66070 Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 

ENVIRONMENTAL PROTECTION 

AGENCY 

40 CFR Part 312 

[SFUND–2004–0001; FRL–7989–7] 

RIN 2050–AF04 

Standards and Practices for All 

Appropriate Inquiries 

AGENCY: Environmental Protection 

Agency. 

ACTION: Final rule. 

SUMMARY: The Environmental Protection 

Agency (EPA) today is establishing 

federal standards and practices for 

conducting all appropriate inquiries as 

required under sections 101(35)(B)(ii) 

and (iii) of the Comprehensive 

Environmental Response, 

Compensation, and Liability Act 

(CERCLA). Today’s final rule establishes 

specific regulatory requirements and 

standards for conducting all appropriate 

inquiries into the previous ownership 

and uses of a property for the purposes 

of meeting the all appropriate inquiries 

provisions necessary to qualify for 

certain landowner liability protections 

under CERCLA. The standards and 

practices also will be applicable to 

persons conducting site characterization 

and assessments with the use of grants 

awarded under CERCLA section 

104(k)(2)(B). 

DATES: This final rule is effective 

November 1, 2006. 

ADDRESSES: EPA established a docket 

for this action under Docket ID No. 

SFUND–2004–0001. All documents in 

the docket are listed in the EDOCKET 

index at http://www.epa.gov/edocket. 

Although listed in the index, some 

information is not publicly available, 

i.e., information labeled Confidential 

Business Information (CBI) or other 

information whose disclosure is 

restricted by statute. Certain other 

material, such as copyrighted material, 

is not placed on the Internet and will be 

publicly available only in hard copy 

form. Publicly available docket 

materials are available either 

electronically in EDOCKET or in hard 

copy at the EPA Docket Center, EPA 

West Building, Room B102, 1301 

Constitution Ave., NW., Washington, 

DC. This docket facility is open from 

8:30 a.m. to 4:30 p.m., Monday through 

Friday, excluding Federal holidays. The 

telephone number for the Public 

Reading Room is (202) 566–1744, and 

the telephone number for the OSWER 

Docket is (202) 566–0276. 

FOR FURTHER INFORMATION CONTACT: For 

further information on specific aspects 

of today’s rule, contact Patricia 

Overmeyer of EPA’s Office of 

Brownfields Cleanup and 

Redevelopment at (202) 566–2774 or at 

overmeyer.patricia@epa.gov. Mail 

inquiries may be directed to the Office 

of Brownfields Cleanup and 

Redevelopment (5105T), 1200 

Pennsylvania Ave. NW., Washington, 

DC 20460. 

SUPPLEMENTARY INFORMATION: 

I. General Information 

A. Who Potentially May be Affected by 

Today’s Rule? 

This regulation may affect most 

directly those persons and businesses 

purchasing commercial property or any 

property that will be used for 

commercial or public purposes and who 

may, after purchasing the property, seek 

to claim protection from CERCLA 

liability for releases or threatened 

releases of hazardous substances. Under 

section101(35)(B) of CERCLA, as 

amended by the Small Business 

Liability Relief and Brownfields 

Revitalization Act (Pub. L. 107–118, 115 

stat. 2356, ‘‘the Brownfields 

Amendments’’) such persons and 

businesses are required to conduct all 

appropriate inquiries prior to or on the 

date on which the property is acquired. 

Prospective landowners who do not 

conduct all appropriate inquiries prior 

to or on the date of obtaining ownership 

of the property may lose their ability to 

claim protection from CERCLA liability 

as an innocent landowner, bona fide 

prospective purchaser, or contiguous 

property owner. 

In addition, today’s rule will affect 

any party who receives a brownfields 

grant awarded under CERCLA section 

104(k)(2)(B) and uses the grant money to 

conduct site characterization or 

assessment activities. This includes 

state, local and tribal governments that 

receive brownfields site assessment 

grants for the purpose of conducting site 

characterization and assessment 

activities. Such parties are required 

under CERCLA section 104(k)(2)(B)(ii) 

to conduct such activities in compliance 

with the standards and practices 

established by EPA for the conduct of 

all appropriate inquiries. EPA notes that 

today’s rule also may affect other parties 

who apply for brownfields grants under 

the provisions of CERCLA section 

104(k), since such parties may have to 

qualify as a bona fide prospective 

purchaser to ensure compliance with 

the statutory prohibitions on the use of 

grant funds under Section 

104(k)(4)(B)(I). Any party seeking 

liability protection as a bona fide 

prospective purchaser, including 

eligible brownfields grantees, must 

conduct all appropriate inquiries prior 

to or on the date of acquiring a property. 

The background document, 

‘‘Economic Impacts Analysis for the 

Proposed All Appropriate Inquiries 

Final Regulation’’ and the Addendum to 

this document provide a comprehensive 

analysis of all potentially impacted 

entities. These documents are available 

in the docket established for today’s 

rule. A summary of potentially affected 

businesses is provided in the table 

below. 

Our aim in the table below is to 

provide a guide for readers regarding 

entities likely to be directly regulated or 

indirectly affected by today’s action. 

This action, however, may affect other 

entities not listed in the table. To 

determine whether you or your business 

is regulated or affected by this action, 

you should examine the regulatory 

language amending CERCLA. This 

language is found at the end of this 

Federal Register notice. If you have 

questions regarding the applicability of 

this action to a particular entity, consult 

the person listed in the preceding 

section entitled FOR FURTHER

INFORMATION CONTACT. 

Industry category NAICS 

code 

Manufacturing ................................. 31–33 

Wholesale Trade ............................ 42 

Retail Trade .................................... 44–45 

Finance and Insurance ................... 52 

Real Estate ..................................... 531 

Professional, Scientific and Technical Services .............................. 541 

Accommodation and Food Services 72 

Repair and Maintenance ................ 811 

Personal and Laundry Services ..... 812 

State, Local and Tribal Government ............................................ N/A 

B. How Can I Get Copies of This 

Document and Other Related 

Information? 

1. Docket. EPA established an official 

public docket for this action under 

Docket ID No. SFUND–2004–0001. The 

official public docket consists of the 

documents specifically referenced in 

this action, any public comments 

received, and other information related 

to today’s action. Although a part of the 

official docket, the public docket does 

not include Confidential Business 

Information (CBI) or other information 

whose disclosure is restricted by statute. 

Documents in the official public docket 

are listed in the index list in EPA’s 

electronic public docket and comment 

system, EDOCKET. Documents may be 

available either electronically or in hard 

copy. Electronic documents may be 

viewed through EDOCKET. Hard copy 

Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 66071 

documents may be viewed at the EPA 

Docket Center, EPA West, Room B102, 

1301 Constitution Avenue, NW., 

Washington, DC. The EPA Docket 

Center Public Reading Room is open 

from 8:30 a.m. to 4:30 p.m., Monday 

through Friday, excluding Federal 

holidays. The telephone number for the 

Public Reading Room is (202) 566–1744, 

and the telephone number for the 

OSWER Docket is (202) 566–0276. 

2. Electronic Access. You may access 

this Federal Register document 

electronically through the EPA Internet 

under the ‘‘Federal Register’’ listings at 

http://www.epa.gov/fedrgstr. 

An electronic version of the public 

docket also is available through EPA’s 

electronic public docket and comment 

system, EDOCKET. You may use 

EDOCKET at http://www.epa.gov/ 

edocket/ to view public comments, 

access the index listing of the contents 

of the public docket, and access those 

documents in the public docket that are 

available electronically. Once in the 

system, select ‘‘search,’’ then key in the 

appropriate docket identification 

number. 

Certain types of information will not 

be placed in EDOCKET. Information 

claimed as CBI and other information 

whose disclosure is restricted by statute, 

which is not included in the official 

public docket, will not be available for 

public viewing in EPA’s electronic 

public docket. EPA’s policy is that 

copyrighted material will not be placed 

in EPA’s electronic public docket but 

will be available only in printed, paper 

form in the official public docket. 

Docket materials that are not available 

electronically may be viewed at the 

docket facility identified above. 

Contents of Today’s Rule 

I. Statutory Authority 

II. Background 

A. What is the Intent of Today’s Rule? 

B. What is ‘‘All Appropriate Inquiries?’’

C. What were the Previous Standards for 

All Appropriate Inquiries? 

D. What are the Liability Protections 

Established Under the Brownfields 

Amendments? 

E. What Criteria Did Congress Establish for 

the All Appropriate Inquiries Standard? 

III. Summary of Comments and Changes 

From Proposed Rule to Final Rule 

IV. Detailed Description of Today’s Rule 

A. What is the Purpose and Scope of the 

Rule? 

B. To Whom is the Rule Applicable? 

C. Does the Final Rule Include Any New 

Reporting or Disclosure Obligations? 

D. What are the Final Documentation 

Requirements? 

E. What are the Qualifications for an 

Environmental Professional? 

F. References 

G. What is Included in ‘‘All Appropriate 

Inquiries?’’

H. Who is Responsible for Conducting the 

All Appropriate Inquiries? 

I. When Must All Appropriate Inquiries be 

Conducted? 

J. Can a Prospective Landowner Use 

Information Collected for Previous 

Inquiries Completed for the Same 

Property? 

K. Can All Appropriate Inquiries be 

Conducted by One Party and Transferred 

to Another Party? 

L. What Are the Objectives and 

Performance Factors for the All 

Appropriate Inquiries Requirements? 

M. What are Institutional Controls? 

N. How must Data Gaps Be Addressed in 

the Conduct of All Appropriate 

Inquiries? 

O. Do Small Quantities of Hazardous 

Substances That Do Not Pose Threats to 

Human Health and the Environment 

Have to Be Identified in the Inquiries? 

P. What are the Requirements for 

Interviewing Past and Present Owners, 

Operators, and Occupants? 

Q. What are the Requirements for Reviews 

of Historical Sources of Information? 

R. What are the Requirements for 

Searching for Recorded Environmental 

Cleanup Liens? 

S. What are the Requirements for 

Reviewing Federal, State, Tribal, and 

Local Government Records? 

T. What are the Requirements for Visual 

Inspections of the Subject Property and 

Adjoining Properties? 

U. What are the Requirements for the 

Inclusion of Specialized Knowledge or 

Experience on the Part of the 

‘‘Defendant?’’

V. What are the Requirements for the 

Relationship of the Purchase Price to the 

Value of the Property, if the Property was 

not Contaminated? 

W. What are the Requirements for 

Commonly Known or Reasonably 

Ascertainable Information about the 

Property? 

X. What are the Requirements for ‘‘the 

Degree of Obviousness of the Presence or 

Likely Presence of Contamination at the 

Property, and the Ability to Detect the 

Contamination by Appropriate 

Investigation?’’

V. Statutory and Executive Order Reviews 

A. Executive Order 12866: Regulatory 

Planning and Review 

B. Paperwork Reduction Act 

C. Regulatory Flexibility Act 

D. Unfunded Mandates Reform Act 

E. Executive Order 13132: Federalism 

F. Executive Order 13175: Consultation 

and Coordination with Indian Tribal 

Governments 

G. Executive Order 13045: Protection of 

Children from Environmental Risks and 

Safety Risks 

H. Executive Order 13211: Actions that 

Significantly Affect Energy Supply, 

Distribution or Use 

I. National Technology Transfer 

Advancement Act 

J. Executive Order 12898: Federal Actions 

to Address Environmental Justice in 

Minority Populations and Low-Income 

Populations 

K. Congressional Review Act 

I. Statutory Authority 

These regulations are promulgated 

under the authority of Section 

101(35)(B) of the Comprehensive 

Environmental Response, 

Compensation, and Liability Act of 1980 

(42 U.S.C. 9601), as amended, most 

importantly by the Small Business 

Liability Relief and Brownfields 

Revitalization Act. 

II. Background 

A. What is the Intent of Today’s Rule? 

On August 26, 2004, EPA published a 

notice of proposed rulemaking outlining 

proposed standards and practices for the 

conduct of ‘‘all appropriate inquiries.’’

This regulatory action was initiated in 

response to legislative amendments to 

the Comprehensive Environmental 

Response, Compensation, and Liability 

Act (CERCLA). On January 11, 2002, 

President Bush signed the Small 

Business Liability Relief and 

Brownfields Revitalization Act (Pub. L. 

107–118, 115 Stat. 2356, ‘‘the 

Brownfields Amendments’’). The 

Brownfields Amendments amend 

CERCLA by providing funds to assess 

and clean up brownfields sites, 

clarifying CERCLA liability provisions 

for certain landowners, and providing 

funding to enhance state and tribal 

cleanup programs. The intent of today’s 

rule is to finalize regulations setting 

federal standards and practices for the 

conduct of all appropriate inquiries, a 

key provision of the Brownfields 

Amendments. Subtitle B of Title II of 

the Brownfields Amendments revises 

CERCLA section 101(35), clarifying the 

requirements necessary to establish the 

innocent landowner defense. In 

addition, the Brownfields Amendments 

add protections from CERCLA liability 

for bona fide prospective purchasers 

and contiguous property owners who 

meet certain statutory requirements. 

Each of the CERCLA liability 

provisions for innocent landowners, 

bona fide prospective purchasers, and 

contiguous property owners, requires 

that, among other requirements, persons 

claiming the liability protections 

conduct all appropriate inquiries into 

prior ownership and use of a property 

prior to or on the date a person acquires 

a property. The law requires EPA to 

develop regulations establishing 

standards and practices for how to 

conduct all appropriate inquiries. 

Congress included in the Brownfields 

Amendments a list of criteria that the 

Agency must address in the regulations 

establishing standards and practices for 

conducting all appropriate inquiries 

66072 Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 

section 101(35)(2)(B)(ii) and (iii). The 

Brownfields Amendments also require 

that parties receiving a federal 

brownfields grant awarded under 

CERCLA section 104(k)(2)(B) to conduct 

site characterizations and assessments 

must conduct these activities in 

accordance with the standards and 

practices for all appropriate inquiries. 

The regulations established today 

only address the all appropriate 

inquiries provisions of CERCLA sections 

101(35)(B)(i)(I) and 101(35)(B)(ii) and 

(iii). Today’s rule does not address the 

requirements of CERCLA section 

101(35)(B)(i)(II) for what constitutes 

‘‘reasonable steps.’’

B. What is ‘‘All Appropriate Inquiries?’’

An essential step in real property 

transactions may be evaluating a 

property for potential environmental 

contamination and assessing potential 

liability for contamination present at the 

property. The process for assessing 

properties for the presence or potential 

presence of environmental 

contamination often is referred to as 

‘‘environmental due diligence,’’ or 

‘‘environmental site assessment.’’ The 

Comprehensive Environmental 

Response Compensation and Liability 

Act (CERCLA) or Superfund, provides 

for a similar, but legally distinct, 

process referred to as ‘‘all appropriate 

inquiries.’’

Under CERCLA, persons may be held 

strictly liable for cleaning up hazardous 

substances at properties that they either 

currently own or operate or owned or 

operated at the time of disposal. Strict 

liability in the context of CERCLA 

means that a potentially responsible 

party may be liable for environmental 

contamination based solely on property 

ownership and without regard to fault 

or negligence. 

In 1986, the Superfund Amendments 

and Reauthorization Act ( Pub. L. No. 

99–499, 100 stat. 1613, ‘‘SARA’’) 

amended CERCLA by creating an 

‘‘innocent landowner’’ defense to 

CERCLA liability. The new section 

101(35)(B) of CERCLA provided a 

defense to CERCLA liability, for those 

persons who could demonstrate, among 

other requirements, that they ‘‘did not 

know and had no reason to know’’ prior 

to purchasing a property that any 

hazardous substance that is the subject 

of a release or threatened release was 

disposed of on, in, or at the property. 

Such persons, to demonstrate that they 

had ‘‘no reason to know’’ must have 

undertaken, prior to, or on the date of 

acquisition of the property, ‘‘all 

appropriate inquiries’’ into the previous 

ownership and uses of the property 

consistent with good commercial or 

customary standards and practices. The 

2002 Brownfields Amendments added 

potential liability protections for 

‘‘contiguous property owners’’ and 

‘‘bona fide prospective purchasers’’ who 

also must demonstrate they conducted 

all appropriate inquiries, among other 

requirements, to benefit from the 

liability protection. 

C. What Were the Previous Standards 

for All Appropriate Inquiries? 

As part of the Brownfields 

Amendments to CERCLA, Congress 

established interim standards for the 

conduct of all appropriate inquiries. The 

federal interim standards established by 

Congress became effective on January 

11, 2002. In the case of properties 

purchased after May 31, 1997, the 

interim standards include the 

procedures of the ASTM Standard 

E1527–97 (entitled ‘‘Standard Practice 

for Environmental Site Assessments: 

Phase 1 Environmental Site Assessment 

Process’’). In the case of persons who 

purchased property prior to May 31, 

1997 and who are seeking to establish 

an innocent landowner defense or 

qualify as a contiguous property owner, 

CERCLA provides that such persons 

must establish, among other statutory 

requirements, that at the time they 

acquired the property, they did not 

know and had no reason to know of 

releases or threatened releases to the 

property. To establish they did not 

know and had no reason to know of 

releases or threatened releases, persons 

who purchased property prior to May 

31, 1997 must demonstrate that they 

carried out all appropriate inquiries into 

the previous ownership and uses of the 

property in accordance with generally 

accepted good commercial and 

customary standards and practices. 

In the case of property acquired by a 

non-governmental entity or noncommercial entity for residential or 

other similar uses, the current interim 

standards for all appropriate inquiries 

may not be applicable. For those cases, 

the Brownfields Amendments to 

CERCLA establish that a ‘‘facility 

inspection and title search that reveal 

no basis for further investigation shall 

be considered to satisfy the 

requirements’ for all appropriate 

inquiries. In addition, such properties 

are not within the scope of today’s rule. 

The interim standards remain in effect 

only until the effective date of today’s 

rule which promulgates federal 

regulations establishing standards and 

practices for conducting all appropriate 

inquiries. 

On May 9, 2003, EPA published a 

final rule (68 FR 24888) clarifying that 

for the purposes of achieving the all 

appropriate inquiries standards of 

CERCLA section 101(35)(B), and until 

the effective date of today’s regulation, 

persons who purchase property on or 

after May 31, 1997 could use either the 

procedures provided in ASTM E1527–

2000, entitled ‘‘Standard Practice for 

Environmental Site Assessments: Phase 

I Environmental Site Assessment 

Process,’’ or the earlier standard cited by 

Congress in the Brownfields 

Amendments, ASTM E1527–97. 

Today’s notice is a final rule and as 

such replaces the current interim 

standards for all appropriate inquiries 

established by Congress in the 

Brownfields Amendments and clarified 

by EPA in the May 9, 2003 final rule. 

Since the Agency is promulgating a final 

rule establishing federal regulations 

containing the standards and practices 

for conducting all appropriate inquiries, 

the interim standard will no longer be 

the operative standard for conducting 

all appropriate inquiries upon 

November 1, 2006, the effective date of 

today’s rule. Until November 1, 2006, 

both the standards and practices 

included in today’s final regulation and 

the current interim standards 

established by Congress for all 

appropriate inquiries will be recognized 

by EPA as satisfying the statutory 

requirements for the conduct of all 

appropriate inquiries under section 

101(35)(B) of CERCLA. 

D. What are the Liability Protections 

Established Under the Brownfields 

Amendments? 

The Brownfields Amendments 

provide important liability protections 

for landowners who qualify as 

contiguous property owners, bona fide 

prospective purchasers, or innocent 

landowners. To meet the statutory 

requirements for any of these landowner 

liability protections, a landowner must 

meet certain threshold requirements and 

satisfy certain continuing obligations. 

To qualify as a bona fide prospective 

purchaser, contiguous property owner, 

or innocent landowner, a person must 

perform ‘‘all appropriate inquiries’’ on 

or before the date on which the person 

acquired the property. Bona fide 

prospective purchasers and contiguous 

property owners also must demonstrate 

that they are not potentially liable or 

affiliated with any other person that is 

potentially liable for response costs at 

the property. In the case of contiguous 

property owners, the landowner 

claiming to be a contiguous property 

owner also must demonstrate that he 

did not cause, contribute, or consent to 

any release or threatened release of 

hazardous substances. To meet the 

statutory requirements for a bona fide 

Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 66073 

prospective purchaser, a property owner 

must have acquired a property 

subsequent to any disposal activities 

involving hazardous substances at the 

property. 

Continuing obligations required under 

the statute include complying with land 

use restrictions and not impeding the 

effectiveness or integrity of institutional 

controls; taking ‘‘reasonable steps’’ with 

respect to hazardous substances 

affecting a landowner’s property to 

prevent releases; providing cooperation, 

assistance and access to EPA, a state, or 

other party conducting response actions 

or natural resource restoration at the 

property; complying with CERCLA 

information requests and administrative 

subpoenas; and providing legally 

required notices. For a more detailed 

discussion of these threshold and 

continuing requirements please see 

EPA, Interim Guidance Regarding 

Criteria Landowners Must Meet in 

Order to Qualify for Bona Fide 

Prospective Purchaser, Contiguous 

Property Owner, or Innocent Landowner 

Limitations on CERCLA Liability 

(Common Elements, 2003). A copy of 

this document is available in the docket 

for today’s rule. 

EPA notes that, as explained below, 

persons conducting all appropriate 

inquiries in compliance with today’s 

final rule are not entitled to the CERCLA 

liability protections provided for 

innocent landowners, bona fide 

prospective purchasers, and contiguous 

property owners, unless they also 

comply with all of the continuing 

obligations established under the 

statute. As explained below, compliance 

with today’s final rule is only one 

requirement necessary for CERCLA 

liability protection. We also note that 

the requirements of today’s rule apply to 

prospective property owners who are 

seeking protection from liability under 

the federal Superfund Law (CERCLA). 

Prospective property owners wishing to 

establish protection from, or a defense 

to, liability under state superfund or 

other related laws must comply with the 

all criteria established under state laws, 

including any criteria for conducting 

site assessments or all appropriate 

inquiries established under applicable 

state statutes or regulations. 

1. Bona Fide Prospective Purchaser 

The Brownfields Amendments added 

a new bona fide prospective purchaser 

provision at CERCLA section 107(r). The 

provision provides protection from 

CERCLA liability, and limits EPA’s 

recourse for unrecovered response costs 

to a lien on property for the lesser of the 

unrecovered response costs or increase 

in fair market value attributable to 

EPA’s response action. To meet the 

statutory requirements for a bona fide 

prospective purchaser, a person must 

meet the requirements set forth in 

CERCLA sections 101(40) and 107(r). A 

bona fide prospective purchaser must 

have bought property after January 11, 

2002 (the date of enactment of the 

Brownfields Amendments). A bona fide 

prospective purchaser may purchase 

property with knowledge of 

contamination after performing all 

appropriate inquiries, provided the 

property owner meets or complies with 

all of the other statutory requirements 

set forth in CERCLA section 101(40). 

Conducting all appropriate inquiries 

alone does not provide a landowner 

with protection against CERCLA 

liability. Landowners who want to 

qualify as bona fide prospective 

purchasers must comply with all of the 

statutory requirements. The statutory 

requirements include, without 

limitation, that the landowner must: 

• Have acquired a property after all 

disposal of hazardous substances at the 

property ceased; 

• Provide all legally required notices 

with respect to the discovery or release 

of any hazardous substances at the 

property; 

• Exercise appropriate care by taking 

reasonable steps to stop continuing 

releases, prevent any threatened future 

release, and prevent or limit human, 

environmental, or natural resources 

exposure to any previously released 

hazardous substance; 

• Provide full cooperation, assistance, 

and access to persons that are 

authorized to conduct response actions 

or natural resource restorations; 

• Comply with land use restrictions 

established or relied on in connection 

with a response action; 

• Not impede the effectiveness or 

integrity of any institutional controls; 

• Comply with any CERCLA request 

for information or administrative 

subpoena; and 

• Not be potentially liable, or 

affiliated with any other person who is 

potentially liable for response costs for 

addressing releases at the property. 

Persons claiming to be bona fide 

prospective purchasers should keep in 

mind that failure to identify an 

environmental condition or identify a 

release or threatened release of a 

hazardous substance on, at, in or to a 

property during the conduct of all 

appropriate inquiries does not relieve a 

landowner from complying with the 

other post-acquisition statutory 

requirements for obtaining the liability 

protections. Landowners must comply 

with all the statutory requirements to 

obtain the liability protection. For 

example, an inability to identify a 

release or threatened release during the 

conduct of all appropriate inquiries 

does not negate the landowner’s 

responsibilities under the statute to take 

reasonable steps to stop a release, 

prevent a threatened release, and 

prevent exposure to any previous 

release once any release is identified. 

Compliance with the other statutory 

requirements for the bona fide 

prospective purchaser liability 

protection is not contingent upon the 

findings of all appropriate inquiries. 

2. Contiguous Property Owner 

The Brownfields Amendments added 

a new contiguous property owner 

provision at CERCLA section 107(q). 

This provision excludes from the 

definition of ‘‘owner’’ or ‘‘operator’’

under CERCLA section 107(a)(1) and (2) 

a person who owns property that is 

‘‘contiguous to, or otherwise similarly 

situated with respect to, and that is or 

may be contaminated by a release or 

threatened release of a hazardous 

substance from’’ property owned by 

someone else. To qualify as a 

contiguous property owner, a 

landowner must have no knowledge or 

reason to know of contamination at the 

time of acquisition, have conducted all 

appropriate inquiries, and meet all of 

the criteria set forth in CERCLA section 

107(q)(1)(A), which include, without 

limitation: 

• Not causing, contributing, or 

consenting to the release or threatened 

release; 

• Not being potentially liable nor 

affiliated with any other person who is 

potentially liable for response costs at 

the property; 

• Taking reasonable steps to stop 

continuing releases, prevent any 

threatened release, and prevent or limit 

human, environmental, or natural 

resource exposure to any hazardous 

substances released on or from the 

landowner’s property; 

• Providing full cooperation, 

assistance, and access to persons that 

are authorized to conduct response 

actions or natural resource restorations; 

• Complying with land use 

restrictions established or relied on in 

connection with a response action; 

• Not impeding the effectiveness or 

integrity of any institutional controls; 

• Complying with any CERCLA 

request for information or 

administrative subpoena; 

• Providing all legally required 

notices with respect to discovery or 

release of any hazardous substances at 

the property. 

The contiguous property owner 

liability protection ‘‘protects parties that 

66074 Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 

are essentially victims of pollution 

incidents caused by their neighbor’s 

actions.’’ S. Rep. No. 107–2, at 10 

(2001). Contiguous property owners 

must perform all appropriate inquiries 

prior to purchasing property. However, 

performing all appropriate inquiries in 

accordance with the regulatory 

requirements alone is not sufficient to 

assert the liability protections afforded 

under CERCLA. Property owners must 

fully comply with all of the statutory 

requirements to be afforded the 

contiguous property owner liability 

protection. Persons who know, or have 

reason to know, that the property is or 

could be contaminated at the time of 

acquisition of a property cannot qualify 

for the liability protection as a 

contiguous property owner, but may be 

entitled to bona fide prospective 

purchaser status. 

Persons claiming to be contiguous 

property owners should keep in mind 

that failure to identify an environmental 

condition or identify a release or 

threatened release of a hazardous 

substance on, at, in or to a property 

during the conduct of all appropriate 

inquiries, does not relieve a landowner 

from complying with the other statutory 

requirements for obtaining the 

contiguous landowner liability 

limitation. Landowners must comply 

with all the statutory requirements to 

qualify for the liability protections. For 

example, an inability to identify a 

release or threatened release during the 

conduct of all appropriate inquiries 

does not negate the landowner’s 

responsibilities under the statute to take 

reasonable steps to stop the release, 

prevent a threatened release, and 

prevent exposure to previous releases 

once a release is identified. None of the 

other statutory requirements for the 

contiguous property owner liability 

protection is contingent upon the results 

of the conduct of all appropriate 

inquiries. 

3. Innocent Landowner 

The Brownfields Amendments also 

clarify the innocent landowner defense. 

To qualify as an innocent landowner, a 

person must conduct all appropriate 

inquiries and meet all of the statutory 

requirements. The requirements 

include, without limitation: 

• Having no knowledge or reason to 

know that any hazardous substance 

which is the subject of a release or 

threatened release was disposed of on, 

in, or at the facility; 

• Providing full cooperation, 

assistance and access to persons 

authorized to conduct response actions 

at the property; 

• Complying with any land use 

restrictions and not impeding the 

effectiveness or integrity of any 

institutional controls; 

• Taking reasonable steps to stop 

continuing releases, prevent any 

threatened release, and prevent or limit 

human, environmental, or natural 

resource exposure to any previously 

released hazardous substances; 

To successfully assert an innocent 

landowner liability defense, a property 

owner must demonstrate compliance 

with CERCLA section 107(b)(3) as well. 

Such persons must establish, by a 

preponderance of the evidence: 

• That the release or threat of release 

of hazardous substances and the 

resulting damages were caused by an act 

or omission of a third party with whom 

the person does not have employment, 

agency, or a contractual relationship; 

• The person exercised due care with 

respect to the hazardous substance 

concerned, taking into consideration the 

characteristics of such hazardous 

substance, in light of all relevant facts 

and circumstances; 

• Took precautions against 

foreseeable acts or omissions of any 

such third party and the consequences 

that could foreseeably result from such 

acts or omissions. 

Like contiguous property owners, 

innocent landowners must perform all 

appropriate inquiries prior to or on the 

date of acquisition of a property and 

cannot know, or have reason to know, 

of contamination to qualify for this 

landowner liability protection. Persons 

claiming to be innocent landowners also 

should keep in mind that failure to 

identify an environmental condition or 

identify a release or threatened release 

of a hazardous substance on, at, in or to 

a property during the conduct of all 

appropriate inquiries, does not relieve 

or exempt a landowner from complying 

with the other statutory requirements 

for asserting the innocent landowner 

defense. Landowners must comply with 

all the statutory requirements to obtain 

the defense. For example, an inability to 

identify a release or threatened release 

during the conduct of all appropriate 

inquiries does not negate the 

landowner’s responsibilities under the 

statute to take reasonable steps to stop 

the release, prevent a threatened release, 

and prevent exposure to a previous 

release. Compliance with the other 

statutory requirements for the innocent 

landowner defense is not contingent 

upon the results of an all appropriate 

inquiries investigation. 

E. What Criteria Did Congress Establish 

for the All Appropriate Inquiries 

Standard? 

Congress included in the Brownfields 

Amendments a list of criteria that the 

Agency must include in the regulations 

establishing standards and practices for 

conducting all appropriate inquiries. In 

addition to providing these criteria in 

the statute, Congress instructed EPA to 

develop regulations establishing 

standards and practices for conducting 

all appropriate inquiries in accordance 

with generally accepted good 

commercial and customary standards 

and practices. The criteria are set forth 

in CERCLA section 101(35)(2)(B)(iii) 

and include: 

• The results of an inquiry by an 

environmental professional. 

• Interviews with past and present 

owners, operators, and occupants of the 

facility for the purpose of gathering 

information regarding the potential for 

contamination at the facility. 

• Reviews of historical sources, such 

as chain of title documents, aerial 

photographs, building department 

records, and land use records, to 

determine previous uses and 

occupancies of the real property since 

the property was first developed. 

• Searches for recorded 

environmental cleanup liens against the 

facility that are filed under federal, 

state, or local law. 

• Reviews of federal, state, and local 

government records, waste disposal 

records, underground storage tank 

records, and hazardous waste handling, 

generation, treatment, disposal, and 

spill records, concerning contamination 

at or near the facility. 

• Visual inspections of the facility 

and of adjoining properties. 

• Specialized knowledge or 

experience on the part of the defendant. 

• The relationship of the purchase 

price to the value of the property, if the 

property was not contaminated. 

• Commonly known or reasonably 

ascertainable information about the 

property. 

• The degree of obviousness of the 

presence or likely presence of 

contamination at the property, and the 

ability to detect the contamination by 

appropriate investigation. 

III. Summary of Comments and 

Changes From Proposed Rule to Final 

Rule 

EPA received over 400 public 

comments in response to the August 26, 

2004 proposed rule. Comments were 

received from environmental 

consultants with experience in 

performing site assessments, trade 

Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 66075 

associations, state government agencies, 

environmental interest groups, and 

other public interest associations. 

Commenters generally supported the 

purpose and goals of the proposed rule. 

Many commenters complimented the 

Agency on its decision to develop the 

proposed rule using the negotiated 

rulemaking process. However, 

commenters had differing views on 

certain aspects of the proposed rule. In 

particular, the Agency received widely 

differing views on the proposed 

definition of ‘‘environmental 

professional.’’ Although many 

commenters supported the definition as 

proposed, other commenters raised 

concerns regarding the stringency of the 

proposed qualifications. A significant 

number of commenters applauded the 

proposed definition of an environmental 

professional and stated that it may 

increase the rigor and caliber of 

environmental site investigations. 

Commenters who would not qualify as 

an environmental professional under 

the proposed definition raised concerns 

with regard to the specific qualifications 

proposed. 

EPA received a significant number of 

comments regarding the statutory 

requirements for qualifying for the 

CERCLA liability protections. Several 

commenters also raised concerns with 

regard to the performance-based 

approach to the all appropriate inquiries 

investigation included in the proposed 

rule. Commenters were concerned that 

the proposed performance-based 

approach would make it more difficult 

to qualify for the CERCLA liability 

protections than an approach that 

requires strict adherence to prescriptive 

data gathering requirements that do not 

allow for the application of professional 

judgment. However, the vast majority of 

commenters who commented on the 

performance-based nature of the 

proposed rule supported the proposed 

approach. 

Other commenters raised concerns 

with regard to the proposed rule’s 

requirements to identify and comment 

upon the significance of ‘‘data gaps’’

where the lack of information may affect 

the ability of an environmental 

professional to render an opinion 

regarding conditions at a property that 

are indicative of releases or threatened 

releases of hazardous substances. 

Commenters were concerned that if any 

data gaps exist potential contamination 

would not be identified, allowing 

property owners to escape liability for 

contamination. Other commenters 

supported the proposed requirement to 

identify data gaps, or missing 

information, that may affect the 

environmental professional’s ability to 

render an opinion regarding the 

environmental conditions at a property 

and comment on their significance in 

this regard and stated that the 

requirement would lend credibility to 

the inquiry’s final report. 

We received many comments on the 

proposed provision to compare the 

purchase price of a property to the fair 

market value of the property (if the 

property were not contaminated). One 

concern raised is that commenters 

believe that the exact market value of a 

property is difficult to determine. Some 

commenters took exception to the fact 

that EPA did not propose that 

prospective landowners have to conduct 

formal real estate appraisals of the 

property to determine fair market value. 

Although this provision has been a 

statutory requirement for the conduct of 

all appropriate inquiries since 1986, 

some commenters thought the 

requirement should not be included 

within the scope of all appropriate 

inquiries. Other commenters stated that 

the environmental professional should 

not be required to undertake the 

comparison. 

We received some comments on the 

results of the economic impact analysis 

that was conducted to assess the 

potential costs and impacts of the 

proposed rule. Many commenters 

generally agreed with the Agency’s 

conclusion that the average incremental 

cost increase associated with the 

requirements in the proposed rule over 

the current industry standard would be 

minimal. However, some commenters 

asserted that EPA underestimated the 

incremental costs associated with the 

proposed rule. Although a few 

commenters mentioned particular 

activities included as requirements in 

the proposed rule that would increase 

the burdens and costs associated with 

conducting all appropriate inquiries, 

most of these commenters did not 

provide specific reasons for claimed 

cost increases over baseline activities. 

Some commenters simply stated that the 

proposed requirements would result in 

an increase in the price of phase I 

environmental site assessments. We 

provide a summary of the comments 

received on the economic impact 

analysis for the proposed rule, our 

responses to issues raised by 

commenters, and the results of some 

additional analyses conducted based on 

some of the issues raised, in an 

addendum to the economic impact 

analysis, which is provided in the 

docket for today’s final rule. 

In section IV of this preamble, we 

discuss the requirements of the final 

rule, including a summary of the 

provisions included in the August 26, 

2004 proposed rule, the significant 

comments raised in response to the 

proposed provisions, and a summary of 

our rationale for the final rule 

requirements. Generally, the final rule 

closely resembles the provisions 

included in the proposed rule. We 

adopted relatively minor changes in 

response to public comments. For 

example, we received a number of 

comments urging EPA to modify the 

proposed definition of environmental 

professional to allow individuals who 

have significant experience in 

conducting environmental site 

assessments, but do not have a 

Baccalaureate degree, to qualify as 

environmental professionals. We were 

convinced by the arguments presented 

in many of these public comments. 

Therefore, the definition of an 

environmental professional included in 

today’s final rule allows individuals 

with ten years of relevant full time 

experience to qualify as an 

environmental professional for the 

purpose of overseeing and performing 

all appropriate inquiries. 

With respect to the proposed 

requirements governing the use of 

previously-conducted environmental 

site assessments for a particular 

property, we agreed with commenters 

who pointed out the proposed rule was 

unclear. In today’s final rule, we modify 

the proposed rule language to allow for 

the use of information contained in 

previously-conducted assessments, even 

if the information was collected more 

than a year prior to the date on which 

the subject property is acquired. The 

final rule does require that all aspects of 

a site assessment, or all appropriate 

inquiries investigation, completed more 

than one year prior to the date of 

acquisition of the subject property be 

updated to reflect current conditions 

and current property-specific 

information. In the case of all 

appropriate inquiries investigations 

completed less than one year prior to 

the date of acquisition of the subject 

property but more than 180 days before 

the acquisition date, the final rule 

retains the requirements of the proposed 

rule that only certain aspects of the all 

appropriate inquiries must be updated. 

In the case of the requirement to 

search for institutional controls that was 

included in the proposed requirements 

to review federal, state, tribal and local 

government records, we agreed with 

commenters who pointed out that 

searching for institutional controls 

associated with properties located 

within a half mile of the subject 

property is overly burdensome and 

without sufficient benefit to the purpose 

of the investigation. The final rule 

66076 Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 

requires that the search for institutional 

controls be confined to the subject 

property only. 

We adopted one other change in the 

final rule, based upon public comments. 

In the proposed rule, we delineated 

responsibilities for particular aspects of 

the all appropriate inquiries 

investigation between the 

environmental professional and the 

prospective landowner of the subject 

property (or grantee). We defined the 

inquiry of the environmental 

professional to include: interviews with 

past and present owners, operators and 

occupants; reviews of historical sources 

of information; reviews of federal state 

tribal and local government records; 

visual inspections of the facility and 

adjoining property; commonly known or 

reasonably ascertainable information; 

and degree of obviousness of the 

presence or likely presence of 

contamination at the property and the 

ability to detect the contamination by 

appropriate investigation. We also 

defined ‘‘additional inquiries’’ that must 

be conducted by the prospective 

landowner or grantee (or an individual 

on the prospective landowner’s or 

grantee’s behalf). These ‘‘additional 

inquiries’’ include: specialized 

knowledge or experience of the 

prospective landowner (or grantee); the 

relationship of the purchase price to the 

fair market value of the property, if the 

property was not contaminated; and 

commonly known or reasonably 

ascertainable information. The 

requirement to search for environmental 

cleanup liens was proposed to be the 

responsibility of the prospective 

landowner (or grantee), if the search is 

not conducted by the environmental 

professional. The proposed rule 

required the prospective landowner (or 

grantee) to provide all information 

collected as part of the ‘‘additional 

inquiries’’ to the environmental 

professional. 

The final rule retains the proposed 

delineation of responsibilities. However, 

based upon the input provided in public 

comments, the final rule does not 

require the prospective landowner (or 

grantee) to provide the information 

collected as part of the ‘‘additional 

inquiries’’ to the environmental 

professional. Although we continue to 

believe that the information collected or 

held by the prospective landowner (or 

grantee) should be provided to the 

environmental professional overseeing 

the other aspects of the all appropriate 

inquiries, we agree with commenters 

who asserted that prospective 

landowners and grantees should not be 

required to provide this information to 

the environmental professional. 

Commenters argued that property 

owners (and grantees) may want to hold 

some information (e.g., the purchase 

price of the property) confidential. 

CERCLA liability rests with the owner 

or operator of a property and not with 

an environmental professional hired by 

the prospective landowner and who is 

not involved with the ownership or 

operation of the property. Since it 

ultimately is up to the owner or operator 

of a property to defend his or herself 

against any claims to liability, we agree 

with commenters that asserted that the 

regulations should not require that 

prospective landowners (or grantees) 

provide information collected to comply 

with the ‘‘additional inquiries’’

provisions to the environmental 

professional. Should the required 

information not be provided to the 

environmental professional, the 

environmental professional should 

assess the impact that the lack of such 

information may have on his or her 

ability to render an opinion with regard 

to conditions indicative of releases or 

threatened releases of hazardous 

substances on, at, in or to the property. 

If the lack of information does impact 

the ability of the environmental 

professional to render an opinion with 

regard to the environmental conditions 

of the property, the environmental 

professional should note the missing 

information as a data gap in the written 

report. We discuss each of the 

requirements of the final rule in Section 

IV of this preamble. 

IV. Detailed Description of Today’s 

Rule 

A. What Is the Purpose and Scope of the 

Rule? 

The purpose of today’s rule is to 

establish federal standards and practices 

for the conduct of all appropriate 

inquiries. Such inquiries must be 

conducted by persons seeking any of the 

landowner liability protections under 

CERCLA prior to acquiring a property 

(as outlined in Section II.D. of this 

preamble). In addition, persons 

receiving federal brownfields grants 

under the authorities of CERCLA section 

104(k)(2)(B) to conduct site 

characterizations and assessments must 

conduct such activities in compliance 

with the all appropriate inquiries 

regulations. 

In the case of persons claiming one of 

the CERCLA landowner liability 

protections, the scope of today’s rule 

includes the conduct of all appropriate 

inquiries for the purpose of identifying 

releases and threatened releases of 

hazardous substances on, at, in or to the 

property that would be the subject of a 

response action for which a liability 

protection would be needed and such a 

property is owned by the person 

asserting protection from liability. 

CERCLA liability is limited to releases 

and threatened releases of hazardous 

substances which cause the incurrence 

of response costs. Therefore, in the case 

of all appropriate inquiries conducted 

for the purpose of qualifying for 

protection from CERCLA liability 

(CERCLA section 107), the scope of the 

inquiries is to identify releases and 

threatened releases of hazardous 

substances which cause or threaten to 

cause the incurrence of response costs. 

In the case of persons receiving 

Federal brownfields grants to conduct 

site characterizations and assessments, 

the scope of the all appropriate inquiries 

standards and practices may be broader. 

The Brownfields Amendments include a 

definition of a ‘‘brownfield site’’ that 

includes properties contaminated or 

potentially contaminated with 

substances not included in the 

definition of ‘‘hazardous substance’’ in 

CERCLA section 101(14). Brownfields 

sites include properties contaminated 

with (or potentially contaminated with) 

hazardous substances, petroleum and 

petroleum products, controlled 

substances, and pollutants and 

contaminants (as defined in CERCLA 

section 101(33)). Therefore, in the case 

of persons receiving federal brownfields 

grant monies to conduct site assessment 

and characterization activities at 

brownfields sites, the scope of the all 

appropriate inquiries may include these 

other substances, as outlined in 

§ 312.1(c)(2), to ensure that persons 

receiving brownfields grants can 

appropriately and fully assess the 

properties as required. It is not the case 

that every recipient of a brownfields 

assessment grant has to include within 

the scope of the all appropriate inquiries 

petroleum and petroleum products, 

controlled substances and CERCLA 

pollutants and contaminants (as defined 

in CERCLA section 101(33)). However, 

in those cases where the terms and 

conditions of the grant or the 

cooperative agreement with the grantee 

designate a broader scope to the 

investigation (beyond CERCLA 

hazardous substances), then the scope of 

the all appropriate inquiries should 

include the additional substances or 

contaminants. 

The scope of today’s rule does not 

include property purchased by a nongovernmental entity or non-commercial 

entity for ‘‘residential use or other 

similar uses * * * [where] a facility 

inspection and title search * * * reveal 

no basis for further investigation.’’ (Pub. 

L. 107–118 § 223). CERCLA section 

Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 66077 

1Nothing in this regulation or preamble is 

intended to suggest that any particular 

documentation prepared in conducting all 

appropriate inquiries will be admissible in court in 

any litigation where a party raises one of the 

liability protections, or will in any way alter the 

judicial rules of evidence. 

101(35)(B)(v) states that in those cases, 

title search and facility inspection that 

reveal no basis for further investigation 

shall satisfy the requirements for all 

appropriate inquiries. 

We note that today’s rule does not 

affect the existing CERCLA liability 

protections for state and local 

governments that acquire ownership to 

properties involuntarily in their 

functions as sovereigns, pursuant to 

CERCLA sections 101(20)(D) and 

101(35)(A)(ii). Involuntary acquisition 

of properties by state and local 

governments fall under those CERCLA 

provisions and EPA’s policy guidance 

on those provisions, not under the all 

appropriate inquiry provisions of 

CERCLA section 101(35)(B). 

B. To Whom Is the Rule Applicable? 

Today’s rule applies to any person 

who may seek the landowner liability 

protections of CERCLA as an innocent 

landowner, contiguous property owner, 

or bona fide prospective purchaser. The 

statutory requirements to obtain each of 

these landowner liability protections 

include the conduct of all appropriate 

inquiries. In addition, the rule applies to 

individuals receiving Federal grant 

monies under CERCLA section 

104(k)(2)(B) to conduct site 

characterization and assessment 

activities. Persons receiving such grant 

monies must conduct the site 

characterization and assessment in 

compliance with the all appropriate 

inquiries regulatory requirements. 

C. Does the Final Rule Include Any New 

Reporting or Disclosure Obligations? 

The final rule does not include any 

new reporting or disclosure obligations. 

The rule only applies to those property 

owners who may seek the landowner 

liability protections provided under 

CERCLA for innocent landowners, 

contiguous property owners or bona fide 

prospective purchasers. The 

documentation requirements included 

in this rule are primarily intended to 

enhance the inquiries by requiring the 

environmental professional to record 

the results of the inquiries and his or 

her conclusions regarding conditions 

indicative of releases and threatened 

releases on, at, in, or to the property and 

to provide a record of the environmental 

professional’s inquiry. Today’s rule 

contains no new requirements to notify 

or submit information to EPA or any 

other government entity. 

Although today’s rule does not 

include any new disclosure 

requirements, CERCLA section 103 does 

require persons in charge of vessels and 

facilities, including on-shore and offshore facilities, to notify the National 

Response Center of any release of a 

hazardous substance from the vessel or 

facility in a quantity equal to or greater 

than a ‘‘reportable quantity,’’ as defined 

in CERCLA section 102(b). Today’s rule 

includes no changes to this reporting 

requirement nor any changes to any 

other reporting or disclosure 

requirements under federal, tribal, or 

state law. 

D. What Are the Final Documentation 

Requirements? 

The proposed rule required that the 

environmental professional, on behalf of 

the property owner, document the 

results of the all appropriate inquiries in 

a written report. As explained in the 

preamble to the proposed rule, the 

property owner could use this report to 

document the results of the inquiries. 

Such a report can be similar in nature 

to the type of report previously 

provided under generally accepted 

commercial practices. We proposed no 

requirements regarding the length, 

structure, or specific format of the 

written report. In addition, the proposed 

rule did not require that a written report 

of any kind be submitted to EPA or any 

other government agency, or that a 

written report be maintained on-site at 

the subject property for any length of 

time. 

Today’s final rule retains the 

requirements, as proposed, for 

documenting the results of the all 

appropriate inquiries investigation 

conducted under the supervision or 

responsible charge of an environmental 

professional. As noted above, the 

primary purpose of the documentation 

requirement is to enhance the inquiry of 

the environmental professional by 

requiring that the environmental 

professional record the results of the 

inquiries and his or her conclusions. 

The written report may allow any 

person claiming one of the CERCLA 

landowner liability protections to offer 

documentation in support of his or her 

claim that all appropriate inquiries were 

conducted in compliance with the 

federal regulations.1 The Agency notes 

that while today’s final regulation does 

not require parties conducting all 

appropriate inquiries to retain the 

written report or any other 

documentation discovered, consulted, 

or created in the course of conducting 

the inquiries, the retention of such 

documentation and records may be 

helpful should the property owner need 

to assert protection from CERCLA 

liability after purchasing a property. 

The final rule requires that a written 

report documenting the results of the all 

appropriate inquiries include an 

opinion of an environmental 

professional as to whether the all 

appropriate inquiries conducted 

identified conditions indicative of 

releases or threatened releases of 

hazardous substances on, at, in or to the 

subject property. The rule also requires 

that the report identify data gaps in the 

information collected that affect the 

ability of the environmental 

professional to render such an opinion 

and that the environmental professional 

comment on the significance of the data 

gaps. 

Several commenters raised issues 

with regard to the proposed requirement 

that the environmental professional 

document and comment on the 

significance of data gaps that affect the 

ability of the environmental 

professional to identify conditions 

indicative of releases or threatened 

releases of hazardous substances on at, 

in, or to the subject property. Some 

commenters stated that the need to 

identify data gaps will make it difficult 

to determine when an all appropriate 

inquiries investigation is complete and 

therefore the requirement would act as 

a disincentive to the development of 

potentially contaminated properties. 

Other commenters asserted that the fact 

that the regulations recognize data gaps 

creates a loophole that would result in 

property owners claiming to be 

protected from CERCLA liability after 

conducting an incomplete investigation 

that includes significant data gaps. 

These commenters raised concerns that 

CERCLA liability protection could be 

claimed by property owners simply 

because they conducted an all 

appropriate inquiries investigation, even 

in those cases where releases on, at, in, 

or to the property were missed during 

the investigation. Other commenters 

stated their support for the requirements 

to document data gaps, as proposed. A 

summary of EPA’s response to these 

comments and the requirements for 

documenting data gaps included in the 

final rule is provided below in Section 

IV.N. 

The final rule, at § 312.21(d), retains 

the proposed requirement that the 

environmental professional who 

conducts or oversees the all appropriate 

inquiries sign the written report. There 

are two purposes for the requirement to 

include a signature in the report. First, 

the individual signing the report must 

declare, on the signature page, that he 

or she meets the definition of an 

66078 Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 

environmental professional, as provided 

in § 312.10. In addition, the rule 

requires that the environmental 

professional declare that: [I, We] have 

developed and performed the all 

appropriate inquiries in conformance 

with the standards and practices set 

forth in 40 CFR part 312. 

Some commenters raised concerns 

about whether the proposed rule would 

require the environmental professional 

to certify the all appropriate inquiries 

report and its findings. Today’s final 

rule does not require the environmental 

professional to ‘‘certify’’ the results of 

the all appropriate inquiries when 

signing the report. The two statements 

or declarations mentioned above and 

required to be included in the final 

written report documenting the conduct 

of all appropriate inquiries are meant to 

document that an individual meeting 

the qualifications of an environmental 

professional was involved in the 

conduct of the all appropriate inquiries 

and that the activities performed by, or 

under the supervision or responsible 

charge of, the environmental 

professional were performed in 

conformance with the regulations. 

Reports signed by individuals holding a 

Professional Engineer (P.E.) or 

Professional Geologist (P.G.) license, 

need not include the individual’s 

professional seal. 

A few commenters requested that EPA 

include specific requirements for the 

content of a final report in the final rule. 

Given that the type and extent of 

information available on a particular 

property may vary greatly with its size, 

type, past uses, and location, and the 

type and extent of information 

necessary for an environmental 

professional to render an opinion 

regarding conditions indicative of 

releases or threatened releases of 

hazardous substances associated with 

any property may vary, we decided not 

to include in the final rule specific 

requirements governing the content of 

all reports. 

The provisions of the final rule allow 

for the property owner (or grantee) and 

any environmental professional engaged 

in the conduct of all appropriate 

inquiries for a specific property to 

design and develop the format and 

content of a written report that will 

meet the prospective landowner’s (or 

grantee’s) objectives and information 

needs in addition to providing 

documentation that all appropriate 

inquiries were completed prior to the 

acquisition of the property, should the 

landowner (or grantee) need to assert 

protection from liability after 

purchasing a property. 

E. What Are the Qualifications for an 

Environmental Professional? 

Proposed Rule 

In the Brownfields Amendments, 

Congress required that all appropriate 

inquiries include ‘‘the results of an 

inquiry by an environmental 

professional’’ (CERCLA section 

101(35)(B)(iii)(I)). The proposed rule 

included minimal qualifications for 

persons managing or overseeing all 

appropriate inquiries. The intent of 

setting minimum professional 

qualifications, is to ensure that all 

inquiries are conducted at a high level 

of professional ability and ensure the 

overall quality of both the inquiries 

conducted and the conclusions or 

opinions rendered with regard to 

conditions indicative of the presence of 

a release or threatened release on, at, in, 

or to a property, based upon the results 

of all inquiries. The proposed rule 

required that an environmental 

professional conducting or overseeing 

all appropriate inquiries possess 

sufficient specific education, training, 

and experience necessary to exercise 

professional judgment to develop 

opinions and conclusions regarding the 

presence of releases or threatened 

releases of hazardous substances to the 

surface or subsurface of a property. In 

addition, the proposed rule included 

minimum qualifications, including 

minimum levels of education and 

experience, that characterize the type of 

professional who is best qualified to 

oversee and direct the development of 

comprehensive inquiries and provide 

the landowner with sound conclusions 

and opinions regarding the potential for 

releases or threatened releases to be 

present at the property. The proposed 

rule allowed for individuals not meeting 

the proposed definition of an 

environmental professional to 

contribute to and participate in the all 

appropriate inquiries on the condition 

that such individuals are conducting 

inquiries activities under the 

supervision or responsible charge of an 

individual that meets the regulatory 

definition of an environmental 

professional. 

The proposed rule required that the 

final review of the all appropriate 

inquiries and the conclusions that 

follow from the inquiries rest with an 

individual who qualifies as an 

environmental professional, as defined 

in proposed section § 312.10 of the 

proposed rule. The proposed rule also 

required that in signing the report, the 

environmental professional must 

document that he or she meets the 

definition of an ‘‘environmental 

professional’’ included in the 

regulations. 

The proposed definition first and 

foremost required that, to qualify as an 

environmental professional, a person 

must ‘‘possess sufficient specific 

education, training, and experience 

necessary to exercise professional 

judgment to develop opinions and 

conclusions regarding the presence of 

releases or threatened releases * * * to 

the surface or subsurface of a property, 

sufficient to meet the objectives and 

performance factors’’ that are provided 

in the proposed regulation. The 

proposed definition of an environmental 

professional included individuals who 

possess the following combinations of 

education and experience. 

• Hold a current Professional 

Engineer’s (P.E.) or Professional 

Geologist’s (P.G.) license or registration 

from a state, tribe, or U.S. territory and 

have the equivalent of three (3) years of 

full-time relevant experience; or 

• Be licensed or certified by the 

federal government, a state, tribe, or 

U.S. territory to perform environmental 

inquiries as defined in § 312.21 and 

have the equivalent of three (3) years of 

full-time relevant experience; or 

• Have a Baccalaureate or higher 

degree from an accredited institution of 

higher education in a relevant discipline 

of engineering, environmental science, 

or earth science and the equivalent of 

five (5) years of full-time relevant 

experience; or 

• As of the date of the promulgation 

of the final rule, have a Baccalaureate or 

higher degree from an accredited 

institution of higher education and the 

equivalent of ten (10) years of full-time 

relevant experience. 

Public Comments 

We received a significant number of 

public comments on the proposed 

definition of environmental 

professional. Many commenters 

supported the definition of 

environmental professional as proposed. 

However, a significant number of 

commenters raised concerns with regard 

to the proposed educational 

requirements. Commenters pointed out 

that the proposed minimum 

qualifications for an environmental 

professional did not allow for 

individuals with many years of relevant 

experience in conducting environmental 

site assessments to qualify as 

environmental professionals, if such 

individuals do not have college degrees. 

The proposed rule only allowed for 

persons with a Baccalaureate degree or 

higher in specific disciplines of science 

and engineering, and a specific number 

of years of experience, to qualify as an 

Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 66079 

environmental professional, unless an 

individual was otherwise licensed as an 

environmental professional by a state, 

tribe or the federal government. Some 

commenters questioned the Agency’s 

reasoning for restricting the degree 

requirements to only certain types of 

science or engineering. Commenters 

requested that EPA provide more 

specific definitions of the types of 

science and engineering degrees that 

would be necessary to qualify as an 

environmental professional. 

Commenters also asserted that the 

proposed ‘‘grandfather clause’’ allowing 

for individuals having a Baccalaureate 

degree (or higher) and who accumulated 

ten years of full time relevant 

experience on or before the 

promulgation date of the final rule to 

qualify as an environmental 

professional was too stringent and 

provided too small of a window of 

opportunity for individuals not 

otherwise meeting the proposed 

definition of environmental professional 

to qualify. 

Some commenters stated that the 

definition of environmental professional 

should not be restricted to those 

individuals licensed as P.E.s or P.G.s. A 

few commenters stated that a licensed 

professional is no more qualified to 

perform all appropriate inquiries 

investigations than other individuals 

with a significant number of years of 

experience in conducting such 

activities. Other commenters asserted 

that only licensed P.E.s and P.G.s are 

qualified to supervise all appropriate 

inquiries activities. 

EPA also received comments from 

independent professional certification 

organizations and members of these 

organizations, including the Academy of 

Certified Hazardous Materials Managers, 

requesting that their organizations’

certification programs be named in the 

regulatory definition of an 

environmental professional. 

Final Rule 

After careful consideration of the 

issues raised by commenters regarding 

the proposed definition of 

environmental professional, we made a 

few modifications to the proposed 

definition to reduce the potential 

burden that the proposed definition may 

have placed upon individuals who have 

significant experience in conducting 

environmental site assessments but do 

not meet the proposed educational, or 

college degree, requirements. We agree 

with those commenters who asserted 

that individuals with a significant 

number of years of experience in 

performing environmental site 

assessments, or all appropriate inquiries 

investigations, should qualify as 

environmental professionals for the 

purpose of conducting all appropriate 

inquiries, even in cases where such 

individuals do not have a college 

degree. Therefore, in the final rule, 

persons with ten or more years of fulltime relevant experience in conducting 

environmental site assessments and 

related activities may qualify as 

environmental professionals, without 

having received a college degree. 

In addition, we agreed with 

commenters who pointed out that the 

requirement that environmental 

professionals hold specific types of 

science or engineering degrees was too 

limiting. In the final rule, persons with 

any science or engineering degree 

(regardless of specific discipline in 

science or engineering) can qualify as an 

environmental professional, if they also 

meet the other required qualifications, 

including the requirement to have five 

(5) years of full-time relevant 

experience. 

We also agree with commenters who 

asserted that the proposed grandfather 

clause was too restrictive. As mentioned 

above, we agree with commenters who 

pointed out that individuals with a 

significant number of years of 

experience in conducting environmental 

site assessments or all appropriate 

inquiries investigations should be able 

to qualify as environmental 

professionals, for the purpose of 

carrying out the provisions of today’s 

rulemaking. In addition, we agree with 

commenters who stated that the ability 

for experienced professionals to qualify 

as an environmental professional should 

not be limited to those who meet the 

threshold qualifications on the effective 

date of the final rule. Therefore, the 

proposed grandfather clause is not 

included within the definition of 

environmental professional in the final 

rule. As explained above, in today’s 

final rule, individuals with ten or more 

years of full-time relevant experience in 

conducting environmental site 

assessments and related investigations 

will qualify as environmental 

professionals for the purposes of this 

rulemaking. 

The final rule retains the provision 

recognizing as environmental 

professionals those individuals who are 

licensed by any tribal or state 

government as a P.E. or P.G., and have 

three years of full-time relevant 

experience in conducting all 

appropriate inquiries. We continue to 

contend that such individuals have 

sufficient specific education, training, 

and experience necessary to exercise 

professional judgment to develop 

opinions and conclusions regarding 

conditions indicative of releases or 

threatened releases on, at, in, or to a 

property, including the presence of 

releases to the surface or subsurface of 

the property, sufficient to meet the 

objectives and performance factors 

provided in the regulation. The rigor of 

the tribal- and state-licensed P.E. and 

P.G. certification processes, including 

the educational and training 

requirements, as well as the 

examination requirements, paired with 

the requirement to have three years of 

relevant professional experience 

conducting all appropriate inquiries 

will ensure that all appropriate inquiries 

are conducted under the supervision or 

responsible charge of an individual well 

qualified to oversee the collection and 

interpretation of site-specific 

information and render informed 

opinions and conclusions regarding the 

environmental conditions at a property, 

including opinions and conclusions 

regarding conditions indicative of 

releases or threatened releases of 

hazardous substances and other 

contaminants on, at, in, or to the 

property. The Agency’s decision to 

recognize tribal and state-licensed P.E.s 

and P.G.s reflects the fact that tribal 

governments and state legislatures hold 

such professionals responsible (legally 

and ethically) for safeguarding public 

safety, public health, and the 

environment. To become a P.E. or P.G. 

requires that an applicant have a 

combination of accredited college 

education followed by approved 

professional training and experience. 

Once a publicly-appointed review board 

approves a candidate’s credentials, the 

candidate is permitted to take a rigorous 

exam. The candidate must pass the 

examination to earn a license, and 

perform ethically to maintain it. After a 

state or tribe grants a license to an 

individual, and as a condition of 

maintaining the license, many states 

require P.E.s and P.G.s to maintain 

proficiency by participating in approved 

continuing education and professional 

development programs. In addition, 

tribal and state licensing boards can 

investigate complaints of negligence or 

incompetence on the part of licensed 

professionals, and may impose fines and 

other disciplinary actions such as cease 

and desist orders or license revocation. 

Although the final rule recognizes 

tribal and state-licensed P.E. and P.G.s 

and other such government licensed 

environmental professionals with three 

years of experience to be environmental 

professionals, the rule does not restrict 

the definition of an environmental 

professional to these licensed 

individuals. The definition of an 

66080 Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 

environmental professional also 

includes individuals who hold a 

Baccalaureate or higher degree from an 

accredited institution of higher 

education in engineering or science and 

have the equivalent of five (5) years of 

full-time relevant experience in 

conducting environmental site 

assessments, or all appropriate 

inquiries. In addition, individuals with 

ten years of full-time relevant 

experience in conducting environmental 

site assessments, or all appropriate 

inquiries qualify as environmental 

professionals for the purpose of 

conducting all appropriate inquiries. 

Individuals with these qualifications 

most likely will possess sufficient 

specific education, training, and 

experience necessary to exercise 

professional judgment to develop 

opinions and conclusions regarding 

conditions indicative of releases or 

threatened releases on, at, in, or to a 

property, sufficient to meet the 

objectives and performance factors 

included in § 312.20(e) and (f). 

In addition to the qualifications for 

environmental professionals mentioned 

above, EPA is retaining the proposed 

provision to include within the 

definition of an environmental 

professional individuals who are 

licensed to perform environmental site 

assessments or all appropriate inquiries 

by the Federal government (e.g., the 

Bureau of Indian Affairs) or under a 

state or tribal certification program, 

provided that these individuals also 

have three years of full-time relevant 

experience. We contend that individuals 

licensed by state and tribal 

governments, or by any department or 

agency within the federal government, 

to perform all appropriate inquiries or 

environmental site assessments, should 

be allowed to qualify as an 

environmental professional under 

today’s regulation. State and tribal 

agencies may best determine the 

qualifications defining individuals who 

‘‘possess sufficient specific education, 

training, and experience necessary to 

exercise professional judgment to 

develop opinions and conclusions 

regarding conditions indicative of 

releases or threatened releases on, at, in, 

or to a property, sufficient to meet the 

rule’s objectives and performance 

factors’’ within any particular state or 

tribal jurisdiction. 

In response to requests from members 

of independent certification 

organizations that EPA recognize in the 

regulation those organizations whose 

certification requirements meet the 

environmental professional 

qualifications included in the final rule, 

we point out that today’s final rule does 

not reference any private party 

professional certification standards. 

Such an approach would require that 

EPA review the certification 

requirements of each organization to 

determine whether or not each 

organization’s certification requirements 

meet or exceed the regulatory 

qualifications for an environmental 

professional. Given that there may be 

many such organizations and given that 

each organization may review and 

change its certification qualifications on 

a frequent or periodic basis, we 

conclude that such a undertaking is not 

practicable. EPA does not have the 

necessary resources to review the 

procedures of each private certification 

organization and review and approve 

each organization’s certification 

qualifications. Therefore, the final rule 

includes within the regulatory 

definition of an environmental 

professional, general performance-based 

standards or qualifications for 

determining who may meet the 

definition of an environmental 

professional for the purposes of 

conducting all appropriate inquiries. 

These standards include education and 

experience qualifications, as 

summarized below. The final rule does 

not recognize, or reference, any private 

organization’s certification program 

within the context of the regulatory 

language. However, the Agency notes 

that any individual with a certification 

from a private certification organization 

where the organization’s certification 

qualifications include the same or more 

stringent education and experience 

requirements as those included in 

today’s final regulation will meet the 

definition of an environmental 

professional for the purposes of this 

regulation. 

Based upon the input received from 

the public commenters, EPA determined 

that the definition of environmental 

professional included in today’s final 

rule establishes a balance between the 

merits of setting a high standard of 

excellence for the conduct of all 

appropriate inquiries through the 

establishment of stringent qualifications 

for environmental professionals and the 

need to ensure that experienced and 

highly competent individuals currently 

conducting all appropriate inquiries are 

not displaced. 

Summary of Final Rule’s Definition of 

Environmental Professional 

In summary, the definition of 

environmental professional included in 

today’s final rule includes individuals 

who possess the following 

qualifications: 

• Hold a current Professional 

Engineer’s or Professional Geologist’s 

license or registration from a state, tribe, 

or U.S. territory and have the equivalent 

of three (3) years of full-time relevant 

experience; or 

• Be licensed or certified by the 

federal government, a state, tribe, or 

U.S. territory to perform environmental 

inquiries as defined in § 312.21 and 

have the equivalent of three (3) years of 

full-time relevant experience; or 

• Have a Baccalaureate or higher 

degree from an accredited institution of 

higher education in science or 

engineering and the equivalent of five 

(5) years of full-time relevant 

experience; or 

• Have the equivalent of ten (10) 

years of full-time relevant experience. 

The definition of ‘‘relevant 

experience’’ is ‘‘participation in the 

performance of environmental site 

assessments that may include 

environmental analyses, investigations, 

and remediation which involve the 

understanding of surface and subsurface 

environmental conditions and the 

processes used to evaluate these 

conditions and for which professional 

judgment was used to develop opinions 

regarding conditions indicative of 

releases or threatened releases * * * to 

the subject property.’’

The final rule retains the proposed 

requirement that environmental 

professionals remain current in their 

field by participating in continuing 

education or other activities and be able 

to demonstrate such efforts. 

The final rule also retains the 

allowance for individuals not meeting 

the definition of an environmental 

professional to contribute to and 

participate in the all appropriate 

inquiries on the condition that such 

individuals are conducting inquiries 

activities under the supervision or 

responsible charge of an individual that 

meets the regulatory definition of an 

environmental professional. This 

provision allows for a team of 

individuals working for the same firm or 

organization (e.g., individuals working 

for the same government agency) to 

share the workload for conducting all 

appropriate inquiries for a single 

property, provided that one member of 

the team meets the definition of an 

environmental professional and reviews 

the results and conclusions of the 

inquiries and signs the final report. 

The final rule requires that the final 

review of the all appropriate inquiries 

and the conclusions that follow from the 

inquiries rest with an individual who 

qualifies as an environmental 

professional, as defined in § 312.10. The 

final rule also requires that in signing 

Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 66081 

the report, the environmental 

professional must document that he or 

she meets the definition of an 

‘‘environmental professional’’ included 

in the regulations. 

F. References 

Proposed Rule 

In the proposed rule, the Agency 

reserved a reference section and stated 

in the preamble that we may include 

references to applicable voluntary 

consensus standards developed by 

standards’ developing organizations that 

are not inconsistent with the final 

regulatory requirements for all 

appropriate inquiries or otherwise 

impractical. The Agency requested 

comments regarding available 

commercially accepted voluntary 

consensus standards that may be 

applicable to and compliant with the 

proposed federal standards for all 

appropriate inquiries. 

Section 12(d) of the National 

Technology Transfer and Advancement 

Act of 1995 (‘‘NTTAA’’), Public Law 

104–113, section 12(d) (15 U.S.C. 272 

note), directs agencies to use technical 

standards that are developed or adopted 

by voluntary consensus standards 

bodies, unless their use would be 

inconsistent with applicable law or 

otherwise impractical. Voluntary 

consensus standards are technical 

standards (e.g., materials specifications, 

test methods, sampling procedures, and 

business practices) that are developed or 

adopted by voluntary consensus 

standards bodies. When developing the 

proposed rule, EPA considered using an 

existing voluntary consensus standard 

developed by ASTM International as the 

federal standard for all appropriate 

inquiries. This standard is known as the 

ASTM E1527–2000 standard (entitled 

‘‘Standard Practice for Environmental 

Site Assessments: Phase I 

Environmental Site Assessment 

Process’’). In the preamble to the 

proposed rule, we acknowledged the 

prevalent use of the ASTM E1527–2000 

standard and the fact that it generally is 

recognized as good and customary 

commercial practice. However, when 

we proposed the federal standards for 

all appropriate inquiries, EPA 

determined that the ASTM E1527–2000 

standard is inconsistent with applicable 

law. As a result, EPA chose not to 

reference the ASTM E1527–2000 

standard because it was inconsistent 

with applicable law. 

Public Comments 

We received relatively few comments 

citing available and applicable 

voluntary consensus standards for 

conducting all appropriate inquiries. 

Several commenters did argue that the 

interim standard cited in the statute, the 

ASTM E1527–97 Environmental Site 

Assessments: Phase I Environmental 

Site Assessment Process, or the updated 

ASTM E1527–2000, is sufficient to meet 

the statutory criteria. A few commenters 

stated a preference for the ASTM 

E1527–2000 standard over the 

requirements included in the proposed 

rule. ASTM International is a standards 

development organization whose 

committees develop voluntary 

consensus standards for a variety of 

materials, products, systems and 

services. ASTM International is the only 

standards development organization 

that submitted a comment requesting 

that the Agency consider its standard, 

the ASTM E1527–2000 Standard 

Practice for Environmental Site 

Assessments: Phase I Environmental 

Site Assessment Process, as an 

equivalent standard to the federal 

regulations. 

Final Rule 

Since publication of the proposed 

rule, ASTM International and its E50 

committee, the committee responsible 

for the development of the ASTM 

E1527–2000 Phase I Environmental Site 

Assessment Process, has reviewed and 

updated the ‘‘2000’’ version of the 

E1527 standard to address EPA’s 

concerns regarding the differences 

between the ASTM E1527–2000 

standard and the criteria established by 

Congress in the Brownfields 

Amendments to CERCLA. These 

activities were conducted within the 

normal review and updating process 

that ASTM International undertakes for 

each standard over a five-year cycle. 

In today’s final rule, EPA is 

referencing the standards and practices 

developed by ASTM International and 

known as Standard E1527–05 (entitled 

‘‘Standard Practice for Environmental 

Site Assessments: Phase I 

Environmental Site Assessment 

Process’’) and recognizing the E1527–05 

standard as consistent with today’s final 

rule. The Agency determined that this 

voluntary consensus standard is 

consistent with today’s final rule and is 

compliant with the statutory criteria for 

all appropriate inquiries. Persons 

conducting all appropriate inquiries 

may use the procedures included in the 

ASTM E1527–05 standard to comply 

with today’s final rule. 

It is the Agency’s intent to allow for 

the use of applicable and compliant 

voluntary consensus standards when 

possible to facilitate implementation of 

the final regulations and avoid 

disruption to parties using voluntary 

consensus standards that are found to be 

fully compliant with the federal 

regulations. 

G. What Is Included in ‘‘All Appropriate 

Inquiries?’’

Proposed Rule 

The proposed regulations for 

conducting all appropriate inquiries 

outlined the standards and practices for 

conducting the activities included in 

each of the statutory criterion 

established by Congress in the 

Brownfields Amendments. These 

criteria are set forth in CERCLA section 

101(35)(B)(iii) and are: 

• The results of an inquiry by an 

environmental professional (proposed 

§ 312.21). 

• Interviews with past and present 

owners, operators, and occupants of the 

facility for the purpose of gathering 

information regarding the potential for 

contamination at the facility (proposed 

§ 312.23). 

• Reviews of historical sources, such 

as chain of title documents, aerial 

photographs, building department 

records, and land use records, to 

determine previous uses and 

occupancies of the real property since 

the property was first developed 

(proposed § 312.24). 

• Searches for recorded 

environmental cleanup liens against the 

facility that are filed under Federal, 

State, or local law (proposed § 312.25). 

• Reviews of Federal, State, and local 

government records, waste disposal 

records, underground storage tank 

records, and hazardous waste handling, 

generation, treatment, disposal, and 

spill records, concerning contamination 

at or near the facility (proposed 

§ 312.26). 

• Visual inspections of the facility 

and of adjoining properties (proposed 

§ 312.27). 

• Specialized knowledge or 

experience on the part of the defendant 

(proposed § 312.28). 

• The relationship of the purchase 

price to the value of the property, if the 

property was not contaminated 

(proposed § 312.29). 

• Commonly known or reasonably 

ascertainable information about the 

property (proposed § 312.30). 

• The degree of obviousness of the 

presence or likely presence of 

contamination at the property, and the 

ability to detect the contamination by 

appropriate investigation (proposed 

§ 312.31). 

Public Comments 

We received a few comments 

addressing the statutory criteria and the 

66082 Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 

inclusion of certain particular criteria 

within the scope of the proposed rule. 

Some commenters requested that EPA 

not include in the final rule the criterion 

to consider the relationship of the 

purchase price of the property to the fair 

market value of the property, if the 

property is not contaminated. In 

addition, a few commenters stated the 

final rule should not include within the 

scope of the all appropriate inquiries the 

specialized knowledge or experience on 

the part of the prospective landowner. 

The Agency notes that both criteria 

that commenters requested be removed 

from the scope of the all appropriate 

inquiries regulations are criteria 

specifically required by Congress to be 

included in the regulations. In addition, 

both criteria have been part of the all 

appropriate inquiries provisions under 

the CERCLA innocent landowner 

defense since 1986. The proposed rule 

included no changes from the previous 

statutory provisions. 

Final Rule 

The final rule retains provisions 

addressing each of the statutory criteria 

for the conduct of all appropriate 

inquiries included in CERCLA section 

101(35)(B)(iii). 

H. Who Is Responsible for Conducting 

the All Appropriate Inquiries? 

The Brownfields Amendments to 

CERCLA require persons claiming any 

of the landowner liability protections to 

conduct all appropriate inquiries into 

the past uses and ownership of the 

subject property. The criteria included 

in the Brownfields Amendments for the 

regulatory standards for all appropriate 

inquiries require that the inquiries 

include an inquiry by an environmental 

professional. The statute does not 

require that all criteria or inquiries be 

conducted by an environmental 

professional. 

Proposed Rule 

The proposed rule required that 

many, but not all, of the inquiries 

activities be conducted by, or under the 

supervision or responsible charge of, an 

individual meeting the qualifications of 

the proposed definition of an 

environmental professional. The 

proposed rule also provided that several 

of the activities included in the 

inquiries could be conducted either by 

the prospective landowner or grantee, 

and not have to be conducted under the 

supervision or responsible charge of the 

environmental professional. The 

proposed rule required that the results 

of all activities conducted by the 

prospective landowner or grantee, and 

not conducted by or under the 

supervision or responsible charge of the 

environmental professional, be provided 

to the environmental professional to 

ensure that such information could be 

fully considered when the 

environmental professional develops an 

opinion, based on the inquiry activities, 

as to whether conditions at the property 

are indicative of a release or threatened 

release of a hazardous substance (or 

other contaminant) on, at, in, or to the 

property. 

The proposed rule allowed for the 

following activities to be the 

responsibility of, or conducted by, the 

prospective landowner or grantee and 

not necessarily be conducted by the 

environmental professional, provided 

the results of such inquiries or activities 

are provided to an environmental 

professional overseeing the all 

appropriate inquiries: 

• Searches for environmental cleanup 

liens against the subject property that 

are filed or recorded under federal, 

tribal, state, or local law, as required by 

proposed § 312.25. 

• Assessments of any specialized 

knowledge or experience on the part of 

the landowner, as required by § 312.28. 

• An assessment of the relationship of 

the purchase price to the fair market 

value of the subject property, if the 

property was not contaminated, as 

required by § 312.29. 

• An assessment of commonly known 

or reasonably ascertainable information 

about the subject property, as required 

by § 312.30. 

The proposed rule required that all 

other required inquiries and activities, 

beyond those listed above to be 

conducted by, or under the supervision 

or responsible charge of, an 

environmental professional. 

Public Comments 

Several commenters asserted that the 

mandatory nature of the proposed 

provision requiring the prospective 

landowner to provide information 

regarding the four criteria listed above 

to the environmental professional is 

problematic. Particularly with regard to 

the requirement to provide ‘‘specialized 

knowledge or experience of the 

defendant,’’ commenters pointed out 

difficulties in a prospective landowner 

being able to document such knowledge 

and experience sufficiently. Also, with 

regard to the information related to the 

‘‘relationship of the purchase price to 

the fair market value of the property, if 

the property was not contaminated,’’

many commenters pointed out that 

prospective landowners may not want 

to divulge information regarding the 

price paid for a property. Commenters 

pointed out that the requirement to 

consider ‘‘commonly known or 

reasonably ascertainable information’’

about a property is implicit to all 

aspects of the all appropriate inquiries 

requirements. In addition, commenters 

stated that CERCLA liability lies solely 

with the owners and operators of a 

vessel or property. A decision on the 

part of a prospective landowner to not 

furnish an environmental professional 

with certain information related to any 

of the statutory criteria can only affect 

the property owner’s ability to claim a 

liability protection provided under the 

statute. In addition, the statute does not 

mandate that information deemed to be 

the responsibility of the prospective 

landowner and not part of the ‘‘inquiry 

of the environment professional’’ be 

provided to the environmental 

professional or even be part of the 

inquiry of the environmental 

professional. Some of the statutory 

criteria are inherently the responsibility 

of the prospective landowner. 

Final Rule 

We agree with the commenters who 

asserted that the results and information 

related to the criteria identified as being 

the responsibility of the prospective 

landowner should not, as a matter of 

law, have to be provided to the 

environmental professional. The statute 

does not mandate that a prospective 

landowner provide all information to an 

environmental professional. Given that 

the burden of potential CERCLA 

liability ultimately falls upon the 

property owner or operator, a 

prospective landowner’s decision not to 

provide the results of an inquiry or 

related information to an environmental 

professional he or she hired to 

undertake other aspects of the all 

appropriate inquiries investigation can 

only affect the liability of the property 

owner. In addition, we believe that the 

environmental professional may be able 

to develop an opinion with regard to 

conditions indicative of releases or 

threatened releases on, at, in, or to a 

property based upon the results of the 

criteria identified to be part of the 

‘‘inquiry of an environmental 

professional.’’ Any information not 

furnished to the environmental 

professional by the prospective 

landowner that may affect the 

environmental professional’s ability to 

render such an opinion may be 

identified by the environmental 

professional as a ‘‘data gap.’’ The 

provisions of the final rule (as did the 

proposed rule) then require that the 

environmental professional comment on 

the significance of the data gap or 

missing information on his or her ability 

to render such an opinion, in light of all 

Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 66083 

other information collected and all other 

data sources consulted. 

As a result of our consideration of the 

issues raised by commenters, today’s 

final rule modifies the requirements of 

§ 312.22 ‘‘additional inquiries’’ by 

stating (in paragraph (a)) that ‘‘persons 

* * * may provide the information 

associated with such inquiries [i.e., the 

information for which the prospective 

landowner or brownfields grantee is 

responsible] to the environmental 

professional * * *.’’ The proposed rule 

provided that such information ‘‘must 

be provided’’ to the environmental 

professional. Although we expect that 

most prospective landowners and 

grantees will furnish available 

information or knowledge about a 

property to an environmental 

professional he or she hired when such 

information could assist the 

environmental professional in 

ascertaining the environmental 

conditions at a property, we affirm that 

compliance with the statutory criteria 

does not require that such information 

be disclosed. Ultimately, CERCLA 

liability rests with the owner or operator 

of a facility or property owner and it is 

the information held by the property 

owner or operator that may be reviewed 

in a court of law when determining an 

owner or operator’s liability status, 

regardless of whether all information 

was disclosed to an environmental 

professional during the conduct of all 

appropriate inquiries. 

I. When Must All Appropriate Inquiries 

Be Conducted? 

CERCLA section 101(40)(B)(i), as 

amended, requires bona fide prospective 

purchasers to conduct all appropriate 

inquiries into ‘‘previous ownerships and 

uses of the facility.’’ In the case of 

contiguous property owners, CERCLA 

section 107(q)(1)(A)(viii) requires that a 

person claiming to be a contiguous 

property owner conduct all appropriate 

inquiries ‘‘at the time at which the 

person acquired the property.’’ In the 

case of innocent landowners, section 

101(35)(B)(i)(I) of CERCLA requires that 

the property owner conduct all 

appropriate inquiries ‘‘on or before the 

date on which the defendant acquired 

the facility.’’

Proposed Rule 

Other than to specify that all 

appropriate inquiries must be 

conducted on or prior to the date a 

person acquires a property, the statute is 

silent regarding how close to the actual 

date of acquisition the inquiries must be 

completed. The proposed rule required 

that all appropriate inquiries be 

conducted or updated within one year 

prior to taking title to a property. The 

proposed rule provided that prospective 

landowners could use information 

collected as part of previous inquiries 

for the same property, if the inquiries 

were completed or updated within one 

year prior to the date the property is 

acquired. The proposed rule required 

that certain information collected as 

part of a previous all appropriate 

inquiries be updated if it was collected 

more than 180 days prior to the date a 

person purchased the property. In 

addition, in the preamble to the 

proposed rule, Agency defined the date 

of acquisition of a property as the date 

on which the prospective landowner 

acquires title to the property. 

Public Comments 

Commenters generally agreed with the 

proposed provision to define the date of 

acquisition of a property as the date on 

which a person acquires title to the 

property. A few commenters stated that 

the requirement for an all appropriate 

inquiries investigation to be completed 

within a year of the date of acquisition 

of the property is too stringent and may 

not allow sufficient time for some 

property transactions to be completed. 

Some commenters also asserted that the 

proposed requirement to update certain 

aspects of the all appropriate inquiries 

investigation, if the investigation was 

conducted more than 180 days prior to 

the date of the acquisition of the 

property was too stringent. 

Final Rule 

The Agency continues to believe that 

the event that most closely reflects the 

Congressional intent of the date on 

which the defendant acquired the 

property is the date on which a person 

received title to the property. As 

explained in the preamble to the 

proposed rule, the Agency considered 

other dates, such as the date a 

prospective landowner signs a purchase 

or sale agreement. However, it could be 

burdensome to require a prospective 

landowner to have completed the all 

appropriate inquiries prior to having an 

agreement with a seller to complete a 

sales transaction. In fact, the time period 

between the date on which a sales 

agreement is signed and the date on 

which the title to the property is 

actually transferred to the prospective 

landowner may be the most convenient 

time for the prospective landowner to 

obtain access to the property and 

undertake the all appropriate inquiries. 

In addition, requiring that all 

appropriate inquiries be completed on 

some date prior to the date of title 

transfer could result in requiring 

prospective landowners to undertake all 

appropriate inquiries so early in the 

property acquisition process as to 

require the inquiries to be completed 

prior to the prospective landowner 

making a final decision on whether to 

actually acquire the property. 

To increase the potential that the 

information collected for the all 

appropriate inquiries accurately reflects 

the proposed objectives and 

performance factors, as well as to 

increase the potential that opinions and 

judgments regarding the environmental 

conditions at a property that are 

included in an all appropriate inquiries 

report are based on current and relevant 

information, the Agency is retaining the 

proposed provision that all appropriate 

inquiries be conducted within one year 

prior to the prospective landowner 

acquiring the property. Today’s final 

rule includes regulatory language at 

§ 312.20(a) clarifying that all 

appropriate inquiries must be 

conducted within one year prior to the 

date on which a person acquires a 

property. 

All appropriate inquiries may include 

information collected for previous 

inquiries that were conducted or 

updated within one year prior to the 

acquisition date of the property. In 

addition, as explained in more detail 

below, the final rule retains the 

requirement that several of the 

components of the inquiries be updated 

within 180 days prior to the date the 

property is purchased. Today’s final 

rule includes a definition of the ‘‘date of 

acquisition,’’ or purchase date, of a 

property (i.e., the date the landowner 

obtains title to the property). 

Although commenters may be correct 

in their assertions that some property 

transactions may take more than a year 

to close, we continue to believe that it 

is important for the all appropriate 

inquiries investigation to be completed 

within one year prior to the date the 

property is acquired. We point out that 

the final regulation, as did the proposed 

regulation, allows for information from 

an older investigation to be used in a 

current investigation. However, if the 

prior all appropriate inquiries 

investigation was completed more than 

a year prior to the property acquisition 

date, all parts of the investigation must 

be reviewed and updated for the all 

appropriate inquiries to be complete. 

We believe that a year is sufficient time 

for conditions at a property to change. 

In particular, in cases where there is a 

release or threatened release at a 

property, significant changes to the 

environmental conditions of a property 

could occur during the course of a year. 

In addition, depending upon the uses 

and ownership of a property during the 

66084 Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 

course of a one-year time period, overall 

conditions at a property could change 

and new evidence of a release or 

threatened release could appear. 

Therefore, today’s final rule requires 

that all appropriate inquiries completed 

for a particular property more than one 

year prior to the date of acquisition of 

that property, be updated in their 

entirety. As summarized below, the 

final rule does allow for the use of 

information contained in previous 

inquiries, even when the inquiries were 

completed more than a year prior to the 

property acquisition date, as long as all 

information was updated within a year 

and includes any changes that may have 

occurred during the interim. 

J. Can a Prospective Landowner Use 

Information Collected for Previous 

Inquiries Completed for the Same 

Property? 

Proposed Rule 

The proposed rule allowed parties 

conducting all appropriate inquiries to 

use the results of and information from 

previous inquiries completed for the 

same property, under certain 

conditions. First, the previous inquiries 

must have been conducted in 

compliance with the proposed rule and 

with CERCLA sections 101(35)(B), 

101(40)(B) and 107(q)(A)(viii). In 

addition, the information in the 

previous inquiries must have been 

collected or updated within one year 

prior to the date of acquisition of the 

property. Certain types of information 

collected more than 180 days prior to 

the current date of acquisition must be 

updated for the current all appropriate 

inquiries. Also, the information required 

under some specific criterion (e.g., 

relationship of purchase price to 

property value, specialized knowledge 

on part of defendant) must be collected 

specifically for the current transaction. 

Public Comments 

A significant number of commenters 

pointed out that the regulatory language 

in proposed § 312.20(b)(1) of the 

proposed rule precludes the use of 

information contained in assessments or 

the results of all appropriate inquiries 

conducted more than a year prior to the 

date of acquisition of a property. 

Commenters pointed out that since the 

language in the proposed rule stated 

that previously collected information 

had to have been collected ‘‘in 

compliance with the requirements of 

* * * 40 CFR Part 312,’’ any 

information included in all appropriate 

inquiries reports completed prior to the 

promulgation of the final rule could not 

be used, since compliance with the 

regulation could not be achieved prior 

to its publication. 

Final Rule 

It is not the Agency’s intent to 

disallow the use of information 

contained in previous inquiries, if the 

environmental professional and the 

prospective landowner find the 

previously collected information to be 

accurate and valid. However, EPA 

continues to believe that information 

collected as part of a prior all 

appropriate inquiries investigation for 

the same property should be updated to 

reflect current environmental conditions 

at the property and to include any 

specific information or specialized 

knowledge held by the prospective 

landowner. The regulatory language in 

today’s final rule (at § 312.20(c)(1)) 

allows for the use of information 

collected as part of prior all appropriate 

inquiries investigation for the same 

property provided that the prior 

information was collected ‘‘during the 

conduct of all appropriate inquiries in 

compliance with CERCLA sections 

101(35)(B), 101(40)(B) and 

107(q)(A)(viii).’’ We have deleted the 

proposed language that would have 

required the previously conducted 

investigation to have been done in 

compliance with the final regulation. 

This allows for the use of information 

collected as part of previous all 

appropriate inquiries, as long as the 

information was collected in 

compliance with the statutory 

provisions for all appropriate inquiries. 

For property purchased on or after May 

31, 1997, therefore, any information 

collected as part of an assessment in 

compliance with the ASTM E1527–97 

standard or the ASTM E1527–2000 

standard may be used as part of a 

current all appropriate inquiries 

investigation. For property purchased 

before May 31, 1997, information from 

assessments completed and in 

compliance with the statutory 

provisions at CERCLA section 

101(35)(B)(iv)(I) may be used as part of 

a current all appropriate inquiries 

investigation. However, this prior 

information may only be used if 

updated in accordance with §§ 312.20(b) 

and (c) of today’s rule. 

The final rule continues to recognize 

that there is value in using previously 

collected information when such 

information was collected in accordance 

with the statutory provisions and good 

customary business practices, 

particularly when the use of such 

previously-collected information will 

reduce the need to undertake 

duplicative efforts. 

The final rule also retains the 

requirement that certain aspects of the 

all appropriate inquiries investigation 

be updated if the investigation was 

completed more than 180 days prior to 

the date of acquisition of the property 

(or the date on which the prospective 

landowner takes title to the property) to 

ensure that an all appropriate inquiries 

investigation accurately reflects the 

current environmental conditions at a 

property. To increase the potential that 

information collected about the 

conditions of a property is accurate, as 

well as increase the potential that 

opinions and judgments regarding the 

environmental conditions at a property 

that are included in an all appropriate 

inquiries report are based on current 

and relevant information, the final rule 

requires that many of the components of 

the previous inquiries be updated 

within 180 days prior to the date of 

acquisition of the property. The 

components of the all appropriate 

inquiries that must be updated within 

180 days prior to the date on which the 

property is acquired are: 

• Interviews with past and present 

owners, operators, and occupants 

(§ 312.23); 

• Searches for recorded 

environmental cleanup liens (§ 312.25); 

• Reviews of federal, tribal, state, and 

local government records (§ 312.26); 

• Visual inspections of the facility 

and of adjoining properties (§ 312.27); 

and 

• The declaration by the 

environmental professional 

(§ 312.21(d)). 

Also, the final rule retains the 

proposed requirement that in all cases 

where a prospective landowner is using 

previously collected information, the all 

appropriate inquiries for the current 

purchase must be updated to include a 

summary of any relevant changes to the 

conditions of the property and any 

specialized knowledge of the 

prospective landowner. 

In today’s final rule, we continue to 

recognize that it is not sufficient to 

wholly adopt previously conducted all 

appropriate inquiries for the same 

property without any review. Certain 

aspects of the all appropriate inquiries 

investigation are specific to the current 

prospective landowner and the current 

purchase transaction. Therefore, the 

final rule requires that each all 

appropriate inquiries investigation 

include current information related to: 

• Any relevant specialized knowledge 

held by the current prospective 

landowner and the environmental 

professional responsible for overseeing 

and signing the all appropriate inquiries 

report (i.e., requirements of § 312.28); 

Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 66085 

• The relationship of the current 

purchase price to the value of the 

property, if the property were not 

contaminated (i.e., requirements of 

§ 312.29); and 

• Commonly known or reasonably 

ascertainable information about the 

property. 

K. Can All Appropriate Inquiries Be 

Conducted by One Party and 

Transferred to Another Party? 

Proposed Rule 

The proposed rule allowed for all 

appropriate inquiries to be conducted 

by one party and transferred to another 

party, provided that certain conditions 

are met. Under certain circumstances, 

the prospective landowner, or a grantee, 

may use a report of all appropriate 

inquiries conducted for the property by 

or for another party, including the seller 

of the property or another party. For 

example, there are situations where the 

federal government or a state 

government agency may conduct the all 

appropriate inquiries on behalf of the 

local government for a property being 

purchased by a local government, such 

as the ‘‘targeted brownfields 

assessments’’ conducted on behalf of 

local governments by EPA. This 

situation also may occur when a state 

government covers the cost of the all 

appropriate inquiries for a property 

owned by a local government or actually 

conducts the all appropriate inquiries 

itself when the local government does 

not have access to appropriate staff or 

capital resources. A local government 

may conduct all appropriate inquiries 

for a third party in its community, such 

as a private prospective landowner. In 

addition, local redevelopment agencies 

may locate a contaminated property, 

conduct all appropriate inquiries, 

acquire the property, and then sell the 

property to a private developer. 

The proposed rule allowed for a 

person acquiring a property, or a 

grantee, to use the results of an all 

appropriate inquiries report conducted 

by or for another party, if the report 

meets the proposed rule’s objectives and 

performance factors and the person who 

is seeking to use the previouslycollected information or report reviews 

all information collected and updates 

the contents of the report as required by 

§ 312.20(c) and necessary to accurately 

reflect current conditions at the 

property. In addition, the proposed rule 

required that the prospective 

landowner, or grantee, update the 

inquiries and the report to include any 

commonly known and reasonably 

ascertainable information, relevant 

specialized knowledge held by the 

prospective landowner and the 

environmental professional, and the 

relationship of the purchase price to the 

value of the property, if it were not 

contaminated. 

Public Comments 

Commenters generally supported the 

proposed provision allowing for all 

appropriate inquiries investigations 

conducted by or for one party to be used 

by another party. 

Final Rule 

For the reasons discussed in the 

preamble to the proposed rule and 

summarized above, the final rule retains 

the provision allowing that all 

appropriate inquiries investigations may 

be conducted by or for one party and 

used by another party. In all cases, the 

all appropriate inquiries investigation 

must be updated to include commonly 

known and reasonably ascertainable 

information and any relevant 

specialized knowledge held by the 

prospective landowner and 

environmental professional. In addition, 

the evaluation of the relationship 

between the purchase price and the fair 

market value of the property must 

reflect the current sale of the property. 

In all other aspects of the investigation, 

the all appropriate inquiries must be in 

compliance with the provisions of the 

final regulation. 

L. What Are the Objectives and 

Performance Factors for the All 

Appropriate Inquiries Requirements? 

Proposed Rule 

As explained in the preamble to the 

proposed rule, when developing the 

proposed standards, EPA and the 

Negotiated Rulemaking Committee 

structured the proposal around the 

statutory criteria established by 

Congress in section 101(35)(B)(iii) of 

CERCLA. As development of the 

proposed rule progressed, it became 

apparent that the purposes and 

objectives for the individual criterion 

and the types of information that must 

be collected to meet the objectives of 

each criterion often overlapped. For 

example, in developing standards 

addressing the criterion requiring a 

review of historical information, a 

search for recorded environmental 

cleanup liens, and a review of 

government records, the Committee 

concluded that the objectives of each 

criterion or activity were similar, which 

could lead to the collection of the same 

information to fulfill each of the 

criterion’s objectives. For example, a 

chain of title document is historic 

information that may include 

information on environmental cleanup 

liens, as well as information on past 

owners of the property indicating that 

previous owners managed hazardous 

substances on the property. 

To avoid requiring duplicative efforts, 

but to ensure that the proposed 

regulations included standards and 

practices that result in a comprehensive 

assessment of the environmental 

conditions at a property, the proposed 

all appropriate inquiries standards were 

structured around a concise set of 

objectives and performance factors. The 

proposed objectives and performance 

factors applied to the standards 

comprehensively. In conducting the 

inquiries collectively, the landowner 

and the environmental professional 

must seek to achieve the objectives and 

performance factors and use the 

objectives and standards as guidelines 

in implementing, in total, all of the 

other proposed regulatory standards and 

practices. 

Public Comments 

Commenters overwhelmingly 

supported the proposed approach of 

structuring the all appropriate inquiries 

standards around a definitive set of 

performance factors and objectives. 

Commenters stated that the 

establishment of performance factors 

will improve the quality of 

environmental site assessments because 

the performance factors allow for the 

application of professional judgement 

and provide flexibility. 

A few commenters did not support 

the proposed approach of structuring 

the regulations around a set of 

performance factors and objectives. 

These commenters asserted that the 

objectives and performance factors 

made the regulation too vague and 

open-ended. In addition, the 

commenters stated that they want the 

regulation to be centered around a 

‘‘checklist’’ of activities, each of which 

should be required to be completed 

independently and without 

consideration of a comprehensive 

performance approach. Commenters 

who argued for a checklist approach 

said that such an approach would 

ensure that the environmental 

professional only would have to 

undertake a finite list of activities and 

it would be easier (in the commenter’s 

opinion) for property owners to obtain 

liability protection if the list of activities 

could be completed without regard to 

performance goals or an overall 

objective. These commenters also 

expressed concern that, if the 

regulations are based on performance 

factors that the all appropriate inquiries 

investigation would not have an 

66086 Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 

endpoint at which prospective 

landowners could stop looking for 

evidence of releases or threatened 

releases. The commenters believed that 

under a checklist approach liability 

protection would be awarded upon 

completion of all activities on the 

checklist. 

Final Rule 

We are retaining the proposed 

performance factors and objectives in 

the final rule. We continue to believe, as 

did many commenters, that basing the 

regulations on a set of overall 

performance factors and specific 

objectives lends clarity and flexibility to 

the standards. Such an approach also 

allows for the application of 

professional judgment and expertise to 

account for site-specific circumstances. 

The primary objective of an all 

appropriate inquiries investigation is to 

identify conditions indicative of 

releases and threatened releases of 

hazardous substances on, at, in, or to the 

subject property. In the case of 

recipients of brownfields grants, the 

objective may be expanded to include 

petroleum and petroleum products, 

pollutants, contaminants, and 

controlled substances, depending upon 

the scope of the grantee’s cooperative 

agreement. 

The performance factors are meant to 

guide the individual aspects of the 

investigation toward meeting both the 

statutory criteria for all appropriate 

inquiries and the regulatory objectives 

of (1) collecting necessary information 

about the uses and ownerships of a 

property and (2) identifying, through the 

collection of this information, 

conditions indicative of releases and 

threatened releases on, at, in, or to the 

subject property. By establishing a 

concise set of objectives and setting 

some boundaries on the information 

collection activities through the 

establishment of performance factors, 

we believe that the final rule fulfills the 

statutory objectives, provides for a 

comprehensive assessment of the 

environmental conditions at the 

property, and avoids the conduct of 

duplicative investigations and data 

collection efforts. 

EPA disagrees with the commenters 

who argued that the proposed approach 

of establishing overall objectives and 

performance factors for the all 

appropriate inquiries standards would 

result in an approach that is too vague 

and open-ended. In fact, by establishing 

clear objectives and setting parameters 

to the investigation through a set of 

performance factors that include 

gathering information that is publicly 

available, obtainable from its source 

within reasonable time and cost 

constraints, and which can practicably 

be reviewed, the approach taken in the 

final rule provides reasonable goals and 

endpoints to the information collection 

requirements. The proposed objectives 

provide a discrete list of the types of 

information that must be collected as 

part of the all appropriate inquiries 

investigation. In addition, the 

performance factors set boundaries 

around the efforts that must be taken 

and the cost burdens that must be 

incurred to obtain the required 

information. The fact that the rule is 

framed within a primary objective, to 

‘‘identify conditions indicative of 

releases and threatened releases of 

hazardous substances,’’ actually reduces 

the open-ended nature of the 

investigation and establishes an overall 

goal for the inquiries. 

Commenters who advocated that a 

checklist approach (or an approach not 

based upon overall objectives and 

performance factors) is superior because 

they believe that it would better provide 

for a stopping point in the investigation 

may have misunderstood the statutory 

requirements that must be met to obtain 

a defense to CERCLA liability. These 

commenters may have incorrectly 

assumed that the completion of the all 

appropriate inquiries investigation is all 

that is required to obtain liability 

protection. The conduct of all 

appropriate inquiries is only one 

requirement for obtaining relief from 

CERCLA liability. Prospective 

landowners must conduct all 

appropriate inquiries prior to acquiring 

a property to qualify for a defense to 

CERCLA liability as an innocent 

landowner, bona fide prospective 

purchaser or contiguous landowner. 

However, once a property is acquired, 

the property owner must comply with 

all of the other statutory criteria 

necessary to qualify for the liability 

protections. In particular, landowners 

must undertake ‘‘reasonable steps’’ to 

‘‘stop any continuing releases.’’

Therefore, the final rule’s objective of 

identifying conditions indicative of 

releases and threatened releases of 

hazardous substances on, at, in, or to a 

property links appropriately with the 

statutory criteria requiring the 

landowner to address such releases to 

qualify for the liability protections. 

Conducting the inquiries merely in 

compliance with a checklist and 

without the purpose of meeting an 

overall objective could result in an 

inability to recognize the value of 

certain types of information or in 

chasing down multiple sources of 

information that may not have added 

value for meeting the overall objective 

of the investigation. A lack of 

information or an inability to obtain 

information that may affect the ability of 

an environmental professional to 

determine whether or not there are 

conditions indicative of a release or 

threatened release of a hazardous 

substance (or other contaminant) on, at, 

in or to a property can have significant 

consequences regarding a prospective 

landowner’s ultimate ability to claim 

protection from CERCLA liability. 

Failure to identify a release during the 

conduct of all appropriate inquiries 

does not relieve the property owner 

from the responsibility to take 

reasonable steps and address the 

release. Even if the Agency agreed with 

the commenters and adopted a 

‘‘checklist’’ approach for the regulation, 

simply conducting the checklist of 

activities and ending the investigation 

after each activity is conducted would 

not result in protection from CERCLA 

liability (as commenters claimed). 

The final rule also establishes that in 

those cases where certain information 

included in the list of regulatory 

objectives (§ 312.20(e)) cannot be found 

or obtained within the parameters of the 

performance factors, such data gaps 

must be identified and the significance 

of the missing information with regard 

to the environmental professional’s 

ability to render an opinion on the 

presence of conditions indicative of 

releases and threatened releases be 

documented. Exhaustive and costly 

efforts do not have to be made to access 

all available sources of data and find 

every piece of data and information 

about a property. Nor does the rule 

require that duplicative information be 

sought from multiple sources. The 

inquiries and the overall investigation 

must be undertaken to meet the data 

collection objectives and primarily 

determine the environmental conditions 

of the property. Structuring the 

standards around such objectives will 

render the results of the investigation 

more valuable to a landowner in his or 

her efforts to comply with the post 

acquisition continuing obligations for 

obtaining the CERCLA liability 

protections than an approach framed 

around a mere checklist of activities. 

In retaining the proposed objectives 

and performance factors, the final rule 

allows that an all appropriate inquiries 

investigation need not address each of 

the regulatory criterion in any particular 

sequence. In addition, information 

relevant to more than one criterion need 

not be collected twice, and a single 

source of information may satisfy the 

requirements of more than one criterion 

and more than one objective. However, 

the information required to achieve each 

Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 66087 

of the objectives and performance 

factors must be obtained for the all 

appropriate inquiries investigation to be 

complete. Although compliance with 

the all appropriate inquiries 

requirements ultimately will be 

determined in court, the final rule 

allows the prospective landowner or 

grantee and environmental professional 

to determine the best process and 

sequence for collecting and analyzing 

all required information. The sequence 

of activities and the sources of 

information used to collect any required 

information is left to the judgment and 

expertise of the environmental 

professional, provided that the overall 

objectives and the performance factors 

established for the final rule are met. 

In performing the inquiries, including 

but not limited to conducting 

interviews, collecting historical data 

and government records, and inspecting 

the subject property and adjoining 

properties, all parties undertaking all 

appropriate inquiries must be attentive 

to the fact that the primary objectives of 

the regulation are to identify the 

following types of information about the 

subject property: 

• Current and past property uses and 

occupancies; 

• Current and past uses of hazardous 

substances; 

• Waste management and disposal 

activities that could have caused 

releases or threatened releases of 

hazardous substances; 

• Current and past corrective actions 

and response activities undertaken to 

address past and on-going releases of 

hazardous substances; 

• Engineering controls; 

• Institutional controls; and 

• Properties adjoining or located 

nearby the subject property that have 

environmental conditions that could 

have resulted in conditions indicative of 

releases or threatened releases of 

hazardous substances on, at, in, or to the 

subject property. 

EPA notes that in the case of 

brownfields grantees, the scope of each 

of the activities listed above may be 

broader if the grant or cooperative 

agreement includes within its scope the 

assessment of a property for conditions 

indicative of releases or threatened 

releases of petroleum and petroleum 

products, controlled substances, or 

other contaminants. 

The final performance factors for 

achieving the objectives set forth above 

are set forth in § 312.20(e) and require 

the persons conducting the inquiries to: 

(1) Gather the information that is 

required for each standard and practice 

that is publicly available, obtainable 

from its source within reasonable time 

and cost constraints, and which can 

practicably be reviewed, and (2) review 

and evaluate the thoroughness and 

reliability of the information gathered in 

complying with each standard and 

practice, taking into account 

information gathered in the course of 

complying with the other standards and 

practices of this subpart. In complying 

with § 312.20(f)(2), if the environmental 

professional or person conducting the 

inquiries determines through such 

review and evaluation that the 

information is either not thorough or not 

reliable, then further inquiries should be 

made to ensure that the information 

gathered is both thorough and reliable. 

The performance factors are provided as 

guidelines to be followed in conjunction 

with the final objectives for the all 

appropriate inquiries. 

M. What Are Institutional Controls? 

The final rule requires the 

identification of institutional controls 

placed on the subject property. As 

defined in § 312.10, institutional 

controls are non-engineered 

instruments, such as administrative and 

legal controls, that among other things, 

can help to minimize the potential for 

human exposure to contamination, and 

protect the integrity of a remedy by 

limiting land or resource use. For 

example, an institutional control might 

prohibit the drilling of a drinking water 

well in a contaminated aquifer or 

disturbing contaminated soils. 

Institutional controls also may be 

referred to as land use controls, activity 

and use limitations, etc., depending on 

the program under which a response 

action is conducted or a release is 

addressed. 

Institutional controls are typically 

used whenever contamination precludes 

unlimited use and unrestricted exposure 

at the property. Thus, institutional 

controls may be needed both before and 

after completion of the remedial action 

or may be employed in place of a 

remedial action. Institutional controls 

often must remain in place for an 

indefinite duration and, therefore, 

generally need to survive changes in 

property ownership (i.e., run with the 

land) to be legally and practically 

effective. Some common examples of 

institutional controls include zoning 

restrictions, building or excavation 

permits, well drilling prohibitions, 

easements and covenants. 

The importance of identifying 

institutional controls during all 

appropriate inquiries is twofold. First, 

institutional controls are usually 

necessary and important components of 

a remedy. Failure to abide by an 

institutional control may put people at 

risk of harmful exposure to hazardous 

substances. Second, an owner wishing 

to maintain protections from CERCLA 

liability as an innocent landowner, 

contiguous property owner, or bona fide 

prospective purchaser must fulfill 

ongoing obligations to: (1) Comply with 

any land use restrictions established or 

relied on in connection with a response 

action and (2) not impede the 

effectiveness or integrity of any 

institutional control employed in 

connection with a response action. For 

a more detailed discussion of these 

requirements please see EPA, Interim 

Guidance Regarding Criteria 

Landowners Must Meet in Order to 

Qualify for Bona Fide Prospective 

Purchaser, Contiguous Property Owner, 

or Innocent Landowner Limitations on 

CERCLA Liability (Common Elements, 

2003). 

Those persons conducting all 

appropriate inquiries may identify 

institutional controls through several of 

the standards and practices set forth in 

this rule. As noted, implementation of 

institutional controls may be 

accomplished through the use of several 

administrative and legal mechanisms, 

such as zoning restrictions, building 

permit requirements, easements, 

covenants, etc. For example, an 

easement implementing an institutional 

control might be identified through the 

review of chain of title documents 

under § 312.24(a). Furthermore, 

interviews with past and present 

owners, operators, or occupants 

pursuant to § 312.23; and reviews of 

federal, tribal, state, and local 

government records under § 312.26, may 

identify an institutional control or refer 

a person to the appropriate source to 

find an institutional control. For 

example, a review of federal Superfund 

records, including Records of Decision 

and Action Memoranda, as well as other 

information contained in the CERCLIS 

database, may indicate that zoning was 

selected as an institutional control or an 

interview with a current operator may 

reveal an institutional control as part of 

an operating permit. 

The final rule requires that all 

appropriate inquiries include a search 

for institutional controls placed upon 

the subject property as part of the 

requirements for reviewing federal, 

state, tribal, and local government 

records. A discussion of these 

requirements is provided in section IV.S 

below. 

66088 Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 

N. How Must Data Gaps Be Addressed 

in the Conduct of All Appropriate 

Inquiries? 

Proposed Rule 

The proposed rule required 

environmental professionals, 

prospective landowners, and 

brownfields grant recipients to identify 

data gaps that affect their ability to 

identify conditions indicative of 

releases or threatened releases of 

hazardous substances (and, in the case 

of grant recipients, pollutants, 

contaminants, petroleum and petroleum 

products, and controlled substances). 

The proposed rule also required these 

persons to identify the sources of 

information consulted to address, or fill, 

the data gaps and then comment upon 

the significance of the data gaps with 

regard to the ability to identify 

conditions indicative of releases or 

threatened releases of hazardous 

substances on, at, in or to the subject 

property. The proposed rule defined a 

data gap as a lack of or an inability to 

obtain information required by the 

standards and practices listed in the 

proposed regulation, despite good faith 

efforts by the environmental 

professional or the prospective 

landowner or grant recipient to gather 

such information. 

Public Comments 

Some commenters raised concerns 

that the proposed definition of a data 

gap may result in difficulties in 

determining when an all appropriate 

inquiries investigation is complete. 

These commenters stated that the need 

to identify and comment on the 

significance of data gaps may render it 

difficult to complete an investigation, 

that could potentially affect a property 

owner’s ability to claim protection from 

CERCLA liability. Other commenters 

asserted that because an investigation 

could be considered complete despite 

the existence of a data gap, a regulatory 

loophole exists (in the opinion of the 

commenters) that will result in the 

property owner’s being able to claim 

protection from CERCLA liability even 

when the all appropriate inquiries 

investigation results in a failure to 

identify a release or threatened release 

at a property. 

Some commenters stated that the 

proposed requirement to identify data 

gaps, or missing information, that may 

affect the environmental professional’s 

ability to render an opinion regarding 

the environmental conditions at a 

property and comment on their 

significance in this regard will lend 

credibility to the inquiry’s final report. 

Final Rule 

We are retaining the proposed 

definition of data gap and the proposed 

requirements for identifying and 

commenting on the significance of data 

gaps. For the purposes of today’s final 

rule, a ‘‘data gap’’ is a lack of or inability 

to obtain information required by the 

standards and practices listed in the 

regulation, despite good faith efforts by 

the environmental professional or the 

prospective landowner (or grant 

recipient) to gather such information 

pursuant to the objectives for all 

appropriate inquiries. In today’s final 

rule, § 312.20(g) requires environmental 

professionals, prospective landowners, 

and grant recipients to identify data 

gaps that affect their ability to identify 

conditions indicative of releases or 

threatened releases of hazardous 

substances (and in the case of grant 

recipients pollutants, contaminants, 

petroleum and petroleum products, and 

controlled substances). The final rule 

requires such persons to identify the 

sources of information consulted to 

address the data gaps and comment 

upon the significance of the data gaps 

with regard to the ability to identify 

conditions indicative of releases or 

threatened releases. Section 312.21(c)(2) 

also requires that the inquiries report 

include comments regarding the 

significance of any data gaps on the 

environmental professional’s ability to 

provide an opinion as to whether the 

inquiries have identified conditions 

indicative of releases or threatened 

releases. 

In response to issues raised by 

commenters, we point out that the final 

regulation, as did the proposal, requires 

that environmental professionals 

document and comment on the 

significance of only those data gaps that 

‘‘affect the ability of the environmental 

professional to identify conditions 

indicative of releases or threatened 

releases of hazardous substances * * *

on, at, in, or to the subject property.’’ If 

certain information included within the 

objectives and performance factors for 

the final rule cannot be found and the 

lack of certain information, in light of 

all other information that was collected 

about the property, has no bearing on 

the environmental professional’s ability 

to render an opinion regarding the 

environmental conditions at the 

property, the final rule does not require 

the lack of such information to be 

documented in the final report. Given 

the restriction on the type of data gaps 

that must be documented, and given 

that the documentation is restricted to 

instances where the lack of information 

hinders the ability of the environmental 

professional to render an opinion 

regarding the environmental conditions 

at the property, we disagree with the 

commenters who assert that the 

requirement is overly burdensome or 

will result in the inability to complete 

the required investigations. 

Commenters who asserted that the 

requirement to document data gaps 

would result in a ‘‘loophole’’ that would 

allow property owners to claim 

protection from CERCLA liability after 

conducting an incomplete all 

appropriate inquiries investigation may 

have misunderstood the scope of the 

rule and the statutory requirements for 

obtaining the liability protections. As 

explained in detail in Section II of this 

preamble, the conduct of all appropriate 

inquiries is only one requirement 

necessary for obtaining protection from 

CERCLA liability. The mere fact that a 

prospective landowner conducted all 

appropriate inquiries does not provide 

an individual with protection from 

CERCLA liability. To qualify as a bona 

fide prospective purchaser, innocent 

landowner or a contiguous property 

owner, a person must, in addition to 

conducting all appropriate inquiries 

prior to acquiring a property, comply 

with all of the other statutory 

requirements. These criteria are 

summarized in section II.D. of this 

preamble. The all appropriate inquiries 

investigation may provide a prospective 

landowner with necessary information 

to comply with the other postacquisition statutory requirements for 

obtaining liability protections. The 

conduct of an incomplete all 

appropriate inquiries investigation, or 

the failure to detect a release during the 

conduct of all appropriate inquiries, 

does not exempt a landowner from his 

or her post-acquisition continuing 

obligations under other provisions of 

the statute. Failure to comply with any 

of the statutory requirements may be 

problematic in a claim for protection 

from liability. 

The final rule retains the requirement 

to identify data gaps, address them 

when possible, and document their 

significance. Prospective landowners 

may wish to consider the potential 

significance of any data gaps, that may 

exist after conducting the preacquisition all appropriate inquiries in 

assessing their obligations to fulfill the 

additional statutory requirements after 

purchasing a property. 

If a person properly conducts all 

appropriate inquiries pursuant to this 

rule, including the requirements 

concerning data gaps at §§ 312.10, 

312.20(g) and 312.21(c)(2), the person 

may fulfill the all appropriate inquiries 

requirements of CERCLA sections 

Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 66089 

107(q), 107(r), and 101(35), even when 

there are data gaps in the inquiries. 

However, as explained further in this 

preamble, fulfilling the all appropriate 

inquiries requirements does not, by 

itself, provide a person with a 

protection from or defense to CERCLA 

liability. Failure to identify a release or 

threatened release during the conduct of 

all appropriate inquiries does not negate 

the landowner’s continuing 

responsibilities under the statute, 

including the requirements to take 

reasonable steps to stop the release, 

prevent a threatened release, and 

prevent exposure to the release or 

threatened release once the landowner 

has acquired a property. Also, if an 

existing institutional control or land use 

restriction is not identified during the 

conduct of all appropriate inquiries 

prior to the acquisition of a property, a 

landowner is not exempt from 

complying with the institutional control 

or land use restriction after acquiring 

the property. None of the other statutory 

requirements for the liability protections 

is satisfied by the results of the all 

appropriate inquiries. 

We emphasize that the mere fact that 

a prospective landowner conducted all 

appropriate inquiries does not provide 

an individual with a defense to or 

limitation from CERCLA liability. To 

qualify as a bona fide prospective 

purchaser, innocent landowner or a 

contiguous property owner, a person 

must, in addition to conducting all 

appropriate inquiries prior to acquiring 

a property, comply with all of the other 

statutory requirements. These criteria 

are summarized in section II.D. of this 

preamble. The all appropriate inquiries 

investigation may provide a prospective 

landowner with necessary information 

to comply with the other postacquisition statutory requirements for 

obtaining liability protections. The 

failure to detect a release during the 

conduct of all appropriate inquiries 

does not exempt a landowner from his 

or her post-acquisition continuing 

obligations under other provisions of 

the statute. 

Section 312.20(g) of the final rule 

points out that one way to address data 

gaps may be to conduct sampling and 

analysis. The final regulation does not 

require that sampling and analysis be 

conducted to comply with the all 

appropriate inquiries requirements. The 

regulation only notes that sampling and 

analysis may be conducted, where 

appropriate, to obtain information to 

address data gaps. The Agency notes 

that sampling and analysis may be 

valuable in determining the possible 

presence and extent of potential 

contamination at a property. Such 

information may be valuable for 

determining how a landowner may best 

fulfill his or her post-acquisition 

continuing obligations required under 

the statute for obtaining protection from 

CERCLA liability. 

O. Do Small Quantities of Hazardous 

Substances That Do Not Pose Threats to 

Human Health and the Environment 

Have To Be Identified in the Inquiries? 

Proposed Rule 

The environmental professional 

should identify and evaluate all 

evidence of releases or threatened 

releases on, at, in or to the subject 

property, in accordance with generally 

accepted good commercial and 

customary standards and practices. 

However, the proposed rule provided 

that the environmental professional 

need not specifically identify, in the 

written report prepared pursuant to 

§ 312.21(c), extremely small quantities 

or amounts of contaminants, so long as 

the contaminants generally would not 

pose a threat to human health or the 

environment. 

Public Comments 

EPA received no significant comment 

on the proposed provision on the 

identification of extremely small 

quantities of contamination. 

Final Rule 

The final retains the provision that 

the environmental professional need not 

specifically identify, in the written 

report prepared pursuant to § 312.21(c), 

extremely small quantities or amounts 

of contaminants, so long as the 

contaminants generally would not pose 

a threat to human health or the 

environment. 

P. What Are the Requirements for 

Interviewing Past and Present Owners, 

Operators, and Occupants? 

Proposed Rule 

CERCLA section 101(35)(B)(iii)(II) 

requires EPA to include in the standards 

and practices for all appropriate 

inquiries ‘‘interviews with past and 

present owners, operators, and 

occupants of the facility for the purpose 

of gathering information regarding the 

potential for contamination at the 

facility.’’ The Agency proposed that the 

inquiry of the environmental 

professional include interviews with the 

current owner(s) and occupant(s) of the 

subject property. In addition, the 

proposed rule required that interviews 

be conducted with current and past 

facility managers with relevant 

knowledge of the property, as well as 

past owners, occupants, or operators, 

and employees of current and past 

occupants of the property, as necessary, 

to meet the proposed objectives and 

performance factors. In the case of 

abandoned properties, the Agency 

proposed that the inquiry of the 

environmental professional include 

interviewing one or more owners or 

occupants of neighboring or nearby 

properties to obtain information on 

current and past uses of the property 

and other information necessary to meet 

the objectives and performance factors. 

Public Comments 

Several commenters asserted that the 

requirement to interview current and 

past owners and occupants of a property 

may be burdensome. Commenters gave 

several reasons for asserting that 

interviews may be burdensome. Some 

commenters said it is difficult to locate 

current and past owners and occupants. 

Other commenters questioned the 

accuracy of any information that would 

be provided by a current or past owner 

or occupant. One commenter expressed 

concern that the requirement to conduct 

interviews of current and past owners 

and occupants of a property could result 

in the environmental professional 

divulging information regarding the sale 

of the property against the prospective 

landowner’s wishes. 

In the case of the proposed interview 

requirements for abandoned properties, 

some commenters opposed the 

requirement to interview at least one 

owner or occupant of a neighboring 

property. Commenters stated that the 

proposed requirement was unreasonable 

and that it is impractical to attempt to 

find and contact neighboring property 

owners and occupants. Some 

commenters said that neighboring 

property owners and occupants can not 

be relied upon to provide accurate 

information about a property. 

Final Rule 

The requirements for conducting 

interviews of past and present owners, 

operators, and occupants of the subject 

property are included in § 312.23. The 

final rule identifies these interviews as 

being within the scope of the inquiry of 

the environmental professional. 

Therefore, all interviews must be 

conducted by the environmental 

professional or by someone under the 

supervision or responsible charge of the 

environmental professional. The intent 

is that an individual meeting the 

definition of an environmental 

professional (§ 312.10) must oversee the 

conduct of, or review and approve the 

results of, the interviews to ensure the 

interviews are conducted in compliance 

with the objectives and performance 

66090 Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 

factors (§ 312.20). This is to ensure that 

the information obtained from the 

interviews provides sufficient 

information, in conjunction with the 

results of all other inquiries, to allow 

the environmental professional to 

render an opinion with regard to 

conditions at the property that may be 

indicative of releases or threatened 

releases of hazardous substances (and 

pollutants, contaminants, petroleum 

and petroleum products, and controlled 

substances, if applicable). 

The final rule requires the 

environmental professional’s inquiry to 

include interviewing the current owner 

and occupant of the subject property. In 

addition, the rule provides that the 

inquiry of the environmental 

professional include interviews of 

additional individuals, including 

current and past facility managers with 

relevant knowledge of the property, past 

owners, occupants, or operators of the 

subject property, or employees of 

current and past occupants of the 

subject property, as necessary to meet 

the rule’s objectives and in accordance 

with the performance factors. A primary 

purpose of the interviews portion of the 

all appropriate inquiries is to obtain 

information regarding the current and 

past ownership and uses of the 

property, and obtain information 

regarding the potential environmental 

conditions of the property. The final 

rule does not prescribe particular 

questions that must be asked during the 

interview. The type and content of any 

questions asked during interviews will 

depend upon the site-specific 

conditions and circumstances and the 

extent of the environmental 

professional’s (or other individual’s 

under the supervision or responsible 

charge of the environmental 

professional) knowledge of the property 

prior to conducting the interviews. 

Therefore, the final rule does not 

include specific questions for the 

interviews, but requires that the 

interviews be conducted in a manner 

that achieves the objectives and 

performance factors. Interviews with 

current and past owners and occupants 

may provide opportunities to collect 

information about a property that was 

not previously recorded nor well 

documented and may provide valuable 

perspectives on how to find or interpret 

information required to complete other 

aspects of the all appropriate inquiries. 

Information gathered during the 

interview portion of the all appropriate 

inquiries may in turn provide valuable 

information for the on-site visual 

inspection. Persons conducting the 

interviews of current and past owners 

and occupants may want to spend some 

time during the interviews requesting 

information on the locations of 

operations or units used to store or 

manage hazardous substances on the 

property. 

In the case of properties where there 

may be more than one owner or 

occupant, or many owners or occupants, 

the final rule requires the inquiry to 

include interviews of major occupants 

and those occupants that are using, 

storing, treating, handling or disposing 

(or are likely to have used, stored, 

treated, handled or disposed) of 

hazardous substances (or pollutants, 

contaminants, petroleum and petroleum 

products, and controlled substances, as 

applicable) on the property. The rule 

does not specify the number of owners 

and occupants to be interviewed. The 

environmental professional must 

perform this function in the manner that 

best fulfills the objectives and 

performance factors for the inquiries in 

§ 312.20(e) and (f). Environmental 

professionals may use their professional 

judgment to determine the specific 

occupants to be interviewed and the 

total number of occupants to be 

interviewed in seeking to comply with 

the objectives and performance factors 

for the inquiries. Interviews must be 

conducted with individuals most likely 

to be knowledgeable about the current 

and past uses of the property, 

particularly with regard to current and 

past uses of hazardous substances on 

the property. 

In response to commenters who 

asserted that the proposed interview 

requirements are burdensome, we point 

out that the statutory criteria in CERCLA 

section 101(35)(B)(iii) include 

‘‘interviews with past and present 

owners, operators, and occupants of the 

facility for the purpose of gathering 

information regarding the potential for 

contamination at the facility.’’ EPA 

asserts that it was clearly congressional 

intent that the all appropriate inquiries 

investigation include the conduct of 

interviews with current and past owners 

and occupants. We also assert that 

current and past owners and occupants 

of a property may be excellent sources 

of information regarding past and ongoing uses of the property as well as the 

types of waste management activities 

that were undertaken at the property. 

Given that the ASTM E1527 Phase 1 

Environmental Site Assessment Process, 

the interim standard for the conduct of 

all appropriate inquiries, includes 

requirements for conducting interviews 

with the current owners and occupants 

of a property and provides that other 

owners and occupants are good 

additional sources of information about 

property uses and potential 

contamination at a property, we 

disagree with commenters who asserted 

that the proposed and final 

requirements for conducting interviews 

will be overly burdensome. 

In the case of abandoned properties, 

the final rule requires the inquiry of the 

environmental professional to include 

interviews with one or more owners or 

occupants of neighboring or nearby 

properties. In the case of abandoned 

properties, it most likely will be 

difficult to identify or interview current 

or past owners and occupants of the 

property. Therefore, the final rule 

requires that at least one owner or 

occupant of a neighboring property be 

interviewed to obtain information 

regarding past owners or uses of the 

property in cases where the subject 

property is abandoned and no current 

owner is available to be interviewed. 

The final rule defines an abandoned 

property as a ‘‘property that can be 

presumed to be deserted, or an intent to 

relinquish possession or control can be 

inferred from the general disrepair or 

lack of activity thereon such that a 

reasonable person could believe that 

there was an intent on the part of the 

current owner to surrender rights to the 

property.’’ As is the case with 

interviews conducted with current and 

past owners and occupants of the 

property, interview questions should be 

developed prior to the conduct of the 

interviews, and tailored to gather 

information to achieve the rule’s 

objectives and performance factors. The 

final rule contains no specific 

requirements with regard to the type or 

content of questions that must be asked 

during the interviews. 

EPA disagrees with commenters who 

stated that it will be difficult to locate 

and contact neighboring property 

owners and occupants. The final rule, as 

did the proposed rule, requires that the 

environmental professional only locate 

and interview one neighboring property 

owner or occupant and only in those 

cases where no owner or occupant of 

the subject property can be identified. 

An environmental professional should 

be able to locate one owner or occupant 

of a neighboring property when 

conducting the on-site visual inspection 

of the property. If the environmental 

professional cannot easily locate an 

owner and occupant of a neighboring 

property, he or she may enlist the 

assistance of local government officials 

in identifying a neighboring property 

owner or occupant. As is the case with 

information ascertained from any 

interview, the environmental 

professional must apply his or her 

judgment when drawing conclusions 

Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 66091 

based on the information provided in 

interviews with neighboring property 

owners and occupants and should 

attempt to verify any information 

provided by reviewing other available 

sources of information. 

Q. What Are the Requirements for 

Reviews of Historical Sources of 

Information? 

Proposed Rule 

Historical documents and records 

may contain information regarding past 

ownership and uses of a property that 

may be essential to assessing the 

potential for environmental conditions 

indicative of releases or threatened 

releases of hazardous substances to be 

present at the property. Historical 

documents and records, among others, 

may include chain of title documents, 

land use records, aerial photographs of 

the property, fire insurance maps, and 

records held at local historical societies. 

The proposed rule required that the 

inquiry of the environmental 

professional include a review of 

historical documents and records for the 

subject property that document the 

ownership and use of the property for 

a period of time as far back in the 

history of the property as it can be 

shown that the property contained 

structures, or from the time the property 

was first used for residential, 

agricultural, commercial, industrial, or 

governmental purposes. 

Public Comments 

Some commenters raised concerns 

regarding the proposed requirements to 

review historical records covering ‘‘a 

period of time as far back in the history 

of the subject property as it can be 

shown that the property contained 

structures or from the time the property 

was first used for residential, 

agricultural, commercial, industrial, or 

governmental purposes.’’ Commenters 

said that the proposed historical scope 

of the records search is too extensive. 

Some commenters requested that in the 

final rule EPA adopt the provisions for 

historical records searches provided in 

the ASTM E1527–2000 standard. 

Several commenters requested that EPA 

explicitly require as part of the review 

of historical records a review of chain of 

title documents. The commenters 

asserted that a review of chain of title 

documents is the only reliable way to 

identify previous owners of a property. 

Final Rule 

The statutory criteria in the 

Brownfields Amendments require that 

reviews of historical sources of 

information be conducted to ‘‘determine 

previous uses and occupancies of the 

real property since the property was 

first developed.’’ The final rule requires 

(as did the proposed rule) that historical 

records on the subject property be 

searched for information on the 

property covering a time period as far 

back in history as there is 

documentation that the property 

contained structures or was placed into 

use of some form. This provision 

follows the statutory language. In 

addition, the final rule requires that 

historical documents and information 

be reviewed to obtain necessary 

information for meeting the objectives 

and performance factors in § 312.20(e) 

and (f). If a search of historical sources 

of information results in an inability of 

the environmental professional to 

document previous uses and 

occupancies of the property as far back 

in history as it can be shown that the 

property contained structures or was 

placed into use of some form, and such 

information is not acquired elsewhere 

during the investigation then it must be 

documented as a data gap to the 

inquiries. The requirements of 

§§ 312.20(g) and 312.21(c)(2) are 

applicable to all instances in the all 

appropriate inquiries that result in data 

gaps. 

Despite the concerns raised by some 

commenters regarding the scope of the 

historical records review, we assert that 

the scope of the requirements in the 

final rule (as did the scope of the 

proposed requirements) reflects the 

statutory language provided in CERCLA 

section 101(35)(B)(iii). The statutory 

criterion provide that all appropriate 

inquiries include ‘‘reviews of historical 

sources * * * to determine previous 

uses and occupancies of the real 

property since the property was first 

developed.’’ We point out that the final 

rule does allow the environmental 

professional to exercise his or her 

professional judgment ‘‘in context of the 

facts available at the time of the inquiry 

as to how far back in time it is necessary 

to search historical records.’’ We believe 

that this provides sufficient flexibility to 

allow for any circumstances where, due 

to the availability of other information 

about a property an environmental 

professional may conclude that a 

comprehensive search of historical 

records is not necessary to meet the 

objectives and performance factors. 

In response to commenters that 

requested that EPA adopt the provisions 

of the ASTM E1527–2000 standard for 

conducting searches of historical 

records, we assert that the scope of the 

historical records search in today’s final 

rule is very similar to the scope of 

ASTM E1527 standard. The ASTM 

E1527 standard, at section 7.3.1, 

requires that historical sources of 

information be searched to identify ‘‘all 

obvious uses of the property* * *from 

the present, back to the property’s 

obvious first developed use, or back to 

1940, whichever is earlier.’’ Given that 

the language of both the ASTM E1527 

standard and the requirements in the 

final rule for conducting historical 

records searches is very similar, we 

conclude that the intent is the same and 

the final rule represents no change from 

current good customary business 

practice. In addition, the final rule 

provides for sufficient flexibility both 

within the application of the 

performance factors to the historical 

records search requirements and in 

allowing the environmental professional 

to apply his or her judgment ‘‘in the 

context of the facts available at the time 

of the inquiry.’’

The final rule does not require that 

any specific type of historic information 

be collected. In particular, the rule does 

not require that persons obtain a chain 

of title document for the property. The 

rule allows for the environmental 

professional to use professional 

judgment when determining what types 

of historical documentation may 

provide the most useful information 

about a property’s ownership, uses, and 

potential environmental conditions 

when seeking to comply with the 

objectives and performance factors for 

the inquiries. Although we agree with 

commenters that chain of title 

documents may serve as an important 

source of information regarding past 

ownership of a property, it may not be 

the only source of this information. To 

the extent that chain of title documents 

are otherwise obtained for other 

purposes during the conduct of a 

property sale or transaction, we believe 

that these documents can easily be 

made available to the environmental 

professional by the prospective 

landowner. Given that the final rule 

requires that historical records be 

searched for information on previous 

uses and ownership of a property for as 

far back in the history of property as can 

be shown that the property contained 

structures or was first used for 

residential, agricultural, commercial, 

industrial or governmental purposes, if 

chain of title documents are the best and 

most easily attainable source of this 

information, we assume that such 

documents will be obtained and used by 

the environmental professional. 

Given the wide variety of property 

types and locations to which the final 

rule could apply, any list of specific 

documents could result in undue 

burdens on many prospective 

66092 Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 

landowners and grantees due to 

difficulties in collecting any specific 

document for any particular property or 

property location. Therefore, the final 

requirements for reviewing historical 

documents allow the prospective 

landowner or grantee and the 

environmental professional to use their 

judgment, in accordance with generally 

accepted good commercial and 

customary standards and practices, in 

locating the best available sources of 

historical information and reviewing 

such sources for information necessary 

to comply with the rule’s objectives and 

performance factors. 

As explained in section IV.J of this 

preamble, the prospective landowner, 

grantee, or environmental professional 

may make use of previously collected 

information about a property when 

conducting all appropriate inquiries. 

The collection of historical information 

about a property may be a particular 

case where previously collected 

information may be valuable, as well as 

easily accessible. In addition, nothing in 

the rule prohibits a person from using 

secondary sources (e.g., a previously 

conducted title search) when gathering 

information about historical ownership 

and usage of a property. As explained in 

section IV.J, information must be 

updated if it was last collected more 

than 180 days prior to the date of 

acquisition of the property. 

R. What Are the Requirements for 

Searching for Recorded Environmental 

Cleanup Liens? 

For purposes of this rule, recorded 

environmental cleanup liens are 

encumbrances on property for the 

recovery of incurred cleanup costs on 

the part of a state, tribal or federal 

government agency or other third party. 

Recorded environmental cleanup liens 

often provide an indication that 

environmental conditions either 

currently exist or previously existed on 

a property that may include the release 

or threatened release of a hazardous 

substance. The existence of an 

environmental cleanup lien should be 

viewed as an indicator of potential 

environmental concerns and as a basis 

for further investigation into the 

potential existence of on-going or 

continued releases or threatened 

releases of hazardous substances on, at, 

in, or to the subject property. 

Proposed Rule 

The proposed rule required that 

prospective landowners and grantees, or 

environmental professionals on their 

behalf, search for environmental 

cleanup liens that are recorded under 

federal, tribal, state, or local law. 

Environmental cleanup liens that are 

not recorded by government entities or 

agencies are not addressed by the 

language of the statute (the statute 

speaks only of ‘‘recorded liens’’); 

therefore, the proposed rule required 

that only a search for recorded 

environmental liens be included in the 

all appropriate inquiries investigation. 

Public Comments 

Some commenters asked that EPA 

state more clearly that the responsibility 

for searching for environmental cleanup 

liens rests with the prospective 

landowner and not the environmental 

professional. A few commenters 

requested that the Agency provide some 

guidance on where to find recorded 

environmental cleanup liens. 

Final Rule 

EPA is finalizing the proposed 

requirements to search for recorded 

environmental cleanup liens without 

changes. The all appropriate inquiries 

investigation must include a search for 

recorded environmental cleanup liens. 

The final rule allows that the search for 

recorded environmental cleanup liens 

be performed either by the prospective 

landowner or grantee, or through the 

inquiry of the environmental 

professional. The search for such liens 

may not necessarily require the 

expertise of an environmental 

professional and therefore may be more 

efficiently or more cost-effectively 

performed by the prospective 

landowner or grantee, or his or her 

agent. Such liens may be included as 

part of the chain of title documents or 

may be recorded in some other manner 

or format by state or local government 

agencies. If such information is 

collected by the prospective landowner 

or grantee, or other agent who is not 

under the supervision or responsible 

charge of the environmental 

professional, the final rule allows for, 

but does not require, the information 

that is collected by or on the behalf of 

the prospective landowner or grantee to 

be provided to the environmental 

professional. If the information is 

provided to the environmental 

professional, he or she can then make 

use of such information during the 

conduct of the all appropriate inquiries 

and when rendering conclusions or 

opinions regarding the environmental 

conditions of the property. If such 

information is not provided to the 

environmental professional and the lack 

of such information affects the ability of 

the environmental professional to 

identify conditions indicative of 

releases or threatened releases of 

hazardous substances on, at, in or to the 

property, the lack of information should 

be noted as a data gap (per the 

requirements of § 312.21(b)(2)). 

Although some commenters requested 

that EPA be more explicit in the final 

rule in requiring that the search for 

recorded environmental cleanup liens 

be conducted by the prospective 

landowner (or grantee), we believe that 

the decision of who conducts the search 

may be best left up to the judgment of 

the prospective landowner or grantee 

and environmental professional. The 

final rule provides in § 312.22 that the 

search for recorded environmental 

cleanup liens can fall outside the 

inquiries conducted by the 

environmental professional. The search 

for recorded environmental cleanup 

liens is not included as part of the 

requirements governing the results of an 

inquiry by an environmental 

professional (§ 312.21). Therefore, the 

search may be conducted by the 

prospective landowner or grantee, his or 

her attorney or agent, or the 

environmental professional. 

We offer one caution about the 

conclusion that might be drawn if no 

recorded environmental cleanup liens 

are found. If EPA is conducting a 

cleanup at site at the time it is 

transferred or acquired, EPA is able to 

record a lien post acquisition. For 

example, one type of lien, often referred 

to as a windfall lien, has no statute of 

limitations and arises at the time EPA 

first spends Superfund money. States 

and localities may have similar 

mechanisms. Therefore, even if a 

recorded environmental cleanup lien is 

not found during the conduct of the all 

appropriate inquiries investigation, one 

may be recorded at a later date if EPA 

is undertaking a cleanup or response 

action at the property. 

With regard to commenters who 

requested that EPA provide guidance on 

where to search for environmental 

cleanup liens, we advise that 

prospective landowners and grantees to 

seek the advice of a local realtor, real 

estate attorney, title company, or other 

real estate professional. Environmental 

cleanup liens may be recorded as part 

of the land title records or as part of 

other state or local government land or 

real estate records. Recorded 

environmental cleanup liens may be 

recorded in different places, depending 

upon the particular state and particular 

locality in which the property is 

located. 

S. What Are the Requirements for 

Reviewing Federal, State, Tribal, and 

Local Government Records? 

Federal, tribal, state and local 

government records may contain 

Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 66093 

information regarding environmental 

conditions at a property. In particular, 

government records, or data bases of 

such information, may include 

information on previously reported 

releases of hazardous substances, 

pollutants, contaminants, petroleum 

and petroleum products and controlled 

substances. Government records and 

available databases can provide valuable 

information on remedial actions and 

emergency response activities that may 

have been conducted at a particular 

property. Government records also may 

include information on institutional 

controls related to a particular property. 

For example, in the case of NPL sites, 

EPA Superfund records, including 

Action Memoranda and Records of 

Decision, may have information on 

institutional controls in place at such 

properties. Government records also 

may include information on activities or 

property uses that could cause releases 

or threatened releases to be present at a 

property. 

Proposed Rule 

The proposed rule required that 

federal, state, tribal and local 

government records be searched for 

information necessary to achieve the 

objectives and performance factors, 

including information regarding the use 

and occupancy of and the 

environmental conditions at the subject 

property and conditions of nearby or 

adjoining properties that could have a 

impact upon the environmental 

conditions of the subject property. The 

proposed rule included requirements to 

search federal, tribal, state, and local 

government records for information 

indicative of environmental conditions 

at the subject property. 

The proposed rule also included 

requirements to review government 

records, or data bases of information 

contained in government records, for 

information about nearby and adjoining 

properties. Reviews of such records may 

provide valuable information regarding 

the potential impact to the subject 

property from hazardous substances and 

petroleum contamination migrating 

from contiguous or nearby properties. 

The proposed rule included required 

minimum search distances for 

government records searches of nearby 

properties. 

To account for property-specific and 

regionally-specific conditions that can 

influence the appropriateness of the 

proposed search distances for any given 

type of record and property, the 

proposed rule allowed the 

environmental professional to adjust the 

applicable search distances when 

searching for information about off-site 

properties by applying professional 

judgment. For example, appropriate 

search distances for properties located 

in rural settings may differ from 

appropriate search distances for urban 

settings. In addition, ground water flow 

direction, depth to ground water, arid 

weather conditions, the types of 

facilities located on nearby properties, 

and other factors may influence the 

degree of impact to a property from offsite sources. Therefore, the proposed 

rule allowed the environmental 

professional to adjust any or all of the 

proposed minimum search distances for 

any of the record types, based upon 

professional judgment and the 

consideration of site-specific conditions 

or circumstances when seeking to 

achieve the proposed objectives and 

performance factors for the required 

inquiries. 

Public Comments 

The Agency received a variety of 

comments in which commenters 

expressed concerns about the 

applicability or adequacy of specific 

types of government records included in 

the proposed rule (e.g., CERCLIS 

records, information on RCRA facilities, 

ERNS). A few commenters raised 

concerns about the availability of tribal 

records. Several commenters raised 

concerns regarding the availability of 

government records on institutional 

controls. Commenters also pointed out 

that, given the lack of available 

databases and other information on 

institutional controls, it may be 

particularly difficult to search for 

institutional controls associated with 

adjoining and nearby properties. 

Final Rule 

We are finalizing the requirements for 

reviewing federal, state, tribal, and local 

government data bases as proposed, 

with one exception. The final rule 

requires that government records and 

available lists for institutional and 

engineering controls be searched only 

for information on such controls at the 

subject property. All appropriate 

inquiries investigations do not have to 

include searches for institutional and 

engineering controls in place at nearby 

and adjoining properties. We made this 

change because we agree with 

commenters who pointed out that 

information on institutional and 

engineering controls may be difficult to 

find as there are no available national 

sources of this information. Only a few 

states have available lists of institutional 

controls. In addition, the information 

that may be inferred from knowledge of 

institutional and engineering controls 

that are in place at adjoining and nearby 

properties, i.e., that there was a 

response action, a remedial action, or 

corrective action taken at the site, can be 

inferred from information obtained from 

other sources (e.g., CERCLIS, RCRIS, 

state records of response actions). 

It is important that prospective 

landowners obtain information on 

institutional and engineering controls in 

place at the property being acquired. It 

also may be important to locate 

information on such controls in place at 

nearby properties. To obtain the liability 

protections afforded under CERCLA 

(i.e., innocent landowner, contiguous 

property owner, bona fide prospective 

purchaser), the statute requires, as part 

of the ‘‘continuing obligations,’’ that the 

property owner comply with all land 

use restrictions and not impede the 

effectiveness of institutional controls. 

Therefore, it is important that 

information on institutional and 

engineering controls be obtained by 

prospective landowners, even though 

information about such controls may 

not have been routinely obtained as part 

of due diligence practices prior to 

today’s final rule (we note that the 

current interim standard does include 

provisions for searching for ‘‘activity 

and use limitations’’). 

Routine ‘‘chain of title’’ reports may 

not always contain information labeled 

as institutional or engineering controls. 

However, title companies may include, 

as part of the chain of title reports 

‘‘restrictions of record on title’’ when 

such restrictions are recorded because of 

underlying environmental conditions at 

a property. Therefore, when requesting 

information on ‘‘institutional controls’’

or ‘‘engineering controls’’ about a 

property, prospective landowners, 

grantees, and environmental 

professionals may want to request 

information on ‘‘restrictions of record 

on title’’ as well, in case any available 

information on institutional or 

engineering controls is so labeled in the 

chain of title records. In addition to 

chain of title records, information on 

institutional controls and engineering 

controls may be recorded in local land 

records. Also, some states are beginning 

to create registries to track information 

on institutional and engineering 

controls. Therefore, prospective 

landowners and grantees should 

consider consulting these other sources 

of information in addition to chain of 

title records for information on 

institutional and engineering controls. 

In response to the commenters who 

pointed out particular shortcomings 

with specific sources of information 

(e.g., CERCLIS, RCRIS, ERNS) we point 

out that the requirement to review 

government records explicitly provides 

66094 Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 

that the reviews be conducted in 

compliance with the objectives and 

performance standards. If a particular 

source of information cannot be 

accessed within a reasonable time frame 

or within reasonable costs, then the 

information should be sought from other 

sources. In addition, if a particular 

source of information will only provide 

information that can more easily or 

readily be found elsewhere, the 

particular source does not have to be 

obtained or consulted. If application of 

the objectives and performance 

standards to the requirement to review 

government records results in an 

inability to provide necessary 

information (or information identified 

as necessary in the objectives for the 

final rule), then the lack of information 

should be documented as a data gap in 

the final report. In addition, the 

environment professional should 

comment on the significance the lack of 

any information has on his or her ability 

to identify conditions at the property 

that are indicative of releases or 

threatened releases of hazardous 

substances (in compliance with 

§ 312.21(c)(2)). 

In response to commenters who 

pointed out that it may be difficult to 

obtain or gain access to tribal 

government records, we point out that 

such records need only be searched for 

and reviewed in those instances where 

the subject property is located on or 

near tribal-owned lands. In these cases, 

it is important to attempt, within the 

scope of the rule’s objectives and 

performance factors, to review such 

records. When such records are not 

available, necessary information should 

be sought from other sources. When no 

information is available and the 

objectives and performance factors of 

the final rule cannot be met and the 

result is a lack of information that may 

affect the environmental professional’s 

ability to render an opinion regarding 

the environmental conditions of a 

property, the lack of information must 

be documented as a data gap in 

compliance with § 312.21(c)(2). 

The final rule requires that the 

following types of government records 

or data bases of government records be 

reviewed to obtain information on the 

subject property and nearby properties 

necessary to meet the rule’s objectives 

and performance standards: 

1. Government records of reported 

releases or threatened releases at the 

subject property, including previously 

conducted site investigation reports. 

2. Government records of activities, 

conditions, or incidents likely to cause 

or contribute to releases or threatened 

releases, including records documenting 

regulatory permits that were issued to 

current or previous owners or operators 

at the property for waste management 

activities and government records that 

identify the subject property as the 

location of landfills, storage tanks, or as 

the location for generating and handling 

activities for hazardous substances, 

pollutants, contaminants, petroleum 

and petroleum products, or controlled 

substances. 

3. CERCLIS records—EPA’s 

Comprehensive Environmental 

Response, Compensation, and Liability 

Information System (CERCLIS) database 

contains general information on sites 

across the nation and in the U.S. 

territories that have been assessed by 

EPA, including sites listed on the 

National Priorities List (NPL). CERCLIS 

includes information on facility 

location, status, contaminants, 

institutional controls, and actions taken 

at particular sites. CERCLIS also 

contains information on sites being 

assessed under the Superfund Program, 

hazardous waste sites and potential 

hazardous waste sites. 

4. Government-maintained records of 

public risks—the all appropriate 

inquiries government records search 

should include a search for available 

records documenting public health 

threats or concerns caused by, or related 

to, activities currently or previously 

conducted at the site. 

5. Emergency Response Notification 

System (ERNS) records—ERNS is EPA’s 

data base of oil and hazardous substance 

spill reports. The data base can be 

searched for information on reported 

spills of oil and hazardous substances 

by state. 

6. Government registries, or publicly 

available lists of engineering controls, 

institutional controls, and land use 

restrictions. The all appropriate 

inquiries government records search 

must include a search for registries or 

publicly available lists of recorded 

engineering and institutional controls 

and recorded land use restrictions. Such 

records may be useful in identifying 

past releases on, at, in, or to the subject 

property or identifying continuing 

environmental conditions at the 

property. 

The final rule requires that 

government records be searched to 

identify information relative to the 

objectives and in accordance with the 

performance factors on: (1) Adjoining 

and nearby properties for which there 

are governmental records of reported 

releases or threatened releases (e.g., 

properties currently listed on the 

National Priorities List (NPL), properties 

subject to corrective action orders under 

the Resource Conservation and 

Recovery Act (RCRA), properties with 

reported releases from leaking 

underground storage tanks); (2) 

adjoining and nearby properties 

previously identified or regulated by a 

government entity due to environmental 

conditions at a site (e.g., properties 

previously listed on the NPL, former 

CERCLIS sites with notices of no further 

response actions planned (NFRAP)); and 

(3) adjoining and nearby properties that 

have government-issued permits to 

conduct waste management activities 

(e.g., facilities permitted to manage 

RCRA hazardous wastes). 

In the case of government records 

searches for nearby properties, the final 

rule includes minimum search distances 

(e.g., properties located either within 

one mile or one-half mile of the subject 

property) for obtaining and reviewing 

records or data bases concerning 

activities and facilities located on 

nearby properties. The search distances 

are based upon our best judgment 

regarding the potential impacts that 

incidents or circumstances at an 

adjoining property may have on the 

subject property. With the exception of 

the required searches for institutional 

and engineering controls, the search 

distances finalized in today’s rule are 

the search distances that were proposed 

in the proposed rule. For example, 

government records identifying 

properties listed on the NPL must be 

searched to obtain information on NPL 

sites located within one mile of the 

subject property. NPL sites located 

beyond one mile of a property most 

likely will have little or no impact on 

the environmental conditions at the 

subject property. In the case of two 

types of records, records of hazardous 

waste handler and generator records and 

permits, records of registered storage 

tanks, the final requirements specify 

that such records only be searched for 

information specific to the subject 

property and adjoining properties (the 

rule contains no requirement to search 

for these two types of government 

records for other nearby properties). The 

final rule requires that available lists of 

institutional controls and engineering 

controls only be searched for 

information on the subject property. 

In the case of all the government 

records listed above and in the final rule 

in § 312.26, the requirements of this 

criterion may be met by searching data 

bases containing the same government 

records mentioned in the list above that 

are accessible and available through 

government entities or private sources. 

The review of actual records is not 

necessary, provided that the same 

information contained in the 

government records and required to 

Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 66095 

meet the requirements of this criterion 

and achieve the objectives and 

performance factors for these 

regulations is attainable by searching 

available data bases. 

The final rule allows the 

environmental professional to adjust the 

search distances for reviewing 

government records of nearby properties 

based upon his or her professional 

judgment. Environmental professionals 

may consider one or more of the 

following factors when determining an 

alternative appropriate search distance: 

• The nature and extent of a release; 

• Geologic, hydrogeologic, or 

topographic conditions of the subject 

property and surrounding environment; 

• Land use or development densities; 

• The property type; 

• Existing or past uses of surrounding 

properties; 

• Potential migration pathways (e.g., 

groundwater flow direction, prevalent 

wind direction); or 

• Other relevant factors. 

The final rule requires environmental 

professionals to document the rationale 

for making any modifications to the 

required minimum search distances 

included in § 312.26 of the regulation. 

T. What Are the Requirements for 

Visual Inspections of the Subject 

Property and Adjoining Properties? 

Proposed Rule 

The proposed rule required that an 

on-site visual inspection of the subject 

property be conducted as part of the all 

appropriate inquiries investigations, 

with one limited exception. The 

proposed on-site visual inspection 

requirements included requirements to 

inspect any facilities and improvements 

on the property as well as all areas 

where hazardous substances are or may 

have been used, stored, treated, 

handled, or disposed. In addition, the 

proposed rule included requirements to 

visually inspect adjoining properties. 

The proposal required that inspections 

of adjoining properties be conducted 

from the property line, public right-ofway, or other vantage point. 

The proposed rule included a limited 

exception from the requirement to 

conduct the visual inspection ‘‘on-site.’’

The proposed exception provided that 

in unusual circumstances where an onsite visual inspection cannot be 

performed because of physical 

limitations, remote and inaccessible 

location, or another inability to obtain 

access to the property, provided good 

faith efforts are taken to obtain such 

access and access to the property could 

not be obtained, a visual inspection 

could be conducted from an off-site 

vantage point (e.g., property-line, 

airplane, public right-of-way). To 

qualify for the exception from the 

requirement to conduct the inspection 

on site, the proposed rule required that 

the environmental professional 

document the good faith efforts 

undertaken to gain access to the 

property and explain why such efforts 

were unsuccessful. The proposed rule 

also required that the environmental 

professional document what other 

sources of information were consulted 

to obtain information regarding the 

potential environmental conditions at 

the property and the significance of the 

failure to conduct the inspection on site 

on his or her ability to identify 

conditions indicative of releases or 

threatened releases of hazardous 

substances on, at, in, or to the subject 

property. 

In the preamble to the proposed rule, 

EPA recommended that an 

environmental professional conduct the 

on-site visual inspection. 

Public Comments 

A few commenters stated that EPA 

should not recommend, as we did in the 

preamble to the proposed rule, that an 

individual meeting the definition of 

environmental professional conduct the 

on-site visual inspection. These 

commenters stated that anyone under 

the responsible charge or supervision of 

an environmental professional should 

be able to conduct the on-site visual 

inspection. Commenters stated, that by 

recommending in the preamble that the 

environmental professional conduct the 

on-site visual inspection, the Agency 

was effectively requiring an 

environmental professional to conduct 

the visual inspection. Other commenters 

expressed support for the Agency’s 

recommendation. 

A few other commenters thought the 

proposed exception from the 

requirement to conduct the visual 

inspection on site was ‘‘broad’’ and 

‘‘would increase the likelihood of 

inspections not being performed and 

contamination not being detected.’’

These commenters expressed a concern 

that any exception from the requirement 

to conduct an on-site visual inspection 

could open the door to abuse and result 

in properties being transferred without 

being inspected. Commenters raised 

concerns that owners of uninspected 

properties could obtain liability 

protection by claiming to have fulfilled 

the requirements of all appropriate 

inquiries without knowledge of ongoing releases at a property. 

Final Rule 

The final rule, at § 312.27, retains the 

proposed requirement that a visual onsite inspection be conducted of the 

subject property. The final visual on-site 

inspection requirements include 

requirements to inspect the facilities 

and any improvements on the property, 

as well as visually inspect areas on the 

property where hazardous substances 

may currently be or in the past may 

have been used, stored, treated, 

handled, or disposed of. We continue to 

assert that, and commenters agreed, that 

every all appropriate inquiries 

investigation must include an on-site 

visual inspection of the property. The 

on-site inspection of a property most 

likely will be an excellent source of 

information regarding indications of 

environmental conditions on a property. 

The final rule requires that a visual onsite inspection of the subject property be 

conducted in all but a few very limited 

cases. In addition, the final rule retains 

the proposed requirement that in those 

cases where physical limitations restrict 

the portions of the property that may be 

visually inspected, that the physical 

limitations encountered during the 

visual on-site inspection (e.g., weather 

conditions, physical obstructions) must 

be documented. 

We note that persons conducting all 

appropriate inquiries with monies 

provided in a grant awarded under 

CERCLA section 104(k)(2)(B) must, 

depending on the terms and conditions 

of the grant or cooperative agreement, 

include within the scope of the on-site 

visual inspection an inspection of the 

facilities, improvements, and other areas 

of the property where pollutants, 

contaminants, petroleum and petroleum 

products, or controlled substances may 

currently be or in the past may have 

been used, stored, treated, handled, or 

disposed. 

The visual on-site inspection of a 

property during the conduct of all 

appropriate inquiries may be the most 

important aspect of the inquiries and 

the primary source of information 

regarding the environmental conditions 

on the property. In all cases, every effort 

must be made to conduct an on-site 

visual inspection of a property when 

conducting all appropriate inquiries. 

We understand that a prospective 

landowner, grantee, or environmental 

professional, in some limited 

circumstances, may not be able to obtain 

on-site access to a property. Extreme 

and prolonged weather conditions and 

remote locations can impede access to a 

property. A prospective landowner, 

grantee or environmental professional 

also could be unable to gain on-site 

66096 Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 

access to a property if the owner refuses 

to provide access to the party, even after 

the party exercises all good faith efforts 

to gain access to the property (e.g., 

seeking assistance from state 

government officials). Such 

circumstances may arise in cases where 

a local government becomes a last resort 

purchaser of a potentially-contaminated 

property that has little economic value. 

The unique nature of such transactions 

may result in a local government facing 

an uncooperative or recalcitrant 

property owner. Unlike commercial 

property transactions between private 

parties, where the parties’ economic and 

legal liability interests and the ability to 

abandon the transaction can work in 

favor of the purchasing party’s ability to 

gain access to a property prior to 

acquisition, property transactions 

between a private party and a local 

government may not afford the local 

government the same leverage, even if it 

is in the public interest to attain 

ownership of the property. This 

situation may occur when the local 

government seeks to assess, clean up, 

and revitalize an area, but the owner of 

the property is unreachable, 

unavailable, or otherwise unwilling to 

provide access to the property. In such 

limited circumstances, the public 

benefit attained from a government 

entity gaining ownership of a property 

may outweigh the need to gain on-site 

access to the property prior to the 

transfer of ownership. 

The final rule requires, in unusual 

circumstances, that the prospective 

landowner or grantee make good faith 

efforts to gain access to the property. 

However, the mere refusal of a property 

owner to allow the prospective property 

owner or grantee to have access to the 

property does not constitute an unusual 

circumstance, absent the making of good 

faith efforts to otherwise gain access. 

The final rule, at § 312.10, defines ‘‘good 

faith’’ as ‘‘the absence of any intention 

to seek an unfair advantage or to 

defraud another party; an honest and 

sincere intention to fulfill one’s 

obligations in the conduct or transaction 

concerned.’’

In those unusual circumstances where 

a prospective landowner, a grantee, or 

an environmental professional, after 

undertaking good faith efforts, cannot 

gain access to a property and therefore 

cannot conduct an on-site visual 

inspection, the final rule requires that 

the property be visually inspected, or 

observed, by another method, such as 

through the use of aerial photography, 

or be inspected, or observed, from the 

nearest accessible vantage point, such as 

the property line or a public road that 

runs through or along the property. In 

addition, the rule requires that the all 

appropriate inquiries report include 

documentation of efforts undertaken by 

the prospective landowner, grantee, or 

the environmental professional to obtain 

on-site access to the subject property 

and include an explanation of why good 

faith efforts to gain access to subject 

property were unsuccessful. The all 

appropriate inquiries report must 

include documentation of other sources 

of information that were consulted to 

obtain information necessary to achieve 

the objectives and performance factors. 

This documentation should include 

comments, from the environmental 

professional who signs the report, 

regarding any significant limitations on 

the ability of the environmental 

professional to identify conditions 

indicative of releases or threatened 

releases on, at, in, or to the subject 

property, that may arise due to the 

inability of the prospective landowner, 

grantee, or environmental professional 

to obtain on-site access to the property. 

In those limited cases where an onsite visual inspection cannot be 

conducted prior to the date a property 

is acquired, we remind prospective 

landowners that protection from 

CERCLA liability depends upon the 

prospective landowner complying with 

all of the post-acquisition continuing 

obligations provided in the statute. 

Therefore, to ensure that adequate 

information is attained about a property 

to ensure that the property owner can 

fulfill these obligations, we recommend 

that once a property is purchased, the 

property owner conduct an on-site 

visual inspection of the property once 

the property is acquired, if it could not 

be conducted prior to acquisition. Such 

an inspection may provide important 

information necessary for the property 

owner to fully comply with the other 

statutory provisions, including on-going 

obligations, governing the CERCLA 

liability protections. 

We disagree with the commenters 

who argued that the exception from the 

requirement to conduct the visual 

inspection on-site is ‘‘broad.’’ We point 

out that the exception is limited to the 

requirement that the visual inspection 

be conducted on-site. In all cases where 

the exception applies, the visual 

inspection must still be conducted from 

another vantage point. In addition, the 

exception is limited to only those 

circumstances where all good faith 

efforts are made to gain access the 

property. The final rule requires that all 

good faith efforts to gain access be 

documented and requires that the 

environmental professional comment on 

the consequences that the inability to 

gain access to the property may have on 

his or her ability to render an opinion 

on property conditions that may be 

indicative of releases or threatened 

releases on, at, in, or to the property. 

The exception is very limited in scope 

and the documentation requirements 

should limit the use of the exception as 

well as provide the prospective 

landowner with useful information for 

determining the potential need for 

further investigations of the property 

after acquisition. 

The final rule also requires that the all 

appropriate inquiries investigation 

include visual inspections of properties 

that adjoin the subject property. Visual 

inspections of adjoining properties may 

provide excellent information on the 

potential for the subject property to be 

affected by contamination migrating 

from adjoining properties. Visual 

inspections of adjoining properties may 

be conducted from the subject 

property’s property line, one or more 

public rights-of-way, or other vantage 

point (e.g., via aerial photography). 

Where practicable, a visual on-site 

inspection is recommended and may 

provide greater specificity of 

information. The visual inspections of 

adjoining properties must include 

observing areas where hazardous 

substances currently may be, or 

previously may have been, stored, 

treated, handled, or disposed. Visual 

inspections of adjoining properties 

otherwise also must be conducted to 

achieve the objectives and performance 

goals for all the appropriate inquiries. 

Physical limitations to the visual 

inspections of adjoining properties 

should be noted. 

As explained in the preamble to the 

proposed rule, EPA and the Negotiated 

Rulemaking Committee considered, 

when developing the proposed rule, 

requiring that all activities in the all 

appropriate inquiries investigation to be 

conducted by persons meeting the 

proposed definition of an environmental 

professional. Requiring that an 

environmental professional conduct all 

activities could ensure that all data 

collection and investigations are 

conducted in a manner and to a degree 

of specificity that allows the 

environmental professional to make best 

use of all information in forming 

opinions and conclusions regarding the 

environmental conditions at a property. 

However, after careful review of the 

specific activities included in the 

statutory criteria and conducting an 

assessment of the costs and burdens of 

such a requirement, EPA and the 

Committee concluded that it is not 

necessary for each and every regulatory 

requirement to be conducted by an 

environmental professional. As outlined 

Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 66097 

in section IV.H of this preamble, today’s 

final rule, as did the proposed rule, 

allows for certain aspects of the 

inquiries to be conducted solely by the 

prospective landowner or grantee, while 

providing that all other aspects be 

conducted under the supervision or 

responsible charge of the environmental 

professional. Among the activities 

required to be conducted under the 

supervision or responsible charge of an 

environmental professional is the onsite visual inspection. 

It continues to be EPA’s 

recommendation that visual inspections 

of the subject property and adjoining 

properties be conducted by an 

individual who meets the regulatory 

definition of an environmental 

professional. Although many other 

aspects of the all appropriate inquiries 

may be conducted sufficiently and 

accurately by individuals other than an 

environmental professional (e.g., a 

research associate or librarian may be 

well qualified to search government 

records, an attorney may be well 

qualified to conduct a search for an 

environmental lien), EPA believes that 

an environmental professional is best 

qualified to conduct a visual inspection 

and locate and interpret information 

regarding the physical and geological 

characteristics of the property as well as 

information on the location and 

condition of equipment and other 

resources located on the property. EPA 

recognizes that other individuals who 

do not meet the regulatory definition of 

an environmental professional, 

particularly when these individuals are 

conducting such activities under the 

supervision or responsible charge of an 

environmental professional, may have 

the required skills and knowledge to 

conduct an adequate on-site visual 

inspection. However, EPA believes that 

the professional judgment of an 

individual meeting the definition of an 

environmental professional is important 

to ensuring that all circumstances at the 

property that are indicative of 

environmental conditions and potential 

releases or threatened releases are 

properly identified and analyzed. An 

environmental professional is best 

qualified for identifying such situations 

and conditions and rendering a 

judgment or opinion regarding the 

potential existence of conditions 

indicative of environmental concerns. 

Although some commenters stated 

that EPA should not recommend that 

the visual inspection be conducted by a 

person meeting the definition of 

environmental professional, we point 

out that other commenters stated their 

support for our recommendation and 

some even stated that EPA should 

require in the regulation that the 

inspection be conducted by an 

environmental professional. We remain 

convinced that the on-site visual 

inspection of the property can be the 

single most important source of 

information regarding the 

environmental conditions of a property 

and that an individual meeting the 

regulatory definition of environmental 

professional is best able to interpret 

such observations of a property and 

ascertain the probability of conditions 

indicative of releases or threatened 

releases of hazardous substances being 

present at the property. In addition, we 

point out that the definition of 

environmental professional included in 

the final rule is less stringent than the 

proposed definition. Therefore, 

commenter concerns regarding any 

significant cost burdens associated with 

the environmental professional 

conducting the on-site visual inspection 

may be alleviated. We emphasize that 

EPA is recommending that the on-site 

visual inspection be conducted by an 

individual who meets the definition of 

environmental professional included in 

the final rule; it is not a requirement 

that the inspection be conducted by an 

environmental professional. The rule 

requires only that the inspection be 

conducted by an individual who is 

under the supervision or responsible 

charge of an individual meeting the 

definition of environmental 

professional. EPA agrees that if the final 

rule required that the on-site visual 

inspection be conducted by an 

individual meeting the definition of an 

environmental professional, the 

requirement could impose undue 

burdens in certain circumstances. In 

addition, there may be circumstances 

that in the best professional judgment of 

an environmental professional, another 

person under the responsible charge of 

the environmental professional may be 

more qualified to conduct the on-site 

inspection. To allow for flexibility and 

the application of professional judgment 

to specific circumstances, EPA 

continues to recommend that an 

environmental professional conduct the 

on-site inspection, but the Agency is not 

requiring that the inspection be 

conducted by an environmental 

professional. 

U. What Are the Requirements for the 

Inclusion of Specialized Knowledge or 

Experience on the Part of the 

‘‘Defendant?’’

Because the conduct of all appropriate 

inquiries is one element of a legal 

defense to CERCLA liability, the statute 

refers to the prospective landowner, or 

the user of the all appropriate inquiries 

investigation, as the ‘‘defendant.’’ This 

ensures that any information or special 

knowledge held by the prospective 

landowner with regard to a property and 

its conditions be included in the preacquisition inquiries and be considered, 

along with all information collected 

during the conduct of all appropriate 

inquiries, when an environmental 

professional renders a judgment or 

opinion regarding conditions indicative 

of environmental conditions indicative 

of releases or potential releases of 

hazardous substances on, at, in, or to the 

subject property. It is recommended that 

this information be revealed to the 

parties conducting the all appropriate 

inquiries so that any specialized 

knowledge may be taken into account 

during the conduct of the required 

aspects of the all appropriate inquiries. 

Congress first added the innocent 

landowner defense to CERCLA in the 

Superfund Amendments and 

Reauthorization Act (SARA) of 1986. 

The Brownfields Amendments amended 

the innocent landowner defense and 

added to CERCLA the bona fide 

prospective purchaser and the 

contiguous property owner liability 

protections to CERCLA liability. The 

1986 SARA amendments to CERCLA 

established that among other elements 

necessary for a defendant to 

successfully assert the innocent 

landowner defense, a defendant must 

demonstrate that he or she had, on or 

before the date of acquisition of the 

property in question, made all 

appropriate inquiries into previous 

ownership and uses of the property. 

Congress directed courts evaluating a 

defendant’s showing of all appropriate 

inquiries to take into account, among 

other things, ‘‘any specialized 

knowledge or experience on the part of 

the defendant.’’ Nothing in today’s rule 

changes the nature or intent of this 

requirement as it has existed in the 

statute since 1986. 

Proposed Rule 

The proposed rule retained, as part of 

the federal all appropriate inquiries 

requirements, the consideration of any 

specialized knowledge or experience of 

the prospective landowner (or grantee if 

the grantee is or will be the property 

owner). The proposed rule did not 

extend this requirement beyond what 

already was required under CERCLA 

and established through case law. The 

proposed rule required that all 

appropriate inquiries include the 

consideration of specialized knowledge 

held by the prospective landowner or 

grantee with regard to the subject 

property, the area surrounding the 

subject property, the conditions of 

66098 Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 

adjoining properties, as well as other 

experience relative to the inquiries that 

may be applicable to identifying 

conditions indicative of releases or 

threatened releases at the subject 

property. The proposed rule also 

required that the results of the inquiries 

take into account any specialized 

knowledge related to the property, 

surrounding areas, and adjoining 

properties held by the persons 

responsible for undertaking the 

inquiries, including any specialized 

knowledge on the part of the 

environmental professional. 

Public Comments 

EPA did not receive significant 

comment on the proposed requirements 

for considering the specialized 

knowledge or experience on the part of 

the defendant. A few commenters 

mentioned that the proposed 

requirements would result in the all 

appropriate inquiries investigations 

having to include interviews with all 

previous owners and occupants of the 

property. These commenters may have 

mistakenly interpreted the proposed 

provisions as requiring that the 

specialized knowledge of all current 

owners and occupants be considered as 

part of the all appropriate inquiries 

investigation. We clarify that only the 

specialized knowledge of the 

prospective landowner or grantee, and 

the environmental professional 

overseeing the conduct of the inquiries 

need be considered. 

Final Rule 

The final rule retains the proposed 

provisions governing the consideration 

of specialized knowledge or experience 

on the part of the prospective 

landowner (or grantee) and the 

environmental professional conducting 

the all appropriate inquiries 

investigation on the part of the 

prospective landowner or grantee. 

As provided in the preamble to the 

proposed rule, existing case law related 

to the innocent landowner defense 

shows that courts appear to have 

interpreted the ‘‘specialized knowledge’’

factor to mean that the professional or 

personal experience of the defendant 

may be taken into account when 

analyzing whether the defendant made 

all appropriate inquiries. For example, 

in Foster v. United States, 922 F. Supp. 

642 (D. D.C. 1996), the owner of a 

property formerly owned by the General 

Services Administration and 

contaminated by, among other things, 

lead, mercury and PCBs, brought an 

action against the United States and 

District of Columbia, prior owners or 

operators of the site. The plaintiff was 

a principal in Long & Foster companies 

and purchased the property through a 

general partnership, and received it by 

quitclaim deed. The innocent 

landowner defense requires a property 

owner to demonstrate that when he or 

she purchased a property, he or she did 

not know and had no reason to know of 

contamination at, on, in, or to the 

property. The court rejected the 

plaintiff’s claim to the innocent 

landowner defense based in part on the 

plaintiff’s specialized knowledge. The 

court found that his specialized 

knowledge included his position at 

Long & Foster, which did hundreds of 

millions of dollars of commercial real 

estate transactions, and his position as 

a partner in at least 15 commercial real 

estate partnerships. The partnership was 

involved as an investor in a number of 

real estate transactions, some of which 

involved industrial or commercial or 

mixed-use property. The court ruled 

that ‘‘it cannot be said that [the 

partnership] is a group 

unknowledgeable or inexperienced in 

commercial real estate transactions.’’

Foster, 922 F. Supp. at 656. 

In American National Bank and Trust 

Co. of Chicago v. Harcros Chemicals, 

Inc., 1997 WL 281295 (N.D. Ill. 1997), 

the plaintiff was a company ‘‘involved 

in brownfields development, purchasing 

environmentally distressed properties at 

a discount, cleaning them up, and 

selling them for a profit.’’ American 

National Bank,1997 WL 281295 at *4. 

As a counter-claim defendant, the 

company asserted it was an innocent 

landowner and therefore not liable 

pursuant to CERCLA. The court found 

that among other reasons the defense 

failed because the company possessed 

specialized knowledge. The court ruled 

that the company was an expert 

environmental firm and possessed 

knowledge that should have alerted it to 

the potential problems at the site. 

The final rule requires that the 

specialized knowledge of prospective 

landowners and the persons responsible 

for undertaking the all appropriate 

inquiries, including grantees, be taken 

into account when conducting the all 

appropriate inquiries for the purposes of 

identifying conditions indicative of 

releases or threatened releases at a 

property. However, as evidenced by the 

case law cited above, the determination 

of whether or not the all appropriate 

inquiries standard is met with regard to 

specialized knowledge (as well as in 

regard to all the criteria) remains within 

the discretion of the courts. 

V. What Are the Requirements for the 

Relationship of the Purchase Price to 

the Value of the Property, if the Property 

Was Not Contaminated? 

Congress included in the statutory 

criteria for all appropriate inquiries a 

requirement to consider the relationship 

of the purchase price of a property to 

the value of the property, if the property 

was not contaminated. The criteria was 

retained in the criteria included in the 

Brownfields Amendments from the all 

appropriate inquiries provisions of the 

innocent landowner defense established 

by Congress in the 1986 amendments to 

CERCLA. 

Proposed Rule 

The proposed rule required that the 

prospective landowner or grantee 

consider whether or not the purchase 

price of the property reflects the fair 

market value of the property, assuming 

that the property is not contaminated. 

The proposed rule required that the 

prospective landowner or grantee 

consider whether any differential 

between the purchase price and the 

value of the property is due to the 

presence of releases or threatened 

releases of hazardous substances at the 

property. There may be many reasons 

that the price paid for a particular 

property is not an accurate reflection of 

the fair market value. The all 

appropriate inquiries investigation need 

only include a consideration of whether 

a significant difference between the 

price paid for a property and the fair 

market value of a property, if the 

property were not contaminated, is an 

indication that the property may be 

contaminated. 

Public Comments 

Many commenters asserted that an 

environmental professional should not 

be required to consider the relationship 

of the purchase price to the value of the 

property as part of the all appropriate 

inquiries investigation. Concerns raised 

by commenters include whether 

environmental professionals are 

qualified to assess the fair market value 

of a property. Some commenters 

thought that a requirement that 

prospective landowners or 

environmental professionals consider 

the relationship of the purchase price of 

property to the value of the property 

could violate federal or state laws 

governing property appraisals. Some 

commenters argued that the all 

appropriate inquiries investigation 

should not include the requirement to 

consider the relationship of the 

purchase price to the value of the 

property because the fair market value 

Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 66099 

is not always easily ascertainable. Other 

commenters requested that the preamble 

to the final rule include a 

recommendation that an appraisal be 

performed to determine a property’s fair 

market value. In addition, commenters 

requested that in cases where an 

appraisal is conducted to determine the 

fair market value of a property, the rule 

should require that it meet the Uniform 

Standards of Professional Appraisal 

Practice. Still other commenters 

supported including the requirement in 

the final rule, but asked the Agency to 

require prospective landowners to 

obtain a property appraisal conducted 

by a trained or certified real estate 

appraiser. Some commenters stated that 

prospective landowners should not be 

required to divulge information on the 

price paid for a property to the 

environmental professional or other 

third party. 

Final Rule 

The final rule retains the requirement 

to consider the relationship of the 

purchase price to the fair market value 

of the property, if the property were not 

contaminated. The requirement is part 

of the statutory criteria established by 

Congress and has been part of the 

statutory provisions governing all 

appropriate inquiries, within the 

innocent landowner defense, since 

1986. Today’s rule does not change the 

previously existing provision. As did 

the proposed rule, today’s final rule 

allows for this criterion to be conducted 

by the prospective landowner or the 

grantee or undertaken as part of the 

inquiry by an environmental 

professional. If an environmental 

professional is not qualified to consider 

the relationship of the purchase price to 

the value of the property, the 

prospective landowner or grantee may 

undertake the task or hire another third 

party to make the comparison of price 

and fair market value and consider 

whether any differential is due to 

potential environmental contamination. 

If the relationship of the purchase 

price to the fair market value of the 

property, assuming the property is not 

contaminated, is determined by the 

prospective landowner or grantee, or 

other agent who is not under the 

supervision or responsible charge of the 

environmental professional, the final 

rule allows for, but does not require, the 

information that is collected and the 

determination made by or on the behalf 

of the prospective landowner to be 

provided to the environmental 

professional. If the information is 

provided to the environmental 

professional, he or she can then make 

use of such information during the 

conduct of the all appropriate inquiries 

and when rendering conclusions or 

opinions regarding the environmental 

conditions of the property. If the 

information is not provided to the 

environmental professional and the 

environmental professional determines 

that the lack of such information affects 

his or her ability to identify conditions 

indicative of releases or threatened 

releases of hazardous substances on, at, 

in, or to the property, then the 

environmental professional should 

identify the lack of information as a data 

gap and comment on its significance in 

the written report for the all appropriate 

inquiries investigation. 

The rule does not require that a real 

estate appraisal be conducted to achieve 

compliance with this criterion. 

Although some commenters requested 

that the final rule require that a formal 

appraisal be conducted and we 

acknowledge that there may be potential 

value in conducting an appraisal, we 

determined that a formal appraisal is 

not necessary for the prospective 

landowner or grantee to make a general 

determination of whether the price paid 

for a property reflects its fair market 

value. In the case of many property 

transactions, a formal appraisal may be 

conducted for other purposes (e.g., to 

establish the value of the property for 

the purposes of establishing the 

conditions of a mortgage or to provide 

information of relevance where a 

windfall lien may be filed). In cases 

where the results of a formal property 

appraisal are available, the appraisal 

results may serve as an excellent source 

of information on the fair market value 

of the property. 

In cases where the results of a formal 

appraisal are not available, the 

determination of fair market value may 

be made by comparing the price paid for 

a particular property to prices paid for 

similar properties located in the same 

vicinity as the subject property, or by 

consulting a real estate expert familiar 

with properties in the general locality 

and who may be able to provide a 

comparability analysis. The objective is 

not to ascertain the exact value of the 

property, but to determine whether or 

not the purchase price paid for the 

property generally is reflective of its fair 

market value. Significant differences in 

the purchase price and fair market value 

of a property should be noted and the 

reasons for any differences also should 

be noted. 

Although some commenters requested 

that EPA be more explicit in the final 

rule in requiring that the comparison of 

the purchase price to the fair market 

value of the property be conducted by 

the prospective landowner or grantee 

(and not the environmental 

professional), we believe that the 

decision of who conducts the 

comparison may be best left up to the 

judgment of the individual prospective 

landowner (or grantee) and 

environmental professional. The final 

rule provides in § 312.22 that the 

comparison of the purchase price to the 

fair market value of the property, if it 

were not contaminated, can fall outside 

the inquiries conducted by the 

environmental professional. The criteria 

to consider the relationship of the 

purchase price to the fair market value 

of the property, if it was not 

contaminated is not included as part of 

the requirements governing the ‘‘results 

of an inquiry by an environmental 

professional’’ (§ 312.21). Therefore, the 

requirement may be conducted by the 

prospective landowner or grantee, his or 

her attorney or agent, or the 

environmental professional. Given that 

a prospective landowner or grantee can 

conduct the comparison of the purchase 

price and the fair market value of the 

property or hire another agent other 

than the environmental professional to 

conduct this task, we conclude that 

commenter concerns regarding the 

prospective landowner (or grantee) 

having to divulge the price paid for a 

property to the environmental 

professional are unfounded. 

W. What Are the Requirements for 

Commonly Known or Reasonably 

Ascertainable Information About the 

Property? 

Commonly known or reasonably 

ascertainable information includes 

information about a property that 

generally is known to the public within 

the community where the property is 

located and can be easily sought and 

found from individuals familiar with 

the property or from easily attainable 

public sources of information. As 

mentioned above, the Brownfields 

Amendments to CERCLA amended the 

innocent landowner defense previously 

added to CERCLA in 1986. In addition, 

the Brownfields Amendments added to 

CERCLA the bona fide prospective 

purchaser and the contiguous property 

owner liability protections. The 1986 

amendments to CERCLA established, 

that among other elements necessary for 

a defendant to successfully assert the 

innocent landowner defense, a 

defendant must take into account 

commonly known or reasonably 

ascertainable information about the 

property. Congress retained this 

criterion as part of the all appropriate 

inquiries requirements included in the 

Brownfields Amendments. Today’s rule 

does not change the nature or intent of 

66100 Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 

this requirement as it has existed in the 

statute since 1986. 

Proposed Rule 

The proposed rule required that all 

appropriate inquiries include the 

collection and consideration of 

commonly known information about the 

potential environmental conditions at a 

property. The proposed rule required 

both the prospective landowner or 

grantee and the environmental 

professional obtain and consider 

commonly known or reasonably 

ascertainable information during the 

conduct of the all appropriate inquiries 

investigation. The proposed rule also 

provided a list of potential sources of 

such information. 

Public Comments 

A few commenters expressed concern 

that the requirement to consider 

commonly known or reasonably 

ascertainable information about a 

property renders the all appropriate 

inquiries requirements too vague and 

open-ended. Commenters stated that the 

requirement is broad and may result in 

the need to interview a large number of 

people and consult a wide variety of 

sources of information. One commenter 

expressed a preference that the federal 

standards include only a checklist of 

specific sources of information that 

must be consulted. A few commenters 

thought the list of potential sources of 

commonly known information included 

in the proposed rule was too broad. 

Final Rule 

The final rule retains the proposed 

provisions requiring that prospective 

landowners and environmental 

professionals consider commonly 

known or reasonably ascertainable 

information about a property when 

conducting all appropriate inquiries. 

This information may be ascertained 

from the owner or occupant of a 

property, members of the local 

community, including owners or 

occupants of neighboring properties to 

the subject property, local or state 

government officials, local media 

sources, and local libraries and 

historical societies. In many cases, this 

information may be incidental to other 

information collected during the 

inquiries, and separate or distinct efforts 

to collect the information may not be 

necessary. Information about a property, 

including its ownership and uses, that 

is commonly known or reasonably 

ascertainable within the community or 

neighborhood in which a property is 

located may be valuable to identifying 

conditions indicative of releases or 

threatened releases at the subject 

property. Such information, if not 

collected during the course of collecting 

other information necessary to complete 

the all appropriate inquiries 

investigation, may be obtained by 

interviewing community officials and 

other residents of the locality. For 

example, neighboring property owners 

and local community members may 

have information regarding 

undocumented uses of a property 

during periods when the property was 

idle or abandoned. Local community 

sources may be good (i.e., reasonably 

ascertainable) sources of commonly 

known information on uses of a 

property and activities conducted at a 

property, particularly in the case of 

abandoned properties. 

The collection and use of commonly 

known information about a property 

may be done in connection with the 

collection of all other required 

information for the purposes of 

achieving the objectives and 

performance factors contained in 

§ 312.20. Persons undertaking the all 

appropriate inquiries may collect 

commonly known or reasonably 

ascertainable information on the subject 

property from a variety of sources, 

including sources located in the 

community in which the property is 

located. The opinion provided by an 

environmental professional regarding 

the environmental conditions of a 

property and included in the all 

appropriate inquiries report should be 

based upon a balance of all information 

collected, including commonly known 

or reasonably ascertainable information 

about the property. The potential 

sources of commonly known or 

reasonably ascertainable information 

provided in the proposed rule and 

retained in the final rule are provided as 

suggestions for where such information 

may be found and the list provided is 

not meant as an exhaustive list of 

sources that must be consulted. 

Commonly known information may be 

collected from other sources and may be 

most easily collected during the conduct 

of other aspects of the all appropriate 

inquiries investigation (e.g., interviews, 

reviews of historical sources of 

information, reviews of governmental 

records). The requirement is not meant 

to require exhaustive data collection 

efforts, as some commenters asserted. 

The intent of the requirement is to 

establish that a prospective landowner 

or grantee and an environmental 

professional conducting all appropriate 

inquiries on his or her behalf must make 

efforts to collect and consider 

information about a property that is 

commonly known within the local 

community or that can be reasonably 

ascertained. 

There is some case law, related to the 

innocent landowner defense, that 

provides guidance on how a court may 

rule with regard to the need to consider 

commonly known or reasonably 

ascertainable information about the 

property. For example, in Wickland Oil 

Terminals v. Asarco, Inc., 1988 WL 

167247 (N.D. Cal. 1988), the court noted 

that Wickland was aware of potential 

water quality problems at the subject 

property due to large piles of mining 

slag stored at the property, even though 

Wickland argued that previous owners 

withheld such information, because the 

information was available from other 

sources consulted by Wickland prior to 

purchasing the property, including the 

Regional Water Quality Control Board 

and a consulting firm hired by 

Wickland. Such information was 

commonly known by local sources and 

therefore should have been considered 

by Wickland during its conduct of all 

appropriate inquiries. 

In Hemingway Transport Inc. v. Kahn, 

174 FR 148 (Bankr. D. Mass. 1994), the 

court ruled against an innocent 

landowner claim because it found ‘‘that 

had [the defendants] exerted a modicum 

of effort they may easily have 

discovered information that at a 

minimum would have compelled them 

to inspect the property further * * * the 

[defendants] could have taken a few 

significant steps, literally, to minimize 

their liability and discover information 

about the property * * *’’ The court 

noted that one action the defendants 

should have taken to collect available 

information about the property included 

phone calls to city officials to inquire 

about conditions at the property. 

X. What Are the Requirements for ‘‘The 

Degree of Obviousness of the Presence 

or Likely Presence of Contamination at 

the Property, and the Ability to Detect 

the Contamination by Appropriate 

Investigation?’’

Proposed Rule 

The proposed rule required that the 

inquiries conducted by a prospective 

landowner (or grantee) and 

environmental professional take into 

account all the information collected 

during the conduct of the all 

appropriate inquiries in considering the 

degree of obviousness of and ability to 

detect the presence of a release or 

threatened release of hazardous 

substances at, in, on, or to a property. 

In addition, the proposed rule required 

the environmental professional to 

provide an opinion regarding additional 

appropriate investigation, if any may be 

Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 66101 

necessary in his or her opinion to 

determine the environmental conditions 

of the property. 

Public Comments 

A few commenters asserted that the 

proposed requirements regarding the 

degree of obviousness of the presence or 

likely presence of contamination at the 

property, and the ability to detect the 

contamination by appropriate inquiry 

were too open-ended. Also, a few 

commenters suggested that the final rule 

should include requirements to conduct 

sampling and analysis to meet the 

‘‘ability to detect contamination by 

appropriate investigation’’ portion of the 

statutory criteria. However, commenters 

overwhelmingly agreed that the 

standards for all appropriate inquiries 

should not require sampling and 

analysis. 

Final Rule 

The final rule requires that persons 

conducting all appropriate inquiries 

consider all the information collected 

during the conduct of the inquiries in 

totality to ascertain the potential 

presence of a release or threatened 

release at the property. Persons 

conducting all appropriate inquiries, 

following the collection of all required 

information, must assess whether or not 

an obvious conclusion may be drawn 

that there are conditions indicative of a 

release or threatened release of 

hazardous substances (or other 

pollutants, contaminants, petroleum or 

petroleum products, and controlled 

substances) on, at, in, or to the property. 

In addition, the rule requires parties to 

consider whether or not the totality of 

information collected prior to acquiring 

the property indicates that the parties 

should be able to detect a release or 

threatened release on, at, in, or to the 

property. The final rule also retains the 

proposed requirement that the 

environmental professional include as 

part of the results of his or her inquiry 

an opinion regarding additional 

appropriate investigation, if any may be 

necessary. 

We interpret the statutory criterion to 

require consideration of information 

already obtained during the conduct of 

all appropriate inquiries investigation 

and not as a requirement to collect 

additional information. We do not agree 

with commenters who asserted that the 

criterion is open-ended. In fact, we see 

this criterion as providing direction on 

how all of the information collected 

while carrying out the other criteria and 

regulatory requirements must be viewed 

comprehensively. After collecting and 

considering all the information required 

to comply with the rule’s objectives and 

performance standards, all the 

information should be considered in 

total to determine whether or not there 

are indications of releases or threatened 

releases of hazardous substances on, at, 

in, or to the property. In addition, the 

environmental professional should 

provide an opinion regarding whether 

or not additional investigation is 

necessary to detect potential 

contamination at the site, if in his or her 

opinion there are conditions indicative 

of releases or threatened releases of 

hazardous substances. 

The previous innocent landowner 

defense (added to CERCLA in 1986) 

required a court to consider the degree 

of obviousness of the presence or likely 

presence of contamination at a property, 

and the ability of the defendant (i.e., the 

landowner) to detect the contamination 

by appropriate investigation. Nothing in 

today’s rule changes the nature or intent 

of this requirement as it has existed in 

the statute since 1986. 

Case law relevant to this criterion 

indicates that defendants may not be 

able to claim an innocent landowner 

defense if a preponderance of evidence 

available to a prospective landowner 

prior to acquiring the property indicates 

that the defendant should have 

concluded that there is a high likelihood 

of contamination at the site. In some 

cases (e.g., Hemingway Transport Inc. v. 

Kahn, 174 F.R. 148 (Bankr. D. Mass. 

1994), and Foster v. United States, 922 

F. Supp. 642 (D.D.C. 1996), courts have 

ruled that if a defendant had done a bit 

more visual inspection or further 

investigation, based upon information 

available to the defendant prior to 

acquiring the property, it would have 

been obvious that the property was 

contaminated. In Foster v. United 

States, the court determined that the 

innocent landowner defense was not 

available based in part on the fact that 

the partnership presumed the site was 

free of contamination based upon 

cursory visual inspections despite 

evidence in the record that, at the time 

of the sale, the soil was visibly stained 

by PCB-contaminated oil. In addition, 

although the property was located in a 

run-down industrial area, the defendant 

did no investigation into the 

environmental conditions at the site 

prior to acquiring the property. 

EPA also notes that in U.S. v. 

Domenic Lombardi Realty, Inc., 290 F. 

Supp. 2d 198, 211 (D.R.I. 2003), the 

court held that the defendant did not 

qualify for the innocent landowner 

defense. The defendant could not show 

he had ‘‘no reason to know’’ of 

contamination at the property or that he 

had performed all appropriate inquiries 

in accordance with ‘‘good commercial 

or customary practices.’’ The court also 

found that the defendant had not 

performed even a minimal 

environmental assessment of the site 

despite having learned that the property 

had been used as an automobile 

scrapyard. The court noted the 

distinction between Phase I and Phase 

II environmental assessments and 

credited the testimony of the United 

States’ expert who concluded that, 

under the circumstances of this case, the 

defendant should have conducted a 

Phase II assessment. Id. at 203–04. 

With regard to the conduct of 

sampling and analysis, today’s final rule 

does not require sampling and analysis 

as part of the all appropriate inquiries 

investigation. However, sampling and 

analysis may be valuable in determining 

the possible presence and extent of 

potential contamination at a property. In 

addition, the fact that the all appropriate 

inquiry standards do not require 

sampling and analysis does not prevent 

a court from concluding that, under the 

circumstances of a particular case, 

sampling and analysis should have been 

conducted to meet ‘‘the degree of 

obviousness of the presence or likely 

presence of contamination at the 

property, and the ability to detect the 

contamination by appropriate 

investigation’’ criterion and obtain 

protection from CERCLA liability. 

Prospective landowners should keep in 

mind that the conduct of all appropriate 

inquiries prior to acquiring a property is 

only one requirement that he or she 

must comply with to assert protection 

from CERCLA liability. The statute 

requires that persons, after acquiring a 

property, comply with continuing 

obligations to take reasonable steps to 

stop on-going releases at the property, 

prevent any threatened future releases, 

and prevent or limit any human, 

environmental, or natural resource 

exposure to any previously released 

hazardous substances (these criteria are 

summarized in detail in section II.D. of 

this preamble). In certain instances, 

depending upon site-specific 

circumstances and the totality of the 

information collected during the all 

appropriate inquiries prior to the 

property acquisition, it may be 

necessary to conduct sampling and 

analysis, either pre-or post-acquisition, 

to fully understand the conditions at a 

property, and fully comply with the 

statutory requirements for the CERCLA 

liability protections. In addition, 

sampling and analysis may help explain 

existing data gaps. Prospective 

landowners should be mindful of all the 

statutory requirements for obtaining the 

CERCLA liability protections when 

66102 Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 

2The document titled ‘‘The Economic Impact 

Analysis for the Final All Appropriate Inquiries 

Regulation’’ includes (1) the EIA conducted for the 

proposed rulemaking and (2) the Addendum to the 

EIA. The cost estimates presented in the Addendum 

are the estimated costs of the final all appropriate 

inquiries regulation. 

considering whether or not to conduct 

sampling and analysis prior to or after 

acquiring a property. Today’s final 

regulation does not require that 

sampling and analysis be conducted as 

part of the all appropriate inquiries 

investigation. 

V. Statutory and Executive Order 

Reviews 

A. Executive Order 12866: Regulatory 

Planning and Review 

Under Executive Order 12866 (58 FR 

51735), the Agency must determine 

whether this regulatory action is 

‘‘significant’’ and therefore subject to 

formal review by the Office of 

Management and Budget (OMB) and to 

the requirements of the Executive Order. 

The Executive Order defines 

‘‘significant regulatory action’’ as one 

that is likely to result in a rule that may: 

(1) Have an annual effect on the 

economy of $100 million or more or 

adversely affect in a material way the 

economy, a sector of the economy, 

productivity, competition, jobs, the 

environment, public health or safety, or 

state, local, or tribal governments or 

communities; (2) create a serious 

inconsistency or otherwise interfere 

with an action taken or planned by 

another agency; (3) materially alter the 

budgetary impact of entitlements, 

grants, user fees, or loan programs or the 

rights and obligations of recipients 

thereof; or (4) raise novel legal or policy 

issues arising out of legal mandates, the 

President’s priorities, or the principles 

set forth in the Executive Order. 

Pursuant to the terms of Executive 

Order 12866, it has been determined 

that today’s final rule is a ‘‘significant 

regulatory action’’ because this rule 

contains novel policy issues, although it 

is not economically significant. As such, 

this action was submitted to OMB for 

review. Changes made in response to 

OMB suggestions or recommendations 

are documented in the docket for 

today’s rule. 

To estimate the economic effects of 

today’s final rule, we conducted an 

evaluation of the potential effects of this 

rule on the universe of prospective 

landowners who may chose to comply 

with the provisions of today’s final rule 

to obtain protection from CERCLA 

liability for potential releases and 

threatened releases of hazardous 

substances that may exist at properties 

they intend to purchase. The results of 

this analysis are included in the 

document titled ‘‘Economic Impact 

Analysis for the Final All Appropriate 

Inquiries Regulation,’’ which is 

included in the docket for today’s final 

rule. Based upon the results of the 

Economic Impact Analysis (EIA), EPA 

has determined that this final rule will 

have an annual effect on the economy 

of less than $100 million. The 

annualized benefits associated with the 

final rule have not been monetized but 

are identified and summarized in the 

EIA for the all appropriate inquiries 

rule.2

1. Methodology 

The value of any regulatory action is 

traditionally measured by the net 

change in social welfare that it 

generates. The EIA conducted in 

support of today’s rule examines both 

costs and qualitative benefits in an effort 

to assess the overall net change in social 

welfare. The primary focus of the EIA 

document is on compliance costs and 

economic impacts. Below, EPA 

summarizes the analytical methodology 

and findings for the all appropriate 

inquiries rule. The information 

presented is derived from the EIA. 

The all appropriate inquiries 

regulation potentially will apply to most 

commercial property transactions. The 

requirements will be applicable to any 

public or private party, who may 

potentially claim protection from 

CERCLA liability as an innocent 

landowner, a bona fide prospective 

purchaser, or a contiguous property 

owner. However, the conduct of all 

appropriate inquiries, also known as 

environmental due diligence or Phase I 

Environmental Site Assessment, is not 

new to the commercial property market. 

Prior to the Brownfields Amendments to 

CERCLA, commercial property 

transactions often included an 

assessment of the environmental 

conditions at properties prior to the 

closing of any real estate transaction 

whereby ownership was transferred for 

the purposes of confirming the 

conditions at the property or to establish 

an innocent landowner defense should 

environmental contamination be 

discovered after the property was 

acquired. The process most prevalently 

used for conducting all appropriate 

inquiries, or environmental site 

assessments, is the process developed 

by ASTM International (formerly known 

as the American Society for Testing and 

Materials) and entitled ‘‘E1527, 

Standard Practice for Environmental 

Site Assessments: Phase I 

Environmental Site Assessment 

Process.’’ In addition, some properties, 

particularly in cases where the subject 

property is assumed not to be 

contaminated or was never used for 

industrial or commercial purposes, were 

assessed using a less rigorous process 

developed by ASTM International, 

sometimes referred to as a ‘‘transaction 

screen’’ and entitled ‘‘E1528, Standard 

Practice for Environmental Site 

Assessments: Transaction Screen 

Process.’’

Our first step in assessing the 

economic impacts of the rule was to 

establish a baseline to represent the 

relevant aspects to the commercial real 

estate market in the absence of any 

changes in regulations. Because under 

existing conditions almost all 

commercial property transactions are 

accompanied by either an 

environmental site assessment (ESA) 

conducted in accordance with ASTM 

E1527–2000 or a transaction screen as 

specified in ASTM E1528, it was 

assumed these practices would continue 

even in the absence of the all 

appropriate inquiries regulation. The 

numbers of each type of assessment 

were estimated on the basis of industry 

data for recent years, with recent growth 

rates in transactions assumed to 

continue for the 10-year period covered 

by the EIA. An adjustment in the 

relative numbers of ESAs and 

transaction screens was made to account 

for the fact that, under the rule, an ESA 

will provide more certain protection 

from liability. This adjustment was 

made by comparing shifts between the 

two procedures that occurred when the 

Brownfields Amendments established 

the ASTM E1527–2000 standard as the 

interim standard for all appropriate 

inquiries, and thus as one requirement 

for qualifying as an innocent landowner, 

bona fide prospective purchaser, or 

contiguous property owner. 

We then considered the requirements 

included in the final rule and compared 

them to the requirements for 

environmental site assessments 

conducted under the ASTM E1527–

2000 and ASTM E1528 standards. 

When compared to the ASTM E1527–

2000 standard (i.e., the baseline 

standard), today’s final rule is expected 

to result in a reduced burden for the 

conduct of interviews in those cases 

where the subject property is 

abandoned; increased burden in those 

cases where past owners or occupants 

need to be interviewed; increased 

burden associated with documenting 

recorded environmental cleanup liens; 

increased burden for documenting the 

reasons for the price and fair market 

value of a property in those cases where 

the purchase price paid for the subject 

property is significantly below the fair 

Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 66103 

3The distribution of abandoned properties and 

properties with known owners, modeled as a range, 

is based on an estimate of vacant lands in urban 

areas and an estimate of abandoned Superfund 

sites. 

market value of the property; and 

increased burden for recording 

information about the degree of 

obviousness of contamination at a 

property. 

To estimate the changes in costs 

resulting from the rule, we developed a 

costing model. This model estimates the 

total costs of conducting site 

assessments as the product of costs per 

assessment, numbers of assessments per 

year, and the number of years in the 

analysis. The costs per assessment, in 

turn, are calculated by dividing each 

assessment into individual labor 

activities, estimating the labor time 

associated with each, and assigning a 

per-hour labor cost to each activity on 

the basis of the labor category most 

appropriate to that activity. Labor times 

and categories are assumed to depend 

on the size and type of property being 

assessed, with the nationwide 

distribution of properties based on data 

from industry on environmental sites 

assessments and brownfield sites.3 The 

estimates and assignments of categories 

are made based on the experience of 

professionals who have been involved 

in large numbers of site assessments, 

and who are therefore skilled in cost 

estimation for the relevant activities. 

Other costs, such as reproduction and 

the purchase of data, are added to the 

labor costs to form the estimates of total 

costs per assessment. These total costs, 

stratified by size and type of property, 

are then multiplied by estimated 

numbers of assessments of each size and 

type to generate our estimates of total 

annual costs. The model was tested by 

comparing its results to industry-wide 

estimates of average price of conducting 

assessments under baseline conditions, 

and generally found to agree. The 

difference between the estimated cost to 

comply with the final rule and the 

estimated cost in the baseline 

constitutes our estimate of the 

incremental regulatory costs. 

The EIA provides a qualitative 

assessment of the benefits of the all 

appropriate inquiries rule. The benefits 

discussed are those that may be 

attributed to an increased level of 

certainty with regard to CERCLA 

liability provided to prospective 

purchasers of potentially contaminated 

properties, including brownfields, who 

comply with the provisions of the rule 

and the other statutory provisions 

associated with the liability protections. 

The basic premise for associating certain 

benefits to the rule is the expectation 

that the level of certainty provided by 

the liability protections may result in 

increased brownfields property 

transactions. However, it is difficult to 

predict how many additional 

transactions may occur that involve 

brownfields properties in direct 

response to the increased certainty of 

the liability protections. It also is 

difficult to obtain data on changes in 

behaviors and practices of prospective 

landowners in response to the liability 

protections. Therefore, EPA made no 

attempt to quantify potential benefits or 

compare the benefits to estimated 

incremental costs. 

The Agency believes that increasing 

property transactions involving 

brownfields and other contaminated 

and potentially contaminated properties 

and improving information about 

environmental conditions at these 

properties may provide additional 

indirect benefits such as increased 

numbers of cleanups, reduced use of 

greenfields, potential increases in 

property values, and potential increases 

in quality of life measures (e.g., 

decreases in urban blight, reductions in 

traffic, congestion, and reduced 

pollution due to mobile source 

emissions). However, as stated above, 

the benefits of the rule are considered 

only qualitatively, due to the difficulty 

of predicting how many additional 

brownfields and contaminated property 

transactions may occur in response to 

the increased certainty of liability 

protections provided by the rule, as well 

as the difficulty in getting data on 

changes in behaviors and practices in 

response to the availability of the 

liability protections. EPA is confident 

that the new liability protections 

afforded to prospective landowners, if 

they comply with the all appropriate 

inquiries provisions, will result in 

increased benefits. EPA is not able to 

quantify, with any significant level of 

confidence, the exact proportion of the 

benefits attributed only to the 

availability of the liability protections 

and the all appropriate inquiries 

regulations. For these reasons, the costs 

and benefits could not be directly 

compared. 

2. Summary of Regulatory Costs in 

Proposed Rule 

For a given property, the costs of 

compliance with the all appropriate 

inquiries rule relative to the baseline 

depend on whether that property would 

have been assessed, in absence of the all 

appropriate inquiries regulation, with 

an ASTM E1527–2000 assessment 

process or with the simpler ASTM 

E1528 transaction screen. EPA 

estimated the average incremental cost 

of the proposed rule relative to 

conducting an ASTM E1527–2000 to be 

between $41 and $47. For the small 

percentage of cases for which a 

transaction screen would have been 

preferred to the ASTM E1527–2000 in 

the baseline, but which would, as a 

result of the proposed rule, require an 

assessment in compliance with the all 

appropriate inquiries rule, the average 

incremental cost was estimated to be 

between $1,448 and $1,454. We 

estimated that approximately 97 percent 

of property transactions will bear only 

the incremental cost of the rule relative 

to the ASTM E1527–2000 process. 

Therefore, the weighted average 

incremental cost of the proposed rule, 

per transaction, was estimated to be 

fairly low, between $84 and $89. 

3. Public Comments on EIA for 

Proposed Rule 

EPA received a number of public 

comments on the EIA conducted to 

assess the potential costs and impacts of 

the proposed rule. We summarized the 

public comments received related to the 

cost and economic impacts in the 

document titled ‘‘Addendum to 

Economic Impact Analysis for the Final 

All Appropriate Inquiries Regulation’’

(Addendum to the EIA). This document 

is included in the docket for today’s 

final rule. The Addendum to the EIA 

also summarizes EPA’s responses to the 

comments received that addressed the 

estimated costs and economic impacts. 

Many commenters generally agreed 

with EPA’s conclusion that the average 

incremental cost increase per 

transaction associated with the 

requirements of the proposed rule 

would be minimal. Some commenters 

mentioned that the EIA conducted for 

the proposed rule underestimated the 

incremental costs associated with the 

proposed rule. However, only a few 

commenters provided an explanation as 

to why they thought our cost estimates 

were low or provided information 

regarding which particular activities 

would result in an incremental increase 

in the activities and costs associated 

with conducting an environmental site 

assessment, if conducted in compliance 

with the requirements of the proposed 

rule. Most commenters did not provide 

specific reasons for their claims of cost 

increases over the ASTM E1527–2000 

standard. A few commenters suggested 

that the EIA for the proposed rule 

underestimated the level of effort 

necessary for locating and interviewing 

past owners or occupants, with one 

commenter providing an estimated level 

of effort of one to three hours for this 

task. 

66104 Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 

4We assumed that the environmental 

professionals will need to complete the full 

interview with the current owner before conducting 

an interview with the past owners or occupants. To 

the extent that this may not always be the case, the 

average incremental cost (and by extension, the 

average cost for an AAI Phase I ESA) is 

overestimated. 

4. Estimate of Costs Associated With the 

Final Rule 

EPA made one revision to the analysis 

of cost impacts associated with the 

requirements of the proposed and final 

rule in response to specific issues raised 

by commenters. EPA agrees with the 

commenters who asserted that locating 

past owners or occupants of a property 

may be more time consuming than 

locating the current owners or 

occupants, as was assumed in the 

analysis of costs conducted for the 

proposed rule. Locating past owners or 

occupants could require as little as one 

5-minute phone call (e.g., if the current 

owner has the contact information for 

the past owner) or it could require 

multiple phone calls that could take in 

excess of one hour. For the purpose of 

estimating the cost under the final rule, 

EPA estimates the incremental burden 

for locating past owners or occupants to 

be, on average, 0.5 hours per interview 

regardless of the property type or size. 

EPA did not account for this 

incremental burden in our analysis of 

the costs associated with the proposed 

rule. EPA also recognizes that in some 

cases the environmental professional 

will need to complete the full interview 

with the current owner before 

determining that it is necessary to 

interview a past owner. In other words, 

the environmental professional may 

need to complete the interview with the 

current owner, and then perform a more 

focused interview of a past owner to fill 

data gaps. EPA estimates that the 

incremental burden for interviewing 

past owners or occupants will be 0.5 

hours for undeveloped and residential 

properties, one hour for commercial and 

industrial properties (of all sizes except 

large industrial), and 1.5 hours for large 

industrial properties. Therefore, EPA 

estimates that the total incremental level 

of effort for locating and interviewing 

past property owners or occupants will 

range from one hour to two hours 

depending on the property type or size. 

The additional incremental hour 

burden, however, will not be incurred 

in the case of every site assessment. EPA 

expects that the interview with past 

owners or occupants will be conducted 

only for properties with a higher than 

average owner or occupant turnover 

rate. To derive the number of potentially 

affected properties, we assume that the 

environmental professional will 

interview only the current property 

owner if the owner was in the 

possession of the subject property for 

more than two years. We assume that 

after two years of owning a property, the 

current property owner should have a 

reasonably good knowledge of its 

condition. EPA estimates that 19 

percent of Phase I ESAs conducted in a 

given year are conducted on properties 

that were sold at least once in the 

previous two years (for a detailed 

explanation on the derivation of this 

estimate, see the Addendum to the EIA). 

Using the assumption that 15 percent of 

all properties are abandoned properties 

(see Section 5.6.5.2 of EIA) which 

would not be affected by the 

requirement to interview past owners or 

occupants, we revised our original cost 

estimate to account for non-abandoned 

properties that were sold over the past 

two years. Therefore, for the purpose of 

our revised cost analysis, we estimate 

that 16 percent of properties will require 

an additional interview with past 

owners or occupants. 

Except for the increase in the level of 

effort for the interview task for nonabandoned properties, all other 

parameters used in modeling our cost 

estimates are the same as presented in 

the EIA conducted for the proposed 

rule. To derive the incremental average 

cost per transaction and the total annual 

cost of the final rule, we employed the 

methodology explained in detailed in 

Chapters 7 and 8 of the EIA conducted 

for the proposed rule. Based on our 

analysis, the cost of a Phase I ESA under 

the final regulation will increase, on 

average, between $52 and $58. The 

estimated average cost for a Phase I ESA 

thus will range between $2,185 and 

$2,190.4

Using our revised incremental cost 

estimate for conducting interviews of 

past owners or occupants, we revised 

our estimated total annual cost of the 

final rule and our incremental total 

annual cost estimate. Our revised total 

annual cost estimate for all activities 

included in the all appropriate inquiries 

investigations conducted under the final 

rule is between $693.5 and $695.3 

million (calculated using a discount rate 

of three percent). Our revised estimate 

of the incremental total annual cost of 

the final rule is between $29.7 million 

and $31.4 million. A more detailed 

explanation of our revised cost 

estimates, including an additional 

sensitivity analysis performed in 

response to the public comments, is 

included in the document titled 

‘‘Addendum to the Economic Impact 

Analysis for the Final All Appropriate 

Inquiries Regulation.’’ This document is 

in the public docket for today’s final 

rule. 

B. Paperwork Reduction Act 

The information collection 

requirements contained in this final rule 

were submitted for approval to the 

Office of Management and Budget under 

the Paperwork Reduction Act, 44 U.S.C. 

3501 et seq. The information collection 

requirements are not enforceable until 

OMB approves them. The Information 

Collection Request (ICR) document 

prepared by EPA has been assigned EPA 

ICR Number 2144.02. 

Under the PRA, EPA is required to 

estimate the notification, reporting and 

recordkeeping costs and burdens 

associated with the requirements 

specified in today’s rule. Today’s rule 

will require persons wanting to assert 

one of the liability protections under 

CERCLA to conduct some activities that 

go beyond current customary and usual 

business practices (i.e., beyond ASTM 

E1527–2000) and therefore will impose 

an information collection burden under 

the provisions of the Paperwork 

Reduction Act. The information 

collection activities are associated with 

the activities mandated in section 101 

(35)(B) of CERCLA for those persons 

wanting to claim protection from 

CERCLA liability. None of the 

information collection burdens 

associated with the provisions of today’s 

rule include requirements to submit the 

collected information to EPA or any 

other government agency. Information 

collected by persons affected by today’s 

rule may be useful to such persons if 

their potential liability under CERCLA 

for the release or threatened release of 

a hazardous substance is challenged in 

a court. 

The activities associated with today’s 

rule that go beyond current customary 

and usual business practices include 

interviews with neighboring property 

owners and/or occupants in those cases 

where the subject property is 

abandoned, documentation of all 

environmental cleanup liens in the 

Phase I Environmental Site Assessment 

report, discussion of the relationship of 

purchase price to value of the property 

in the report, and consideration and 

discussion of whether additional 

environmental investigation is 

warranted. Paperwork burdens are 

estimated to be 546,179 hours annually, 

with a total cost of $29,583,206 

annually. The estimated average burden 

hours per response is estimated to be 

approximately one hour (or 25 hours per 

response, assuming a transition from a 

transaction screen). The estimated 

average cost burden per response is 

estimated to be either $67 or $1,479, 

Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 66105 

5For a very small percentage of entities 

transitioning from transaction screens to the all 

appropriate inquiries requirements, the maximum 

increase per establishment per property transaction 

is estimated to be approximately $2,845. When we 

annualize this incremental cost per property 

transaction over ten years at a seven percent 

discount rate, we estimate that the maximum 

annual cost increase per establishment per property 

transaction will be $405. We estimate that 

approximately one fifth of one percent of the 

properties transitioning from a transaction screen to 

a Phase I ESA will have an impact of this 

magnitude each year. 

depending on whether, under baseline 

conditions, an ASTM E1527–2000 

process or a transaction screen (ASTM 

E1528) would have been used. 

Under the Paperwork Reduction Act, 

‘‘burden’’ means the total time, effort, or 

financial resources expended by persons 

to generate, maintain, retain, or disclose 

or provide information to or for a 

Federal agency. This includes the time 

needed to review instructions; develop, 

acquire, install, and utilize technology 

and systems for the purposes of 

collecting, validating, and verifying 

information, processing and 

maintaining information, and disclosing 

and providing information; adjust the 

existing ways to comply with any 

previously applicable instructions and 

requirements; train personnel to be able 

to respond to a collection of 

information; search data sources; 

complete and review the collection of 

information; and transmit or otherwise 

disclose the information. 

An agency may not conduct or 

sponsor, and a person is not required to 

respond to a collection of information 

unless it displays a currently valid OMB 

control number. The OMB control 

numbers for EPA’s regulations in 40 

CFR are listed in 40 CFR part 9. This 

ICR is approved by OMB, and the 

Agency will publish a technical 

amendment to 40 CFR part 9 in the 

Federal Register to display the OMB 

control number for the approved 

information collection requirements 

contained in this final rule. 

C. Regulatory Flexibility Act 

The Regulatory Flexibility Act (RFA), 

as amended by the Small Business 

Regulatory Enforcement Fairness Act of 

1996 (SBREFA), 5 U.S.C. 601 et. seq., 

generally requires an agency to prepare 

a regulatory flexibility analysis of any 

rule subject to notice and comment 

rulemaking requirements under the 

Administrative Procedure Act or any 

other statute, unless the agency certifies 

that the rule will not have a significant 

economic impact on a substantial 

number of small entities. Small entities 

include small businesses, small 

organizations, and small governmental 

jurisdictions. 

For the purposes of assessing the 

impacts of today’s rule on small entities, 

small entity is defined as: (1) A small 

business that is defined by the Small 

Business Administration by category of 

business using the North American 

Industrial Classification System 

(NAICS) and codified at 13 CFR 

121.201; (2) a small governmental 

jurisdiction that is a government of a 

city, county, town, school district or 

special district with a population of less 

than 50,000; and (3) a small 

organization that is any not-for-profit 

enterprise which is independently 

owned and operated and is not 

dominant in its field. 

Since all non-residential property 

transactions could be affected by today’s 

rule, if it is promulgated, large numbers 

of small entities could be affected to 

some degree. However, we estimate that 

the effects, on the whole, will not be 

significant for small entities. We 

estimate that, for the majority of small 

entities, the average incremental cost of 

today’s rule relative to conducting an 

ASTM E1527–2000 Phase I 

Environmental Site Assessment will be 

between $52 and $58. When we 

annualize the incremental cost of $58 

per property transaction over ten years 

at a seven percent discount rate, we 

estimate that the average annual cost 

increase per establishment per property 

transaction will be $8. Thus, the cost 

impact to small entities is estimated to 

not be significant. A more detailed 

summary of our analysis of the potential 

impacts of today’s rule to small entities 

is included in ‘‘Economic Impacts 

Analysis of the Final All Appropriate 

Inquiries Regulation.’’ This document is 

included in the docket for today’s rule. 

After considering the economic 

impacts of today’s final rule on small 

entities, I certify that this action will not 

have a significant economic impact on 

a substantial number of small entities. 

We estimate that, on average, 266,000 

small entities may purchase commercial 

real estate in any given year and 

therefore could potentially be impacted 

by today’s final rule. Though large 

numbers of small entities could be 

affected to some degree, we estimated 

that the effects, on the whole, would not 

be significant for small entities. We 

estimate that, for the majority of small 

entities, the average incremental cost of 

today’s rule relative to conducting an 

ASTM E1527–2000 will be between $52 

and $58. For the small percentage of 

cases for which a transaction screen 

would have been preferred to the ASTM 

E1527–2000 in the baseline, but which 

now will require an assessment in 

compliance with the rule, the average 

incremental cost of conducting an 

environmental site assessment will be 

between $1,459 and $1,465. When we 

annualize the incremental cost per 

property transaction over ten years at a 

seven percent discount rate, we estimate 

that for the majority of small entities the 

average annual cost increase per 

establishment per property transaction 

will be approximately $8. For the small 

percentage of entities transitioning from 

transaction screens to the all 

appropriate inquiries requirements of 

the final rule, the average annual cost 

increase per establishment per property 

transaction will be $209.5

D. Unfunded Mandates Reform Act 

Title II of the Unfunded Mandates 

Reform Act of 1995 (UMRA), Public 

Law 104–4, establishes requirements for 

federal agencies to assess the effects of 

their regulatory actions on State, local, 

and tribal governments and the private 

sector. Under section 202 of the UMRA, 

EPA must prepare a written statement, 

including a cost-benefit analysis, for 

proposed and final rules with ‘‘Federal 

mandates’’ that may result in 

expenditures to State, local, and tribal 

governments, in the aggregate, or to the 

private sector, of $100 million or more 

in any one year. Before promulgating an 

EPA rule for which a written statement 

is needed, section 205 of the UMRA 

generally requires EPA to identify and 

consider a reasonable number of 

regulatory alternatives and adopt the 

least costly, most cost-effective, or least 

burdensome alternative that achieves 

the objectives of the rule. The 

provisions of section 205 do not apply 

when they are inconsistent with 

applicable law. Moreover, section 205 

allows EPA to adopt an alternative other 

than the least costly, most cost-effective 

or least burdensome alternative if the 

Administrator publishes with the final 

rule an explanation of why that 

alternative was not adopted. 

Before EPA establishes any regulatory 

requirements that may significantly or 

uniquely affect small governments, 

including tribal governments, it must 

have developed under section 203 of the 

UMRA, a small government agency 

plan. The plan must provide for 

notifying potentially affected small 

governments, enabling officials to have 

meaningful and timely input in the 

development of regulatory proposals 

with significant federal 

intergovernmental mandates, and 

informing, educating, and advising 

small governments on compliance with 

the regulatory requirements. 

Today’s rule contains no federal 

mandates (under the regulatory 

provisions of Title II of the UMRA) for 

66106 Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 

state, local, or tribal governments or the 

private sector. The rule imposes no 

enforceable duty on any state, local, or 

tribal governments. EPA also 

determined that today’s rule contains no 

regulatory requirements that might 

significantly or uniquely affect small 

governments. In addition, as discussed 

above, the private sector is not expected 

to incur costs of $100 million or more 

as a result of today’s rule. Therefore, 

today’s rule is not subject to the 

requirements of Sections 202 and 205 of 

UMRA. 

E. Executive Order 13132: Federalism 

Executive Order 13132, entitled 

‘‘Federalism’’ (64 FR 43255, August 10, 

1999), requires EPA to develop an 

accountable process to ensure 

‘‘meaningful and timely input by State 

and local officials in the development of 

regulatory policies that have federalism 

implications.’’ ‘‘Policies that have 

federalism implications’’ is defined in 

the Executive Order to include 

regulations that have ‘‘substantial direct 

effects on the states, on the relationship 

between the national government and 

the states, or on the distribution of 

power and responsibilities among the 

various levels of government.’’

Today’s rule does not have federalism 

implications. It will not have substantial 

direct effects on the states, on the 

relationship between the national 

government and the states, or on the 

distribution of power and 

responsibilities among the various 

levels of government, as specified in 

Executive Order 13132. No state and 

local government bodies will incur 

compliance costs as a result of today’s 

rulemaking. Therefore, Executive Order 

13132 does not apply to this rule. 

F. Executive Order 13175: Consultation 

and Coordination With Indian Tribal 

Governments 

Executive Order 13175, entitled 

‘‘Consultation and Coordination with 

Indian Tribal Governments’’ (65 FR 

67249, November 9, 2000), requires EPA 

to develop an accountable process to 

ensure ‘‘meaningful and timely input by 

tribal officials in the development of 

regulatory policies that have tribal 

implications.’’ Today’s rule does not 

have tribal implications, as specified in 

Executive Order 13175. Today’s rule 

does not significantly or uniquely affect 

the communities of Indian tribal 

governments, nor would it impose 

direct compliance costs on them. Thus, 

Executive Order 13175 does not apply 

to this rule. 

G. Executive Order 13045: Protection of 

Children From Environmental Risks and 

Safety Risks 

Executive Order 13045, entitled 

‘‘Protection of Children from 

Environmental Health Risks and Safety 

Risks (62 FR 19885, April 23, 1997) 

applies to any rule that: (1) Is 

determined to be ‘‘economically 

significant’’ as defined under Executive 

Order 12866, and (2) concerns an 

environmental health or safety risk that 

EPA has reason to believe may have a 

disproportionate effect on children. If 

the regulatory action meets both criteria, 

the Agency must evaluate the 

environmental health or safety effects of 

the planned rule on children; and 

explain why the planned regulation is 

preferable to other potentially effective 

and reasonably feasible alternatives 

considered by the Agency. 

Today’s rule is not subject to the 

Executive Order because it is not 

economically significant as defined in 

Executive Order 12866. 

H. Executive Order 13211: Actions That 

Significantly Affect Energy Supply, 

Distribution or Use 

Today’s final rule is not a ‘‘significant 

energy action’’ as defined in Executive 

Order 13211, ‘‘Actions Concerning 

Regulations That Significantly Affect 

Energy Supply, Distribution, or Use’’ (66 

FR 28355, May 22, 2001) because it is 

not likely to have a significantly adverse 

effect on the supply, distribution, or use 

of energy. Further, we have concluded 

that this rule is not likely to have any 

adverse energy effects. 

I. National Technology Transfer and 

Advancement Act 

Section 12(d) of the National 

Technology Transfer and Advancement 

Act of 1995 (‘‘NTTAA’’), Public Law 

104–113, section 12(d) (15 U.S.C. 272 

note), directs EPA to use voluntary 

consensus standards in its regulatory 

activities, unless to do so would be 

inconsistent with applicable law or 

otherwise impractical. Voluntary 

consensus standards are technical 

standards (e.g., materials specifications, 

test methods, sampling procedures, and 

business practices) that are developed or 

adopted by voluntary consensus 

standards bodies. The NTTAA directs 

EPA to provide Congress, through OMB, 

explanations when the Agency decides 

not to use available and applicable 

voluntary consensus standards. Today’s 

rule involves technical standards. 

Therefore, the requirements of section 

12(d) of the National Technology 

Transfer and Advancement Act of 1995 

(15 U.S.C. 272) apply. 

Today’s final rule is based upon a 

proposed rule that was developed with 

the assistance of a regulatory negotiation 

committee comprised of various affected 

stakeholder groups and modified 

slightly, based upon public comments 

received in response to the proposed 

rule. When developing the proposed 

rule, EPA considered using the existing 

standard developed by ASTM 

International as the federal standard for 

all appropriate inquiries. This standard 

is known as the ASTM E1527–2000 

standard (‘‘Standard Practice for 

Environmental Site Assessment: Phase I 

Environmental Site Assessment 

Process’’). However, when we proposed 

the federal standards for all appropriate 

inquiries, EPA determined that the 

ASTM E1527–2000 standard is 

inconsistent with applicable law. 

In CERCLA section 101(35)(B), 

Congress included ten specific criteria 

to be used in promulgating the all 

appropriate inquiries rule. The 2000 

version of the ASTM Phase I 

Environmental Site Assessment Process 

does not address all of the required 

criteria. For example, the ASTM 

International standard does not provide 

for interviews of past owners, operators, 

and occupants of a facility. The statute, 

however, states that the federally 

promulgated standard ‘‘shall include 

* * * interviews with past and present 

owners, operators, and occupants of the 

facility for the purpose of gathering 

information regarding the potential for 

contamination at the facility.’’ CERCLA 

section 101(35)(B)(iii)(II). In addition, as 

outlined in the preamble to the 

proposed rule (69 FR 52541) the ASTM 

E1527–2000 standard also does not meet 

other statutory requirements. As a 

result, use of the ASTM E1527–2000 

standard would be inconsistent with 

applicable law. 

In today’s final rule, EPA is 

referencing the updated standards and 

practices developed by ASTM 

International and known as Standard 

E1527–05 (entitled ‘‘Standard Practice 

for Environmental Site Assessments: 

Phase I Environmental Site Assessment 

Process’’). The Agency has determined 

that this voluntary consensus standard 

is consistent with today’s final rule and 

is compliant with the statutory criteria 

for all appropriate inquiries. Persons 

conducting all appropriate inquiries 

may use the procedures included in the 

ASTM E1527–05 standard to comply 

with today’s final rule. 

Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 66107 

J. Executive Order 12898: Federal 

Actions To Address Environmental 

Justice in Minority Populations and 

Low-Income Populations 

Executive Order 12898, ‘‘Federal 

Actions to Address Environmental 

Justice in Minority Populations and 

Low-Income Populations’’ (February 11, 

1994), is designed to address the 

environmental and human health 

conditions of minority and low-income 

populations. EPA is committed to 

addressing environmental justice 

concerns and has assumed a leadership 

role in environmental justice initiatives 

to enhance environmental quality for all 

citizens of the United States. The 

Agency’s goals are to ensure that no 

segment of the population, regardless of 

race, color, national origin, income, or 

net worth bears disproportionately high 

and adverse human health and 

environmental impacts as a result of 

EPA’s policies, programs, and activities. 

Our goal is to ensure that all citizens 

live in clean and sustainable 

communities. In response to Executive 

Order 12898, and to concerns voiced by 

many groups outside the Agency, EPA’s 

Office of Solid Waste and Emergency 

Response (OSWER) formed an 

Environmental Justice Task Force to 

analyze the array of environmental 

justice issues specific to waste programs 

and to develop an overall strategy to 

identify and address these issues 

(OSWER Directive No. 9200.3–17). 

EPA’s brownfields program has a 

particular emphasis on addressing 

concerns specific to environmental 

justices communities. Many of the 

communities and neighborhoods that 

are most significantly impacted by 

brownfields are environmental justice 

communities. EPA’s brownfields 

program targets such communities for 

assessment, cleanup, and revitalization. 

The brownfields program has a long 

history of working with environmental 

justice communities and advocates 

through our technical assistance and 

grant programs. In addition to the 

monies awarded to such communities in 

the form of assessment and cleanup 

grants, the brownfields program also 

works with environmental justice 

communities through our job training 

grants program. The job training grants 

provide money to government entities to 

facilitate the training of persons living 

in or near brownfields communities to 

attain skills for conducting site 

assessments and cleanups. 

Given that environmental justice 

communities are significantly impacted 

by brownfields, and the federal 

standards for all appropriate inquiries 

may play a primary role in encouraging 

the assessment and cleanup of 

brownfields sites, EPA made it a priority 

to obtain input from representatives of 

environmental justice interest groups 

during the development of today’s 

rulemaking. The Negotiated Rulemaking 

Committee tasked with developing the 

all appropriate inquiries proposed rule 

included three representatives from 

environmental justice advocacy groups. 

Each representative played a significant 

role in the negotiations and in the 

development of the proposed rule. 

Today’s final rule includes no 

significant changes to the proposed rule 

and in particular, includes no changes 

that will significantly or 

disproportionately impact 

environmental justice communities. 

K. Congressional Review Act 

The Congressional Review Act, 5 

U.S.C. 801 et seq., as added by the Small 

Business Regulatory Enforcement 

Fairness Act of 1996, generally provides 

that before a rule may take effect, the 

agency promulgating the rule must 

submit a rule report, which includes a 

copy of the rule, to each House of the 

Congress and to the Comptroller General 

of the United States. EPA will submit a 

report containing this rule and other 

required information to the U.S. Senate, 

the U.S. House of Representatives, and 

the Comptroller General of the United 

States prior to publication of the rule in 

the Federal Register. A major rule 

cannot take effect until 60 days after it 

is published in the Federal Register. 

This action is not a ‘‘major rule’’ as 

defined by 5 U.S.C. 804(2). This rule 

will be effective November 1, 2006. 

List of Subjects in 40 CFR Part 312 

Environmental protection, 

Administrative practice and procedure, 

Hazardous substances, 

Intergovernmental relations, Reporting 

and recordkeeping requirements. 

Dated: October 21, 2005. 

Stephen L. Johnson, 

Administrator. 

■ For reasons set out in the preamble, 

title 40, chapter I of the Code of Federal 

Regulations is amended by revising part 

312 as follows: 

PART 312—INNOCENT 

LANDOWNERS, STANDARDS FOR 

CONDUCTING ALL APPROPRIATE 

INQUIRIES 

Subpart A—Introduction 

Sec. 

312.1 Purpose, applicability, scope, and 

disclosure obligations. 

Subpart B—Definitions and References 

312.10 Definitions. 

312.11 References. 

Subpart C—Standards and Practices 

312.20 All appropriate inquiries. 

312.21 Results of inquiry by an 

environmental professional. 

312.22 Additional inquiries. 

312.23 Interviews with past and present 

owners, operators, and occupants. 

312.24 Reviews of historical sources of 

information. 

312.25 Searches for recorded environmental 

cleanup liens. 

312.26 Reviews of federal, state, tribal and 

local government records. 

312.27 Visual inspections of the facility and 

of adjoining properties. 

312.28 Specialized knowledge or 

experience on the part of the defendant. 

312.29 The relationship of the purchase 

price to the value of the property, if the 

property was not contaminated. 

312.30 Commonly known or reasonably 

ascertainable information about the 

property. 

312.31 The degree of obviousness of the 

presence or likely presence of 

contamination at the property, and the 

ability to detect the contamination by 

appropriate investigation. 

Authority: Section 101(35)(B) of CERCLA, 

as amended, 42 U.S.C. 9601(35)(B). 

PART 312—INNOCENT 

LANDOWNERS, STANDARDS FOR 

CONDUCTING ALL APPROPRIATE 

INQUIRIES 

Subpart A—Introduction 

§ 312.1 Purpose, applicability, scope and 

disclosure obligations. 

(a) Purpose. The purpose of this 

section is to provide standards and 

practices for ‘‘all appropriate inquiries’’

for the purposes of CERCLA sections 

101(35)(B)(i)(I) and 101(35)(B)(ii) and 

(iii). 

(b) Applicability. The requirements of 

this part are applicable to: 

(1) Persons seeking to establish: 

(i) The innocent landowner defense 

pursuant to CERCLA sections 101(35) 

and 107(b)(3); 

(ii) The bona fide prospective 

purchaser liability protection pursuant 

to CERCLA sections 101(40) and 107(r); 

(iii) The contiguous property owner 

liability protection pursuant to CERCLA 

section 107(q); and 

(2) persons conducting site 

characterization and assessments with 

the use of a grant awarded under 

CERCLA section 104(k)(2)(B). 

(c) Scope. (1) Persons seeking to 

establish one of the liability protections 

under paragraph (b)(1) of this section 

must conduct investigations as required 

in this part, including an inquiry by an 

environmental professional, as required 

under § 312.21, and the additional 

inquiries defined in § 312.22, to identify 

66108 Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 

conditions indicative of releases or 

threatened releases, as defined in 

CERCLA section 101(22), of hazardous 

substances, as defined in CERCLA 

section 101(14). 

(2) Persons identified in paragraph 

(b)(2) of this section must conduct 

investigations required in this part, 

including an inquiry by an 

environmental professional, as required 

under § 312.21, and the additional 

inquiries defined in § 312.22, to identify 

conditions indicative of releases and 

threatened releases of hazardous 

substances, as defined in CERCLA 

section 101(22), and as applicable per 

the terms and conditions of the grant or 

cooperative agreement, releases and 

threatened releases of: 

(i) Pollutants and contaminants, as 

defined in CERCLA section 101(33); 

(ii) Petroleum or petroleum products 

excluded from the definition of 

‘‘hazardous substance’’ as defined in 

CERCLA section 101(14); and 

(iii) Controlled substances, as defined 

in 21 U.S.C. 802. 

(d) Disclosure obligations. None of the 

requirements of this part limits or 

expands disclosure obligations under 

any federal, state, tribal, or local law, 

including the requirements under 

CERCLA sections 101(40)(c) and 

107(q)(1)(A)(vii) requiring persons, 

including environmental professionals, 

to provide all legally required notices 

with respect to the discovery of releases 

of hazardous substances. It is the 

obligation of each person, including 

environmental professionals, 

conducting the inquiry to determine his 

or her respective disclosure obligations 

under federal, state, tribal, and local law 

and to comply with such disclosure 

requirements. 

Subpart B—Definitions and References 

§ 312.10 Definitions. 

(a) Terms used in this part and not 

defined below, but defined in either 

CERCLA or 40 CFR part 300 (the 

National Oil and Hazardous Substances 

Pollution Contingency Plan) shall have 

the definitions provided in CERCLA or 

40 CFR part 300. 

(b) When used in this part, the 

following terms have the meanings 

provided as follows: 

Abandoned property means: property 

that can be presumed to be deserted, or 

an intent to relinquish possession or 

control can be inferred from the general 

disrepair or lack of activity thereon such 

that a reasonable person could believe 

that there was an intent on the part of 

the current owner to surrender rights to 

the property. 

Adjoining properties means: any real 

property or properties the border of 

which is (are) shared in part or in whole 

with that of the subject property, or that 

would be shared in part or in whole 

with that of the subject property but for 

a street, road, or other public 

thoroughfare separating the properties. 

Data gap means: a lack of or inability 

to obtain information required by the 

standards and practices listed in subpart 

C of this part despite good faith efforts 

by the environmental professional or 

persons identified under § 312.1(b), as 

appropriate, to gather such information 

pursuant to §§ 312.20(e)(1) and 

312.20(e)(2). 

Date of acquisition or purchase date 

means: the date on which a person 

acquires title to the property. 

Environmental Professional means: 

(1) a person who possesses sufficient 

specific education, training, and 

experience necessary to exercise 

professional judgment to develop 

opinions and conclusions regarding 

conditions indicative of releases or 

threatened releases (see § 312.1(c)) on, 

at, in, or to a property, sufficient to meet 

the objectives and performance factors 

in § 312.20(e) and (f). 

(2) Such a person must: 

(i) Hold a current Professional 

Engineer’s or Professional Geologist’s 

license or registration from a state, tribe, 

or U.S. territory (or the Commonwealth 

of Puerto Rico) and have the equivalent 

of three (3) years of full-time relevant 

experience; or 

(ii) Be licensed or certified by the 

federal government, a state, tribe, or 

U.S. territory (or the Commonwealth of 

Puerto Rico) to perform environmental 

inquiries as defined in § 312.21 and 

have the equivalent of three (3) years of 

full-time relevant experience; or 

(iii) Have a Baccalaureate or higher 

degree from an accredited institution of 

higher education in a discipline of 

engineering or science and the 

equivalent of five (5) years of full-time 

relevant experience; or 

(iv) Have the equivalent of ten (10) 

years of full-time relevant experience. 

(3) An environmental professional 

should remain current in his or her field 

through participation in continuing 

education or other activities. 

(4) The definition of environmental 

professional provided above does not 

preempt state professional licensing or 

registration requirements such as those 

for a professional geologist, engineer, or 

site remediation professional. Before 

commencing work, a person should 

determine the applicability of state 

professional licensing or registration 

laws to the activities to be undertaken 

as part of the inquiry identified in 

§ 312.21(b). 

(5) A person who does not qualify as 

an environmental professional under 

the foregoing definition may assist in 

the conduct of all appropriate inquiries 

in accordance with this part if such 

person is under the supervision or 

responsible charge of a person meeting 

the definition of an environmental 

professional provided above when 

conducting such activities. 

Relevant experience, as used in the 

definition of environmental professional 

in this section, means: participation in 

the performance of all appropriate 

inquiries investigations, environmental 

site assessments, or other site 

investigations that may include 

environmental analyses, investigations, 

and remediation which involve the 

understanding of surface and subsurface 

environmental conditions and the 

processes used to evaluate these 

conditions and for which professional 

judgment was used to develop opinions 

regarding conditions indicative of 

releases or threatened releases (see 

§ 312.1(c)) to the subject property. 

Good faith means: the absence of any 

intention to seek an unfair advantage or 

to defraud another party; an honest and 

sincere intention to fulfill one’s 

obligations in the conduct or transaction 

concerned. 

Institutional controls means: nonengineered instruments, such as 

administrative and/or legal controls, 

that help to minimize the potential for 

human exposure to contamination and/ 

or protect the integrity of a remedy. 

§ 312.11 References. 

The following industry standards may 

be used to comply with the 

requirements set forth in §§ 312.23 

through 312.31: 

(a) The procedures of ASTM 

International Standard E1527–05 

entitled ‘‘Standard Practice for 

Environmental Site Assessments: Phase 

I Environmental Site Assessment 

Process.’’

(b) [Reserved] 

Subpart C—Standards and Practices 

§ 312.20 All appropriate inquiries. 

(a) ‘‘All appropriate inquiries’’

pursuant to CERCLA section 101(35)(B) 

must be conducted within one year 

prior to the date of acquisition of the 

subject property and must include: 

(1) An inquiry by an environmental 

professional (as defined in § 312.10), as 

provided in § 312.21; 

(2) The collection of information 

pursuant to § 312.22 by persons 

identified under § 312.1(b); and 

Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 66109 

(3) Searches for recorded 

environmental cleanup liens, as 

required in § 312.25. 

(b) Notwithstanding paragraph (a) of 

this section, the following components 

of the all appropriate inquiries must be 

conducted or updated within 180 days 

of and prior to the date of acquisition of 

the subject property: 

(1) Interviews with past and present 

owners, operators, and occupants (see 

§ 312.23); 

(2) Searches for recorded 

environmental cleanup liens (see 

§ 312.25); 

(3) Reviews of federal, tribal, state, 

and local government records (see 

§ 312.26); 

(4) Visual inspections of the facility 

and of adjoining properties (see 

§ 312.27); and 

(5) The declaration by the 

environmental professional (see 

§ 312.21(d)). 

(c) All appropriate inquiries may 

include the results of and information 

contained in an inquiry previously 

conducted by, or on the behalf of, 

persons identified under § 312.1(b) and 

who are responsible for the inquiries for 

the subject property, provided: 

(1) Such information was collected 

during the conduct of all appropriate 

inquiries in compliance with the 

requirements of CERCLA sections 

101(35)(B), 101(40)(B) and 

107(q)(A)(viii); 

(2) Such information was collected or 

updated within one year prior to the 

date of acquisition of the subject 

property; 

(3) Notwithstanding paragraph (b)(2) 

of this section, the following 

components of the inquiries were 

conducted or updated within 180 days 

of and prior to the date of acquisition of 

the subject property: 

(i) Interviews with past and present 

owners, operators, and occupants (see 

§ 312.23); 

(ii) Searches for recorded 

environmental cleanup liens (see 

§ 312.25); 

(iii) Reviews of federal, tribal, state, 

and local government records (see 

§ 312.26); 

(iv) Visual inspections of the facility 

and of adjoining properties (see 

§ 312.27); and 

(v) The declaration by the 

environmental professional (see 

§ 312.21(d)). 

(4) Previously collected information is 

updated to include relevant changes in 

the conditions of the property and 

specialized knowledge, as outlined in 

§ 312.28, of the persons conducting the 

all appropriate inquiries for the subject 

property, including persons identified 

in § 312.1(b) and the environmental 

professional, defined in § 312.10. 

(d) All appropriate inquiries can 

include the results of report(s) specified 

in § 312.21(c), that have been prepared 

by or for other persons, provided that: 

(1) The report(s) meets the objectives 

and performance factors of this 

regulation, as specified in paragraphs (e) 

and (f) of this section; and 

(2) The person specified in § 312.1(b) 

and seeking to use the previously 

collected information reviews the 

information and conducts the additional 

inquiries pursuant to §§ 312.28, 312.29 

and 312.30 and the all appropriate 

inquiries are updated in paragraph (b)(3) 

of this section, as necessary. 

(e) Objectives. The standards and 

practices set forth in this part for All 

Appropriate Inquiries are intended to 

result in the identification of conditions 

indicative of releases and threatened 

releases of hazardous substances on, at, 

in, or to the subject property. 

(1) In performing the all appropriate 

inquiries, as defined in this section and 

provided in the standards and practices 

set forth this subpart, the persons 

identified under § 312.1(b)(1) and the 

environmental professional, as defined 

in § 312.10, must seek to identify 

through the conduct of the standards 

and practices set forth in this subpart, 

the following types of information about 

the subject property: 

(i) Current and past property uses and 

occupancies; 

(ii) Current and past uses of 

hazardous substances; 

(iii) Waste management and disposal 

activities that could have caused 

releases or threatened releases of 

hazardous substances; 

(iv) Current and past corrective 

actions and response activities 

undertaken to address past and on-going 

releases of hazardous substances; 

(v) Engineering controls; 

(vi) Institutional controls; and 

(vii) Properties adjoining or located 

nearby the subject property that have 

environmental conditions that could 

have resulted in conditions indicative of 

releases or threatened releases of 

hazardous substances to the subject 

property. 

(2) In the case of persons identified in 

§ 312.1(b)(2), the standards and 

practices for All Appropriate Inquiries 

set forth in this part are intended to 

result in the identification of conditions 

indicative of releases and threatened 

releases of hazardous substances, 

pollutants, contaminants, petroleum 

and petroleum products, and controlled 

substances (as defined in 21 U.S.C. 802) 

on, at, in, or to the subject property. In 

performing the all appropriate inquiries, 

as defined in this section and provided 

in the standards and practices set forth 

in this subpart, the persons identified 

under § 312.1(b) and the environmental 

professional, as defined in § 312.10, 

must seek to identify through the 

conduct of the standards and practices 

set forth in this subpart, the following 

types of information about the subject 

property: 

(i) Current and past property uses and 

occupancies; 

(ii) Current and past uses of 

hazardous substances, pollutants, 

contaminants, petroleum and petroleum 

products, and controlled substances (as 

defined in 21 U.S.C. 802); 

(iii) Waste management and disposal 

activities; 

(iv) Current and past corrective 

actions and response activities 

undertaken to address past and on-going 

releases of hazardous substances 

pollutants, contaminants, petroleum 

and petroleum products, and controlled 

substances (as defined in 21 U.S.C. 802); 

(v) Engineering controls; 

(vi) Institutional controls; and 

(vii) Properties adjoining or located 

nearby the subject property that have 

environmental conditions that could 

have resulted in conditions indicative of 

releases or threatened releases of 

hazardous substances, pollutants, 

contaminants, petroleum and petroleum 

products, and controlled substances (as 

defined in 21 U.S.C. 802) to the subject 

property. 

(f) Performance factors. In performing 

each of the standards and practices set 

forth in this subpart and to meet the 

objectives stated in paragraph (e) of this 

section, the persons identified under 

§ 312.1(b) or the environmental 

professional as defined in § 312.10 (as 

appropriate to the particular standard 

and practice) must seek to: 

(1) Gather the information that is 

required for each standard and practice 

listed in this subpart that is publicly 

available, obtainable from its source 

within reasonable time and cost 

constraints, and which can practicably 

be reviewed; and 

(2) Review and evaluate the 

thoroughness and reliability of the 

information gathered in complying with 

each standard and practice listed in this 

subpart taking into account information 

gathered in the course of complying 

with the other standards and practices 

of this subpart. 

(g) To the extent there are data gaps 

(as defined in § 312.10) in the 

information developed as part of the 

inquiries in paragraph (e) of this section 

that affect the ability of persons 

(including the environmental 

professional) conducting the all 

66110 Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 

appropriate inquiries to identify 

conditions indicative of releases or 

threatened releases in each area of 

inquiry under each standard and 

practice such persons should identify 

such data gaps, identify the sources of 

information consulted to address such 

data gaps, and comment upon the 

significance of such data gaps with 

regard to the ability to identify 

conditions indicative of releases or 

threatened releases of hazardous 

substances [and in the case of persons 

identified in § 312.1(b)(2), hazardous 

substances, pollutants, contaminants, 

petroleum and petroleum products, and 

controlled substances (as defined in 21 

U.S.C. 802)] on, at, in, or to the subject 

property. Sampling and analysis may be 

conducted to develop information to 

address data gaps. 

(h) Releases and threatened releases 

identified as part of the all appropriate 

inquiries should be noted in the report 

of the inquiries. These standards and 

practices however are not intended to 

require the identification in the written 

report prepared pursuant to § 312.21(c) 

of quantities or amounts, either 

individually or in the aggregate, of 

hazardous substances pollutants, 

contaminants, petroleum and petroleum 

products, and controlled substances (as 

defined in 21 U.S.C. 802) that because 

of said quantities and amounts, 

generally would not pose a threat to 

human health or the environment. 

§ 312.21 Results of inquiry by an 

environmental professional. 

(a) Persons identified under § 312.1(b) 

must undertake an inquiry, as defined 

in paragraph (b) of this section, by an 

environmental professional, or 

conducted under the supervision or 

responsible charge of, an environmental 

professional, as defined in § 312.10. 

Such inquiry is hereafter referred to as 

‘‘the inquiry of the environmental 

professional.’’

(b) The inquiry of the environmental 

professional must include the 

requirements set forth in §§ 312.23 

(interviews with past and present 

owners * * *), 312.24 (reviews of 

historical sources * * *), 312.26 

(reviews of government records), 312.27 

(visual inspections), 312.30 (commonly 

known or reasonably ascertainable 

information), and 312.31 (degree of 

obviousness of the presence * * * and 

the ability to detect the contamination 

* * *). In addition, the inquiry should 

take into account information provided 

to the environmental professional as a 

result of the additional inquiries 

conducted by persons identified in 

§ 312.1(b) and in accordance with the 

requirements of § 312.22. 

(c) The results of the inquiry by an 

environmental professional must be 

documented in a written report that, at 

a minimum, includes the following: 

(1) An opinion as to whether the 

inquiry has identified conditions 

indicative of releases or threatened 

releases of hazardous substances [and in 

the case of inquiries conducted for 

persons identified in § 312.1(b)(2) 

conditions indicative of releases and 

threatened releases of pollutants, 

contaminants, petroleum and petroleum 

products, and controlled substances (as 

defined in 21 U.S.C. 802)] on, at, in, or 

to the subject property; 

(2) An identification of data gaps (as 

defined in § 312.10) in the information 

developed as part of the inquiry that 

affect the ability of the environmental 

professional to identify conditions 

indicative of releases or threatened 

releases of hazardous substances [and in 

the case of inquiries conducted for 

persons identified in § 312.1(b)(2) 

conditions indicative of releases and 

threatened releases of pollutants, 

contaminants, petroleum and petroleum 

products, and controlled substances (as 

defined in 21 U.S.C. 802)] on, at, in, or 

to the subject property and comments 

regarding the significance of such data 

gaps on the environmental 

professional’s ability to provide an 

opinion as to whether the inquiry has 

identified conditions indicative of 

releases or threatened releases on, at, in, 

or to the subject property. If there are 

data gaps such that the environmental 

professional cannot reach an opinion 

regarding the identification of 

conditions indicative of releases and 

threatened releases, such data gaps must 

be noted in the environmental 

professional’s opinion in paragraph 

(c)(1) of this section; and 

(3) The qualifications of the 

environmental professional(s). 

(d) The environmental professional 

must place the following statements in 

the written document identified in 

paragraph (c) of this section and sign the 

document: 

‘‘[I, We] declare that, to the best of [my, 

our] professional knowledge and belief, [I, 

we] meet the definition of Environmental 

Professional as defined in § 312.10 of this 

part.’’

‘‘[I, We] have the specific qualifications 

based on education, training, and experience 

to assess a property of the nature, history, 

and setting of the subject property. [I, We] 

have developed and performed the all 

appropriate inquiries in conformance with 

the standards and practices set forth in 40 

CFR Part 312.’’

§ 312.22 Additional inquiries. 

(a) Persons identified under § 312.1(b) 

must conduct the inquiries listed in 

paragraphs (a)(1) through (a)(4) below 

and may provide the information 

associated with such inquiries to the 

environmental professional responsible 

for conducting the activities listed in 

§ 312.21: 

(1) As required by § 312.25 and if not 

otherwise obtained by the 

environmental professional, 

environmental cleanup liens against the 

subject property that are filed or 

recorded under federal, tribal, state, or 

local law; 

(2) As required by § 312.28, 

specialized knowledge or experience of 

the person identified in § 312.1(b); 

(3) As required by § 312.29, the 

relationship of the purchase price to the 

fair market value of the subject property, 

if the property was not contaminated; 

and 

(4) As required by § 312.30, and if not 

otherwise obtained by the 

environmental professional, commonly 

known or reasonably ascertainable 

information about the subject property. 

§ 312.23 Interviews with past and present 

owners, operators, and occupants. 

(a) Interviews with owners, operators, 

and occupants of the subject property 

must be conducted for the purposes of 

achieving the objectives and 

performance factors of § 312.20(e) and 

(f). 

(b) The inquiry of the environmental 

professional must include interviewing 

the current owner and occupant of the 

subject property. If the property has 

multiple occupants, the inquiry of the 

environmental professional shall 

include interviewing major occupants, 

as well as those occupants likely to use, 

store, treat, handle or dispose of 

hazardous substances [and in the case of 

inquiries conducted for persons 

identified in § 312.1(b)(2) pollutants, 

contaminants, petroleum and petroleum 

products, and controlled substances (as 

defined in 21 U.S.C. 802)], or those who 

have likely done so in the past. 

(c) The inquiry of the environmental 

professional also must include, to the 

extent necessary to achieve the 

objectives and performance factors of 

§ 312.20(e) and (f), interviewing one or 

more of the following persons: 

(1) Current and past facility managers 

with relevant knowledge of uses and 

physical characteristics of the property; 

(2) Past owners, occupants, or 

operators of the subject property; or 

(3) Employees of current and past 

occupants of the subject property. 

(d) In the case of inquiries conducted 

at ‘‘abandoned properties,’’ as defined 

in § 312.10, where there is evidence of 

potential unauthorized uses of the 

subject property or evidence of 

Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 66111 

uncontrolled access to the subject 

property, the environmental 

professional’s inquiry must include 

interviewing one or more (as necessary) 

owners or occupants of neighboring or 

nearby properties from which it appears 

possible to have observed uses of, or 

releases at, such abandoned properties 

for the purpose of gathering information 

necessary to achieve the objectives and 

performance factors of § 312.20(e) and 

(f). 

§ 312.24 Reviews of historical sources of 

information. 

(a) Historical documents and records 

must be reviewed for the purposes of 

achieving the objectives and 

performance factors of § 312.20(e) and 

(f). Historical documents and records 

may include, but are not limited to, 

aerial photographs, fire insurance maps, 

building department records, chain of 

title documents, and land use records. 

(b) Historical documents and records 

reviewed must cover a period of time as 

far back in the history of the subject 

property as it can be shown that the 

property contained structures or from 

the time the property was first used for 

residential, agricultural, commercial, 

industrial, or governmental purposes. 

For the purpose of achieving the 

objectives and performance factors of 

§ 312.20(e) and (f), the environmental 

professional may exercise professional 

judgment in context of the facts 

available at the time of the inquiry as to 

how far back in time it is necessary to 

search historical records. 

§ 312.25 Searches for recorded 

environmental cleanup liens. 

(a) All appropriate inquiries must 

include a search for the existence of 

environmental cleanup liens against the 

subject property that are filed or 

recorded under federal, tribal, state, or 

local law. 

(b) All information collected 

regarding the existence of such 

environmental cleanup liens associated 

with the subject property by persons to 

whom this part is applicable per 

§ 312.1(b) and not by an environmental 

professional, may be provided to the 

environmental professional or retained 

by the applicable party. 

§ 312.26 Reviews of Federal, State, Tribal, 

and local government records. 

(a) Federal, tribal, state, and local 

government records or data bases of 

government records of the subject 

property and adjoining properties must 

be reviewed for the purposes of 

achieving the objectives and 

performance factors of § 312.20(e) and 

(f). 

(b) With regard to the subject 

property, the review of federal, tribal, 

and state government records or data 

bases of such government records and 

local government records and data bases 

of such records should include: 

(1) Records of reported releases or 

threatened releases, including site 

investigation reports for the subject 

property; 

(2) Records of activities, conditions, 

or incidents likely to cause or contribute 

to releases or threatened releases as 

defined in § 312.1(c), including landfill 

and other disposal unit location records 

and permits, storage tank records and 

permits, hazardous waste handler and 

generator records and permits, federal, 

tribal and state government listings of 

sites identified as priority cleanup sites, 

and spill reporting records; 

(3) CERCLIS records; 

(4) Public health records; 

(5) Emergency Response Notification 

System records; 

(6) Registries or publicly available 

lists of engineering controls; and 

(7) Registries or publicly available 

lists of institutional controls, including 

environmental land use restrictions, 

applicable to the subject property. 

(c) With regard to nearby or adjoining 

properties, the review of federal, tribal, 

state, and local government records or 

databases of government records should 

include the identification of the 

following: 

(1) Properties for which there are 

government records of reported releases 

or threatened releases. Such records or 

databases containing such records and 

the associated distances from the subject 

property for which such information 

should be searched include the 

following: 

(i) Records of NPL sites or tribal- and 

state-equivalent sites (one mile); 

(ii) RCRA facilities subject to 

corrective action (one mile); 

(iii) Records of federally-registered, or 

state-permitted or registered, hazardous 

waste sites identified for investigation 

or remediation, such as sites enrolled in 

state and tribal voluntary cleanup 

programs and tribal- and state-listed 

brownfields sites (one-half mile); 

(iv) Records of leaking underground 

storage tanks (one-half mile); and 

(2) Properties that previously were 

identified or regulated by a government 

entity due to environmental concerns at 

the property. Such records or databases 

containing such records and the 

associated distances from the subject 

property for which such information 

should be searched include the 

following: 

(i) Records of delisted NPL sites (onehalf mile); 

(ii) Registries or publicly available 

lists of engineering controls (one-half 

mile); and 

(iii) Records of former CERCLIS sites 

with no further remedial action notices 

(one-half mile). 

(3) Properties for which there are 

records of federally-permitted, tribalpermitted or registered, or statepermitted or registered waste 

management activities. Such records or 

data bases that may contain such 

records include the following: 

(i) Records of RCRA small quantity 

and large quantity generators (adjoining 

properties); 

(ii) Records of federally-permitted, 

tribal-permitted, or state-permitted (or 

registered) landfills and solid waste 

management facilities (one-half mile); 

and 

(iii) Records of registered storage 

tanks (adjoining property). 

(4) A review of additional government 

records with regard to sites identified 

under paragraphs (c)(1) through (c)(3) of 

this section may be necessary in the 

judgment of the environmental 

professional for the purpose of 

achieving the objectives and 

performance factors of § 312.20(e) and 

(f). 

(d) The search distance from the 

subject property boundary for reviewing 

government records or databases of 

government records listed in paragraph 

(c) of this section may be modified 

based upon the professional judgment of 

the environmental professional. The 

rationale for such modifications must be 

documented by the environmental 

professional. The environmental 

professional may consider one or more 

of the following factors in determining 

an alternate appropriate search distance: 

(1) The nature and extent of a release; 

(2) Geologic, hydrogeologic, or 

topographic conditions of the subject 

property and surrounding environment; 

(3) Land use or development 

densities; 

(4) The property type; 

(5) Existing or past uses of 

surrounding properties; 

(6) Potential migration pathways (e.g., 

groundwater flow direction, prevalent 

wind direction); or 

(7) Other relevant factors. 

§ 312.27 Visual inspections of the facility 

and of adjoining properties. 

(a) For the purpose of achieving the 

objectives and performance factors of 

§ 312.20(e) and (f), the inquiry of the 

environmental professional must 

include: 

(1) A visual on-site inspection of the 

subject property and facilities and 

improvements on the subject property, 

66112 Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 

including a visual inspection of the 

areas where hazardous substances may 

be or may have been used, stored, 

treated, handled, or disposed. Physical 

limitations to the visual inspection must 

be noted. 

(2) A visual inspection of adjoining 

properties, from the subject property 

line, public rights-of-way, or other 

vantage point (e.g., aerial photography), 

including a visual inspection of areas 

where hazardous substances may be or 

may have been stored, treated, handled 

or disposed. Physical limitations to the 

inspection of adjacent properties must 

be noted. 

(b) Persons conducting site 

characterization and assessments using 

a grant awarded under CERCLA section 

104(k)(2)(B) must include in the 

inquiries referenced in § 312.27(a) 

visual inspections of areas where 

hazardous substances, and may include, 

as applicable per the terms and 

conditions of the grant or cooperative 

agreement, pollutants and 

contaminants, petroleum and petroleum 

products, and controlled substances as 

defined in 21 U.S.C. 802 may be or may 

have been used, stored, treated, handled 

or disposed at the subject property and 

adjoining properties. 

(c) Except as noted in this subsection, 

a visual on-site inspection of the subject 

property must be conducted. In the 

unusual circumstance where an on-site 

visual inspection of the subject property 

cannot be performed because of 

physical limitations, remote and 

inaccessible location, or other inability 

to obtain access to the property, 

provided good faith (as defined in 

§ 312.10) efforts have been taken to 

obtain such access, an on-site inspection 

will not be required. The mere refusal 

of a voluntary seller to provide access to 

the subject property does not constitute 

an unusual circumstance. In such 

unusual circumstances, the inquiry of 

the environmental professional must 

include: 

(1) Visually inspecting the subject 

property via another method (such as 

aerial imagery for large properties), or 

visually inspecting the subject property 

from the nearest accessible vantage 

point (such as the property line or 

public road for small properties); 

(2) Documentation of efforts 

undertaken to obtain access and an 

explanation of why such efforts were 

unsuccessful; and 

(3) Documentation of other sources of 

information regarding releases or 

threatened releases at the subject 

property that were consulted in 

accordance with § 312.20(e). Such 

documentation should include 

comments by the environmental 

professional on the significance of the 

failure to conduct a visual on-site 

inspection of the subject property with 

regard to the ability to identify 

conditions indicative of releases or 

threatened releases on, at, in, or to the 

subject property, if any. 

§ 312.28 Specialized knowledge or 

experience on the part of the defendant. 

(a) Persons to whom this part is 

applicable per § 312.1(b) must take into 

account, their specialized knowledge of 

the subject property, the area 

surrounding the subject property, the 

conditions of adjoining properties, and 

any other experience relevant to the 

inquiry, for the purpose of identifying 

conditions indicative of releases or 

threatened releases at the subject 

property, as defined in § 312.1(c). 

(b) All appropriate inquiries, as 

outlined in § 312.20, are not complete 

unless the results of the inquiries take 

into account the relevant and applicable 

specialized knowledge and experience 

of the persons responsible for 

undertaking the inquiry (as described in 

§ 312.1(b)). 

§ 312.29 The relationship of the purchase 

price to the value of the property, if the 

property was not contaminated. 

(a) Persons to whom this part is 

applicable per § 312.1(b) must consider 

whether the purchase price of the 

subject property reasonably reflects the 

fair market value of the property, if the 

property were not contaminated. 

(b) Persons who conclude that the 

purchase price of the subject property 

does not reasonably reflect the fair 

market value of that property, if the 

property were not contaminated, must 

consider whether or not the differential 

in purchase price and fair market value 

is due to the presence of releases or 

threatened releases of hazardous 

substances. 

(c) Persons conducting site 

characterization and assessments with 

the use of a grant awarded under 

CERCLA section 104(k)(2)(B) and who 

know that the purchase price of the 

subject property does not reasonably 

reflect the fair market value of that 

property, if the property were not 

contaminated, must consider whether or 

not the differential in purchase price 

and fair market value is due to the 

presence of releases or threatened 

releases of hazardous substances, 

pollutants, contaminants, petroleum 

and petroleum products, or controlled 

substances as defined in 21 U.S.C. 802. 

§ 312.30 Commonly known or reasonably 

ascertainable information about the 

property. 

(a) Throughout the inquiries, persons 

to whom this part is applicable per 

§ 312.1(b) and environmental 

professionals conducting the inquiry 

must take into account commonly 

known or reasonably ascertainable 

information within the local community 

about the subject property and consider 

such information when seeking to 

identify conditions indicative of 

releases or threatened releases, as set 

forth in § 312.1(c), at the subject 

property. 

(b) Commonly known information 

may include information obtained by 

the person to whom this part applies in 

§ 312.1(b) or by the environmental 

professional about releases or 

threatened releases at the subject 

property that is incidental to the 

information obtained during the inquiry 

of the environmental professional. 

(c) To the extent necessary to achieve 

the objectives and performance factors 

of § 312.20(e) and (f), persons to whom 

this part is applicable per § 312.1(b) and 

the environmental professional must 

gather information from varied sources 

whose input either individually or taken 

together may provide commonly known 

or reasonably ascertainable information 

about the subject property; the 

environmental professional may refer to 

one or more of the following sources of 

information: 

(1) Current owners or occupants of 

neighboring properties or properties 

adjacent to the subject property; 

(2) Local and state government 

officials who may have knowledge of, or 

information related to, the subject 

property; 

(3) Others with knowledge of the 

subject property; and 

(4) Other sources of information (e.g., 

newspapers, Web sites, community 

organizations, local libraries and 

historical societies). 

§ 312.31 The degree of obviousness of the 

presence or likely presence of 

contamination at the property, and the 

ability to detect the contamination by 

appropriate investigation. 

(a) Persons to whom this part is 

applicable per § 312.1(b) and 

environmental professionals conducting 

an inquiry of a property on behalf of 

such persons must take into account the 

information collected under § 312.23 

through 312.30 in considering the 

degree of obviousness of the presence of 

releases or threatened releases at the 

subject property. 

(b) Persons to whom this part is 

applicable per § 312.1(b) and 

Federal Register / Vol. 70, No. 210 / Tuesday, November 1, 2005 / Rules and Regulations 66113 

environmental professionals conducting 

an inquiry of a property on behalf of 

such persons must take into account the 

information collected under § 312.23 

through 312.30 in considering the 

ability to detect contamination by 

appropriate investigation. The inquiry 

of the environmental professional 

should include an opinion regarding 

additional appropriate investigation, if 

any. 

[FR Doc. 05–21455 Filed 10–31–05; 8:45 am] 

BILLING CODE 6560–50–P