Understanding the Costs of a Phase I Environmental Site Assessment (ESA)
"Why does it cost so much for a Phase I Environmental Site Assessment?" This is the most common question from prospective clients seeking this type of service. After all, the product is simply a large document outlining the detailed history of the property. How difficult is that?
First, understand that all Phase I Environmental Site Assessments (ESAs) must be conducted using the guidelines in the American Society of Testing & Materials (ASTM) Standard for Phase I ESAs. Following the ASTM standard assures protection from environmental damage caused by previous property owners.
Okay - so why does it cost so much? Let’s start with what it takes to prepare a Phase I site assessment according to the ASTM standard.
What are the Phase I Preparation Steps in an Environmental Site Assessment?
The preparation of a Phase I ESA can be broken down into the following steps:
|
Step |
Time to Complete |
|---|---|
|
1) Initial property evaluation |
1 - 3 |
|
2) Government data request |
2 |
|
3) Local records request and file review |
2 - 6 |
|
4) Data review and client communication |
1 - 2 |
|
5) Government records review |
12 - 16 |
|
6) Historical records review |
8 - 12 |
|
7) Interviews with persons knowledgeable of property history |
1 - 2 |
|
8) Property inspection |
2 - 8 |
|
9) Report preparation |
10 - 16 |
|
10) Report review and submittal |
1 - 3 |
|
Total Hours |
40 - 70 |
What Drives the Cost of an Environmental Site Assessment?
Government and Historical Records Review
A large amount of time is spent on conducting a thorough investigation into the current and historical uses of the property under review. This is done by reviewing governmental and historical records. As seen in the table above - this takes up to 28 hours.
Many Phase I providers turn to Environmental Data Resources (EDR), a company that tailors their products to comply with the ASTM Standard. EDR searches hundreds of federal, state, local, and tribal databases using the property as the focal point. An EDR database package for Phase I costs about $375.
Local governmental agencies are also contacted for records related to the property under review. These agencies can include local fire departments, environmental health agencies, building departments, and tax assessors (for verifying property characteristics). Some agencies have their files available online, others will copy requested files and mail a CD, and others require an in-person visit to their office to review the files.
Historical records such as air photos, street directories, topographic maps, and fire insurance maps (Sanborns Maps) are also reviewed to provide information on past uses of the subject property. For example, if the local governmental agencies have no records of any USTs being used at the property, but an air photo from 1949 shows a gas station canopy on the property, then we’ll cross-check the historical street directories to see if a gas station existed at the property during this year.
Interviews, Inspection, and Reporting
Along with records review, interviews are conducted, the site is inspected, and a report of findings is prepared - according to the table estimate, up to 29 hours of work.
Completing a Phase I ESA can take at least 40 hours, with the average being around 52 hours. We quote most of our Phase I ESA projects between $4,200 and $5,500,on a fixed fee basis.
Why does the Phase I Report cost so much more than the Environmental Data Resources (EDR) Report?
To meet the ASTM Phase I standard, an Environmental Professional must conduct, or be responsible for conducting a Phase I ESA. The EP and staff must have sufficient education, training, and experience to conduct a Phase I ESA, and that drives cost.
The cost of an EDR report is fixed at a low price because it is primarily a computer-generated database dump. On the other hand, the EP and their staff sift through the EDR report, inspect the site, conduct interviews, and review historical information. They gather all the relevant information and summarize it in a Phase I report that includes conclusions and recommendations. It is these recommendations and conclusions that commercial real estate transactions depend upon. That is what drives the cost far above the cost of an EDR report.
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Our Phase I ESA preparers are well-qualified, with over 30 years of experience in the industry. We are here to answer your questions, and our initial consultation is always free. Click the button below to schedule a consultation or call us today at (831) 475-8141.