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What's the Cost of a Phase II Environmental Assessment?

How Much Will a Phase II Assessment Cost?

drilling in townA close friend called. She told me she was working on a development project, and just got the results of a Phase I Environmental Assessment. The assessment pointed to a potential obstacle to the project - a Recognized Environmental Condition (REC). The project site used to be a dry cleaner that closed up shop a few years back, and the assessment noted there could have been a release of tetrachloroethylene, or perchloroethylene (PCE) into the soil and groundwater. My friend was really upset. It was already difficult enough with stakeholders, banks, city and county regulators taking chunks of her time and money - now this. She was stressed. “Can you help?” she said, “Now they want a Phase II Assessment to investigate the REC (Recognized Environmental Condition). All I want to know is, how much is this going to cost?”

I paused for a moment thinking, “It depends…”, but quickly remembered the stress she was under. “How about we meet for coffee in a couple of hours and in the meantime, I will work up a cost for a Phase II Assessment for you?” That’s what she wanted to hear.

Why a Phase II Assessment is Often Recommended

A Phase II Assessment is often recommended to verify a REC (Recognized Environmental Condition). In the case of my friend, a Phase II was recommended to determine whether there was a release of PCE. Typically, a Phase II assessment entails collecting soil and/or groundwater samples and analyzing the samples for particular chemicals. Often, a Phase II Assessment means the same thing as a soil and groundwater investigation.

My friend described the site as a small empty retail unit at a shopping mall, so it seemed to me that we could find out if there had been a chemical leak by drilling three small-diameter holes into the ground to collect soil and groundwater samples. One at the former location of the dry-cleaning machine, one at the floor drain, and one along the sewer leaving the unit. At least two soil samples and one groundwater sample would be collected from each hole, and samples would be analyzed at a state-certified laboratory. A soil and groundwater investigation report would be prepared that would include methods, results, conclusions, and recommendations. All the work would be overseen by a professional geologist or engineer whose signature would appear on the final report.

Breaking Up the Phase II Assessment Into Tasks

puzzleOne way to estimate the cost of work is to break it up into tasks, and then estimate the cost of each task. A Phase II soil and groundwater investigation can be broken into three main tasks:

  • preparation of a work plan,
  • fieldwork, and
  • reporting.

Estimate the Cost

With the tasks identified, we can estimate the cost. My knowledge and experience are important here, but a reference carries weight. The California Underground Storage Tank Cleanup Fund, a state program for underground storage tank owners and operators that funds investigation and cleanup, publishes cost recommendations (Guidelines). While these recommendations are associated with work on sites contaminated with gasoline and the like, they can be applied to assessment work for other compounds, such as the dry-cleaning chemicals my friend was worried about.

Work Plan

The work plan:

  • identifies known property conditions,
  • the potential contaminants and
  • suggests how best to take samples.

The Guidelines estimate the 2018 cost of a Phase II soil and groundwater investigation work plan at $3,380.

Adjusting for inflation, about 8.6% according to California Consumer Price Index (CPI) Inflation calculator, we have estimated the cost of a Phase II soil and groundwater work plan at $3,671. (Note – you can also adjust estimated costs to a particular area of California or to a national average.)

Field Work

For field work, we will consider the cost of drilling three holes to 30 feet as suggested in the Guidelines. In the description of work, the Guidelines include scheduling, coordination, field preparation, permitting and field work in the estimated cost for three holes. The Guidelines also include costs for equipment rental and supplies, a drilling contractor, chemical analyses, and subcontractor mark-up. Here the number of samples and methods of sampling that the Guidelines recommend differing slightly from the proposed work for my friend’s site. To address the differences, we will simply adjust the Guidelines cost by subtracting unnecessary costs.

sampleAs presented in the Guidelines, the total cost to drill three holes to 30 feet is $11,244, but after adjusting for the difference in the number of samples to be analyzed (9 for my friend versus 15 in the guidelines) and the number of analyses to be conducted (one for my friend versus two in the guidelines), the total cost for drilling three holes to 30 feet comes down to $8,308.

Field work also includes health and safety coordination and waste disposal. The Guidelines estimate the cost of a Community Health and Safety Plan at $1,392 and waste disposal at $145 per 55-gallon drum of soil waste. It is likely only one drum of waste will be generated during field work on my friend’s project.

Reporting

Regarding an assessment report, the Guidelines provide the cost for a report where six holes are drilled and three of the holes are converted to groundwater monitoring wells. It’s clear the scope of work linked to the Guidelines estimate is greater than for my friend; however, in my experience, the difference in terms of report preparation is small, in this case, less than $500. The Guidelines quote $6,944 for an investigation report – let’s say $6,500 for our report.

Something Left Out

Finally, is there anything we left out? For example, it’s likely the floor of the unit is concrete, and we will need a concrete driller to actually get underground. Additionally, now that we have holes in the floor, we will need to restore the floor by backfilling the holes and patching the surface. The Guidelines are not much help here, but in my experience, a concrete-cutting contractor is going to cost about $500 and the backfill and patch is going to cost about $900.

Now, what else did we miss? Something. To address this something, we use a contingency factor, say 10 percent. This additional 10 percent is to account for things we did not address or for unforeseen circumstances – like the concrete floor being 15 inches thick instead of the typical 6-to-8-inch thickness.

Estimated Cost

Now we are ready to sum up the costs. Between the work plan, field work, and the report, the total estimated cost (adjusted for inflation) is $22,946. With a 10% contingency the total cost ranges from $22,946 to $25,241. Now I was ready for a cup of coffee with my friend.

I arrived on time to find my friend seated at a window table. She looked up and noticed me, “Hi, great to see you”, she said. We received our coffee and spent what seemed like forever adding cream and sugar in silence. I spouted up, “Ready for the news?” She slumped, “Okay.”

I started with my explanation of how I got the estimate, but when I looked over, her glazed eyes told me to get on with it. “Alright, I estimated the cost for a Phase II soil and groundwater investigation at your location to be $25,000.” The glaze turned intense, “That’s a heck of a lot of money - why does it cost so much?” I thought for a moment and said, “Let’s look at the factors that drive cost.”

Factors That Drive Cost Up in a Phase II Assessment (Why Does it Cost So Much?)

There are several factors that drive the cost of a soil and groundwater investigation, but for me, two factors top the list: the type of contamination and site location.

Type of Contamination

The type of contamination can be broken down into the composition (what’s in it), the magnitude (how much is there), and the extent (how far has it spread).

Site Location

Site location includes things like where the site is located, how big it is and whether improvements have been done, the location of groundwater, site geology, local regulations, site use (residential or commercial); and how hard it is to properly dispose of waste from drilling.

Let’s take a closer look at some of these factors.

Factor That Drives Up Cost

How and Why the Factor Drives Cost

Kind of Contamination Hazardous contaminants, such as those that are toxic, require specialized personnel, equipment, and disposal that drive up costs.
Contamination Level Higher levels of contamination drive up waste disposal fees and require specialized methods, personnel, and equipment that cost more.
Contamination Area and Depth Larger areas and depths of contamination need more time to investigate and bring on more waste to dispose of, more samples to analyze, and more data to report.
Soil and Rock Very hard or dense ground requires special equipment for drilling and longer drilling times that drive up costs. The same is true for drilling in sandy or loose soil.
Groundwater Dealing with groundwater drives up costs and the depth of groundwater below the ground drives costs because greater depths require more drilling, more well construction time, and more waste disposal.

 

"Well, that sounds complicated," she said. “So you’re saying that if the groundwater was deeper at my place, a soil and groundwater investigation would cost more?” “Yes”, I said, “for one thing, the field investigation might take longer than it would otherwise, increasing the cost.”

“So it could be worse…” she said flatly.

We sat in silence for a moment and then I asked if she had any more questions. She sat up straight and said, “Probably, but thank you. I need to let this soak in.” “No problem”, I replied, “let me know if you need any more help with your project.” I let her know our firm was a one-stop-shop that could provide all the environmental-related services she would need to complete her project. I also told her we are very sensitive to the hardships, both financial and emotional, that environmental issues bring.

Understanding the Cost of a Phase II Environmental Assessment: Factors That Influence the Price

We covered a lot of ground here. Using cost guidelines from California’s Underground Storage Tank Cleanup Fund as a reference, we broke down how much it costs to complete a Phase II soil and groundwater investigation, including the work plan, field work, report, and a 10% contingency. We also looked at the two primary factors that make a Phase II assessment so expensive - the type of contamination and site location. 

Are you staring down the barrel of a Phase II Assessment, and don’t understand why? Are you having trouble juggling the competing demands of regulators and other stakeholders?  Let us help. We’ve got 20 years of experience solving problems just like this. Schedule a consultation by clicking the button below, or just give us a call at 831-475-8141.