PHASE Is: All Appropriate Inquiry in the Time of PFAS

In this podcast, David Rieser (K&L Gates) and Amy Edwards (Holland & Knight) will discuss the challenges and uncertainties of incorporating PFAS compounds into Phase I environmental assessments, including how to detect their presence and manage associated risks in real estate transactions.

Now that EPA has identified two PFAS compounds as hazardous substances, ASTM’s most recent Phase I methodology (ASTM E-1527-21) allows environmental professionals to include those PFAS compounds as part of their Phase I assessment. Yet it’s not clear how they determine whether PFAS are present or likely present at a property, let alone whether that presence is the result of a past or threatened release.

On the one hand, PFAS can be associated with certain locations, such as airports which used firefighting foam and certain industries such as manufacturers producing non-stick material and products. At the same time, PFAS have been found in surprising places with no clearly identifiable sources, such as Antarctica. While Phase Is are always more art than science, the level of uncertainty around PFAS makes the process especially fraught. Buyers and sellers will have to decide whether this is an issue they want addressed and consultants will be concerned about their risks of addressing or not addressing PFAS. These choices may affect the ability of the buyer to assert an innocent landowner or bona fide purchaser defense to a CERCLA claim regarding the costs to address PFAS. Unscrupulous parties may look to take advantage of the uncertainty to obtain favorable leverage and unscrupulous consultants may use the uncertainty to sell unnecessary services.

In short, this is a good time to hear from experts in Phase I requirements and nuances. Amy Edwards has participated in the ASTM Phase I process from the beginning, has a wealth of environmental transactional experience and has read more Phase Is than she cares to admit. David Rieser is an experienced environmental attorney and has written extensively on transactional issues. Together they intend to talk through the PFAS issues in Phase Is in the hope of finding useful approaches to deal with these thorny issues.