Deal Making Strategies for Contaminated Properties Webinar Presented by: W&M Environmental Group
Webinar Introduction What are my options for buying, selling, and lending on contaminated properties? Do I pass on the deal or move forward? How much is this going to cost? This webinar focuses on S olutions for contaminated properties in Texas. We have only one hour and can’ t address everything!
Michael Whitehead Chairman, W&M Environmental BS in Soil Science and MS in Soil Chemistry from the University of Florida 25 years professional experience Phase I ESAs to Regulatory Closure of Contaminated Sites
Determine if Property is Contaminated TCEQ and/ or EP A files showing previous sampling results Previous sampling from current owner (not on file) RECs, HRECs, and/ or CRECs noted in Phase I ES A Historic RECs (HREC) indicate property cleaned up and closed through state regulatory program with no use restrictions; S ampling on case by case basis; TCEQ reviews on case by case basis Controlled REC (CREC) – S ite closed (and maybe cleaned up) but has use restrictions (commercial vs. residential) S ome level of Phase II Investigation consisting of soil, groundwater, and/ or soil gas Compare sampling results to TCEQ TRRP PCLs or PS T Action Levels; EP A is rarely involved with Texas sites S oil gas levels compared to EP A VIS Ls; TCEQ regulates indoor air but not soil gas
Limited or Comprehensive Sampling Limited Phase II Investigation performed to save money; usually Geoprobe vs. drilling rig; temporary vs. permanent wells; fewer samples and less analyses A more accurate site picture may be obtained by more samples and analyses, but not always More expensive permanent wells to determine groundwater flow direction and evaluate metals in groundwater; poor water quality will likely result in a “ hit” with metals Extra cost may NOT give you the “ bang for the buck” you expected Key: Good EP that works with you to obtain your obj ective, focus on key issues, and balance between accuracy and costs
Vapor Intrusion (VI) Many historically closed sites (VCP , LPS T , and CA) did NOT include an evaluation of soil gas or indoor air (vapor) Impact to S ite from on-S ite/ off-S ite vapors associated with underlying groundwater or impacted soil in vadose zone VI considered from on-S ite sources as well as off-S ite sources (depends on groundwater flow direction and can range from 1/ 3 mile for BTEX to 100 feet for VOCs VI typically evaluated with subgrade/ subslab soil gas samples; indoor air samples may be required inside buildings S oil gas results compared to EP A VIS Ls and is NOT regulated in Texas (TCEQ regulates indoor air) For W&M, primary VI concerns are typically: TCE, VC, and benzene
TRRP vs. PST Rules In Texas, most sites are regulated through the TCEQ or RRC rather than EP A (S uperfund or Brownfields) For TCEQ, sites fall under the TRRP or PS T rules and regulations TRRP rules (30 TAC 350) are utilized by the VCP , DCRP , CA, and enforcement. COCs detected in Phase II are compared to TRRP PCL tables PS T rules (30 TAC 334) are for PS T facilities containing petroleum products; COCs are compared to PS T Action Levels Data is compared to applicable program; if above PCLs or Action Levels, then S ite is an “ Affected Property” or LPS T case
Site Contaminated, What are My Options? Determine appropriate remediation, closure strategy and costs Can I S creen “ out of TRRP” Voluntary Cleanup Program (VCP) - gold standard Leaking Petroleum S torage Tank (LPS T) Program Innocent Owner Program (IOP) limited to properties that did not “ cause or contribute” to contamination (off-S ite sources) Approval of City Municipal S etting Designation (MS D) followed by TCEQ Certification to restrict use of groundwater Dry Cleaner Remediation Program (DCRP) for dry cleaners and property owners with dry cleaners (strip centers) Corrective Action Program – mostly used with industrial facilities TCEQ or EP A Brownfields Programs (depends on city) Closure may not address all potential environmental concerns such as asbestos, vapor, and/ or construction-related costs
“Screen out of TRRP” Contaminants above PCLs (higher of default residential PCLs and TS BCs) However, COCs are below S ite-specific background or COCs do not leach (S PLP) and have not impacted groundwater Typically used with soil metals such as lead and arsenic present in most urban soils For example, TCEQ PCL (TS BC) for lead is 15 ppm and most soils in large cities are above this level Can impacted soil be removed and remaining soil is “ clean” S ite-specific soil lead based on 8 or more “ background” soil samples using Upper Prediction Limit (UPL) calculation Option to submit to TCEQ for review, if you want TCEQ’s concurrence; Otherwise letter to file TCEQ review usually takes 45 to 60 days
TCEQ VCP VCP primary option for contaminated real estate in Texas TCEQ issues Certificate for all contaminants, all media, and current and future land owners Not re-opened except to change property use (commercial to residential) $1,000 fee + on-going review fees AP AR required and maybe a drinking water survey; expect comments and changes Class 3 Groundwater = 100 X Default PCL RAP , RACR, and even RAER may be required if remediation part of closure Most cases take 10 months to 2 years; more complicated sites take longer and final Certificate may linger with TCEQ
TCEQ IOP IOP for properties that did not “ cause or contribute” to contamination Not required by TCEQ but provides formal review with agency concurrence No shallow soil impacts; high to low COC concentrations in groundwater across site; no on-site sources in Phase I ES A IOP does not require remediation or on-going groundwater monitoring May not absolve property owner from VI issue and/ or potential VI abatement/ mitigation Property Owner may have to deal with additional construction costs (e. g., excavated soil is impacted) TCEQ issues IOP Certificate, which does not run with land and has to be resubmitted to TCEQ for next owner S ites can have both IOP and VCP
TCEQ LPST Limited to sites with PS Ts (US Ts and AS Ts); comingled plume may be disqualified LPS T cases handled by PS T group in Austin; 30 TAC 334 rules and regulations Re-imbursement money no longer available for new cases TCEQ uses PS T Action Levels to evaluate sampling data rather than TRRP PCLs Can be quicker and cheaper than TRRP , since it only addresses PS T releases TCEQ issues a No Further Action letter Previously closed LPS T cases - TCEQ likely to keep closed if COCs similar or below previous closure levels Closed LPS T sites may be re-opened due to higher COC levels, vapor, and/ or other contaminants (metals)
TCEQ and City MSDs MS D used to restrict use of groundwater in selected locations, especially where groundwater is not primary source of drinking water MS D eliminates groundwater pathway, which is generally the most restriction cleanup level. With MS D, “ perc” in groundwater goes from 0.005 ppm to 500 ppm MS D MUS T be pre-approved by City before TCEQ will review MS D application Cities with MS D include: Dallas, FW, Arlington, Grapevine, Garland, Plano, Waco, Wylie, Houston, Denton, Wichita Falls, Beaumont, Brownsville, Tyler, etc. Once approved by City, TCEQ is very likely certify the MS D MS D is used with another TCEQ program (typically VCP) because it doesn’ t provide “ closure” in and of itself
TCEQ DCRP DCRP is for cleanup of dry cleaner facilities and associated properties (shopping centers) Pay $5,000 deductible for Application; Phase II and remediation costs credited towards deductible Must pay quarterly fees ($375) as long as Corrective Action is performed Must pay back fees starting Dec. 2007 ($1,500/ year) Assessment, remediation, and closure activities performed by TCEQ contractor and paid by TCEQ TCEQ addresses DCRP based on ranking; S ites with low risk given low priority TCEQ does not allow use of MS D with DCRP cases Lower cost strategy to address dry cleaners but most sites are generally not closed in reasonable time period
Corrective Action and Other Options Corrective Action falls under TRRP but is primarily used for Industrial facilities Key differences of CA to VCP: 1) no time line for reviews; 2) NF A letter vs. Certificate; and 3) CA applicant does not have to address all COCs in all media TCEQ BS A or EP A Brownfields: limited money available for cities and public entities; TCEQ pays for Phase I/ II ES A using selected contractors TCEQ Enforcement – generally the result of non-compliance or being non-responsive to the TCEQ requests TCEQ or EP A S uperfund -(RS R/ West Dallas) – S uperfund less likely these days with alternate programs and limited funding Railroad Commission of Texas (RRC) VCP for oil and gas properties
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