from screening to mitigation

– Allows the risk of vapor intrusion to be quickly ruled out for most properties

The ASTM VI Standard

• VI was a non-scope consideration in E 1527-05 (under “indoor air quality” exclusion in that standard)

• E 2600-08 was intended to clarify that VI is non-scope in E 1527

• E1527-13 expressly added consideration of VI

• BUT – E1527-13 also specifically stated that use of E2600 is not required to achieve compliance with All Appropriate Inquiries (E1527-13, Note 4).

The ASTM VI Standard

The ASTM VI Standard

• Standard is intended to help understand and mitigate issues as part of real estate transactions

• Standard does not supersede federal or state guidelines or regulations – it refers user to applicable standards or regulations

How the Standard Works

• Vapor Intrusion Condition (VIC) is defined as “the presence or likely presence of any chemicals of concern in the indoor air environment of existing or planned structures on a property caused by the release of vapor from contaminated soil or groundwater on the property or within close proximity to the property, at a concentration that presents or may present an unacceptable health risk to occupants.”

How the Standard Works

• Four tiers, used to determine risk of a VIC or potential VIC (pVIC)– Tier 1: Screening – Desktop; Search Distance and

characteristics of subsurface and building– Tier 2: Screening – Data collection; source areas,

plume delineation, agency file reviews– Tier 3: Sampling/testing – data collection; vapor

sampling and modeling– Tier 4: Mitigation

Tiers 1 and 2

• Tiers 1 and 2 rely on existing data, typically collected during Phase I ESA

• pVICs dependent on Site Setting information, as well as COCs and Critical Distances

• Use all available information to eliminate pVICs or proceed to Tier 3

Tier 3 – Types of Sampling

• Indoor Air Sampling– Considered only a snapshot in time due to variable nature of indoor air concentrations – Generally requires numerous sampling events spanning varying atmospheric conditions and seasons – Summa canisters are generally used to collect indoor air samples. – Easily confounded by other contaminants in the facility (e.g., bottle of glue in a cabinet)

• Subslab Soil Gas– Preferred method - Collect from granular subbase material beneath building slab– Gas concentrations less influenced by ventilation and seasonal factors.– Generally collected from small (<1-inch diam.) holes drilled through the slab

Tier 3 – Types of Sampling

• Soil Vapor (Outside of Building)– In cases where subslab sampling is not allowed or is politically sensitive – Can be used to estimate soil-gas levels beneath the slab– Generally collected using a Direct Push Geoprobe unit or with Gore Samplers.

• Ambient Air– Required to establish background levels for comparison – Gas stations and industrial operations can have a significant impact on area-wide concentrations– Summa canisters generally used to collect the air samples.

Sampling Equipment• Summa Canister

– Stainless Steel Canister – Under Vacuum, regulator used to collect a time-weighted sample– Submit to laboratory for TO-15 Analysis - quantitative analysis of VOCs

Sampling Equipment• Gore Samplers

– Flexible "Tape" passive diffusion sampling devices– Insert into a rigid protective tube and installed 3-feet below surface– Soil gases adsorb onto the gore sampler and are later retrieved and

submitted for laboratory analysis

Sampling Equipment

• Photoionization detector (PID)– Instantaneous readings of total VOCs.– Does not provide a detailed analysis of the types of VOCs present

Sampling Equipment• Lower Explosive Limit (LEL) Meters

– Instantaneous reading. of the potential for an explosive atmosphere– Commonly used in methane gas intrusion investigations

Sampling Considerations

• What if urrent operations continue to use COC – intrusion vapors can not be distinguished from operating vapors during indoor sampling.

• Rising groundwater conditions may yield higher than ‘normal’ vapor levels – conversely, declining groundwater levels my yield false negatives due to a vacuum effect.

• Seasonal effects on VI levels

Tier 4 - Mitigation Solutions

• Intrinsically Safe Building Design• Institutional Controls (deed restrictions, etc.)• Engineering controls

– Source Removal– Sub-slab depressurization (most common – similar to a radon system)– Building or slab pressurization– Sealing the building envelope– Passive barriers– Passive venting

Passive Vapor Intrusion Mitigation Methods:

• Sealing openings involves filling in cracks in the floor slab and gaps around pipes and utility lines found in basement walls. Concrete can be poured over unfinished dirt floors.

• Installing vapor barriers involves placing sheets of “geomembrane” or strong plastic beneath a building to prevent vapor entry. Vapor barriers are best installed during building construction, but can be installed in existing buildings that have crawl spaces.

• Passive venting involves installing a venting layer beneath a building. Wind or the build-up of vapors causes vapors to move through the venting layer toward the sides of the building where it is vented outdoors. A venting layer can be installed prior to building construction as well as within existing buildings. It is usually used with a vapor barrier.

Tier 4 - Mitigation Solutions

Active Vapor Intrusion Mitigation Methods:

• Sub-slab depressurization (SSD) involves connecting a blower (an electric fan) to a small suction pit(s) dug into the slab in order to vent vapors outdoors. (Most common method.)

• Building over-pressurization involves adjusting the building’s heating, ventilation, and air-conditioning system to increase the pressure indoors relative to the sub-slab area. This method is typically used for office buildings and other large structures.

*Note that active systems require ongoing operation and maintenance (O&M) costs.

Typical fan and vent pipe

Effect of the New Standard• Increasing General Awareness• Sites closed using less strict cleanup standards due to

groundwater ordinances/municipal setting may have a proportionally higher VI risk if re-opened

• Deal Delays and Timing Issues– VI issues can take longer to evaluate and resolve– VI can have seasonal fluctuations– If VI mitigation requires perpetual maintenance, when

is site considered “closed” for purposes of indemnification agreements?

– PR with tenants/residents or offsite company

Effect of the New Standard• Increased environmental sensitivity for leased facilities with

potential worker exposure risks from vapors• Alterative to sampling: Preemptive engineered solutions

may be more cost effective and protective than uncertain sample results. May also reduce potential reporting requirements or risk of voiding ‘no look provisions’

• Consideration of preventative engineered barriers in new construction in the event of future risk exposure to vapor intrusion.

Part 3:Special Focus:

Construction Stormwater Permits

A. Permits required for construction sites of at least 1 acre (or smaller sites if part of a common plan of development that exceeds 1 acre)

B. Operator must obtain a NPDES permit from either EPA (in D.C., Idaho, Mass., N.H., territories and Indian Country) or authorized State environmental agency prior to discharging stormwater

C. EPA has been stepping up enforcement of the permit requirements, assessing large fines against national developers including Toll Brothers, K. Hovnanian, and Walmart

D. Permit Requirements:

1. Written Requirements:

i. Develop and Implement a Stormwater Pollution Prevention Plan (kept on site)

ii. Submit a Notice of Intent. For EPA General Permit, the NOI must include a certification that the activity will not impact endangered or threatened species. Not a requirement of most NPDES-delegated states

iii. Submit a site plan for review that incorporates consideration of potential water quality impacts

iv. Post a NPDES Permit Tracking number with contact name and phone number on site perimeter

v. Maintain records of inspections and maintenance on site

vi. Establish responsibilities among subcontractors within contract terms

vii. Submit a Notice of Termination when final stabilization of the site has been achieved

2. Erosion and Sediment Control Requirements

i. Minimize (1) sediment discharges, (2) soil exposed during construction activity, (3) disturbance to steep slopes, (4) soil compaction

ii. Install and maintain BMP controls (mulch, grass, silt fence, inlet protection, check dams, sediment traps, etc.)

iii. Control volume to minimize erosioniv. Provide natural buffers (unless infeasible)v. Utilize outlet structures that withdraw water from the surface when

discharging from basins or outlets (unless infeasible)

3. Pollution Prevention Requirementsi. Minimize stormwater exposure to construction

materials, chemical products and wastes which should be stored in dry places

ii. Prohibit discharges from pollution sources, such as fuels and oils from vehicle and equipment O&M, and develop a spill prevention and response plan

iii. Establish litter control, control of wastes such as discarded building materials, and a dedicated, and dedicate paint and concrete truck washout areas with impervious floor and berms

iv. Train staff and contractors on the purpose and use of controls

4. Site Stabilization Requirements

i. Initiate stabilization immediately if construction stops permanently or temporarily

ii. Permit must establish a deadline for completing stabilization

iii. Alternative requirements apply to arid, semi-arid, and drought stricken areas

5.For sites larger than 5 acres, construction activity must achieve higher standards (BAT and BACT)

E. Permit waivers available1.Rainfall Erosivity Factor Waiver for construction when and where little or no rainfall is expected

i. Requires an "erosivity factor" of less than 5 -- sounds technical but it only takes a few minutes to determine if the waiver applies

ii. TMDL Waiver for sites affecting impaired water bodies subject to TMDL wasteload allocations

Part 4:Special Focus:

Building Materials

A. What’s the issue?1. Building materials may be contaminated with PCBs and

other contaminants, including metals and polyaromatic hydrocarbons

B. Sources of contamination?1. Concrete aggregate2. Coatings3. Caulk

C. Potential liability for reuse or disposal of building materials

1. Improper reuse or disposal could result in liability as a discharger of hazardous substances, requiring remediation and potentially resulting in civil or criminal fines or penalties.

Part V:

Special Focus: Developments –

Wetlands and Other Waters

A. USEPA and Army Corps of Engineers (“ACOE”) proposing rules to revise several definitions of the federal Clean Water Act (“CWA”) in light of recent U.S. Supreme Court decisions

B. Comment period ends July 21, 2014

C. New definitions would expand the jurisdiction of USEPA and the ACOE

Current Regulatory Definition of Waters of the U.S.

40 CFR 230.3(s) The term waters of the United States means: 1. All waters which are currently used, or were used in the past, or may be susceptible to use in interstate or foreign commerce, including all waters which are subject to the ebb and flow of the tide; 2. All interstate waters including interstate wetlands; 3. All other waters such as intrastate lakes, rivers, streams (including intermittent streams), mudflats, sandflats, wetlands, sloughs, prairie potholes, wet meadows, playa lakes, or natural ponds, the use, degradation or destruction of which could affect interstate or foreign commerce including any such waters: * Which are or could be used by interstate or foreign travelers for recreational or other purposes; or * (From which fish or shellfish are or could be taken and sold in interstate or foreign commerce; or * Which are used or could be used for industrial purposes by industries in interstate commerce;

4. All impoundments of waters otherwise defined as waters of the United States under this definition; 5. Tributaries of waters identified in paragraphs (s)(1) through (4) of this section; 6. The territorial sea; 7. Wetlands adjacent to waters (other than waters that are themselves wetlands) identified in paragraphs (s)(1) through (6) of this section; waste treatment systems, including treatment ponds or lagoons designed to meet the requirements of CWA (other than cooling ponds as defined in 40 CFR 423.11(m) which also meet the criteria of this definition) are not waters of the United States.

Waters of the United States do not include prior converted cropland. Notwithstanding the determination of an area’s status as prior converted cropland by any other federal agency, for the purposes of the Clean Water Act, the final authority regarding Clean Water Act jurisdiction remains with EPA.

1. Revised definition of “Waters of the United States”

a. Proposed definition would require that all waters in the following categories be jurisdictional “waters of the United States” by rule – no additional analysis would be required: “Traditional navigable waters; interstate waters, including interstate wetlands; the territorial seas; impoundments of traditional navigable waters, interstate waters, including interstate wetlands, the territorial seas, and tributaries, as defined, of such waters; tributaries, as defined, of such waters; tributaries, as defined, of traditional navigable waters, interstate waters, or the territorial seas; and adjacent waters, including adjacent wetlands.”

2. “Other waters” (those not fitting in any of the above categories) could be determined to be “waters of the United States” through a case-specific showing that, either alone or in combination with similarly situated “other waters” in the region, they have a “significant nexus” (a term to be defined) to a traditional navigable water, interstate water, or the territorial seas.

3. Define several regulatory terms for the first time (“neighboring,” “riparian area,” “flood plain,” “tributary,” and “significant nexus”).

4. Categorically exempt by regulation certain waters and features over which the agencies have not asserted jurisdiction as policy matters.

5. The 2006 Rapanos Supreme Court decision required showing that a water has a “significant nexus” to a traditional navigable water, interstate water or the territorial seas.

D. Many legal and scientific experts believe that the proposed rule would result in more smaller and remote upstream bodies of water falling within federal CWA jurisdiction, which would require permitting mitigation for activities within such water bodies

E. USEPA is asking a panel of the agency's Science Advisory Board (“SAB”) to review the scientific and technical basis of the agency's proposed rule on U.S. jurisdictional waters under the CWA

1. The USEPA request is being directed to the SAB panel that is reviewing a related agency draft report, “Connectivity of Streams and Wetlands to Downstream Waters: A Review and Synthesis of the Scientific Evidence.”

2. USEPA is requesting public comments on the draft report.

3. USEPA has also requested comments on alternate approaches to determining whether “other waters” are similarly situated and have a “significant nexus” to a traditional navigable water, interstate water, or the territorial seas.

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