New EPA Standard for Investigating Contaminated Sites

Client Advisory

April 19, 2006

The U.S. Environmental Protection Agency (EPA) has promulgated a new standard for investigating contaminated sites that will supersede present methods. The new standard will take effect November 1, 2006. It will require greater effort on the part of property purchasers and their consultants, but may well achieve better results. It defines “all appropriate inquiries,” a statutory term used in several defenses to landowner liability for cleanup of contamination under the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA), popularly known as the Superfund Law.[1]

As is generally well known, CERCLA casts a wide net of legal responsibility for release of a broad range of hazardous substances. Included under the statute as “potentially responsible parties,” or PRPs, are persons who own and operate a “facility,” or who owned and operated a facility when hazardous substances were disposed of; persons who arranged for the disposal of hazardous substances at a facility and persons who transported hazardous substances to a facility.[2] Superfund liability for cleanup costs is strict, joint and several, and retroactive.[3]

The three CERCLA defenses for which the new standard is relevant are those for so-called “innocent landowners,” non-responsible contiguous property owners, and bona fide prospective purchasers. Persons who are able to prove their entitlement to these defenses are excluded from the owner or operator category of parties responsible for cleanup under CERCLA. All three defenses require the proponent to prove that it undertook “all appropriate inquiries into the previous ownership and uses of the facility in accordance with generally accepted good commercial and customary standards and practices.”[4]

Congress charged EPA with developing a standard for “all appropriate inquiries” in the 2002 Small Business Liability Relief and Brownfields Redevelopment Act (the 2002 Brownfields Act).[5] Until EPA acted, Congress provided that compliance with the ASTM International E1527 standard for environmental site assessments satisfied the appropriate inquiry requirements. On November 1 of this year, the new EPA rule will replace the ASTM standard.[6]

While the new rule is similar in several respects to the ASTM standard (requiring the involvement of an “environmental professional,” review of historical and governmental records, interviews and site visits), there are several important differences, so that one cannot rely on knowledge of prior procedures.

First, the requirements for who can function as an “environmental professional” have been tightened, requiring specified levels of education and experience.

Second, performance standards to which the inquiry must conform have been specified, requiring the environmental professional to analyze any “data gaps” to determine whether they affect the reliability of the investigation. “Sampling and analysis may be conducted to develop information to address data gaps.”[7]

Third, the historical document review is to “cover a period of time as far back in the history of the subject property as it can be shown that the property contained structures or from the time the property was first used for residential, agricultural, commercial, industrial, or governmental purposes."[8] Under the ASTM standard, it was only necessary to go back as far as 1940.

Fourth, the interview requirements in the EPA rule are significantly broader that those in the ASTM standard (where a single interview was often conducted). Under the EPA rule, the inquiry must include interviews of the current owner and occupant of the property, and where there is more than one occupant, major occupants must be interviewed, “as well as those occupants likely to use, store, treat, handle or dispose of hazardous substances…, or those who have likely done so in the past."[9] If necessary to achieve the rule’s performance objectives, the inquiry should include interviews with one or more current and past facility managers, and past owners, occupants or operators and their employees. Further, for abandoned properties, “where there is evidence of potential unauthorized uses of the subject property or evidence of uncontrolled access to the subject property, the environmental professional’s inquiry must include interviewing one or more (as necessary) owners or occupants of neighboring or nearby properties from which it appears possible to have observed uses of, or releases at, such abandoned properties.”[10]

Fifth, the person who has commissioned the inquiry must play an active part, and not leave everything to the environmental professional. It must determine any specialized knowledge or experience it possesses, the relationship of the purchase price of the property to the price if the site were uncontaminated, commonly known or reasonably ascertainable information about the property (if not located by the environmental professional), and recorded environmental cleanup liens (unless the environmental professional’s search includes such liens).[11] The EPA rules encourages, but does not require, that any information that is so developed be made available to the environmental professional; if it is withheld, there is a risk that the environmental professional may determine that there is a data gap requiring additional investigation.[12]

EPA’s new rule is almost certain to become the new standard for conducting environmental site assessments. Persons contemplating property acquisitions should begin at once to familiarize themselves with its requirements, and should inquire as to the procedures their consultants and professionals will be following to assure that post-November 1 site assessments comply with the new rule, thus providing protection against CERCLA liability, as well as important information on site conditions to avoid obstacles to future development. 

Questions regarding this advisory should be addressed to Clifford P. Case (212-238-8798 or, Michael C. Davis (202-898-1515 or or Christopher Rizzo (212-238-8677 or


[1] 42 U.S.C. §§ 9601 et seq.

[2] 42 U.S.C. §§ 9607(a)(1)-(4).

[3] United States v. Alcan Aluminum Corp., 990 F.2d 711 (2d Cir. 1993).

[4] 42 U.S.C. § 9601(40)(B)(i). See also 42 U.S.C. § 9601(35)(B)(i)(I).

[5] Pub. Law No. 107-118, signed into law January 11, 2002 (the “2002 Brownfields Act”).

[6] 70 Fed. Reg. 66,070, 66,072 (November 1, 2005).

[7] 40 C.F.R. § 312.20(g).

[8] 40 C.F.R. § 312.24(b).

[9] 40 C.F.R. § 312.23(b).

[10] 40 C.F.R. § 312.23(d).

[11] 40 C.F.R. § 312.22.

[12]  See 70 Fed. Reg. 66,092.

Carter Ledyard & Milburn LLP uses Client Advisories to inform clients and other interested parties of noteworthy issues, decisions and legislation which may affect them or their businesses. A Client Advisory does not constitute legal advice or an opinion. This document was not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein. © 2020 Carter Ledyard & Milburn LLP.
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