Transaction Screening Process

The purpose of this practice is to define a good practice in the United States for conducting a transaction screen for a parcel of commercial real estate where the user wishes to conduct limited environmental due diligence (that is, less than a Phase I Environmental Site Assessment).

If the driving force behind the environmental due diligence is a desire to qualify for one of the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) Landowner Liability Protections (LLPs), this practice should not be applied. Instead, the ASTM E1527: Standard Practice for Environmental Site Assessments: Phase I Environmental Site Assessment Process or ASTM E2247: Standard Practice for Environmental Site Assessments: Phase I Environmental Site Assessment Process for Forestland or Rural Property may be used.

A Transaction Screen Assessment (TSA) or Transaction Screening Process (TSP) or Environmental Screen (ES) is a form of environmental due diligence which is less comprehensive than a Phase I Environmental but more comprehensive than an RSRA. There really only cost advantages in ordering a TSP/ TSA/ ES. You essentially gain a site visit, the backend of a Phase I Environmental, as well as a questionnaire completed by the Environmental Professional and user of the report.

A Transaction Screening is less expensive than a Phase 1 ESA but more than a RSRA, while taking close to the same amount of time to complete as a Phase I. A Transaction Screen does not satisfy the requirement to conduct all appropriate inquiries into the previous ownership and uses of the property in order to qualify for one of the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) Landowner Liability Protections (LLPs). Qualification for one of the CERCLA LLPs does require a Phase I Environmental Assessment.

Simply stated, the Transaction Screen may lead to more questions than answers. We recommend looking into Records Search and Risk Assessments or a Phase I Environmental Assessment.