Environmental Assessments

Phase 1, Phase 2, Phase 3?

Sometimes it seems that there is a bit of confusion as to an environmental assessment and environmental reports.  In California, every new project that is submitted to a City/County for approval must be accompanied by an environmental assessment study, which is dictated by the California Environmental Quality Act (CEQA).  The goal is that the environmental impacts of a new project are adequately assessed, and these potential impacts typically focus on traffic, habitat, species, air quality, cultural resources, and the like.  Other states may have a similar or some version of CEQA.

But when you hear the term “Phase 1”, it is typically referring to an environmental assessment of a property relative to previous uses and whether the site contains any toxic materials or contaminants.  This Phase 1 report is not considering the new project proposed, but whether the previous uses might require some level of remediation on the property.  This Phase 1 report is commonly required by lending institutions.

So, what is Phase 1, versus Phase 2 and Phase 3 reports?  The Phase 1 is generally more preliminary in nature, and typically includes research of historical records for a property and a site walk for visual observations.  If the history of the property and the site visit do not indicate a likelihood of contamination, any further research or studies may not be needed.  But let’s say that the records showed a previous installation of an underground storage tank (UST), which typically means storage of fuels, then there is some possibility of contaminants.

Phase 2 is commonly the next step, which would entail taking some soil samples through site borings and conducting lab analyses.  Depending on the Phase 2 results, the next step could be Phase 3, which could mean further research or a remediation plan to clean up the soils.  Because of the work with soils, I have found that geotechnical firms are many times the experts who conduct and prepare these reports.

If you are an expert in this field, or if you have questions, we welcome additional comments or questions below.

John Kaye has over 30 years experience within the land development and homebuilding industries, having held senior management positions with The Irvine Company, Koll Real Estate Group, and Brookfield Homes. As a developer, John has overseen the land acquisition, entitlements, and development of master planned communities, residential tracts, urban infill sites, and land assemblages. His experience and skill sets include land acquisition, land brokerage, project management, market analysis, finance, and strategic planning.

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