Oil Spills

Asbestos

Mold

Phase I, II, and III
Environmental Audits

ENVIRONMENTAL SERVICES

A buyer seeking a piece of commercial property will typically approach a bank for the financing. Virtually all banks today call for an environmental audit (Phase I) before proceeding with the loan approval. Should an environmental concern be surfaced by the audit, further study (Phase II) and remediation may be required in order to fully assess the situation from a clean up cost standpoint. This need grew out of an increasing concern that the bank could be held liable for pollution clean up even though they are merely the lender. Further, they may be lending on collateral that is devalued due to the presence of pollution. For similar reasons, buyers and sellers (real estate developers, etc.) approach our firm to protect their interests. We recognize that we are a service business. We offer fast turnaround for Phase I and Phase II environmental assessments. Our goal is to make your real estate deal go through. As such, we guarantee remediation costs. We are a hands on company that stresses client satisfaction.

Our approach involves a high level of technical expertise, rapid service and reasonable cost. What distinguishes us from our competitors is our knowledge of and involvement in the real estate aspect of the process. In the event of a pollution problem, we will find a way to make the deal go through. One of the principals of Dorson (Bruce Stetson) has experience in the real estate field and is conversant with the issues involved in the buying and selling of property. As such, we are part of the team that allows business to transact and not a "deal breaker". This approach has been highly successful for our clients.

Phase I

A loan application is made. Upon receiving an application for a mortgage, the bank will ask that a Phase I audit be done. The Phase I audit is a broad study of all possible environmental concerns. Its purpose is to determine whether or not there are any issues that require further study. The actual study of those issues is beyond the scope of this audit. If no issues are found, there are no further environmental requirements. If there are questions raised, a Phase II study is required.

Funds to pay for this audit are usually (but not always) collected by the bank from the prospective buyer at the time of the loan application and disbursed to the consultant doing the work.

Phase II

This involves an in-depth investigation of the issues of concern raised in the Phase I audit. Typically, it involves preliminary soil and water sampling and testing. It could also involve an asbestos survey or document research. If nothing is found, there are no further environmental requirements. If something is discovered, such as contaminated soil, it is necessary to determine the cost of the required corrective action.(Phase III assessment).

Payment for this study is usually the subject of a negotiation between the buyer and the seller. Typically, the cost is divided between the two.

Phase III

If all environmental issues cannot be fully assessed within the scope of the Phase II study, a Phase III study may be required. This phase typically involves extensive testing of soil and water to determine the exact cost for the clean-up of the property. This cost can then be used as part of the negotiating process and is typically deducted from the selling price. In many cases, this cost can be guaranteed by the consultant and put in escrow at the time of closing. The property is then transferred. At that time, the money is released to the consultant for the remediation. Payment for this assessment is negotiated