Vapor Intrusion: When to Worry? NAREIM National Assn of Real
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Transcript Vapor Intrusion: When to Worry? NAREIM National Assn of Real
Vapor Intrusion: When to Worry?
NAREIM
National Assn of Real Estate Investment Managers
Las Colinas, TX
September 26, 2012
Beverlee E. Silva, Esq.
Alston & Bird LLP
[email protected]
Why Should You Care?
Human health concerns
Can’t supply an alternative source of air
Potential liability for personal injury
Material impact on property value
It is increasingly on the Regulators radar
It is increasingly on Lender’s radar
A Wake Up Call – Hillside School 1989
Current state of vapor intrusion law,
regulation and guidance
32 states have developed / adopted VI guidance in the last few
years
More expected after EPA’s guidance is released
Move towards including VI risk evaluations as part of standard
Phase I ESA
EPA is working toward a proposed rulemaking to add a new
screening component to OSWER's Hazard Ranking System
(HRS), which would allow sites impacted by vapor intrusion or
intrusion of other subsurface contamination to be evaluated for
placement on the Superfund National Priorities List (NPL).
Newest Regulatory Developments
EPA VI Guidance promised by November 30, 2012
ASTM – E2600-10
Examples of State Regulation
California
New York
Numerous others (1,1-DCE and TCE have become the major
COC)
California
DTSC (LA RWQCB)
Soil Gas, Vapor Intrusion and Mitigation “Advisory”
California Human Health Screening Levels
EPA Region 9
Follows EPA Draft VI Guidance
Adopted Region 3 Screening Levels
Proposed DTSC Changes
Preference for sub-slab samples
Collect exterior soil gas samples at source
Repeated sampling of soil gas
Preference for gaseous tracers
Raising sub-slab AF to 0.05 (5x stricter)
A decision matrix?
Defer to LUFT manual for petroleum hydrocarbons
California LUFT
Vapor Intrusion is NO PROBLEM if
Dissolved GW concentrations < 1000 ug/L for benzene, and
10,000 ug/L for TPH and 5 feet from receptor
Free product is 30 or more feet from receptor
If above conditions are met, then it is assumed that natural
attenuation is sufficient to mitigate concentrations
New York
In 2005 NY reopened over 400 pollution cases to determine if chemical
vapors were lingering at the sites
Over 250 of those cases are now listed as completed
Current law went into effect in 2008
Requires notice to be given to tenants when owner or owner’s agent receives a
letter from “issuer” that test results exceed NYSDOH guideline or an OSHA
guideline
Issuers include:
New York State DEC
Certain Municipalities
Person subject to an order under State Superfund or Oil Spill Program
Participant entered into a Brownfield Site Cleanup Agreement
Fact Sheets
The owner must submit one or more fact sheets from NYSDOH within 15 days
of receipt of SVI results which exceed relevant guideline, identify:
Compound or contaminant of concern
Detected levels of the compound or contaminant
Health risks associated with exposure to compound or contaminant
A means of obtaining additional info on the compound or contaminants
If subject to engineering control, owner must provide fact sheet to prospective
tenant prior to signing of lease
Lease must include the following language in bold:
“NOTIFICATION OF TEST RESULTS: The property has been
tested for contamination of indoor air: test results and additional
information are available upon request."
New York Upcoming Legislation
Proposed Law to Be Introduced Next Year Amends Current
VI Law
Strengthen current requirements for notifying tenants of health
risks at contaminated sites
Amend current notification requirements to include subtenants
Require warning signs on contaminated buildings
Double the maximum fine landlords face for violating law
Due Diligence for Vapor Intrusion
Start with general questions
Type of contaminants
On-site/offsite
From owner, former owner, or third party
Remediation status
Closed
Ongoing investigation/remediation
Remediation strategy
Active/passive
Planned use
Engineering controls
AAI may or may not include ASTM E 2600-10, but recommended in due
diligence
Lender Requirements for Vapor Intrusion
Current state of lender requirements
CERCLA – secured creditor exemption
Requires:
No affiliation with polluter
Disposal ended before purchase of site
All Appropriate Inquiry (AAI) performed before purchase
Report any releases identified
Continuing obligations after purchase
Likely direction for lender requirements
VI required as part of Phase I ESA
ASTM E 2600-10
Adopted June 14, 2010: “Standard Guide for Vapor
Encroachment Screening on Property Involved in Real Estate
Transactions.”
Replaced 2008 “Standard Practice for Assessment of Vapor
Intrusion into Structures on Property Involved in Real Estate
Transactions”
The revised standard is refocused solely on screening for the likelihood
of volatile vapors to reach the subsurface of a property involved in a or
otherwise real estate transaction --a Vapor Encroachment Condition
(VEC).
Acronyms
VES: Vapor Encroachment Screen
Chemicals of Concern (COC): Chemical that can potentially migrate as a vapor
into a structure, and is generally recognized as having an adverse impact on
human health. COC generally meet specific criteria for volatility and toxicity.
Vapor Encroachment Condition (VEC):
The presence or likely presence of any chemicals of concern in the indoor air
environment of existing or planned structures on a property caused by the
release of vapor from contaminated soil or groundwater on the property or
within close proximity to the property, at a concentration that presents or may
present unacceptable health risk to occupants.
PVEC – Potential VEC
Two Tier Vapor Encroachment Screen
Tier 1 – Investigation of all known or
suspected contamination within Area
of Concern
Tier 2 – Screening to determine actual
risk
Tier 1
Tier 1 of a VES is an investigation of all
known or suspected contaminated
properties within an Area of Concern
AOC for petroleum contamination -- 1/10
of a mile
AOC for VOCs -- 1/3 of a mile
Tier 1
May include:
searches of government records, local history,
media archives and aerial photography
Does PVEC exist within area of concern? May
need to move on to Tier 2 screening
Professional judgment of EP crucial
Tier 2
May include physical sampling of soil and
groundwater to determine the nature and
extent of the underground plume
If sufficient information exists in regulatory
records or previous investigations, physical
sampling may not be necessary
Tier 2
Three questions:
how serious is the contamination?
how close is it to the property of interest?
it likely to encroach on the property?
Crucial questions to evaluating whether to
invest/lend
What Affects Vapor Intrusion?
Contaminant Type (i.e., petroleum compounds or
chlorinated solvents)
Type of soil under the structure,
Contaminant concentration,
Exposure/contaminant migration pathways (i.e.,
foundation cracks, utility trenches),
Depth and location of contaminants relative to the
structure, and building/ventilation system design.
How Does ASTM E2600-10 Impact
Diligence?
Contains legal appendix to clarify the
relationship with the ASTM E 1527-05
Phase I standard, CERCLA, and AAI.
EPA appears to agree with ASTM
interpretations
Phase I
The Legal Appendix of E 2600-10 “clarified” that vapor
migration onto a property involved in a real estate
transaction needs to be evaluated in a Phase I
investigation, no different than groundwater migration.
If VEC is found to exist or is likely, then EP uses
professional judgment to determine if VEC represents a
recognized environmental condition (REC).
AAI
CERCLA, the definition of “release” includes the terms
“emitting” and “escaping” into the “environment”
In the AAI rule, the environmental professional is required
to provide “an opinion as to whether the inquiry has
identified conditions indicative of releases or threatened
releases of hazardous substances…on, at, in, or to the subject
property.”
VEC is a “release” under CERCLA and for purposes of AAI
When to Worry?
Location
Structures with odors, wet basements, floors
Sites with contamination (future use restrictions)
Complaining occupants
Be particularly sensitive to VI issues on properties on
or near residential developments or sensitive-use
operations (e.g., day cares or schools)
Higher risk of lawsuits
Different standard of care with sensitive populations
What types of site cause most worry?
Brownfields Redevelopment
Former industrial site with on-site soil and groundwater impacts
Purchase of commercial property
Former dry cleaner or gas station on-site or nearby
Petroleum Hydrocarbons
Service Stations, USTs, Pipelines
Oil Furnaces (naphthalene)
Chlorinated Hydrocarbons
Vapor Degreasers (TCE, TCA)
Dry Cleaners (PCE, DCE)
Circuit Boards (VC, TCE, CCl4)
Semi-Volatiles
MGP Sites (PAHs)
Electrical Power (PCBs)
How to Protect Yourself?
Environmental insurance
Mitigation techniques
Revise environmental due diligence policies or
Phase I scopes of work to address vapor intrusion
When reviewing Phase I ESA, look beyond list
of recognized environmental conditions (RECs)
Mitigation v. Liability
Institutional controls
Engineering controls
= removal of the contamination sources
placement of vapor barriers
vapor collection systems
indoor treatment systems
Not legally enforceable
Intrinsically safe building design
= building features as ventilated basements, vapor barriers
and other systems to reduce or eliminate vapor intrusion
issues
Mitigation techniques at site and jurisdiction specific