One of the most common questions we are asked is what exactly is a Phase 1 ESA?
To begin with ESA stands for environmental site assessment.
A Phase 1 ESA is an environmental site assessment report that is prepared to identify any possible or potential environmental contamination issues. This is done via a detailed visual inspection and records review of the property that will include looking at the history of the property, reviewing government records, viewing aerial photography of the property and any other public and private resources available to create as detailed a history of the property and its past use as possible.
We will cover this in another article but a Phase 2 ESA would then be implemented depending on the results found in the Phase 1 ESA. A Phase 2 ESA is often undertaken if the Phase 1 ESA finds actual or potential risks of contamination.
A Phase 1 ESA report is basically due diligence on behalf of the purchaser or property owner to ensure there are no known contamination issues and to help make you aware of any potential contamination issues that may arise in the future. Phase 1 ESA reports are often required for financing from the banks for commercial properties and are also useful to provide baseline data before any activity is undertaken. It would not make sense to make a large purchase on a property and then five years down the road find out you cannot sell it because you neglected to complete a Phase 1 ESA at purchase that could have identified issues you now find prevent you from selling the property. It would be like bolting the stable after the horse has gone and the clean-up is often very expensive. As the property owner it would be your responsibility to clean up any contamination. A Phase 1 ESA protects you against this and could help protect you from being liable to complete the fore mentioned cleanup. Any baseline data you have collected before you undertake any activity which could potentially contaminate a site provides evidence of the condition of the site at that point in time and can assist in protecting you when you go to sell your property.