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EPA Issues Final Rule Amending All Appropriate Inquiries Standard

January 6, 2014

New ASTM Standard can be used to Protect Prospective Purchasers against Superfund Liability

The All Appropriate Inquiries Rule at 40 CFR Part 312 ("AAI Rule") protects prospective purchasers of property from liability under the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA") for certain environmental conditions if the prospective purchaser conducts an investigation that meets the requirements of the AAI Rule. The AAI Rule provides that prospective purchasers who comply with specified industry standards issued by the American Society for Testing and Materials ("ASTM") are deemed to have complied with the AAI Rule.

On December 30, 2013, the Federal Environmental Protection Agency ("EPA") issued a new final rule amending the AAI Rule to include a reference to the new ASTM Standard E1527-13 "Standard Practice for Environmental Site Assessments: Phase 1 Environmental Site Assessment Process." As part of this rule, the EPA is not (at this time) prohibiting the use of the previous ASTM Standard (E1527-05); rather, the rule has been revised to indicate that applying the new standard is acceptable to demonstrate compliance with the AAI Rule. This rule is effective immediately.

This rulemaking follows the EPA’s direct-to-final rule passed on August 15, 2013, wherein the EPA invited comment on its decision to incorporate the new standard into the AAI Rule. In response to comments, the EPA’s newest rulemaking makes clear that while no party is required to use this new standard, the EPA expects that prospective purchasers will prefer the "additional clarity" offered by the new standard and that because ASTM Standard E1527-13 is the most up-to-date industry standard, all prospective purchasers should begin to use this new standard. As part of this rule, and in response to comments from the August rulemaking, the EPA has announced its intent, in the near future, to propose a new rule which will remove the reference to ASTM Standard E1527-05 in the AAI Rule.

The rule published on December 30 also highlights some of the significant differences between the previous ASTM Standard and the newest standard. In particular, the new standard clarifies that "all appropriate inquiries and environmental site assessments must include . . . an assessment of the real or potential occurrence of vapor migration and vapor releases on, at, in or to the subject property." 78 Fed. Reg. 79321. Additionally, the standard has updated the definitions of: Recognized Environmental Condition (REC), Historical Recognized Environmental Condition (HREC), de minimis condition, migrate / migration, and release. ASTM added a new defined term, Controlled Recognized Environmental Condition (CREC) and provided additional guidance regarding the requirement to review agency records.

While this rule does not create additional regulatory requirements, prospective purchasers of property should be aware of the changes and that the EPA is planning to issue a rule that will revise the AAI Rule such that ASTM E1527-05 will no longer meet the requirements of the AAI Rule. Until such time, prospective purchasers can continue to use ASTM E1527-05, but should be aware that there is a more intensive option available.

If you would like more information about the AAI Rule, please contact Patricia Boye-Williams at 860.240.6168/pboyewilliams@murthalaw.com, Mark Sussman at 860.240.6034/msussman@murthalaw.com, or any member of our Environmental Practice Group.

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