Standard due diligence practices may not necessarily identify all the potential liabilities associated with the rapidly evolving field of vapor intrusion. To avoid unwelcome surprises, prospective purchasers may want to consider identifying potential gaps in due diligence coverage and developing a plan to close those gaps – either in the environmental site assessment (ESA) prepared for the target property or in a supplemental report or briefing.

The industry standard for an ESA of commercial property is a practice adopted by the American Society for Testing and Materials (ASTM) known as ASTM E1527.[1] ASTM E1527 was designed to identify the “presence or likely presence” of hazardous substances or petroleum products on a property – and to satisfy the “all appropriate inquiry” standards of the Comprehensive Environmental Response, Compensation & Liability Act (“CERCLA”), thereby qualifying the prospective purchaser for certain defenses to cleanup liability under CERCLA.[2]

Under ASTM E1527, conditions that are considered “de minimis” are not required to be identified as a recognized environmental condition (“REC”).[3] De minimis conditions are those 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 government agencies.”[4]

In some case, however, certain liabilities associated with vapor intrusion may exist even in the absence of a health threat or an enforcement action – or, where such conditions do exist, the liabilities may be different than those an ESA is intended to identify. Moreover, an ESA may not discuss proposed guidance or regulations, or agency practices (independent of guidance or regulations) – which could nonetheless significantly impact liabilities associated with the target property.

Among other things, in 2014, the U.S. EPA concluded that short-term exposure to low doses of trichlorethylene (“TCE”) may present potential risks to the hearts of developing fetuses.[5] Consequently, several regulatory agencies (among others, agencies in California, Ohio, Connecticut and U.S. EPA Region IX) adopted guidance, practices, or policies that establish trigger levels for TCE in contaminated media (including, but not limited to indoor air) and require evacuation of buildings where TCE is present above the applicable trigger levels.[6]

ASTM E1527, however, is not designed to identify health risks or special liabilities associated with specific contaminants. Thus, an ESA might call out the presence or likely presence of various hazardous substances on a property, including TCE, but – depending on the environmental professional preparing the report and/or client directives – not necessarily include information outside the standard scope of an ESA, such as TCE’s potential short-term exposure health risks or existing or proposed agency policy, guidance or regulations applicable only to TCE.

In addition, some states (e.g., California, Massachusetts) – following the lead of the U.S. EPA – have started to shift from a stepwise approach to vapor intrusion investigation to a “multiple lines of evidence” approach.[7] Under a step-wise approach, indoor air sampling is a last resort only after other media are screened. Under a multiple lines of evidence approach, samples from different media, including indoor air, are collected on a contemporaneous basis. Consequently, if the target property is adjacent to the source of the TCE, the property may not be subject to an enforcement action but the property nonetheless may be the likely subject of a vapor intrusion investigation, including the collection of indoor air samples.

In addition, draft and proposed guidance or policies may not be identified in an ESA but could have significant impacts on liabilities associated with properties within the scope of a vapor intrusion investigation. For example, In February 2020, California released a Draft Supplemental Vapor Intrusion Guidance (“Draft Guidance”) which, among other things, favors source remediation rather than vapor intrusion mitigation measures. [8] Although the Draft Guidance has not been finalized some agencies are already adopting certain features of the Draft Guidance.

Agency practies, even if unwritten, may also be important. For example, some regulatory agencies in California have started to require source remediation (consistent with the Draft Guidance) when a potential vapor intrusion risk exists even if current sampling data indicate there is no actual vapor intrusion present. Costs associated with source remediation may significantly exceed the cost of a vapor mitigation system.

While ASTM has adopted a guide, ASTM E2600, [9] to evaluate vapor encroachment (the migration of vapors to the property), ASTM E2600 does not necessarily close all of the gaps in coverage for potential vapor intrusion liabilities. ASTM E2600 is designed to supplement the ASTM E1527 practice guide by providing a framework for identifying the presence or likely presence of contaminated vapors at the target property. ASTM E2600 does, however, expand the scope of due diligence as it relates to vapor intrusion.

Under ASTM E2600, if a potential for contaminated vapors in soil gas is identified during an initial review, the environmental professional may conduct a more exhaustive analysis of the possibility of vapor intrusion (e.g., a review of sampling data to evaluate the size and distance of the plume) or move to invasive screening, which “may include sampling of soil, soil gas, and/or groundwater.”)[10] Although this recommendation does not incorporate the multiple lines of evidence approach to sampling, the guide advises consulting state and local guidance about vapor intrusion before conducting a vapor intrusion investigation.[11]

Finally, practices vary from one environmental professional to the other – for example, some may differ about what conditions are considered de minimis. Indeed, preferences differ among users of ESAs about whether the scope of an ESA should stick to to the ASTM E1527 standard or whether they want a more comprehensive evaluation of risks and liabilities in the ESA.

In conclusion, prospective purchasers should consider scoping out a plan for due diligence that will inform them about potential risks associated with vapor intrusion even if the risks may not be within the scope of a standard ESA.

[1] ASTM E1527-13, Standard Practice for Environmental Site Assessments: Phase I Environmental Site Assessment Process, ASTM, 2013.

[2] The U.S. EPA has affirmed that the ASTM E1527 standard satisfies the “all appropriate inquiry” requirements under CERCLA. 40 CFR 312.20.

[3] Depending on the status of the regulation of the site, the presence or likely presence of hazardous substances at a site are identified in an ESA as a recognized environmental condition (“REC”), a controlled recognized environmental condition (“CREC”), or a historical recognized environmental condition (“HREC”).

[4] ASTM E1527-13, 3.2.74

[5] TSCA Work Plan Chemical Risk Assessment, EPA, 2014.

[6] In California, the San Francisco Bay Regional Water Quality Control Board adopted a memo establishing trigger levels for TCE.

[7] OSWER Technical Guide for Assessing and Mitigating the Vapor Intrusion Pathway from Subsurface Vapor Sources to Indoor Air, U.S. EPA, June 2014.

[8] Draft Guidance, Cal-EPA, February 2020.

[9] ASTM E2600-16, Standard Guide for Vapor Encroachment Screening on Property Involved in Real Estate Transactions, ASTM, 2016. ASTM E2600 was first adopted in 2008 and was most recently revised in 2016.

[10] ASTM E2600, 9.1.2 at 13.

[11] Id., X.5 at 23.