SECURITIES AND EXCHANGE COMMISSION
                                Washington, DC 20549

                                     FORM 10-K


[X]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
     SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended     December 31, 2001

                                         OR

[ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
     SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________ to ________

Commission file No.  0-19761

                       OP-TECH Environmental Services, Inc.
                (Exact name of registrant as specified in its charter)

                Delaware                          91-1528142
     (State or other jurisdiction of            (I.R.S. Employer
      incorporation or organization)            Identification No.)

                6392 Deere Road, Syracuse, NY             13206
               (Address of principal executive office)  (Zip Code)

                                (315) 463-1643
                Registrant's telephone number, including area code

Securities registered pursuant to Section 12(b) of the Act:

Title of each class         Name of each exchange on which registered
      None

             Securities registered pursuant to Section 12(g) of the Act:
                          Common Stock, $.01 par value
                                 (Title of Class)

<PAGE>


	Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.

                               Yes   X   or No

	Indicate by check mark if disclosure of delinquent filers pursuant to item
405 of regulation S-K (Section 229.405 of this chapter) is not contained herein,
and will not be contained, to the best of registrant's knowledge, in
definitive proxy or information statements incorporated by reference in
Part III of this Form 10-K or any amendment to this Form 10-K [X].

	The aggregate market value of the voting stock held by non-affiliates of
the Company as of March 27, 2002 was $713,942 based upon the average bid and
ask price of such stock on such day.

	                 APPLICABLE ONLY TO CORPORATE ISSUERS:
	Indicate the number of shares outstanding of each of the Company's classes
of common stock, as of March 27, 2002.  Common stock, $.01 par value.
11,703,963


                                    PART I

SPECIAL NOTICE REGARDING FORWARD-LOOKING STATEMENTS

	The Company is including the following cautionary statement in this Form
10-K to make applicable and take advantage of the "safe harbor" provisions of
the Private Securities Litigation Reform Act of 1995 for any forward-looking
statement made by, or on behalf of, the Company.  This 10-K, press releases
issued by the Company, and certain information provided periodically in
writing and orally by the Company's designated officers and agents contain
statements which constitute forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934.  The words expect, believe, goal, plan, intend,
estimate, and similar expressions and variations thereof used are intended to
specifically identify forward-looking statements.  Where any such forward-
looking statement includes a statement of the assumptions or basis underlying
such forward-looking statement, the Company cautions that, while it believes
such assumptions or basis to be reasonable and makes them in good faith,
assumed facts or basis almost always vary from actual results, and the
differences between assumed facts or basis and actual results can be material,
depending on the circumstances.  Where, in any forward-looking statement, the
Company, or its management, expresses an expectation or belief as to future
results, such expectation or belief is expressed in good faith and believed to
have a reasonable basis, but there can be no assurance that the statement of
expectation or belief will result or be achieved or accomplished.


                                          2

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ITEM 1. BUSINESS

General

	OP-TECH Environmental Services, Inc. and Subsidiary (the "Company"), a
Delaware corporation, provides comprehensive environmental services
predominately in Upstate New York, Massachusetts, Northern Pennsylvania, and
New Jersey.  The Company performs industrial cleaning of hazardous and non-
hazardous materials and provides varying services relating to plant facility
closure, including interior and exterior demolition and asbestos removal.  In
addition, the Company provides remediation services for sites contaminated by
hazardous and non-hazardous materials and provides 24-hour emergency spill
response services.  The majority of the Company's revenues are derived from
industrial companies and municipalities facing complex environmental clean-up
problems associated with hazardous and non-hazardous materials as required by
various governmental agencies.  The Company's services include assessing the
regulatory, technical, and construction aspects of the environmental issue,
and performing the necessary remediation activities.  The Company seeks to
provide its clients with remedial solutions which integrate the various
aspects of a project and are well-documented, practical, cost effective, and
acceptable to regulatory agencies and the public.

	In December 2001, the Company's Board of Directors approved a resolution
to establish OP-TECH AVIX, Inc. ("AVIX"), a newly formed, wholly-owned
subsidiary of the Company, for purposes of pursuing and engaging in
diversified lines of business.  AVIX was formed in January 2002.


SERVICES

Transportation and Disposal Services

	The Company provides transportation of hazardous and non-hazardous wastes
from customer sites to customer-designated landfills, disposal facilities, and
the Company's own Aqueous Treatment/Part 360 facility.  The Company also
provides liquid tank truck transports equipped with vacuum pumps.

Aqueous Treatment/Part 360 Facility

	The Company operates an Aqueous Treatment/Part 360 facility at the
Company's Massena, New York location.  The facility provides for the
consolidation of non-hazardous solids and liquids as well as the treatment of
contaminated water and its eventual discharge into the St. Lawrence River.
The facility services the Company, its clients, and outside vendors.

                                       3

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24-Hour Emergency Spill Response

	The Company undertakes environmental remediation projects on both a
planned and emergency basis.  Emergency response actions may develop into
planned remedial action projects when soil, groundwater, buildings, or
facilities are extensively contaminated.  The Company has established
specially trained emergency response teams.  Many of the Company's
decontamination and mitigation activities result from a response to an
emergency situation by one of its response teams.  These incidents can
result from transportation accidents involving chemical or petroleum
substances, fires at chemical facilities or hazardous waste sites, transformer
fires or explosions involving PCBs, and other unanticipated events.  The
substances involved may pose an immediate threat to public health or the
environment, such as possible groundwater contamination.  The Company also has
an agreement with the New York State Department of Environmental Conservation
(NYSDEC) to provide emergency response services in Upstate New York, payment
of which is guaranteed by the NYSDEC.

	Emergency response projects require trained personnel who are equipped
with protective gear and specialized equipment and are prepared to respond
promptly whenever these situations occur.  The Company's health and safety
specialists and other skilled personnel closely supervise these projects
during and subsequent to the clean-up process.  The steps performed by the
Company include rapid response, containment and control procedures, sampling
for analytical testing and assessment, neutralization and treatment, and
collection and transportation of the substance to an appropriate treatment or
disposal facility.

Asbestos Abatement

	The Company provides asbestos abatement contracting services to both the
public and private sectors.  The Company has expertise in all types of
asbestos abatement including removal, disposal and enclosure, and
encapsulation.  Asbestos removal is performed in commercial buildings,
industrial facilities, and governmental buildings.

Interior Demolition/Structural Dismantling

	The Company provides interior demolition services such as removing walls,
ceilings, and flooring.  In addition, the Company offers structural
dismantling services and has experience in razing concrete, wood and steel
structures, concrete and brick chimneys, and concrete piers and foundations.

                                         4

<PAGE>


On-Site Industrial and Waste Management Services

	The Company provides on-site industrial cleaning and waste management
services.  Specialized services for the handling, processing and disposal of
hazardous wastes are performed by vacuuming, soda blasting, hydroblasting,
dredging, dewatering and sludge processing, sludge pumping, chemical cleaning,
and tank cleaning.


Excavation and Site Remediation Services

	The Company provides excavation and soil blending services for treatment
of contaminated soil using heavy equipment such as excavators and loaders.
The Company primarily provides on-site soil blending to public utilities and
municipal customers.

Hydrogeological/Drilling Services

	The Company provides hydrogeological services to petroleum companies,
engineering firms and local and state public entities through the use of
qualified subcontractors.  Through performing hydrogeological assessments, the
Company evaluates and determines the need for ground water remediation
systems, pump and treatment systems and sub-surface petroleum product
recovery.  In addition, the Company provides air sparging systems, long-term
remediation system operations and maintenance as well as monitoring well and
recovery well installations.

Overall Site Assessment and Implementation of Remediation Services

	Hazardous Waste: The Company's hazardous waste projects include the design
and construction of on-site facilities to monitor, isolate, or contain
hazardous wastes existing in surface and subsurface water, the transport of
contaminated soils, the decontamination of equipment and facilities related to
the production and use of hazardous materials, industrial cleaning, building
demolition and asbestos removal.  Although the Company's projects vary widely
in objective, scope, and duration, each project involves the Company providing
one or more of the following services through the use of its own resources or
the resources of selected subcontractors: strategic planning, site
reconnaissance and security, remedial evaluation, clean-up evaluation,
design, construction, and operation of facilities to treat, stabilize, or
isolate the hazardous materials, and closure planning and monitoring.

	Strategic Planning: On each of its projects, the Company attempts as early
as possible, to formulate a complete strategy for directing all efforts toward
solving the hazardous waste problem.  The Company's strategic plans are
designed to satisfy the demands of regulatory agencies and the public,
sometimes under emergency conditions.  Additionally, the Company attempts to
balance the cost of the alternatives against risks to the client associated
with potential litigation or unfavorable publicity.  Through strategic
planning, the Company attempts to minimize expenditures that will not lead to
appropriate solutions, and to enhance the client's credibility with regulatory
agencies and the public.

                                           5

<PAGE>

	Site Reconnaissance and Security: In conducting a site reconnaissance, the
Company makes a general assessment to determine the basic characteristics of a
site and the limitations imposed thereby, climatological considerations and
the proximity and degree of residential development.  In providing site
security, the Company's services include assessing the hazardous condition,
restricting access to the affected area, assisting in the preparation of any
necessary evacuation plans, eliminating or reducing potential risks of fire or
explosion, containing or removing hazardous materials which might pose
additional risk, and implementing measures to reduce or halt the spread of
hazardous substances into adjacent areas.

	Remedial Evaluation:  A remedial investigation involves the detailed
assessment of an affected area to determine the nature and extent of hazardous
materials present.  This is often done at the request of one or more
regulatory agencies.  In conducting such investigations, the Company often
reviews the construction of a facility and past storage and handling practices
regarding hazardous materials.

	Clean-up Evaluation:  A feasibility study addresses measures which may be
implemented to remove hazardous wastes from a site, to treat, stabilize, or
contain such wastes on-site or to otherwise mitigate their effects.  Such
studies take into account, among other things, available technology,
regulatory considerations, and the cost-benefit relationship of alternative
measures.  Additionally, the Company reviews the project and alternative
remedial measures in light of legitimate public concerns.

	Construction and Operation of Remedial Facilities:  Based on the results
of remedial investigations and feasibility studies, the Company uses its
expertise directly, or through subcontractors, to design an appropriate
structure or system for use at a particular site, and performs the necessary
remediation activities.  These remediation activities might include such
diverse measures as construction of a slurry wall to contain the hazardous
materials, construction and operation of a pumping and filtration system
to decontaminate surface or subsurface waters or construction and operation of
an integrated system to excavate contaminated soil and remove it to a licensed
disposal facility.

	Closure Planning and Site Monitoring:  The Resource Conservation and
Recovery Act of 1976 ("RCRA") requires the planning of closure and postclosure
monitoring for all licensed secure hazardous landfills, treatment facilities,
and on-site hazardous waste storage areas.  The Company plans and performs
facility closures and postclosure monitoring programs.  While certain
monitoring requirements are mandated by RCRA, many sites have, at some time,
contained hazardous wastes which also frequently require monitoring.  The
Company provides monitoring for sites and the corresponding data management
services.

                                         6

<PAGE>

	The Company usually contracts for and manages all aspects of the work
related to the completion of a particular project.  In addition, the Company
performs all aspects of the work and certain other specialized operations,
some of which are subcontracted to other parties.  The Company does, however,
occasionally, contract to perform only certain aspects of a particular
project.


Technologies Employed

	The Company utilizes a wide variety of physical and chemical treatment
technologies in performing its remediation activities.  Physical treatment
technologies generally involve filtration and aeration techniques and are used
to separate contaminants from soils, slurries, or water.  Chemical treatment
technologies generally involve flocculation, clarification, precipitation,
polymer addition, chemical oxidation, chemical absorption, and stabilization.
Depending on the contaminants present and the site characteristics, these
technologies are combined into integrated treatment systems which reduce
contaminant concentrations to levels consistent with prescribed regulatory
standards.

Regulation

	The business of the Company and its clients is subject to extensive,
stringent, and evolving regulation by the EPA and various other federal,
state, and local environmental authorities.  These regulations directly
impact the demand for the services offered by the Company.  In addition, the
Company is subject to the Federal Occupational Safety and Health Act, which
imposes requirements for employee safety and health.  The Company believes it
is in  compliance with all federal, state, and local regulations governing its
business.

	RCRA.  The Resources Conservation and Recovery Act of 1976 is the
principal federal statute governing hazardous waste generation, treatment,
storage, and disposal.  RCRA, or EPA-approved state programs may govern any
waste handling activities of substances classified as "hazardous."  The 1984
amendments to RCRA substantially expanded its scope by, among other things,
providing for the listing of additional wastes as "hazardous" and providing of
the regulation of hazardous wastes generated in lower quantities than
previously had been regulated.  Additionally, the amendments impose
restrictions on land disposal of certain hazardous wastes, prescribe more
stringent standards for hazardous waste land disposal sites, set standards for
underground storage tanks and provide for "corrective" action at or near sites
of waste management units.  Under RCRA, liability and stringent operating
requirements may be imposed on a person who is either a "generator" or a
"transporter" of hazardous waste, or an "owner" or "operator" of a waste
treatment, storage, or disposal facility.  The Company does not believe its
hazardous waste remediation services cause it to fall within any of these
categories, although it might be considered an "operator" of a waste
management facility or a "generator" of hazardous waste if it were to control
the collection, source, separation, storage, transportation, processing,
treatment, recovery, or disposal of hazardous wastes, including operation of
a treatment unit for remedial purposes.

                                        7

<PAGE>


	Regulation of underground storage tanks (UST) legislation, in particular
Subtitle I of RCRA, focuses on the regulation of underground tanks in which
liquid petroleum or hazardous substances are stored and provides for the
regulatory setting for the principal portion of the Company's work.
Subtitle I of RCRA requires owners of all existing underground tanks to list
the age, size, type, location, and use of each tank with a designated state
agency.  The EPA has published performance standards and financial

responsibility requirements for storage tanks over a five year period.  These
regulations also require all new tanks which are installed to have protection
against spills, overflows, and corrosion.  Subtitle I of RCRA provides civil
penalties of up to $15,000 per violation for each day of non-compliance with
tank requirements and $10,000 for each tank for which notification was not
given or was falsified.  RCRA also imposes substantial monitoring obligations
on parties which generate, transport, treat, store, or dispose of hazardous
waste.

	Superfund Act.  The Comprehensive Environmental Response Compensation
and Liability Act of 1980 ("Superfund Act") generally addresses clean-up of
inactive sites at which hazardous waste treatment, storage, or disposal took
place.  The Superfund Act assigns joint and several liability for cost of
clean-up and damages to natural resources to any person who, currently, or at
the time of disposal of a hazardous substance who by contract, agreement, or
otherwise arranged for disposal or treatment, or arranged with a transporter
for transport of hazardous substances owned or possessed by such person for
disposal or treatment;  and to any person who accepts hazardous substances for
transport to disposal or treatment facilities or sites from which there is a
release or threatened release.  Among other things, the Superfund Act
authorized the federal government either to clean up these sites itself or to
order persons responsible for the situation to do so.  The Superfund Act
created a fund, financed primarily from taxes on oil and certain chemicals, to
be used by the federal government to pay for the clean-up efforts.  Where the
federal government expends money for remedial activities, it may seek
reimbursement from the Potentially Responsible Parties ("PRPs").

	In October 1986, the Superfund Amendment and Reauthorization Act ("SARA")
was enacted and has increased environmental remediation activities
significantly.  SARA authorizes federal expenditures of $8.5 billion over five
years, while imposing more stringent clean-up standards and accelerated
timetables.  The requirements of SARA are expected to add 1,600 to 2,000 sites
to the national priority list.  Within 36 months of the enactment of SARA,
remedial investigation and feasibility studies were to be conducted for at
least 275 national priority list sites, and were this not achieved for at
least 650 sites within five years.  Physical on-site remedial work was to be
commenced for at least 175 new sites in the 36 months after enactment and for
an additional 200 sites in the following 24 months.  SARA also contains
provisions which expand the EPA's enforcement powers and which are expected to
encourage and facilitate settlements with PRPs.  The Company believes that,
even apart from funding authorized by SARA, industry and governmental entities
will continue to try to resolve hazardous waste problems due to their need to
comply with other statutory and regulatory requirements and to avoid
liabilities to private parties.

                                       8

<PAGE>

	The liabilities provided by the Superfund Act could, under certain factual
circumstances, apply to a broad range of possible activities by the Company,
including generation of transportation of hazardous substances, releases of
hazardous substances, failure to properly design a clean-up, removal or
remedial plan and failure to achieve required clean-up standards, leakage of
removed wastes in transit or at the final storage site, and remedial
operations on ground water.  Such liabilities can be joint and several where
other parties are involved.

	Other.  The Company's operations are subject to other federal laws
protecting the environment, including the Clean Water Act and the Toxic
Substances Control Act.

	Many states have also enacted statutes regulating the handling of
hazardous substances, some of which are broader and more stringent than the
federal laws and regulations.

Competitive Conditions

	The markets for environmental remediation, as well as demolition and
asbestos removal, have become increasingly competitive.  The Company competes
with many different firms ranging from small local firms to large national
firms, some of which have greater financial and marketing resources than the
Company.  Competition in environmental services is based largely on
competitive pricing and quality of service provided.  Other competitive
factors include geographic location as well as reputation.  Management
believes the Company is one of the few firms based in its market areas
throughout the Northeastern United States that offers a high quality
combination of environmental services at the most competitive prices.  In
addition, through its wide range of environmental services, good reputation,
and competitive pricing, the Company hopes to maintain a competitive edge in
the environmental services business.

	The Company operates field offices in Syracuse, Massena, Rochester,
Albany, Plattsburgh, Waverly and Buffalo, New York, as well as Rockland,
Massachusetts and Edison, New Jersey. While operations in the Syracuse,
Massena, Albany, Buffalo, Rockland, and Waverly offices are substantial, the
Rochester, Plattsburgh and Edison operations operate at a lower volume.

Seasonality

	Typically during the first quarter of each calendar year there is less
demand for environmental remediation due to the cold weather, particularly in
the Northeast and Midwest regions.  In addition, factory closings for the
year-end holidays reduce the volume of industrial waste generated, which
results in lower volumes of waste handled by the Company during the first
quarter of the following year.

                                        9

<PAGE>

Customers

	The Company's client base includes state agencies, industrial companies,
railroads, real estate developers, auto parts manufacturers, aluminum
producers, utility companies, waste disposal firms, municipalities, and
engineering firms.  During 2001, the Company performed services for more than
600 clients.  These projects ranged from short-term (three months or less) to
projects which were on-going for 12 months or more.  The majority of the
projects were short-term in nature and continue to provide a substantial
amount of revenue for the Company.  During 2001, the Company had sales
of approximately $3,435,000 to a state agency, which totaled approximately 26%
of the Company's revenues.

Insurance

	The Company maintains commercial general liability, asbestos liability and
pollution liability insurance which provides aggregate coverage limits of $5
million.  In addition, the Company also maintains workers compensation,
comprehensive automobile, and Directors and Officers liability insurance.  The
Company's insurance coverage is consistent with the insurance requirements
found in the environmental remediation industry.

Backlog

	As of December 31, 2001, the Company had a backlog of orders of
approximately $2,750,000.

Employees

	In December 2001, the Company entered into a contractual co-employment
agreement with a third party provider.  As of March 27, 2002, the Company had
a total of 82 full-time employees under this contract.  The Company's ability
to retain and expand its staff will be an important factor in determining the
Company's future success.  The Company maintains employment contracts with its
key managers in its branch offices.  Manager contracts are negotiated on an
annual basis and encompass items such as salary, bonuses, and non-compete
clauses.  The Company does not maintain key-person insurance for such
personnel.  The Company considers its relations with its employees to be good,
and the Company has never had a work stoppage or threat of a work stoppage.

                                            10

<PAGE>

ITEM 2. PROPERTIES

Syracuse, New York Branch and Corporate Headquarters

	The Company leases approximately 17,000 square feet of office and shop
space at a current rate of $6,375 per month plus utilities and real estate
taxes.  The term of the lease extends through June 30, 2006, and does not
contain an escalation clause.


Massena, New York Branch

	The Company owns a 13.93-acre parcel of land located in the Town of
Massena, St. Lawrence County, New York.  This parcel, which has approximately
1,300 feet of frontage on the St. Lawrence River, is located in a protected
area where the water is forty-five feet deep.  This provides excellent dockage
for local ships and ocean-going ships utilizing the St. Lawrence Seaway.

	The land is improved with a well-maintained concrete and creosote timbered
dock that extends about 90 feet into the river and about 260 feet along the
riverbed.  It is equipped with the necessary piping, valves, and fittings to
serve the former Metropolitan Oil Petroleum Tank Farm.  The property includes
three petroleum tanks that have a capacity of approximately 200,000 barrels.

	There were four support buildings on the premises, consisting of an office
building, a combination office, shop and boiler room building, and two storage
sheds.  On January 21, 2001, there was a fire in the main office building, and
the building and the majority of its contents were either destroyed or
damaged.  Copies of any project related or payroll related records that were
destroyed were also kept on file at the Company's corporate office.  The
building and its contents were insured, and the Company constructed new office
space and replaced the lost items with the insurance proceeds.


	The Company is currently pursuing the sale of all or part of its Massena
property.  The property is listed for sale with a reputable real estate
broker.

Rockland, Massachusetts Branch

	The Company currently leases approximately 4,500 square feet of office
space at a current rate of $2,950 per month plus utilities.  The term of the
lease extends through March 31, 2003.  The lease payment is scheduled to
increase an additional $125 per month in April of 2002.

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<PAGE>


Buffalo, New York Branch

	The Company leases approximately 3,200 square feet of office and shop
space at a current rate of $2,850 per month plus utilities.  The term of the
lease extends through March 31, 2004 and does not include an escalation
clause.

Rochester, New York Branch

	The Company leases approximately 150 square feet of office space at a
current rate of $150 per month.  The term of the lease is on a month-to-month
basis.

Waverly, New York Branch

	The Company leases approximately 6,400 square feet of office and shop
space at a current rate of $1,800 per month plus utilities.  The term of the
lease extends through December 31, 2003, and does not contain an escalation
clause.

Albany, New York Branch


	The Company leases approximately 5,000 square feet of office and shop
space at a current rate of $2,292 per month plus utilities.  The term of the
lease extends through January 31, 2003, and does not contain an escalation
clause.

Edison, New Jersey Branch

	The Company leases approximately 300 square feet of office space from
O'Brien & Gere Engineers (an affiliated party) at a current rate of $443 per
month.  The term of the lease is on a month-to-month basis.

Plattsburgh, New York Branch


	The Company leases approximately 650 square feet of office and shop space
at a current rate of $430 per month including utilities.  The term of the
lease extends through January 31, 2003, and does not contain an escalation
clause.

Equipment

	The Company's owned equipment consists primarily of construction equipment
such as vacuum trucks, tankers, excavation equipment, pumps, generators, and
compressors, some of which have been specially modified for the Company's use.
Chemical trailers and other specialized equipment for short-term projects are
typically leased from local equipment contractors.

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ITEM 3. LEGAL PROCEEDINGS

	The Company is not a party to any litigation or governmental proceedings
that management believes could result in any judgements or fines against it or
that would have a material adverse effect on the Company's cash flows, results
of operations, or its financial condition.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

	The Company held its annual shareholders meeting on November 8, 2001.  The
shareholders voted on the ratification of PricewaterhouseCoopers LLP as the
Company's auditors and the election of five directors.  The following votes
were cast for each:

                                                      For              Against
Ratification of PricewaterhouseCoopers LLP as
  the Company's auditors                           8,770,340             -0-

Election of Directors:
Robert J. Berger          Director                 8,770,340             -0-
Richard L. Elander        Director                 8,770,340             -0-
Cornelius B. Murphy, Jr.  Director                 8,770,340             -0-
Steven A. Sanders         Director                 8,770,340             -0-


There were no other matters submitted to a vote of the Company's shareholders.

                                          13

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                                        PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

	(a) The shares of the Company's common stock are listed in the "Pink
	    Sheets" and on the NASDAQ Bulletin Board under the symbol OTES.

	The high and low bid prices for the shares of the Company's common stock
were as follows:

    Quarter Ended                 High Bid           Low Bid

    March 31, 2000                  $0.41             $0.31
    June 30, 2000                   $0.31             $0.13
    September 30, 2000              $0.22             $0.13
    December 31, 2000               $0.13             $0.05
    March 31, 2001                  $0.10             $0.06
    June 30, 2001                   $0.22             $0.02
    September 30, 2001              $0.20             $0.10
    December 31, 2001               $0.10             $0.07
    First quarter through
      March 27, 2002                $0.07             $0.06

	The aforementioned prices reflect inter-dealer prices, without retail
mark-up, mark-down, or commission and may not necessarily represent actual
transactions.

	(b) At March 27, 2002, there were approximately 170 holders of record of
	    the Company's common stock.

	(c) The Company has never paid any dividends and does not anticipate
	    paying dividends in the foreseeable future.

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ITEM 6. SELECTED FINANCIAL DATA

Statement of Operations Data

                                      Year Ended December 31

                        2001        2000        1999        1998       1997

Project Billings   $13,243,081 $13,671,025 $12,517,772 $10,917,903 $6,993,221
Net Income (Loss)  $   511,393 $   539,876($ 2,613,883)$   812,753($1,747,543)
Extraordinary Gain         -           -           -           -   $1,000,000
Net Income (Loss)
  Per Share (Basic
  & Diluted)           $.04       $.05        ($.23)       $.07       ($.32)


Balance Sheet Data
                                        As of December 31

                           2001       2000       1999       1998       1997
                                                                        (a)
Total Assets            $5,671,179 $5,734,277 $5,942,940 $6,632,753 $4,776,471
Long-Term Obligations   $2,365,615 $2,432,374 $2,644,353 $1,526,560 $  228,855


(a)	On October 14, 1997, the Company entered into an agreement with its two
largest creditors to convert all or part of its indebtedness into common stock
of the Company.  The agreement included forgiveness of $1,000,000 of debt by
O'Brien & Gere Limited (a shareholder) and the conversion of $540,000 of
convertible debentures, plus accrued interest, into 1,080,000 shares of the
Company's common stock.  In addition, the Company's then financial institution
converted $2,811,070 of principal and interest into 5,622,140 shares of the
Company's common stock.

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<PAGE>


ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS

LIQUIDITY AND CAPITAL RESOURCES

	At December 31, 2001 the Company had cash and cash equivalents of $51,818
as compared to $6,249 at December 31, 2000.  Excess cash in the Company's
operating account is electronically reduced nightly to pay down the Company's
revolving line of credit.

	At December 31, 2001, the Company had working capital of $1,362,528
compared to a working capital deficit of $660,418 at December 31, 2000.  The
Company had a current ratio of approximately 1.59 to 1 at the end of 2001
compared to .86 to 1 at the end of 2000.  The Company's improved working
capital balance is primarily attributable to the fact that the terms of the
Company's revolving loan resulted in the outstanding borrowings to be
classified as a long-term liability at December 31, 2001 and a current
liability at December 31, 2000.

	Cash provided by operating activities during 2001 was $1,007,933 compared
to $368,529 during 2000.  The increase in cash provided by operating
activities in 2001 was mostly attributable to two factors.  First, the
Company's continued profitability for the year ended December 31, 2001, as
discussed in the "Results of Operations - 2001 Compared to 2000" section of
this report.  Second, a net decrease in work-in-process of $202,262 compared
to a net increase in work-in-process of $419,746 during 2000.

	The Company's net cash used in investing activities of $397,404 during the
first nine months of the year was attributable to the construction of a
replacement building for the Massena, NY branch office as well as the purchase
of various field and office equipment, offset by insurance proceeds from a
loss on real property.

	Cash used in financing activities of $564,960 in 2001 was primarily due to
the timing of paydowns and cash advances on the Company's line of credit, as
was necessitated by the net cash provided by operating and investing
activities.

	As of December 31, 2001, the Company had a loan agreement that provided
for borrowings up to $2,200,000 on a revolving basis, collateralized by all
accounts receivable, inventory and equipment now owned or acquired later.  The
loan is payable on May 31, 2003, bears interest at a rate of prime plus 1.25
percent, is subject to certain restrictive financial covenants, and is
subject to default if there is a material adverse change in the financial or
economic condition of the Company.  As of December 31,  2001, borrowing
against the revolving loan aggregated $1,427,900.

	During 2001, all principal payments on the Company's debt were made within
payment terms.

	The Company expects, based on improved operating results and the continued
availability of its line of credit, that it will be able to meet obligations
as they come due.

                                       16

<PAGE>


THE MASSENA PORT FACILITY

	The Massena Port Facility is a former oil tank farm that is located on the
St. Lawrence River in Massena, NY.  The property is improved with several
buildings and a deep water docking facility for large ocean going ships.
Currently, the Company uses the property for its Massena branch office
headquarters, equipment storage and its Aqueous Treatment/360 Facility.  The
property has been held for sale since 1996, during which time the carrying
value has been reduced from $1,900,000 to $480,000.

	During the third quarter of 2001, the Company recognized an additional
provision for impairment of long-lived assets of $300,000 to adjust the
carrying value of the Massena Port Facility to the estimated fair market
value, less cost of disposal, of $480,000.  Management's estimation of fair
market value is based upon an evaluation of existing facts and circumstances,
including current real estate market conditions.


CAPITAL RESTRUCTURING & BUSINESS OPERATIONS

	The Company entered into letters of agreement with its then two largest
creditors, its then financial institution, OnBank & Trust Co. ("OnBank"), and
O'Brien & Gere Limited ("OBG Limited"), a shareholder, on October 14, 1997,
which were executed as of December 31, 1997, whereas OnBank and OBG Limited
agreed to convert all or part of their indebtedness, including accrued
interest, into Common Stock of the Company, and to forgive the remaining
balance.  OBG Limited, to which the Company was indebted for $1,540,000,
including accrued interest of $140,000, forgave $1,000,000 of the debt and
converted the balances into 1,080,000 shares of the Company's Common Stock.
OnBank, to which the Company was indebted for $2,811,070, including accrued
interest of $75,332, converted their debt and accrued interest for 5,622,000
shares of the Company's Common Stock.  The price per share of $.50 was
negotiated with the two creditors and the Company based on the price of
recent sales and their estimates of future risk.  The OnBank ownership of the
Company transferred to M&T Bank as a result of the merger of those financial
institutions in 1998.

RESULTS OF OPERATIONS

	This financial review should be read in conjunction with the accompanying
Consolidated Financial Statements and accompanying notes.

FACTORS THAT MAY AFFECT FUTURE RESULTS

	The Company's future operating results may be affected by a number of
factors, including the Company's ability to successfully increase market share
in its existing service territory while expanding its services into other
markets, realize benefits from cost reduction programs, sell all or part of
the Massena Property, and utilize its facilities and work force profitably in
the face of intense price competition.

                                        17

<PAGE>


2001 COMPARED TO 2000

Revenues

	During the year ended December 31, 2001, the Company's revenues decreased
3% to $13,243,081 as compared to $13,671,025 for the year ended December 31,
2000.  The slight decrease in billings is due to several factors.  Revenues
from spill response and remediation projects increased approximately
$2,100,000.  The increase in revenues from the spill response service line is
primarily due to the fact that the Company's two-year emergency spill response
contract with the New York State Department of Environmental Conservation
began in October of 1999, and had not yet produced the volume in 2000 that the
Company experienced in 2001.  The Company's emergency spill response contract
with the New York State Department of Environmental Conservation has been
extended through 2003.  This increase was offset by decreases in revenues from
tank removal, cleaning and installation projects totaling approximately
$500,000.  This decrease is attributable to the performance of several large
tank removal and installation projects during 2000.  The Company also
experienced a decrease in revenue from transportation and disposal of
approximately $300,000 due to the completion of one large transportation and
disposal project in the second quarter of 2000.  The Company also experienced
a decrease in revenue from asbestos removal projects of approximately $900,000
due to a management decision to eliminate asbestos removal from two of the
Company's service locations.  A decrease in revenue from Industrial cleaning
of approximately $400,000 was due to a large emergency industrial cleaning
project in 2000 that was the result of an explosion of a furnace.  As part of
the Company's plan to refocus its efforts on lines of work that are more
profitable, the Company is no longer pursuing tank installation work and is
being more selective in bidding on asbestos removal projects.

Project Costs and Gross Margin

	Project costs for the year ended December 31, 2001 decreased 6% to
$9,466,613 from $10,059,070 for the year ended December 31, 2000.  Project
costs as a percentage of revenues decreased to 71% for the year ended December
31, 2001 compared to 74% for the same period in 2000.  The gross profit margin
for the year ended December 31, 2001 was 29% versus 26% for the year ended
December 31, 2000.

	The increase in gross margin was a result of the reduction in project
costs, which was a result of improved project management during 2001 as
compared to 2000.  The Company performed fewer public projects, particularly
tank installation and large asbestos removal projects, when comparing 2001 to
2000.  These projects typically produce lower gross margins than other service
lines the Company offers.  The Company also performed more work on a time-and-
material basis.  Time-and-material work typically produces higher margins than
bidwork.  Project meals and lodging expense also decreased approximately
$78,000 from 2000 to 2001 as a result of the Company's efforts to place more
staff at each location rather than borrowing personnel from other branches
within the Company.

                                       18

<PAGE>

Selling, General, and Administrative Expenses

	During the year ended December 31, 2001, selling, general, and
administrative ("SG&A") expenses increased 8% to $3,035,129 compared to
$2,800,661 reported for the previous year.  SG&A expenses were approximately
23% of sales for the year ended December 31, 2001 compared to approximately
20% for the previous year.

	When comparing the year ended December 31, 2001 to the same period in
2000, the overall increase in SG&A is due to several factors.  First, payroll
expense and related payroll taxes and benefits increased $179,063.  During the
fourth quarter of 2000 and the first quarter of 2001, several new employees
were added in the Plattsburgh, Albany, Rochester, NY and Edison, NJ branch
offices.  Each of these offices added new employees as a result of expected
increased sales volume and long-term growth plans.  As is customary in adding
new employees, it takes approximately six months for a new employee to meet
the company's chargeability goals as set forth in the operating budget.
Second, occupancy expense increased $57,197, primarily due to the relocation
of the Albany, NY and Boston, MA branches to larger offices with higher
rent than the previous locations.  Third, depreciation expense increased
$56,615 primarily due to the purchase of several large field vehicles.

Provision for Impairment of Long-Lived Assets

	During the third quarter of 2001, the Company recognized an additional
provision for impairment of long-lived assets of $300,000 to adjust the
carrying value of the Massena Port Facility to the estimated fair market
value, less costs of disposal, of $480,000.

Operating Income

	As a result of the factors discussed above, for the year ended December
31, 2001, the Company reported operating income of $441,339 compared to
$811,294 for the previous year.

                                       19

<PAGE>


Interest Expense

	Interest expense decreased 21% to $221,046 in 2001 compared to $278,651 in
2000.  The decrease in interest expense was primarily due to a decrease in
the average interest rate incurred on the revolving loan and long-term debt,
as well as a lower average balance on the Company's revolving loan, when
comparing the year ended December 31, 2001 with the same period in 2000.


Net Income

	Net income for the years ended December 31, 2001 and 2000 was $511,393, or
$.04 per share basic & diluted, and $539,876, or $.05 per share basic and
diluted, respectively.

                                        20

<PAGE>


2000 COMPARED TO 1999

Revenues

	During the year ended December 31, 2000, the Company's revenues increased
9% to $13,671,025 as compared to $12,517,772 reported for the year ended
December 31, 1999.  The change in revenues was due to an increase of
approximately $1.25 million in spill response revenue and an increase of
approximately $900,000 in transportation and disposal revenue.  The change in
the spill response service line was mainly attributable to the NYSDEC spill
response contract, which went into effect in October of 1999, and to several
spill response contracts the Company secured with various rail companies
during the year.  The increase in transportation and disposal was attributable
to several large projects the Company had during 2000.  These increases were
offset by a decrease in revenue of approximately $800,000 from underground
storage tank installation projects, as the Company discontinued this service
line in late 1999.  The Company also had a large demolition project in 1999
that it did not have in 2000, which caused a decrease in revenue from this
service line of approximately $120,000.

Project Costs and Gross Margin

	Project costs for the year ended December 31, 2000 decreased 3% to
$10,059,070 from $10,355,805 for the year ended December 31, 1999.  Project
costs as a percentage of revenues decreased to 74% for the year ended December
31, 2000 compared to 83% for the same period in 1999.  The gross profit margin
for the year ended December 31, 2000 was 26% versus 17% for the year ended
December 31, 1999.

	The increase in gross margin was a result of the reduction in project
costs, which was a result of improved project management during 2000 as
compared to 1999.  The Company also performed fewer public projects and large
asbestos jobs in 2000 than in 1999, which typically produce lower margins than
bid work and spill response projects.  Project labor and project labor burden
expense decreased approximately $220,000 combined because of the Company's
increase in spill response and transportation and disposal projects, which are
less labor intensive than other types of projects, such as large asbestos
projects.  The Company had fewer large asbestos jobs during 2000 than in 1999,
which helped to reduce the Company's labor requirement.  Project meals and
lodging expense also decreased approximately $73,000 from 1999 to 2000 as a
result of the Company's increased revenue from spill contracts.  Branches
typically staff emergency spills with its personnel rather than borrowing
personnel from other branches within the Company, which reduced the need for
project employee travel.

                                        21

<PAGE>


Selling, General, and Administrative Expenses

	During the year ended December 31, 2000, selling, general, and
administrative ("SG&A") expenses decreased 19% to $2,800,661 compared to
$3,439,654 reported for the previous year.  SG&A expenses were approximately
20% of sales for the year ended December 31, 2000 compared to approximately
27% for the previous year.

	The significant decrease in SG&A when comparing the year ended December
31, 2000 to the same period in 1999 was primarily due to the Company's
continuous efforts to reduce overhead expenses.  Project managers and branch
managers have been meeting or exceeding chargeability goals set by the
Company, and the Company has been monitoring overhead at the branch level
through the use of branch budgets.  Several personnel at the administrative
and manager levels were also discharged from the Company during late 1999,
primarily due to performance issues.  These changes have resulted in a
decrease in payroll expense and related payroll taxes and benefits of
approximately $530,000 for the year ended December 31, 2000 compared to 1999.
The Company's focus on reducing SG&A expenses has also resulted in a decrease
in office expense of approximately $29,000, in part because of efforts to
reduce office supply use and the use of overnight mail. Travel and subsistence
expense decreased approximately $34,000 due to efforts to eliminate
nonessential travel between branch locations.  These decreases were partially
offset by increases in other SG&A expenses.  Rent, phone and utilities expense
increased approximately $41,000 due mainly to the relocation of the Albany,
New York, and Rockland, Massachusetts, branches to new offices with higher
rent than the previous locations.  Professional services expense increased
approximately $32,000 due to additional computer consultant support needed
for the relocated branch offices, increased audit and legal fees, and fees for
outsourced payroll processing which began in April of 1999.

	The Company's expenses related to its equipment showed an overall decrease
when comparing 2000 to 1999.  Depreciation expense decreased approximately
$25,000 due to a write-off and an impairment of equipment the Company was not
utilizing in the fourth quarter of 1999.  Fuel expense decreased overall by
approximately $20,000.  Due to the significant increases in fuel prices during
2000, the Company implemented a 4% fuel surcharge on customer invoices.  The
Company collected approximately $96,000 in billed fuel surcharges through
December of 2000, which was offset against fuel expense.  Equipment operating
lease expense increased approximately $58,000 due to the addition of several
full-service leases of vacuum trucks and tractors in order to service the
Company's major emergency spill contracts.  Usage of the Company's equipment
increased approximately $104,000.  This change was attributable to the
addition of equipment in late 1999, and to the Company's project managers
meeting or exceeding utilization goals set for each piece of equipment.  The
costs associated with using the equipment are shown in the income statement as
a reduction in SG&A expense and as an increase in project costs. Equipment
costs related to equipment utilized on projects are then billed to customers.

                                       22

<PAGE>


Provision for Impairment of Long-Lived and Other Assets

	During the fourth quarter of 1999, the Company recognized a provision for
impairment of long-lived and other assets of $1,109,877.  Included in this
provision was a loss of $825,427 recognized in order to reflect the carrying
value of the Massena Port Facility at the lower of cost or market.  The
remainder of the impairment was due to a loss recognized on equipment and
other assets the Company was no longer utilizing.

Operating Income

	As a result of the factors discussed above, for the year ended December
31, 2000, the Company reported operating income of $811,294 compared to an
operating loss of $2,387,564 for the previous year.

Interest Expense

	Interest expense increased 46% to $278,651 in 2000 compared to $191,180 in
1999.  The increase in interest expense was primarily due to the increase in
the Company's average outstanding balance on its revolving line of credit,
which was approximately $1,800,000 in 2000 and approximately $1,400,000 in
1999.  The line of credit availability was increased from $1,500,000 to
$2,000,000 in mid 1999.  Higher interest rates when comparing 2000 to 1999
also contributed to the increase in interest expense.  As of December 31,
2000, the Company had $2,000,000 in available borrowings on a revolving
basis, and borrowings against the revolving loan aggregated $1,779,315.  The
increase was also attributable to the financing of new equipment during the
second half of 1999.

Net Income

	Net income (loss) for the years ended December 31, 2000 and 1999 was
$539,876, or $.05 per share basic & diluted, and ($2,613,883), or ($.23) per
share basic and diluted, respectively.

                                      23

<PAGE>


ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

	Due to the fact that the interest rate associated with the Company's
revolving line of credit is based on the prime interest rate, the Company is
exposed to interest rate risk.  If the prime rate increases, the Company's
monthly interest payments on its line of credit also increase, which could
impact cash flow.  Although the Company does not anticipate any material
effects from interest rate risk, the Company attempts to keep its outstanding
balance on its line of credit as low as possible at all times.

	The Company is aware that if the economy were to slow down, the Company's
business could be affected by other companies closing operations or reducing
production, which could reduce the amount of waste generated or industrial
cleaning projects available.  In order to try to mitigate this market risk,
the Company continues to make every effort to secure more emergency spill
response contracts and long-term environmental remediation and industrial
cleaning projects.

	For more information regarding market risk, see the audited financial
statements submitted under Item 14 of this report.


ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

	The consolidated financial statements of the Company and the report of
PricewaterhouseCoopers LLP are submitted under Item 14 of this report.


ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE

	None

                                      24

<PAGE>


                                   PART III

ITEM 10. DIRECTORS AND OFFICERS OF THE COMPANY

	The following table sets forth certain information about the directors of
the Company, all of whom were unanimously elected at the Annual Meeting of
Stockholders of the registrant on November 8, 2001 for a term of one year.

                              Year
     Name, Age                First
Principal Occupation         Elected          Certain Other Information

Robert J. Berger (55)
Director and Chairman of
the Board                     1998

Mr. Berger has served in his present position as
Director since November 1998, and as
Chairman of the Board since February 2000.
Mr. Berger was employed in various positions
for OnBank from 1978 through March 31, 1998,
his last position being Senior Vice President,
Treasurer, and Chief Financial Officer.  From
April through August 1998, he served as
consultant to M&T Bancorp. pursuant to its
merger agreement with OnBank.  Since August
1998, he has been an Adjunct Professor and
Director of the Madden Institute of Business
Education at LeMoyne College in Syracuse,
New York.  Mr. Berger is also Chairman,
President, and Chief Executive Officer of St.
Lawrence Industrial Services, Inc.



Richard L. Elander (60)
Director                      1991

Mr. Elander has served in his present position
as a Director since November of 1991.  He
served as Vice President and General Manager
from June 1994 to December 1996.  He also
served as Chief Executive Officer from
November 1991 to June 1994.  Mr. Elander
served as a Director of O'Brien & Gere Limited
from August 1991 to September 1995.  From
1983 to 1995, Mr. Elander served as President
of OBG Operations.  Mr. Elander currently
operates his own construction management
consulting business, and he has been
appointed to the position of Onondaga County
Department of Water Environment Protection
Commissioner.

                                   25

<PAGE>


Cornelius B. Murphy, Jr. (57)
Director                      1991

Dr. Murphy has served in his current position
since November 1991.  He previously served as
the Company's President from June 1994 to
December 1996 and as Chariman of the Board
from November of 1991 to June 1994.  Dr.
Murphy has been a director of O'Brien & Gere
Limited since 1985 and O'Brien & Gere
Engineers, Inc. from 1982 to date.   Dr. Murphy
served as President of O'Brien & Gere
Engineers from 1992 to 1997.  From 1982 to
1992, he served as President of O'Brien & Gere
Technical Services, Inc.  Dr. Murphy also served
as Chairman of the Board of O'Brien & Gere
Limited from April 1999 to May 2000,  and as
Chief Scientist of O'Brien & Gere Engineers from
January 1998 to December 1999.  Dr. Murphy
currently serves as President of the State
University of New York College of Environmental
Science and Forestry, which is located in
Syracuse, New York.


Steven A. Sanders (56)
Director                      1991

Mr. Sanders has served in his present position
as a Director since 1991.  Since January 1,
2001, he has been of counsel to the law firm of
Spitzer & Feldman PC.  Mr. Sanders served as a
partner in the law firm of Beckman, Millman &
Sanders LLP from October 1997 to December
2000 and has also been President of the Law
Office of Steven A. Sanders PC since 1992.

                                26

<PAGE>


EXECUTIVE OFFICERS OF THE COMPANY

Name                     Age  Position Held
Christopher J. Polimino  36   President and Chief Executive Officer
Anthony R. Pongonis      49   Executive Vice President
Douglas R. Lee           31   Treasurer
Colleen Price            27   Assistant Secretary

	Mr. Polimino was named Chief Executive Officer in January 2001, and has
been President of the Company since January 2000.  He has been with the
Company since December of 1994 and has previously served as Executive Vice
President, General Manager, and Controller.

	Mr. Pongonis was hired during the fourth quarter of 1996.  He previously
served as the Company's President and is currently the Company's Eastern
Region Manager and Executive Vice President.  He has over twenty-five years
of experience in the environmental services industry.

	Mr. Lee was named Treasurer in December 2001, and has been Controller of
the Company since March 2001.  He previously worked as an Auditor for a
public accounting firm from 1993 to 1999, and as Controller for a
manufacturing company from 1999 to February 2001.

	Mrs. Price was named Assistant Secretary in December 2001, and has been
the Billing Supervisor of the Company since June 1999.  She has been with the
Company since March 1997 and has previously served as a billing clerk and
various other positions.

                                        27

<PAGE>


ITEM 11. EXECUTIVE COMPENSATION

The following table sets forth summary information concerning compensation
paid or accrued by the Company for services rendered during the last three
fiscal years.

Summary Compensation Table

                           Annual Compensation   Long Term Compensation
                                                 Awards  Payments

    Name and                        Other Annual # of     LTIP    All Other
Principal Position      Year Salary Compensation Options Payouts Compensation

Christopher J. Polimino 2001 $110,000  $12,500    -0-      -0-       -0-
CEO and President       2000 $100,000     -0-     -0-      -0-       -0-
                        1999 $ 90,000     -0-     -0-      -0-       -0-

Anthony R. Pongonis     2001 $111,080
  -0-     -0-      -0-       -0-
Executive Vice Pres.    2000 $106,542     -0-     -0-      -0-       -0-
                        1999 $107,220     -0-     -0-      -0-       -0-


Year End Option Table

	There were no outstanding stock options held as of December 31, 2001 by
the named executive officers.

Compensation of Directors

	Directors of the Company are paid $1,000 for each quarter plus
reimbursement for their actual expenses incurred in attending meetings.

                                       28

<PAGE>


ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT

	The following table sets forth certain information regarding the
beneficial ownership of the company's common stock at March 15, 2002 by
persons who, to the knowledge of the Board of Directors, beneficially own more
than five percent of the outstanding shares of common stock of the
Corporation.

	All voting power of the Corporation is vested in its common stock.  As of
the close of business on March 27, 2002, 11,703,963 shares of common stock par
value $.01 per share were outstanding.  Each share of common stock is entitled
to one vote.


 Name and Address         Number of Shares of Common            Percentage
of Beneficial Owner        Stock Beneficially Owned (1)          of Class

M&T Bank                           5,622,140                        48%
101 S. Salina Street
Syracuse, NY 13202

O'Brien & Gere Limited             3,148,200                        27%
5000 Brittonfield Parkway
Syracuse, NY 13220

Richard L. Elander                   329,565 (3)                     3%

Cornelius B. Murphy, Jr.               1,424 (3)                    <1%

Steven A. Sanders                     25,752 (2) (3)                <1%

Robert J. Berger                      20,000 (3)                    <1%

All Officers & Directors                     (2)(3)                 <4%
as a Group (8 persons)


(1) The beneficial owners have sole voting and investment power over the
    shares owned.
(2) Includes 200 shares, which are owned by Mr. Sanders' wife as custodian for
    his son, as to which Mr. Sanders disclaims beneficial ownership.
(3) Director

                                      29

<PAGE>



ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

	During 2001, the Company provided approximately $27,000 of remediation,
sub-contract support, and project services to subsidiaries of O'Brien & Gere
Limited, a shareholder.  Services provided to O'Brien & Gere Limited
subsidiaries were at competitive rates which were bid on a project by project
basis.

	The Company purchases technical, and consulting services from subsidiaries
of O'Brien & Gere Limited, a shareholder.  The costs for these services
amounted to $43,000 in 2001.

	Steven A. Sanders, a director of the Company, is of counsel to Spitzer &
Feldman PC, which provides professional services to the Company, and it is
anticipated that it will continue to do so.

	The Company purchases subcontract labor services from St. Lawrence
Industrial Services, Inc., which is owned by Robert J. Berger, a director of
the Company.  The costs for these services amounted to approximately $886,000
in 2001.

                                      30

<PAGE>


                                PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

                                                                          Page
(a) Financial Statements and Exhibits

 (1) Report of Independent Auditors                                        F-1
     Consolidated Balance Sheets at December 31, 2001 and 2000             F-2
     Consolidated Statement of Operations for the years ended
       December 31, 2001, 2000, and 1999                                   F-3
     Consolidated Statements of Shareholders' Equity (Deficit) for
       the years ended December 31, 2001, 2000, and 1999                   F-4
     Consolidated Statements of Cash Flows for the years ended
       December 31, 2001, 2000, and 1999                                   F-5
     Notes to Consolidated Financial Statements                            F-7

 (2) Schedule II, Valuation and Qualifying Accounts for the Years
      Ended 2001, 2000, and 1999                                          F-14

 (3) Subsidiary of the Company:
     OP-TECH Environmental Services Limited - Ontario, Canada

(b) Reports on Form 8-K
    The Company did not file any Current Reports on Form 8-K during the three
    months ended December 31, 2001.

(c) Exhibits

10.1 Union and Employment Contracts (1) Incorporated herein by reference to
     the Company's Form 10-K F/Y/E December 31, 1997.
10.2 Voting Agreement (1) Incorporated herein by reference to the Company's
     Form 10-K F/Y/E December 31, 1997.
10.3 Memorandum of Agreement and Exchange (1) Incorporated herein by reference
     to the Company's Form 10-K F/Y/E December 31, 1997.

                                      31

<PAGE>


                                   SIGNATURES

	Pursuant to the requirements of Section 13 or 15(d) of the Securities and
Exchange Act of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.

                               OP-TECH Environmental Services, Inc.
                                           (Registrant)

                               By:/s/ Christopher J. Polimino
                               Christopher J. Polimino, President, Chief
                               Executive Officer, and Chief Accounting Officer


March 29, 2002

	Pursuant to the requirements of the Securities and Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities indicated on the 29th day of March 2002.


/s/ Robert J. Berger
Director and Chairman of the Board

/s/ Richard L. Elander
Director

/s/ Cornelius B. Murphy, Jr.
Director

/s/ Steven A. Sanders
Director

/s/ Christopher J. Polimino
President, Chief Executive Officer, and Chief Accounting Officer

/s/ Anthony R. Pongonis
Executive Vice President

/s/ Douglas R. Lee
Treasurer

/s/ Colleen Price
Assistant Secretary


                                       32

<PAGE>



                        Report of Independent Accountants



Shareholders and Board of Directors
OP-TECH Environmental Services, Inc. and Subsidiary


In our opinion, the accompanying consolidated balance sheets and the related
consolidated statements of operations and shareholder's equity and of cash
flows present fairly, in all material respects, the financial position of
OP-TECH Environmental Services, Inc. and Subsidiary at December 31, 2001
and 2000, and the results of their operations and their cash flows for each
of the three years in the period ended December 31, 2001, in conformity with
accounting principles generally accepted in the United States of America.
These financial statements are the responsibility of the Company's management;
our responsibility is to express an opinion on these financial statements
based on our audits.  We conducted our audits of these statements in
accordance with auditing standards generally accepted in the United States of
America, which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management,
and evaluating the overall financial statement presentation.  We believe that
our audits provide a reasonable basis for our opinion.



/s/ PricewaterhouseCoopers LLP

March 8, 2002

                                      F1

<PAGE>

OP-TECH Environmental Services, Inc. and Subsidiary
Consolidated Balance Sheets
December 31, 2001 and 2000


Assets                                                    2001        2000
                                                       ----------  ----------
Current assets:
 Cash                                                  $   51,818  $    6,249
 Accounts receivable (net of allowance for doubtful
  accounts of approximately $195,000 in 2001 and
  $149,000 in 2000)                                     2,885,683   3,055,996
Costs on uncompleted projects in excess of billings       420,115     633,178
Prepaid insurance                                          82,386      48,697
Other assets                                              232,764     217,120
                                                       ----------  ----------
   Total current assets                                 3,672,766   3,961,240

Property and equipment, net                             1,518,413     993,037
Assets held for sale                                      480,000     780,000
                                                       ----------  ----------
   Total Assets                                        $5,671,179  $5,734,277
                                                       ==========  ==========

Liabilities and Shareholders' Equity

Current liabilities:
 Bank overdraft                                        $   20,659  $  205,208
 Note payable to bank under line of credit                    -     1,779,315
 Accounts payable                                       1,174,639   1,401,494
 Billings in excess of costs and estimated
  profit on uncompleted contracts                         541,373     552,174
 Accrued payroll and other expenses                       334,198     424,725
 Current portion of long-term debt                        239,369     258,742
                                                       ----------  ----------
   Total current liabilities                            2,310,238   4,621,658

Long-term debt, net of current portion                    698,346     394,317
Note payable to bank under line of credit               1,427,900         -
                                                       ----------  ----------
   Total liabilities                                    4,436,484   5,015,975
                                                       ----------  ----------

Shareholders' equity:
 Common stock, par value $.01 per share; authorized
  20,000,000 shares; 11,703,963 and 11,603,963 shares
  outstanding as of December 31, 2001 and
  2000, respectively                                      117,040     116,040
 Additional paid-in capital                             7,791,152   7,787,152
 Accumulated deficit                                   (6,673,497) (7,184,890)
                                                       ----------- -----------
   Shareholders' equity, net                            1,234,695     718,302
                                                       ----------- -----------
Total Liabilities and Shareholder' Equity              $5,671,179  $5,734,277
                                                       ==========  ==========

The accompanying notes are an integral part of the consolidated financial
statements

                                      F2

<PAGE>


OP-TECH Environmental Services, Inc. and Subsidiary
Consolidated Statements of Operations
Years Ended December 31, 2001, 2000, and 1999


                                           2001          2000         1999
                                        -----------  -----------  -----------

Project billings and services           $13,243,081  $13,671,025  $12,517,772
Project costs                             9,466,613   10,059,070   10,355,805
                                        -----------  -----------  -----------
   Gross margin                           3,776,468    3,611,955    2,161,967

Selling, general and admin. expenses      3,035,129    2,800,661    3,439,654
Provision for impairment of long-
  lived assets                              300,000        -        1,109,877
                                        -----------  -----------  -----------
   Operating income (loss)                  441,339      811,294   (2,387,564)
                                        -----------  -----------  -----------
Other income and expense:
 Interest expense                          (221,046)    (278,651)    (191,180)
 Casualty gain from insurance proceed       301,881          -            -
 Other (expense) income, net                  2,219       (4,767)       8,841
                                        -----------  -----------  -----------
                                             83,054     (283,418)    (182,339)
                                        -----------  -----------  -----------

   Net income (loss) before income taxes    524,393      527,876   (2,569,903)

Income taxes                                 13,000      (12,000)      43,980
                                        -----------  -----------  -----------

   Net Income (Loss)                    $   511,393  $   539,876  $(2,613,883)
                                        ===========  ===========  ============

Earnings (loss) per common
 share - basic and diluted                    $0.04        $0.05       $(0.23)

The accompanying notes are an integral part of the consolidated financial
statements

                                      F3

<PAGE>


OP-TECH Environmental Services, Inc. and Subsidiary
Consolidated Statements of Shareholders' Equity
Years Ended December 31, 2001, 2000, and 1999



                                           Additional
                         Common    Common    Paid-In  Accumulated
                         Shares    Stock     Capital    Deficit       Total
                       ---------- -------- ---------- ------------ ----------
Bal. at Dec. 31, 1998  11,603,963 $116,040 $7,787,152 $(5,110,883) $2,792,309

Net loss                      -        -          -    (2,613,883) (2,613,883)
                       ---------- -------- ---------- ------------ -----------

Bal. at Dec. 31, 1999  11,603,963  116,040  7,787,152  (7,724,766)    178,426

Net income                    -        -          -       539,876     539,876
                       ---------- -------- ---------- ------------ -----------

Bal. at Dec. 31, 2000  11,603,963  116,040  7,787,152  (7,184,890)    718,302

Issuance of 100,000
  Shares                  100,000    1,000      4,000         -         5,000

Net income                    -        -          -       511,393     511,393
                       ---------- -------- ---------- ------------ ----------

Bal. at Dec. 31, 2001  11,703,963 $117,040 $7,791,152 $(6,673,497) $1,234,695
                       ========== ======== ========== ============ ==========

The accompanying notes are an integral part of the consolidated financial
statements

                                       F4

<PAGE>

OP-TECH Environmental Services, Inc. and Subsidiary
Consolidated Statements of Cash Flows
Years Ended December 31, 2001, 2000, and 1999


                                                2001       2000        1999
                                            ---------- ---------- ------------
Operating activities:
 Net income (loss)                          $  511,393 $  539,876 $(2,613,883)
 Adjustments to reconcile net income (loss)
  to net cash provided by (used in)
  operating activities:
   Provision for loss on accounts receivable   135,999    116,500     108,700
   Depreciation and amortization               328,220    266,709     303,287
   Provision for impairment of
    long-lived assets                          300,000        -     1,109,877
   Loss (gain) on sale of equipment              1,167    (10,000)        216
   Gain on insurance proceeds
    from loss on real property                (301,881)       -           -
   Common stock issued for services rendered     5,000        -           -
   (Increase) decrease in operating assets
     and increase (decrease) in operating
     liabilities:
      Accounts receivable                       34,314    136,455    (461,460)
      Costs on uncompleted projects
       applicable to future billings           213,063   (153,208)   (190,202)
      Prepaid expenses and other assets        108,841    103,011      97,171
      Billings and estimated profit in excess
       of costs of uncompleted contracts       (10,801)  (266,538)    249,319
      Accounts payable and other
       accrued expenses                       (317,382)  (364,276)    491,089
                                             ---------- ----------  ----------
  Net cash provided by (used in)
   operating activities                      1,007,933    368,529    (905,886)
                                             ---------- ---------- -----------

Investing activities:
 Purchases of property and equipment          (705,571)   (66,723)   (113,976)
 Insurance proceeds from loss on real property 308,167        -           -
 Proceeds from sale of property and equipment      -       10,000      30,530
                                              --------  ----------  ----------
  Net cash used in investing activities       (397,404)   (56,723)    (83,446)
                                              --------  ----------  ----------


The accompanying notes are an integral part of the consolidated financial
statements

(Continued)

                                      F5

<PAGE>


OP-TECH Environmental Services, Inc. and Subsidiary
Consolidated Statements of Cash Flows (Continued)
Years Ended December 31, 2001, 2000, and 1999


                                               2001        2000       1999
                                           -----------  ----------  ---------
Financing activities:
 Cash overdrafts (repayments)              $  (184,549) $   94,254 $   65,869
 Proceeds from notes payable to banks
  and long-term borrowings, net of
  financing costs                            6,382,500   4,350,593  4,998,188
 Principal payments on current
  and long-term borrowings                  (6,762,911) (4,765,438)(4,181,797)
                                            ----------- ----------- ----------
   Net cash (used in) provided
    by financing activities                   (564,960)   (320,591)   882,260
                                            ----------- ----------- ----------

Increase (dec.) in cash and cash equivalents    45,569      (8,785)  (107,072)

Cash and cash equivalents at beg. of year        6,249      15,034    122,106
                                            ----------- ----------- ----------

Cash and Cash Equivalents at End of Year    $   51,818  $    6,249  $  15,034
                                            ==========  ==========  ==========

Non-cash items:
Equipment purchased through
 bank and other financing sources           $  155,478  $   28,702$  $    -
Non-cash financing of insurance                158,174         -          -
Debt transfer upon sale of asset                   -        31,341        -
Common stock issued for services rendered        5,000         -          -


The accompanying notes are an integral part of the consolidated financial
statements

                                    F6

<PAGE>

OP-TECH Environmental Services, Inc. and Subsidiary
Notes to Consolidated Financial Statements

1.  Summary of Significant Accounting Policies

Basis of Presentation

OP-TECH Environmental Services, Inc. and Subsidiary (the "Company"), provides
comprehensive environmental services predominately in Upstate New York,
Massachusetts, Northern Pennsylvania and New Jersey.  The Company performs
industrial cleaning of non-hazardous materials, provides varying services
relating to plant facility closure including demolition and asbestos services,
provides remediation services for sites contaminated by hazardous materials
and provides emergency spill response services.  The Company has an inactive
Canadian subsidiary, OP-TECH Environmental Services, Ltd.

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of the
Company and its wholly-owned subsidiary.  All significant intercompany
accounts and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported amounts
of assets and liabilities and disclosure of contingent assets and liabilities
at the date of the financial statements.  Estimates also affect the reported
amounts of revenues and expenses during the reporting period.  Actual results
could differ from those estimates.  One of the more significant estimates
includes the evaluation of impairment of the Company's long-lived assets.  As
more fully described in Note 4, the Company has certain property held for
sale.  Future changes in the estimates, or other assumptions utilized by
management to evaluate the asset's carrying value, may have a material effect
on the conclusions reached and the ultimate determination of impairment and
carrying value.

Project Income Recognition and Unbilled Project Costs

Contracts are predominately short-term in nature (less than three months) and
revenue is recognized as costs are incurred and billed.  Income on long-term
fixed-priced contracts greater than three months is recognized on the
percentage-of-completion method.  Project costs are generally billed in
the month they are incurred and are shown as current assets.  Revenues
recognized in excess of amounts billed are recorded as an asset.  In the
event interim billings exceed costs and estimated profit, the net amount of
deferred revenue is shown as a current liability.  Estimated losses are
recorded in full when identified.

Concentration of Business Risk - Significant Customers

Sales to one customer, other than an affiliated party, amounted to
approximately $3,435,000, $1,728,000 and $1,025,700 in 2001, 2000 and 1999,
respectively.  Accounts receivable at December 31, 2001 and 2000 include
$550,000 and $463,000, respectively, from this customer.

                                     F7

<PAGE>


1.  Summary of Significant Accounting Policies (Continued)

Property and Equipment

Property and equipment are stated at cost.  Expenditures for repairs and
maintenance are charged to expense as incurred.  Depreciation of assets
including those recorded under capital leases is provided for using the
straight-line method.

Assets Held for Sale

Assets held for sale are stated at the lower of carrying amount or estimated
fair value less costs of disposal.

Long and Short-Term Debt

The carrying amounts of the Company's short-term collateralized and unsecured
borrowing and non-traded variable-rate long-term debt agreements approximate
fair value.

Income Taxes

The Company provides for income taxes in accordance with the liability method
as set forth in Statement of Financial Accounting Standards No. 109
"Accounting for Income Taxes".  Under the liability method, deferred tax
assets and liabilities are determined based on the difference between the
financial statement and tax basis of assets and liabilities and are measured
using the enacted tax rates and laws that may be in effect in the years in
which the differences are expected to reverse.

Earnings Per Share

Basic earnings per share is computed by dividing net income by the weighted
average shares outstanding for the period, which were 11,641,771, 11,603,963
and 11,603,963 for the years ended December 31, 2001, 2000 and 1999,
respectively.  Diluted earnings per share includes the potentially dilutive
effect of common stock equivalents.  Warrants issued to a financial advisor
in 1998 to purchase 302,500 shares of common stock at $1.65 per share expired
in 2001.




2.  Related Party Transactions

The Company purchases technical, accounting, and consulting services and
rented certain office and warehouse space from a shareholder and its
affiliates.  The cost for these services amounted to approximately $43,000,
$50,000 and $299,000 in 2001, 2000 and 1999, respectively.

Additionally, the Company provided approximately $27,000, $143,000 and
$970,000 of remediation, sub-contract support and project services to a
shareholder and its affiliates for the years ending December 31, 2001, 2000
and 1999, respectively.

During 2001, the Company purchased approximately $886,000 of subcontract
labor services from St. Lawrence Industrial Services, Inc. which is owned by
a director of the Company.

                                      F8

<PAGE>


3.  Property, Plant and Equipment

Property, plant and equipment consisted of the following at December 31:



                                                 2001        2000
                                             ----------  ----------

  Furniture and fixtures                     $   13,820  $   42,743
  Buildings                                     414,541         -
  Office machines                               122,879      79,282
  Field equipment                             2,024,400   1,697,254
  Aqueous treatment system                      121,728      98,330
                                              ---------   ---------
                                              2,697,368   1,917,609
  Less: Accumulated depreciation             (1,178,955)   (924,572)
                                              ---------   ---------
                                             $1,518,413  $  993,037
                                              =========   =========

Depreciation expense approximated $327,000, $267,000 and $294,000 for 2001,
2000 and 1999, respectively.

During the second quarter of 2001, the Company received insurance proceeds in
the amount of $308,167 related to the insured replacement value of a property
that was destroyed by a fire.  The proceeds received were used to replace the
destroyed building and contents at substantially the same cost.  A loss on
disposal of assets, representing the net book value of all the destroyed
assets as of the date of the fire, was recorded in the amount of $6,286.
Accordingly, the Company realized a casualty gain of $301,881 as a result of
the proceeds collected.



4.  Assets Held for Sale

The Company continues to pursue the disposal of its Massena Port Facility
("Facility"), which was acquired in 1991 for the purpose of developing a
large aqueous treatment facility.  Management's estimation of fair value is
based upon an evaluation of existing facts and circumstances, including
current real estate market conditions and certain other factors.  During the
third quarter of 2001 the Company, based on management's estimate of the
Facility's fair value, recognized an additional impairment loss on the
carrying value of the Facility of approximately $300,000.

                                       F9

<PAGE>


5.  Debt and Lease Obligations

Long-term debt is summarized as follows at December 31, 2001:

Line of credit, due May 31, 2003. (a)                            $  1,427,900
Term Loan, due in monthly installment payments of $12,500, plus
 interest at prime plus 1.25% (6% at December 31, 2001).(a)           687,500
Equipment Line of Credit, due in monthly installment payments
 of $2,765, including interest at prime plus 1.25% (6% at
 December 31, 2001). (a)                                              135,245
Equipment Note, due in monthly installment payments of $2,730,
 including interest at 7.5%, collateralized by equipment with a
 carrying value of $80,900.                                            78,808
Insurance Financing Note, due in monthly installment payments
 of $18,304, including interest at 9.85%, collateralized by the
 assignment of unearned premiums.                                      36,162
                                                                  -----------
                                                                    2,365,615
Less: Current portion                                                (239,369)
                                                                 ------------
                                                                 $  2,126,246
                                                                 ============

(a)  In June 2001, the Company entered into financing agreements (the
Agreements) with a new lender including a Line of Credit agreement to
refinance its previous Line of Credit, which provides for borrowings up to
$2,200,000 to be used for working capital and expires on May 31, 2003, unless
renewed by the lender; a $750,000 Term Loan agreement to refinance its
previous term loans outstanding, which expires in August 2006; and a $200,000
Equipment Line of Credit which matures on May 31, 2002, unless renewed by the
lender.  Borrowings under the Equipment Line of Credit are converted to term
loans to be paid in monthly installments over the shorter of five years or
the useful life of the equipment.  During 2001 the Company borrowed $108,535
and $33,850 under the Equipment Line of Credit, both of which were converted
to term notes maturing September 1, 2006 and November 1, 2006, respectively.

The Agreements are collateralized by all accounts receivable, inventory
and equipment now owned or subsequently acquired.  Availability on the Line
of Credit is subject to a specified borrowing base calculation using eligible
accounts receivable and costs in excess of billings.

The Agreements also include certain financial covenants including a minimum
fixed charge ratio, a tangible net worth ratio and a debt to net worth ratio;
cross-collateralization provisions; and a material adverse change clause
which permits the financial institution to call its obligation if the Company
fails to comply with covenants, as defined, or in the event of a material
adverse change in the Company's business.  Management does not anticipate any
adverse changes in the next twelve months, however, there can be no
assurances.

Interest is charged at prime plus 1.25%, or 6% at December 31, 2001.  The
weighted average borrowing rates under short-term credit facilities were
8.16% and 10.49% at December  31, 2001 and 2000, respectively.

Interest paid amounted to approximately $207,000, $267,000 and $191,000 in
2001, 2000 and 1999, respectively.

                                     F10

<PAGE>


5.  Debt and Lease Obligations (Continued)

Scheduled principal payments on long-term debt for the next five years are as
follows:

            2002            $  239,369
            2003             1,634,942
            2004               200,131
            2005               180,761
            2006               110,412
                             ---------
                            $2,365,615
                             =========

Office facilities, a portion of which is with an affiliate of the Company's
shareholder, are leased under noncancelable operating leases expiring at
various dates through 2006.  Rent expense incurred amounted to approximately
$519,000, $553,000 and $515,000 in 2001, 2000 and 1999, respectively.  Future
minimum lease payments under noncancelable operating leases are as follows:
2002 - $372,000, 2003 - $274,000, 2004 - $184,000, 2005 - $163,000 and
2006 - $63,000.



6.  Income Taxes

The following summarizes the income tax (benefit) expense at
December 31, 2001:


                                   2001        2000        1999
                                ---------   ----------  ---------
        Current:
          Federal               $     -     $     -     $     -
          State                    13,000     (12,000)     43,980
                                ---------   ----------  ---------
                                $  13,000   $ (12,000)  $  43,980
                                =========   ==========  =========

The difference between the expected tax provision resulting from the
application of the federal statutory income tax rate to pre-tax income is due
principally to (i) for 2001 and 2000, reversal of the valuation allowance
related to utilized net operating loss carryforwards and (ii) for 1999, the
recognition of a valuation allowance against generated net operating losses.

At December 31, 2001, the Company has federal net operating loss ("NOL") and
alternative minimum tax ("AMT") credit carryforwards of approximately
$6,054,000 and $6,564,000, for income tax purposes.  The federal net
operating loss carryforward expires at various times through the year ending
December 31, 2019.  Alternative minimum tax credit carryforwards do not
expire.  Income taxes and franchise taxes paid were approximately $13,000 and
$3,500 in 2001 and 2000, respectively.

Deferred income taxes reflect the net tax effect of temporary differences
between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for income tax purposes.  The Company
has recorded a valuation allowance amounting to the entire net deferred tax
asset due to uncertainty as to the ultimate recovery of the assets.


                                    F11

<PAGE>


6.  Income Taxes (Continued)

Significant components of the Company's deferred tax liabilities and assets
as of December 31, 2001 and 2000 are as follows:


                                               2001          2000
                                             ----------   ----------
Deferred tax liabilities:
  Depreciation                               $  126,358   $   64,625
                                             ----------   ----------

Deferred tax assets:
 Net operating loss carryforward             $2,058,385   $2,470,447
 Accounts receivable reserve                     77,153       59,156
 Other                                          513,400      568,947
 AMT tax credits                                 25,083       18,785
                                             ----------   ----------
   Total deferred tax assets                  2,674,021    3,117,335
Valuation allowance for deferred assets      (2,547,663)  (3,052,710)
                                             ----------   ----------
   Deferred tax assets                       $  126,358   $   64,625
                                             ----------   ----------
   Net deferred tax assets                   $      -     $      -
                                             ==========   ==========


7.  Employee Benefit Plan

The Company maintains a defined contribution employee retirement plan which
covers substantially all employees.  The Plan is funded by voluntary employee
contributions which are matched by the Company at a designated percentage,
and additional contributions by the Company at the discretion of the Board of
Directors.  There were matching contributions to the plan of approximately
$26,000, $18,700 and $9,900 in 2001, 2000 and 1999, respectively, by the
Company.  The Company did not make discretionary contributions to the Plan in
2001, 2000 and 1999.


8.  Commitment and Contingencies

The Company is subject to various federal, state and local regulations
relating to environmental matters, including laws which require the
investigation and, in some cases, remediation of environmental contamination.
The Company's policy is to accrue and charge to operations environmental
investigation and remediation expenses when it is probable that a liability
has been incurred and an amount is reasonably estimable.

The Company is a party to various proceedings arising from the normal course
of business.  Based on information currently available, management believes
adverse decisions relating to litigation and contingencies in the aggregate
would not materially affect the Company's results of operations, cash
flows or financial condition.

                                     F12

<PAGE>


9.  Two-Year Selected Quarterly Financial Data (Unaudited)


                                      Year Ended December 31, 2001

                            Quarter       Quarter   Quarter       Quarter
                             Ended         Ended     Ended         Ended
                            March 31      June 30  September 30  December 31
                           ----------   ----------   ----------  -----------

Project billings           $2,869,570   $3,378,960   $3,664,400   $3,330,151
Gross margin                  894,927      987,408      926,036      968,097
Net income (loss)              53,429      419,528     (162,448)     200,884
Net income (loss) per
 share (basic and dilutive     $0.00        $0.04       $(0.01)       $0.02



                                     Year Ended December 31, 2000

                            Quarter      Quarter     Quarter       Quarter
                             Ended        Ended       Ended         Ended
                            March 31     June 30    September 30  December 31
                           ----------   ----------   ----------  -----------

Project billings           $2,717,158   $3,377,878   $3,358,271   $4,217,718
Gross margin                  778,363      915,882      935,650      982,060
Net income (loss)              51,174      173,269      161,920      153,513
Net income (loss) per
 share (basic and dilutive     $0.00        $0.01        $0.01        $0.01



(See also Notes 3 and 4.)


                                       F13

<PAGE>


SCHEDULE II


                                  Balance at                       Balance at
                                   Beginning                          End of
      Description                  of Period  Additions  Deductions   Period

YEAR ENDED DECEMBER 31, 2001
Reserves deducted from assets
to which they apply:
  Doubtful accounts receivable   $  149,346  $  135,999 $ 90,563(a) $  194,782
  Valuation allowance for
    deferred assets              $3,052,710  $      -   $505,047    $2,547,663


YEAR ENDED DECEMBER 31, 2000
Reserves deducted from assets
to which they apply:
  Doubtful accounts receivable   $  132,155  $  116,500  $ 99,309(a) $  149,346
  Valuation allowance for
    deferred assets              $2,934,212  $  118,498  $    -      $3,052,710


YEAR ENDED DECEMBER 31, 1999
Reserves deducted from assets
to which they apply:
  Doubtful accounts receivable   $  125,960  $  108,700  $102,505(a) $  132,155
  Valuation allowance for
    deferred assets              $1,726,508  $1,207,704  $    -      $2,934,212



(a) Doubtful accounts written off and adjustments.



                                       F14
<PAGE>
<END>