We cover why you especially need a Phase I Environmental Site Assessment in Florida.
When most of us think about Florida, we tend to have visions of beaches, orange groves, golf courses, and just plain beautiful scenery abound. The Keys, Disney World, Miami Beach... I know that's what I think of!
How about Florida's industrial sectors? Aren't they all new construction, high-tech, service industry type of facilities, usually squeaky clean and brand new like the tourism industry? Surely we don't need to consider the possibility that sites are contaminated with soil and groundwater pollution, do we? Isn't that sort of thing confined to the older industrialized cities in the Northeast and through the Rust Belt?
We get asked questions like this a lot. And, these are great questions, since if you don't understand why you need a Phase I Environmental Site Assessment in Florida - as much if not more than other places - then you could be on the hook for cleaning up a contaminated site, even if you weren't the one who caused the contamination in the first place! In fact, you could be liable even if you didn't know about the contamination, or if it came from someone else's actions or property.
Why you need a Phase I ESA in Florida.
First off, let me set the record straight. You actually don't "need" a Phase I ESA. Just like you don't need to go to the dentist, or a doctor, or change the oil in your car. But, you'd be an idiot not to do all those things. For a better understanding of why you "don't need" a Phase I ESA but really should get one, check out Do I need a Phase I ESA? to learn more.
Moving on. Turns out Florida has it's fair share of contaminated properties, and not all of them have been identified. And, not all of them are large contaminated sites like the 50 or so Superfund sites that are located in Florida.
In fact, an awful lot of contaminated sites throughout Florida are smaller sites, contaminated from things like fuel tanks, repeated small oil spills, gas stations, dry cleaners, faulty septic systems, etc.
These things can be at smaller sized operations, including commercial locations, residential buildings, and tiny industrial operations. Just because a piece of property is small or "looks ok" doesn't mean it actually is!
I hate to affect that idyllic vision we all have of Florida, but there are presently literally hundreds (or more) contaminated sites known to the Florida Department of Environmental Protection and the USEPA. These contaminated sites are located all over the Sunshine State, from Pensacola to Key West to Miami to Jacksonville. Just to be clear, Florida is just like most other states when it comes to contaminated sites. In short, it has a lot of them, and they're all over the place.
So what's a Phase I, and why do I need one in Florida as much if not more than most other states?
First off, if you aren't sure what a Phase I is, I suggest you read these:
Secondly, if you aren't sure how a Phase I protects you
- What does a Phase I ESA cover?
- What protection does a Phase I ESA provide?
- How long is a Phase I ESA good for?
Okay, so now that you know what a Phase I Environmental Site Assessment is and how it protects you against unwanted liability for the actions of others, let's talk about why you need one.
Florida has an interesting past.
There are plenty of things that have occurred in Florida in the past, and at present, which could contaminate the property you're thinking about. Florida's history is full of many types of industrial uses, including:
- Chemical Factories
- Mining and Processing Facilities
- Petroleum Processing
- Military Instillations
- Creosote Manufacturing
- Manufactured Gas Sites
- Metals Processing
- And a whole lot more!
This isn't even including the historical use of pesticides and herbicides at agricultural operations across Florida, gas stations, dry cleaners, and oil or petroleum contamination from smaller industrial, commercial, and residential properties.
Starting to sound more like the middle of New York City and not sunny Florida, right?!
Real estate in Florida comes at a premium.
Let's make no bones about it, Florida has a ton of real estate that demands a very high price. In fact, Florida real estate has historically been in higher demand compared to other parts of the United States, and there continues to be development pressure for residential, commercial, and industrial operations across Florida.
A lot of property transactions means a lot of people are buying and selling properties, and buyers need to make sure they know what they're getting - and getting themselves into. Our article How a Phase I ESA can prevent a bad investment! can help put things into perspective about why when you invest in property, you can accidently be investing in more than meets the eye.
Banks are banks, and Florida's no different.
Florida lending institutions know the score, and it's almost guaranteed that they'll require prospective buyers of any type of property to protect their interests.
When you borrow money from a bank, the bank is essentially buying a piece of property and you're paying them back. We all got that, right? Well, the banks know that buying a piece of property that is contaminated can be an extremely costly mistake. Environmental remediation from some type of contamination can cost hundreds of thousands, to millions of dollars, and could even render a piece of property unsuitable for any type of development. Banks know better than to just buy something without taking a look
The bottom line is a lot of contaminated sites means a lot of liability and remediation, so banks and other lending agencies don't want that additional liability of acquiring a potentially contaminated site.
So if you're buying a property, it's virtually guaranteed banks are going to require you to get a Phase I ESA. If you're buying a property with cash and think you can avoid a Phase I, you're right, but you're a fool for doing so.
Bought a contaminated property in Florida without a Phase I Environmental Site Assessment? Your problem now!
Florida law makes it very, very smart to do your due diligence before you buy a property since it's probable that you're going to be stuck with the remediation costs of a property you bought, even if you didn't cause the contamination.
Let me explain it this way. Suppose you buy a 1-acre piece of property. It's undeveloped, but you know in the past there was a house on the property, with a large 3-car garage where someone ran a home business fixing small commercial vehicles. So what, it was knocked down 25 years ago, who cares?
Well, let's say you go to dig a foundation and find a septic system left over. Probably not a huge deal, right? Now let's say you discover that the old mechanic who ran this garage in the 1950's and 1960's got rid of used oils by pouring them down the drain, which wasn't an uncommon thing to do! Guess where that drain goes? To the septic system. Guess what's in your septic system now? 20+ years of used oil soaking into the ground, contaminating the soil.
Obviously, you didn't go back in time and pollute the property, so it's not your fault, right? WRONG. In this instance, since you purchased the property without conducting a Phase I ESA, that contamination is yours. Meaning you must pay for it, all of it. You'll have to let the Florida DEP know, they're going to demand it's cleaned up, you could get charged a fine, who knows what else! This could cost you hundreds of thousands or millions of dollars, especially if that contamination made its way into groundwater.
It always blows my mind that people will either skip a Phase I or go with a low bidder because they want to save a couple hundred bucks. When there's potentially hundreds of thousands of dollars on the line if you buy something that's contaminated, I can't fathom why someone would cheap out on
To be perfectly clear, you don't want to get burned buying a contaminated piece of property without knowing exactly what you're getting yourself into, what it's going to cost to remediate it, and who's going to pay for it - before you buy!
Also, knowing this information might not stop you from buying the property as a Brownfields site, but at least you'll be making informed decisions before you're stuck with the liability.
Do yourself a favor - get a Phase I ESA in Florida every time.
Florida is a beautiful state, and we all have a responsibility to keep it that way and to clean up any problems that are found. It's the right thing to do, you just want to make sure you're doing it carefully and on your terms. You don't want to get stuck with having to clean up someone else's mess.
Whether you give us a call, or your existing environmental professional, or someone in your town, make sure you hire someone who can conduct a Phase I ESA to cover yourself in case you buy into a contaminated site.
If you're convinced that you need a Phase I Environmental Site Assessment in Florida, I applaud you. You're making a smart move. But you might wonder about the next step, which is how much am I going to lay out for a Phase I? Check out our article on How much does a Phase I ESA cost? to learn what it's going to cost you to have an environmental professional conduct a Phase I Environmental Site Assessment in Florida for you.
A Phase I ESA is good business, and a great investment, regardless of where you're located. But in Florida, it's critical to know where you stand, and what your liabilities might be.