Negotiating real estate deals for potentially tainted property may initiate a complex chain of events that environmental engineering firms can help navigate. These professionals handle the detective work of exploring what might be hidden beneath the surface of a property. At a site being eyed for development, it is not unheard of for trace chemicals, waste material, or some other residue to be left behind by a prior occupant. A former location of heavy industry might be reborn as an office park or a residential project, but only after contaminants are dealt with. Sorting out what needs to be cleaned up – and the extent of work that may be required – could make or break such projects. Additionally, in the wake of the COVID-19 outbreak, cleaning a property might also include professional-grade disinfection.
For example, environmental remediation firm EWMA took quick action as the virus outbreak led to business disruption that cascaded across the state. Donald Richardson, president, says his firm oriented its compliance services to speak to issues and concerns raised by the spread of COVID-19. Such services usually address indoor air quality, mold and other biological hazards, he says. As the severity of the outbreak was realized, Richardson says his firm mobilized to develop protocols for disinfecting and cleaning structures for viral exposure. “It’s straightforward what to do, but it’s complicated by the state we are in,” he says. “We’re in triage right now.”
Offering such services did not come easily given the logistical issues of lockdowns on activity, Richardson says. He cautioned that some businesses might try to handle disinfection on their own and risk doing themselves harm. Misusing bleach and ammonia, for example, could create toxic fumes.
While many businesses closed per the governor’s orders, essential businesses that remain open must address the ongoing risk of exposure in the workplace. Furthermore, even business locations that did close may require a plan to disinfect and keep returning workers safe, says Michael Sylvester, EWMA’s executive vice president.
Workspaces, touchpoints and other sensitive areas that workers come into regular contact with need to be cleaned, he says, beyond a mere wiping down of the surface. EWMA’s plans include matching the degree of disinfection to the potential risk. For example, Sylvester says if a person documented to have contracted the virus passed through an area, aggressive steps, such as fogging or a spray decontamination process, must be taken. Depending on the long-term impact of COVID-19, essential operations such as hospitals and the food industry may need recurring disinfection in the future, he says.
The outbreak naturally affected how environmental engineers operate. With certain construction operations deemed essential in the midst of business closures, GZA GeoEnvironmental continued to send out field teams as necessary per their role in the process. “As recommended, we have provided our essential field staff with a letter indicating their status and job responsibility,” says GZA’s David Winslow, senior vice president and district office manager. The firm issued additional job safety guidelines and protection measures for those essential field workers while many other personnel work remotely from home.
Even without concerns about viral outbreaks, environmental engineers already have plenty on their plates helping developers and property sellers sort out the cleanup for projects. Winslow says GZA helps clients evaluate their risk if chemical or waste contamination is found on a property slotted for development. That risk could include cleanup costs as well as legal and regulatory compliance. One of the steps Winslow says the firm takes is to steer clients towards incentives for brownfield remediation. “There are tax incentives for developing a contaminated property,” he says. “It can be based on job creation or tax increment financing.” Some buyers, he says, actively look for contaminated properties to buy at a lower price and then clean up and elevate their market values.
The choice of who handles the assessment of a property eyed for redevelopment can be a tricky matter and a point of regulatory controversy. A licensed site remediation professional (LSRP) is an environmental pro accredited by the state to take on inspections of property for environmental issues. A mandate LSRPs must adhere to compels them to alert authorities if certain issues are discovered during a site investigation, Winslow says. That can be a point of contention for the seller of a property trying to secure a redevelopment deal with prospective buyers. “The owner might not want an LSRP coming to do the environmental due diligence because of reporting requirements,” he says.
An LSRP must report to the state what they found if there is an imminent threat to human health or the environment, he says. Firms might keep experienced people such as Winslow, who is not an LSRP, on hand to conduct environmental due diligence. If a deal goes through and the buyer wants to do the remediation, then an LSRP can be brought in, he says. Winslow says there have been attempts to change site remediation program laws to ease the reporting requirements during due diligence. Even without a change to existing regulations, Winslow says it is more common for reportable issues to be discovered in later stages of remediation than the initial investigation. “During a typical site assessment, it would be hard to find something that is a reportable condition unless you were there when a valve was opened and oil was spilling out,” he says.
There can be an advantage to using an LSRP to assess a property, says Tim Kinsella, senior vice president and company practice leader for environmental at T&M Associates. LSRPs can accelerate the redevelopment of sites because they can issue certain approvals directly, eliminating certain steps in the process. “The LSRP is responsible for the assessment and remediation,” he says.
It is not uncommon for environmental professionals to be involved in a variety of aspects of the legal and regulatory process, Kinsella says. That can include interaction with the contract purchaser’s attorney and insurance professionals. Environmental professionals will communicate extensively with the New Jersey Department of Environmental Protection.
When a buyer or property seller reaches out to environmental professionals to discuss site remediation, Chemmie Sokolic, technical director for due diligence with Matrix New World Engineering, says the first phone call sets the tone and should start with an open mind. “A lot of people have assumptions when they go forward with projects like this,” he says. “They think they know what they want and that’s dangerous.”
A project may require more or different services to be performed than presumed, he says. For example, the buyer or seller may have a previous environmental report in hand, but the assessment might not be up to date. Sokolic says questions should be asked about old reports such as, “What were the standards, regulations and guidance applied at the time?” If assumptions are made and something is missed, the responsibility to address the problem rests on the current holder of the property. “Under the New Jersey Spill Act, if you buy a property, basically any contamination that’s on the property is yours,” Sokolic says. “You own that.”
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