EPA’s and ASTM’s New Environmental Due Diligence Standards

On November 1, 2005, the U.S. Environmental Protection Agency (EPA) published its long-awaited final “All Appropriate Inquiry” (AAI) Rule that must be followed by persons receiving federal Brownfield grants and any property buyer seeking eligibility for defenses against federal superfund [Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA)] liability as an “innocent landowner,” “contiguous property owner” or “bona fide prospective purchaser.” As expected, in late November ASTM published a new Phase I Environmental Site Assessment Standard known as ASTM E1527-05. Because most lenders are expected to require compliance with the new ASTM Standard, every buyer, seller and developer of real estate needs to understand the AAI Rule, the ASTM Standard, and their differences.