Blogs > Joe Derhake's - Between a REC and Hard Place

How to Love an Environmental Professional (2 Comments)

Fri, 30 Dec 2011 00:42:33 +0000

Entry

Maybe my wife should have written this one—or maybe she would have advised young people to not…better to marry a doctor.

More seriously, how do consulting firms love their environmental professionals? When you run an environmental due diligence firm, you have to be good at it if you want to succeed.

First of all, employees need respect. Firms that focus on environmental due diligence have advantage in terms of respecting the environmental professional. I began my career at a civil engineering firm that was good at Phase I Environmental Site Assessments, but focused more on engineering disciplines. There was a sense that you need to become a PE to move up in the company. Also, in my experience, sometimes firms that are good at a great many cool engineering things have a hard time recognizing the Phase I Environmental Site Assessors as equals to the big shot engineers who are doing $100 million federal contracts.

Secondly, employees need a challenge. The key is to focus on due diligence and all of the ins-and-outs of a Phase I ESA and the commercial real estate business. Consulting in commercial real estate transactions provides an endless helping of interesting and nuanced situations. I find the field interesting because of the intersection of environmental science and business. Also, environmental due diligence intersects so many other disciplines: industrial hygiene, environmental compliance, environmental remediation, and building sciences to name a few. A good Environmental Professional must continue to accrue expertise in the adjacent fields.

Third, most environmental professionals relish a sense of team. When an employee feels like he is part of a team, he will work hard for the company and his teammates. The sense of achieving things together is a very rewarding part of work. Much of the love that the EP feels may come from their peers. Team building activities create a great sense of culture, accountability… and maybe love.

Happy holidays. Hopefully your families will heap the love on their environmental professional this year.

Keywords

Environmental Professional, Environmental Site Assessor, Phase I Environmental Site Assessment, Phase I ESA, environmental due diligence

Putting Henry's Law to Use

Wed, 23 Nov 2011 22:03:23 +0000

Entry by JoeDerhake

Entry

This blog is a re-post. Math is the same, but I corrected a typo and I added some clarifications (see italics).

What do you do when you have groundwater sampling that shows solvent contamination and you want to infer a soil gas concentration, but you don't have soil gas testing data? This situation comes up a lot.

Maybe you are doing a Phase I ESA and know that the property across the street has high solvent concentrations in groundwater – hence the question, what are the highest soil gas concentrations that could partition from the saturated zone to the vadose zone?

Predicting the relationship between soil gas concentrations and groundwater concentrations is relatively easy in a controlled environment. You can use Henry's Law, which is a ratio of the concentration of a substance in air to its concentration in water. Of course, you can only go so far in the open environment of vadose zone soils with differing temperatures and pressures, etc.; but it is helpful to make a couple of assumptions to predict a range of reasonable soil gas concentrations.

Henry's Law Constant (unitless) is defined as:

H’ = C air / C water

Where

H’ = Henry’s Law Constant (dimensionless)

C air = concentration of compound in air (volumetric basis)

C water = concentration of compound in water (volumetric basis)

Therefore, C air = C water * H’

Henry’s Law Constants are the partition coefficients for various substances for water to air partitioning. Henry’s Constants were determined in laboratory experiments published by the U.S. EPA and also by John Washington in the journal Ground Water. You can view Henry’s Constants for various contaminants here.

Let's assume that we have 100 µg/L PCE in a groundwater plume. What is the equilibrium soil gas concentration at 25 °C and standard pressure? Henry’s Constant (H) for PCE at 25 °C is 0.0.0174 atm-m³/mol (U.S. EPA Henry’s Law Constant Calculator website).

According to Environmental Forensics Principles & Applications (link below), you can convert H to H’ (Henry’s Law Constant unitless) via the Ideal Gas Law:

Henry’s Law Constant (unitless) H’ = H/(RT)

where R = ideal gas constant (8.20575E^-5 atm-m³/mol-K)

T = temperature (Kelvin; 25 ^oC = 298.15 ^oK)

Henry’s Law Constant PCE (unitless) H’ = 0.0174/(8.20575E^-5 X 298.15) = 0.711

C_air = C_water x H’ = 100 µg/L X 0.711 = 71.1 µg/L

I reposted the blog because Dr. Peter Woodman correctly points out that ppb_v is not the same as µg/L for atmospheric concentrations of soil gas and my first post implied that they were the same. Henry's Law applies to partials pressures at the parts per billion level on a molar basis (ppb_v). To use Henry's Law on a water concentration in µg/L, you would first convert to parts per billion by volume (ppb_v), by dividing by the Molecular Weight of PCE (165.83 g/mol), and then covert back to µg/L in gas by multiplying by the Molecular Weight -- the molecular Weight Calculations to ppbv and from ppb cancel out.

The mathematical results in the first and second post are the same.

These two links provide additional support for these methods:

Henry’s Law Excerpt from Environmental Forensics

H&P Mobile Geochemistry Excerpt on Henry’s Law

So, 71.1 µg/L is the worst-case on-site scenario for PCE groundwater concentration equivalents likely to produce atmospheric concentrations of PCE in soil gas; however, in reality this concentration is highly unlikely because Henry’s constant assumes that equilibrium was reached (with vigorous blending in a laboratory beaker, etc.). This form of mixing doesn’t occur in the subsurface, so the actual soil gas concentrations tend to be much lower.

You could also calculate a range of soil gas concentration equivalents, by changing the soil temperature, which gives you a new Henry’s Constant coefficient value (H’) to determine the worst-case scenarios in winter and summer. This could be particularly useful in screening out an off-site vapor intrusion source of concern.

How else could you use Henry’s Law?

Maybe you did a Phase II Subsurface Investigation and measured significant concentrations of soil gas – is this from an on-site source or could it be from the off-site groundwater plume?

You may find that you can associate lower concentrations of a chemical in soil gas based on vapor partitioning from groundwater, but not higher soil gas concentrations. Well, where is that line? Henry’s Law can be useful in determining that the soil gas concentration is too high to be coming from the groundwater (but may be from the soil, an active leak, or a preferential vapor migration pathway).

Be careful with this calculation as the groundwater in contact with vadose zone is NOT a closed system and temperature and pressure, etc. vary. This calculation will not predict the precise value of atmospheric soil gas concentrations; rather, help frame the possible range of atmospheric soil gas concentrations that could be detected above a groundwater plume.

Keywords

Henry's Law, Henry's Law Constant, Henry's Constant, Henry's Coefficient, soil gas testing, groundwater sampling, Phase II Subsurface Investigation

Grace and Diplomacy are Part of Quality

Sat, 24 Sep 2011 14:16:52 +0000

Entry by JoeDerhake

Entry

When doing environmental due diligence in support of an acquisition, we are a small but sometimes very important part of a larger process. While our fee is modest, we are often supporting a very high dollar transaction. Occasionally we find ourselves center stage at the negotiating table. Maybe our Phase I ESA found a REC and we are asked to deliver an opinion that may kill a deal and cost several stakeholders a substantial financial loss. Sometime we find one of our peers/competitors across the table offering an opinion different than our own.

Situations like this, where we are put to the test, are when we really earn our money.

Our clients are generally graceful and diplomatic when negotiating with the other side. Real estate professionals understand the importance of relationships and future reputation. I have benefitted from the advice of some of the best in the real estate profession. "Be measured, but firm." "Be hard on the issues and soft on the people.” "Listen before you talk.”

I think clients respect when two engineers agree on the science, but differ as we get to risk tolerance opinion. Two environmental professionals pitted against each other can fulfill their respective missions gracefully and diplomatically by keeping the debate in a professional place. To do this I think you need to allow the other side to have their own opinion and to look for differences in the data analyzed.

When environmental professionals act as graceful and diplomatic extensions of their clients, they deliver quality environmental consulting service.

Keywords

Phase I ESA, Quality Phase I Environmental, environmental risk tolerance, environmental consulting

The $5,000 Phase I Environmental Site Assessment (22 Comments)

Mon, 15 Aug 2011 20:00:24 +0000

Entry by JoeDerhake

Entry

Much energy has been expended in this community in bemoaning the low prices of Phase I Environmental Site Assessments. No doubt we have seen prices drop during the great recession. Much of my practice is spent working for clients who are price sensitive, but I also have as many clients that are more concerned about quality!

Value for value

Look, we are consultants and we more or less sell or time. If a $2,000 Phase I ESA includes 20 hours of staff time (for easy math, often it is much more than that for the same price), then you get 30 hours for a $3,000 Phase I ESA. What can we do for you in those extra 10 hours? What can we do for you in 50 hours? I think we as an industry need to communicate the value for paying more.

Don’t get me wrong, I believe that the standard ASTM E1527 Phase I ESA is a good value—especially the type of Phase I ESA generally produced by an EBA firm. Never the less, ASTM E1527 is a flexible document and if we put our mind to it we can do more.

What can we give our clients in a $5,000 Phase I ESA? Here are a few things that are above and beyond a standard ASTM E1527 Phase I ESA:

Business Environmental Risks: Certainly non-scope items that are left out of a standard ASTM Phase I could be included in the $5,000 Phase I, such as asbestos or lead sampling, compliance review, etc. This requires good discussion with the client and preliminary knowledge of the subject site ahead of time to know what potential risks to evaluate.

Better Aerials: The number and quality of aerials we get for each Phase I Environmental Site Assessment is highly dependent on what is reasonably ascertainable within budget and time constraints. Much of the industry orders digital aerials from a data provider. A fine set of aerials and generally acceptable quality, but not always the best source for a particular area. There are many local aerial companies, public libraries or local government offices with aerials around the country that will allow you to see the actual photographs (not copies or scans) which can yield better clarity. However, often the subject property is nowhere near the local source, or there are multiple possible sources with different sets available, which can render the additional time and cost to obtain them unrealistic unless you have a healthy budget.

Often the local sources can facilitate a 3D aerial review using a stereoscope. The difference can be substantial. Occasionally we find ourselves huddled around a computer screen staring at a dark gray smudge on an aerial asking each other if this smudge represents a recognized environmental condition.

One of my employees once secured an engagement for $15k to do a review of aerial photographs for a contaminated site. And he delivered commensurate value as he poured a great deal of time analyzing aerials from multiple sources. He analyzed every quadrant of the site via a stereoscope. My point is we can deliver more when the client is willing to pay for higher value.

Review All Possible Historical Records: ASTM allows flexibility in what records to review and rightly so. Environmental professionals can choose historical records that yield the best bang for the buck and skip less useful records such as historical topographic maps, or Sanborns in a very rural area. My $5,000 Phase I ESA clients can expect that we gather 100% of useful data, including historical topographic maps, data from local historical societies, etc.

More Interviews: Interviews are an underestimated resource. A couple interviews are standard in a good Phase I ESA when there is adequate cooperation. But if you want to go beyond the industry standard, interview 10 people. Yes, 10 people. Interview the tenants, the owner, the property manager, past owners and tenants (often difficult and time consuming to track down), the neighbors, waste haulers, city officials and regulators (above and beyond standard local agency interviews), and maybe even the town historian. Multiple interviews on the same subject can be interesting especially if you get different answers.

Experienced Registered Professionals: A lot of our work is reviewed by an RG or a PE. Some clients require it. Go a step further and require the RG or PE do the site visit. Having a 15-year registered professional doing the site visit is no doubt beyond what is required by ASTM (ASTM is rather week on this subject, contributing to commoditization), but a trained eye can have great value on a really complicated site. You may even consider sending two professionals, an environmental professional and in industrial hygienist; or an EP and a younger staff member to do a tedious tasks such as inventorying drums.

Our survey on errors in Phase I ESA revealed that two of the top five reasons for errors in Phase I ESAs were due to weak inspectors.

File Reviews: Are regulatory file reviews part of ASTM E1527? There was much debate on the subject at the EDR client summit. Is the fee paid relevant to the answer to this question? What if the site is in Dallas, Texas and the file is at the TCEQ in Austin, Texas (4 hour drive). If the client gives us an appropriately large fee and four weeks to do the project, then a file review is clearly reasonably ascertainable.

Push Quality

Constantly talking about some ridiculously low fee becomes a destructive mantra. Instead encourage clients to specify a scope of work that goes beyond ASTM and understand that the fee will move up accordingly. Of course, you don’t have to do $5,000 Phase I Environmental Site Assessments to push the limit on quality. Ask our clients to commit to paying between $2,500 and $3,000 and then deliver reports that go beyond ASTM.

Keywords

Phase I ESA, Phase I Environmental Site Assessment, Environmental Site Assessments, ASTM E1527, ASTM Phase I ESA, ASTM E1527 Phase I ESA

Phase 1 ESAs on Nearby Assets: One ESA or Two? (14 Comments)

Tue, 02 Aug 2011 00:21:11 +0000

Entry by JoeDerhake

Entry

Anyone in the practice of Phase 1 ESAs knows this story. A client calls and has two properties that need a Phase 1 ESA, but they are very close to each other. To save money the client asks to do the two assets as one Phase 1 ESA.

So where do we draw the line?

Clearly properties immediately adjacent can be lumped into one report; although if they have nothing to do with each other operationally, this lumping can make the report read awkwardly.

What about if the second property is directly across the street? What if it is non-adjacent but 300 feet away? What if it is a quarter mile away? Where is the limit?

If the two assets are not immediately adjacent, it becomes more difficult to deal with in terms of aerials and database reports. At some point the environmental consultant might be forced to order two EDR packages.

When the assets are not operationally connected, the report reads strangely. The consultant starts talking about property A and property B and they might as well just right two reports. I recommend doing two Phase 1 ESAs when assets are non-adjacent or not operationally connected.

I wonder if the ASTM E1527 standard can provide some limits here to protect consultants from having to write clumsy reports.

Keywords

Phase 1 ESA, Phase 1 Environmental Site Assessment, Phase 1 ESAs on nearby sites, Adjacent sites ESA

Off-Site VEC and De Minimis Environmental Conditions (9 Comments)

Wed, 01 Jun 2011 00:10:01 +0000

Entry by JoeDerhake

Entry

At this year’s EDR Client Summit I was asked to be part of a panel on Vapor Encroachment Conditions. The panelists were given case studies where a Phase 1 Environmental Site Assessment had been completed and the assessor had classified a condition as a Vapor Encroachment Condition. The panelists were asked to opine on whether or not these conditions were Recognized Environmental Conditions (RECs). The two cases were as follows:

Phase 1 ESA Case 1:

A former dry cleaner has been identified from historical research in a shopping center located cross-gradient across the street, approximately 100 feet from the target property boundary. No data is available on the dry cleaner and the Phase I consultant identifies the dry cleaner as creating a VEC on the target property. Subsurface soil is sandy with some gravel. For more than 50 years, the target property has had a tall office building centrally located on it surrounded on all sides by open air parking and streets. The asphalt parking lot extends approximately 200 feet from the building to the road on all sides.

Phase 1 ESA Case 2:

A state hazardous waste site with chlorinated solvents is located 1,000 feet up-gradient from the target property boundary. The source of contamination has been excavated and removed. Residual contamination remains in the groundwater with the contaminated plume approximately 920 feet long. A hotel is built on the target property approximately 100 feet from the boundary facing the hazardous waste site. The consultant defined this situation as creating a VEC on the target property.

The panelist generally agreed on the importance of considering the target property and the off-site concern as a specific location in space and not a “star” on the map. We also agreed that the client risk tolerance was an important consideration.

Recognized Environmental Condition?

I raised a technical issue that related specifically to the definition of a recognized environmental condition and the de minimis exclusion. Below is the definition of a recognized environmental condition.

3.2.74 recognized environmental conditions—the presence or likely presence of any hazardous substances or petroleum products on a property under conditions that indicate an existing release, a past release, or a material threat of a release of any hazardous substances or petroleum products into structures on the property or into the ground, ground water, or surface water of the property. The term includes hazardous substances or petroleum products even under conditions in compliance with laws. The term is not intended to include de minimis conditions that generally do not present a threat to human health or the environment and that generally would not be the subject of an enforcement action if brought to the attention of appropriate governmental agencies. Conditions determined to be de minimis are not recognized environmental conditions.

For a vapor encroachment condition to be considered a REC it must not fall within the definition of a de minimis condition. If the VEC is neither a health concern nor a regulatory concern, then it is easily defined as de minimis.

De Minimis/Human Health Conern:

“…conditions that generally do not present a threat to human health…”

If a vapor encroachment condition represents a threat to human health either for the current use or for a planned use of the property, then the environmental professional should classify the VEC as a recognized environmental condition.

De Minimis/Regulatory Enforcement:

“…would not be the subject of an enforcement action if brought to the attention of appropriate governmental agencies.”

This was the most interesting part of the panel discussion as ASTM is a little vague. I interpret this section to mean “would the owner of the target property be subject to a regulatory enforcement action”; as opposed to “would the owner of the off-site property be subject to enforcement action.” This is a huge distinction, as the target property owner is very rarely subject to enforcement action for an off-site release.

Someone in the room debated this subject with me. My argument back was that you do not consider the countless LUST, CERCLIS, and NPL sites in the surrounding areas to all be RECs, right? Why not? These sites are all subject to regulatory enforcement action. We don’t consider every nearby release site a REC simply because the owner of the off-site property is subject to a regulatory enforcement action (without other reason to believe that the off-site release has impacted the subject property or presents a human health risk to the subject property occupants).

In the end, I think that ASTM E1527’s definition of a recognized environmental condition could be clarified on this point.

Is a VEC a REC?

If more than 99% of VECs do not meet the regulatory enforcement portion of the de minimis standard, then the much larger concern for a VEC to be a REC is whether it represents a human health concern.

There were clients at the conference that expressed greater sensitivity on this issue. To address these needs, the Phase 1 ESA consultants should fully discuss the vapor encroachment condition and if it does not meet the definition of REC, still include the discussion as an environmental issue (or some classification of elevated risk that is less than a REC).

In conclusion, the focus of the off-site vapor migration investigations should be on vapor intrusion conditions (vapor potentially inside a building, not just at the property line) and the corresponding threat to human health.

Keywords

Vapor encroachment condition, VEC, off-site vapor, off-site VEC, Vapor intrusion, Recognized Environmental Condition, REC, ASTM REC, De minimis, De minimis environmental condition, Phase 1 environmental, Phase 1 environmental site assessment, Phase 1 esa

Expected Environmental Loss on a VEC

Fri, 13 May 2011 22:12:07 +0000

Entry by JoeDerhake

Entry

What is the Expected Environmental Loss (EEL) on a Vapor Encroachment Condition (VEC)?

First, what does the term Expected Environmental Loss mean? It is a term I coined and introduced on my previous blog post. In short, it is the mean or expected loss that an owner will experience if they own a given asset with an associated recognized environmental condition. The term Expected Environmental Loss (EEL) is mathematically patterned after the Probable Maximum Loss product.

A series of Loss Scenarios could be imagined and then either through real data or professional estimates, a likelihood could be assigned to each scenario. Of course, each scenario is unique. Comparing the liability associated with a 20-year-dry-cleaner in California when groundwater is at 20 feet below ground surface with the liability of a 5-year-dry-cleaner in Colorado where the groundwater is at 100 feet below ground surface. However, large site-specific case variability does not stop us from opining on PMLs, so why should it stop us from opining on the Expected Environmental Loss?

So what is the Expected Environmental Loss on a Vapor Encroachment Condition? First, let me state that I don’t want to get too far into the debate as to whether a VEC is a Recognized Environmental Condition (REC) – VECs are often RECs but it depends on the site.

Secondly, my argument in past blogs has been that off-site releases rarely result in a big dollar amount for the owner of a site, if none of the following are true: 1) she is developing or dewatering the property; 2) the subject site has a drinking water well on-site; 3) the subject site has also released some sort of chemical and there has been co-mingling; 4) VOCs migrate on-site and represent a VEC.

Now, let’s take the 4^th scenario where an off-site VEC would be considered a REC as the basic case study for this EEL:

A firm does a Phase 1 Environmental Site Assessment and finds that a retail center with no on-site RECs and on city water is 100 feet from a dry cleaner with a substantial release of PERC. After a file review of the off-site dry cleaner’s regulatory file, the EP concludes that PCE vapors likely have migrated to the site at soil vapor levels above human health screening levels (HHSLs). Since vapor levels are likely above the HHSLs, the EP designates the Vapor Encroachment Condition a REC.

EEL estimate for an off-site VEC

Here is my EEL estimate on this VEC/REC case. Suppose that I have had 100 clients in this exact situation. Let’s say that all 100 clients purchase the property anyway and owned the office building for the next 20 years. Here is my supposition on the resulting scenario likelihood:

50 Office Buildings           Zero Loss
29 Office Buildings           Minor Loss; forced to do Phase IIs during financing. $10,000
20 Office Buildings           Does an investigation, a risk assessment, installs a venting system. $40,000.
1 Office Building               Conducts active remediation on the on-site fraction of the plume. $100,000

Total Loss = (50x$0) + (29x$10,000) + (20x$40,000) + (1x$100,000) = $1,190,000

EEL = Total Loss/Sample Size = 1,190,000 /100 = $11,900.

If we look at the past 10 years, I think loss rates on this issue are far lower than the above estimates. However, the EEL is intended to be forward looking.

I think someone could argue that as awareness of these issue rises the third category will grow, but even so I don’t think that the EEL is going to get larger than $25,000.

Some might argue that this data is all made up and arbitrary. Well, that is how predicting the future goes. We must use the best data and experience we have, and extrapolate that to estimate what the future might look like. VEC loss data from the 1990s would not be very meaningful. If our client is a buyer, she needs to know what the next 10 or 20 years will hold in liability.

An off-site VEC is typically a Soft REC

The REC represented by a VEC from an off-site source is a soft REC compared to that of an on-site gas station. The difference between EELs of an off-site VEC, $11,900, and a gas station, $164,000, is huge. See my previous blog on Expected Environmental Loss for a discussion of the gas station EEL.

I wonder if some users would be willing to post their view on how such a data set would look in the future. What do you think?

Keywords

Expected Environmental Loss, EEL, Environmental Loss, quanitifying, environmental risk, risk model, Vapor Encroachment Condition, VEC, off-site VEC, off-site REC, Phase I ESA, Phase 1 ESA, Phase I, Phase 1, Environmental Site Assessment

Expected Environmental Loss (4 Comments)

Fri, 22 Apr 2011 20:08:52 +0000

Entry by JoeDerhake

Entry

If I own 100 gas stations for 20 years, what is my Expected Environmental Loss (EEL)?

For an environmental consultant to provide some sort of measure of “expected” environmental risk and related financial loss, as opposed to the worst-case risk, is extremely valuable to real estate investors. Real estate investors constantly balance risk and reward. The environmental consultant tends to speak in worst-case-scenarios. Our clients need the worst-case-scenario, but would also greatly benefit from the most-likely-scenario—or the EEL.

Data exists to provide pretty good estimates, right? There is tons of data out there. For the gas station scenario, we could grab data from 1,000 State UST Fund Sites, add up the expenditure and divide by 1,000. I have been told by the California UST Fund that the result is $167,000. Can we call that the EEL?

One could argue that by definition these sites are sites with releases, so the derived EEL would be skewed too high, or that releases in the future should be less common and smaller than the past. Fair arguments, but I would argue that some quantitative measure is better than none.

Let me layout my definition of the EEL—I recently coined this term. The EEL is all potential environmental costs, multiplied by the percent likelihood of that scenario coming to pass. Here is an example of how to calculate it:

Let’s use the following site as a make-believe case study. A property was used as a gas station for the past 20 years, with no Phase II data, in a given state. In that state, we were provided the following loss data from a major oil company on 100 sites that they owned in this state:

30 Gas Stations:                                Zero Loss
30 Gas Stations:                                Minor Leak.   Average loss for this bucket is $80,000
30 Gas Stations:                                Substantial Leak. Average loss for this bucket is $200,000
10 Gas Stations:                                Huge release. Big plume. Average Loss for this bucket is $800,000

Total Loss = (30x$0) + (30x$80,000) + (30x$200,000) + (10x$1,400,000) = $16,400,000

EEL = Total Loss/Sample Size =16,400,000 /100 = $164,000.

Realize that this math is on a make believe data set, but I think that we as an industry could do a few studies and define this word.

Now if you are working in this make believe state on the gas station with no existing subsurface data, you could site that the Average EEL for gas stations in this state is $164,000. Then just like structural engineers adjust PMLs for unique characteristics, the environmental professional could adjust the EEL up or down based on site specific data, such as groundwater, soil type, or proximity to sensitive receptors. The end result would be a bit inexact for sure, but would give clients a great order of magnitude appreciation of risk.

Gas stations often represent a bona fide recognized environmental condition, but consider how the data set looks for a much softer REC. For example, how might the buckets look if we are talking about a hydraulic lift? This data is harder to find, but any of us who have been in the business for 20 years might be able to offer a good guess or even a valuable data set. Just for fun let’s speculate what that example looks like:

Assume a guy owns 100 sites with 3 hydraulic lifts on each site. Assume for simplicity that he did not use other chemicals in the course of his business. I am guessing the data set would look like this:

50 Sites:                                              Zero Loss
20 Gas Stations:                                Minor Leak.   Average loss for this bucket is $5,000.
20 Gas Stations:                               Substantial Leak. Average loss for this bucket is $20,000
10 Gas Stations:                                Huge release. Big plume. Average Loss for this bucket is $100,000

Total Loss = (50x$0) + (20x$5,000) + (20x$20,000) + (10x$100,000) = $1,500,000

EEL = Total Loss/Sample Size =$1,500,000 /100 = $15,000.

So if I had these data sets available, I could give my clients far more quantitative advice that the binary REC / no-REC advice.

I would tell the gas station-buying client that the EEL is $164,000 and that the reasonable worst case scenario is $1,400,000.

I would tell the hydraulic lift-buying client that the EEL is $15,000 and the reasonable worst case scenario is $100,000.

I’m curious what other consultants think. Has anyone developed this type of data?

Keywords

Expected Environmental Loss, EEL, Environmental Loss, quantifying environmental risk, risk model, Phase I ESA, Phase 1 ESA, Phase I, Phase 1, Environmental Site Assessment, Environmental Report

Mission Critical: It's All About the People (2 Comments)

Fri, 15 Apr 2011 20:34:12 +0000

Entry by JoeDerhake

Entry

My mission statement came from a conversation with my father. My father was 5 years retired and he was reflecting on his career. He was an automotive engineer for Cadillac and Buick. He had a fine career getting promoted up the ladder as an engineer and as an executive. When I asked him what was the most meaningful achievements in his career, he said: “the people”.

I was surprised by this answer. Car companies produce cool products….or at least a lot cooler than a Phase I Environmental Site Assessment. I asked him: what about the cars? He said no, it was the people that he managed, mentored, and worked alongside. Hmmm?

It is normal to compare yourself to your father and as a civil engineer doing Phase I ESAs and PCAs, I always felt like less of an engineer than a man who designed cars. True as this may be, I found an opportunity to be successful in the arena that my father thought most important: the people!

I set out to do something great: build the best firm for talented employees. I have more control over the work environment in my consulting firm than my father did at GM, and this has been our mission from day one.

I even kicked around a tagline of “Clients 2nd, Employees 1st!” I think sophisticated clients would realize that happy, talented employees yield good service and high quality.

Values are critical to attracting and retaining quality professionals. A company must stand for something other than making money. Staying true to values, even when difficult, has helped us create an environment where people work together and like each other. We spend too much of our life at work to not get along with the people on your own team. In the end, we might struggle to tell our grandchildren why our work was so important – we might end up like my father and talk about the PEOPLE.

Keywords

Environmental career, environmental job opportunity, job opportunity, Partner job opportunity, due diligence, career

Off-Site Recognized Environmental Conditions (RECs) (9 Comments)

Mon, 14 Mar 2011 17:45:45 +0000

Entry by JoeDerhake

Entry

Characterizing an off-site release as a Recognized Environmental Condition during a Phase 1 Environmental Site Assessment (ESA) has never sat well with me simply because in 19 years of practice I have yet to do a major environmental cleanup where a regulator was forcing a totally innocent property owner to cleanup his neighbor’s mess.

Now I have had a dozen or more instances where a client has experienced expense as a result of the neighbor’s release. These instances fall into five categories:

Comingled Plume: the subject property has had a release to the soil/groundwater and the plumes have become comingled—in this instance, a regulator may make the property owner cleanup a lot of the neighbor’s mess;
Development: the client is developing the site and must remove soil or groundwater that has been impacted as a result of the neighbor’s release migrating on-site;
Vapor Encroachment: the release of a volatile organic compound has migrated on-site and represents a vapor encroachment condition;
Dewatering: the subject site is dewatering a subterranean parking garage and unknowingly pumping contaminated groundwater into the sewer system; and
Private Water Supply: the subject site has a groundwater supply well that has been impacted by the off-site contamination, and the owner must either abandon the well or filter the contaminants.

While the five scenarios presented above are all serious, we can often eliminate 4 of these quickly: often the client does not plan to develop, there is no reason to suspect an on-site release, there is no on-site dewatering system, and drinking wells are usually deep enough to avoid impact from off-site contamination (provided you can document the well depth and have good information regarding the extent and migration of the off-site plume).

That leaves Vapor Encroachment as the primary reason to consider an off-site release a Recognized Environmental Condition in a Phase 1 Environmental Site Assessment. A large up-gradient release can migrate in vapor phase or through ground water and create a vapor intrusion condition. Vapors can migrate up from groundwater, through the soil column, and into the subject property building. After 15 years of soil vapor sampling this phenomena is well proven and not all that uncommon.

What is uncommon is a real estate owner being forced to write big checks on account of this condition. First, most real estate owners are not that proactive when it comes to vapor encroachment. Second, vapor encroachment conditions can often be mitigated relatively affordably—at least compared to soil and groundwater remediation. I agree that a vapor encroachment condition is a recognized environmental condition; however, these off-site issues are certainly a lesser concern than an on-site issue.

Keywords

Off-site RECs, RECs, Phase 1 ESA RECs, Vapor Encroachment, Vapor Intrusion