ENVIRONMENTAL ASSESSMENTS/ DUE DILIGENCE

An RSRA is the initial step for evaluating the level of risk for contamination at a property purchased under SBA backed 7(a) and 504 loans. The assessment must be completed and overseen by an environmental professional such as a licensed geologist, engineer, or site professional. NWATS has licensed professional geologists and provides the services necessary to interface with SBA lenders and their customers and complete RSRA evaluation. 

A transaction screen is an accessory step to the RSRA that is typically used for properties that are not believed to have past or present uses that may impact the property, but have the potential for contamination to occur. It begins with a site reconnaissance to identify conditions in which contamination may have occurred. NWATS provides the services and professionals necessary to recognize the potential for past impacts that may warrant additional phases of environmental assessment.

A Phase I Environmental Site Assessment (ESA) is conducted for industrial and commercial properties in which the past or present uses pose a potential risk for contamination or when the results of an RSRA indicate that there is an elevated risk for the presence of contamination. An extensive site reconnaissance is conducted to identify conditions that suggest the likelihood of contamination to the soil, groundwater, or surface water of the property. NWATS provides the services and professionals necessary to identify environmental conditions that indicate a potential for contamination.

A Phase II Environmental Site Assessment (ESA) is conducted to determine whether there was a past release of a hazardous substance or substances to the soil or sub-surface at the property. A representative quantity of soil and groundwater samples are collected by an environmental professional and analyzed for hazardous chemicals that may occur at the property. NWATS provides the professional services necessary for completing an environmental investigation that focuses on evaluating the presence and extent of contamination at the property.

An environmental assessment worksheet (EAW) is a document that consists of twenty questions of which a project proposer answers and provides to the respective regulatory agency for evaluating whether the project has the potential to cause significant impacts to the environment. If the agency decides that the respective project does not have the potential for significant environmental impacts, then a negative declaration is made and no further environmental review is required. However, if just the opposite occurs, a positive declaration is made and the project proposer is required to continue the environmental review process with the completion of an Environmental Impact Statement (EIS).

Only certain projects require an EAW. For example, the DNR requires an EAW when 540 acres or more of farmland are proposed to be irrigated in one continuous parcel from one source of water (e.g., an aquifer). Also, the “3-year look-back-rule” applies to the phasing of the 540 acres, meaning that if the conversion occurs over 3 consecutive years, then an EAW is required in the year that the 540-acre threshold occurs.

It’s important to note that even if the 540-acre threshold and one source of water criterion are not met, the DNR has the option to require a “discretionary EAW”. Complicating matters further, a discretionary EAW may be required by way of a citizen petition in which 100 citizens (anywhere in the state) sign a petition asking the DNR to force a discretionary EAW onto the project proposer. However, the DNR has the option to deny the petition after assessing the respective environmental concerns supporting the petition.

NWATS provides the professional services necessary to evaluate the environmental review requirements of your project and assist you with completing the informational requirements of an EAW.

An accessory component of the environmental review process for SBA secured farm loans is the completion of an Environmental Checklist questionnaire. The checklist is similar to a scaled-down EAW and is required for all farm loans related to concentrated animal feedlots consisting of dairy cows, cattle, hogs, poultry, goats, etc. The information provided is used to evaluate the potential for environmental impacts from the storage and handling of the associated animal waste. Main components of the questionnaire include the listing of all permits required of the feedlot operations and identification of nearby domestic wells, wetlands, flood plains and endangered species. Undertaking such an environmental assessment is not a simple task. NWATS has the experienced and qualified staff necessary for completing the checklist questionnaire in the most comprehensive and efficient manner.