[CPEO-BIF] EPA's Inspector General reviews AllAppropriate Inquiries reports

[Ben Neal <bennealsemail@gmail.com>]

Larry
 - "the industry" is hardly a monolith. As in pretty much any human 
commercial endeavor, in the consulting world there are those who seek to
 gain business

by cutting cost and quality as a strategy for increasing their revenue; at least in the short term. 
The legal profession, I'm quite confident, is not immune.


I can assure you that there are many firms in the environmental 
consulting industry who do Phase I work only reluctantly, and only for 
carefully selected clients;

if they do it at all. ÂNot just because it's a low-margin service, but 
because the risk is so profoundly inconsistent with any reward. ÂAnd -- 
because of the presence

of low-margin low-quality consultants -- the price expectations of many clients and their legal counsel are poorly calibrated.


Rather than pointing fingers, perhaps we should brainstorm solutions. 
One solution is education. ÂIf you expect to pay $3,000 or $5,000 for a 
Phase I study, you should know that you have a high probability of 
getting a very poor quality product.
 ÂWouldn't it be nice if clients knew that? ÂIt would also be nice if 
the attorneys, who inevitably are involved in these kinds of 
transactions, advised their clients of that. ÂSome do. ÂI know a few. ÂI
 value them like gold.


I don't know what to do about the fly-by-night low-cost commodity Phase I
 consultant shops. ÂMaybe if there were fewer clients willing to buy a 
$5,000 Phase I there would be fewer consultants offering it. ÂI think we all have a role in educating clients. 
How best to do that? I'm open for suggestions.


Another solution might be to tighten the requirements of who is allowed 
to do Phase I work, with real consequences for those who fail to meet 
expectations. I don't agree with Lenny's suggestion that Phase I reports should routinely be disclosed to 
government regulators. ÂMany Phase I projects are done for tentative 
reasons: speculation or anticipatory due diligence. In my opinion, those
 should be able to remain confidential.


It's a tough question. ÂHow do we counteract the price pressure on a 
service the market considers to be a commodity, when in reality with 
each incremental decrease in fee, the risk to the buyer increases?


I don't have the answers. ÂBut I know the source of the problem is not 
solely an industry that "does all it can to commoditize their work." The 
reality is more complex than that.


Ben Neal


------------------------------
> ------------------------------------------
> Re: [CPEO-BIF] EPA's Inspector General reviews AllAppropriateInquiries reports
> brownfields-bounces@lists.cpeo.org <mailto:brownfields-bounces@lists.cpeo.org> [brownfields-bounces@lists.cpeo.org <mailto:brownfields-bounces@lists.cpeo.org>] on behalf of Larry Schnapf [larry@schnapflaw.com <mailto:larry@schnapflaw.com>]
>
> Sent: Â Tuesday, February 15, 2011 5:49 PM
> To: Â Â 
> 'R CHAPIN' [rwc27q@verizon.net] <https://legacy.ch2m.com/owa/?ae=Item&t=IPM.Note&a=New&to=rwc27q%40verizon.net&nm=%27R+CHAPIN%27>; 'Jerry Kubal' [jerry@kubalassoc.com] <https://legacy.ch2m.com/owa/?ae=Item&t=IPM.Note&a=New&to=jerry%40kubalassoc.com&nm=%27Jerry+Kubal%27>
>
> Cc: Â Â 
> 'Brownfields Internet Forum' [brownfields@lists.cpeo.org] <https://legacy.ch2m.com/owa/?ae=Item&t=IPM.Note&a=New&to=brownfields%40lists.cpeo.org&nm=%27Brownfields+Internet+Forum%27>
>
> Attachments: Â Â
> ATT00001.txtâ (224 Bâ) <https://legacy.ch2m.com/owa/attachment.ashx?attach=1&id=RgAAAACl2eHLflTREZ7oAIBf1MitBwBx4o3TQErREZ7lAIBf1MitAAAABdxGAADiYAlsyYsEQrntj1VTAh9LAANrlN9qAAAJ&attid0=EAD5yEvY5t3mSagCOCOi%2bvvm&attcnt=1>
>
>
> We cant really blame clients without sophisticated environmental 
> knowledge Âbeing unable to discern the value of well-prepared reports 
> when the industry does all it can to commoditize their work
>
> Â
> Lawrence Schnapf
>
> Schnapf Law Office
>
> 55 East 87th Street #8B
>
> New York, New York 10128
>
> 212-756-2205 (p)
>
> 212-646-8483 (c)
>
> Larry@SchnapfLaw.com <https://legacy.ch2m.com/owa/redir.aspx?C=d8d51f5696e141e2b0bb462801bc9b3c&URL="">>
>
> www.SchnapfLaw.com <https://legacy.ch2m.com/owa/redir.aspx?C=d8d51f5696e141e2b0bb462801bc9b3c&URL="">>
>
> Â
> Named to Chambers USA 2009-10 Client Guide of Americaâs Leading Lawyers for Business.
>
> AV Preeminent Rating from Martindale-Hubbell
>
> Â
> Listed in 2010 New York Super Lawyers-Metro Edition
>
> Â
> Blog: Visit Schnapf Judgment on the commonground community at http://commonground.edrnet.com/resources/9d51c3f88e/summary <https://legacy.ch2m.com/owa/redir.aspx?C=d8d51f5696e141e2b0bb462801bc9b3c&URL="">>
>
> Â
> Â
> Linked-In Blog: Environmental Issues in Business Transactions http://www.linkedin.com/groups?mostPopular=&gid=3607181 <https://legacy.ch2m.com/owa/redir.aspx?C=d8d51f5696e141e2b0bb462801bc9b3c&URL="">>
>
> ------------------------------------------------------------------------
>
>
> From: R CHAPIN [mailto:rwc27q@verizon.net <mailto:rwc27q@verizon.net>]
> Sent: Tuesday, February 15, 2011 4:47 PM
> To: Jerry Kubal; larry@schnapflaw.com <mailto:larry@schnapflaw.com>
> Cc: Brownfields Internet Forum
> Subject: Re: [CPEO-BIF] EPA's Inspector General reviews AllAppropriateInquiries reports
>
> Â
> I strongly agree with Jerry. ÂWhen the client selects low bid they typically what they paid for. 
> Â
> ________________________________________________
> Richard W. Chapin, M.S., P.E., BCEE
> President, Chapin Engineering
> 27 Quincy Road, Basking Ridge, NJ 07920
> 908-647-8407 908 625 5697 (cell) 908-647-6959 (fax)
>
> Â
> Â
> Â
> ----- Original Message -----
>
>  Â ÂFrom: Jerry Kubal
>  Â Â<https://legacy.ch2m.com/owa/redir.aspx?C=d8d51f5696e141e2b0bb462801bc9b3c&URL="">>
>
>
>  Â ÂTo: larry@schnapflaw.com
>  Â Â<https://legacy.ch2m.com/owa/redir.aspx?C=d8d51f5696e141e2b0bb462801bc9b3c&URL="">>
>
>
>  Â ÂCc: Brownfields Internet Forum
>  Â Â<https://legacy.ch2m.com/owa/redir.aspx?C=d8d51f5696e141e2b0bb462801bc9b3c&URL="">>
>
>
>  Â ÂSent: Tuesday, February 15, 2011 4:24 PM
>
>  Â ÂSubject: Re: [CPEO-BIF] EPA's Inspector General reviews All
>  Â ÂAppropriateInquiries reports
>
>  Â Â 
>  Â ÂThese have become a commodity and are priced accordingly. Phase I
>  Â Âreports cannot be done properly for the amount of money paid to
>  Â Âconduct them. Expenses eat up more than half the cost and that only
>  Â Âleaves time for junior, lower billiability rate staff to spend any
>  Â Âtime on interpretation. ÂThese things are the equivalent of a loss
>  Â Âleader. When you have junior staff do the work and a P.G. takes 15
>  Â Âminutes to review and sign them, there is a tendency to turn these
>  Â Âinto marketing reports by finding something that will result in a
>  Â ÂPhase II follow-on so some of the actual cost incurred can be
>  Â Ârecovered.
>
>  Â Â 
>  Â ÂWe won't do these types of investigations unless they're for an
>  Â Âexisting client that understands what it takes to do one properly
>  Â Âand is willing to pay accordingly. Unfortunately, the big consumer
>  Â Âof these reports is typically a financial institution that will pick
>  Â Âthe low bidder and then require ridiculous amounts of professional
>  Â Âliability insurance to cover their rear ends because they know a
>  Â Âcertain number of these are going to be substandard.
>
>  Â Â 
>  Â ÂSame sorry state of affairs in the UST business. If you think AAI's
>  Â Âare bad, pick up and read a typical UST report some day. That will
>  Â Âreally scare you.
>
>  Â Â 
>  Â ÂI get tired of hearing all the complaints about the shoddy work of
>  Â Âconsultants when in most cases it's the end user that drives the
>  Â Âquality of the work product. When it's all said and done, you
>  Â Âtypically get what you pay for. Professional services and work
>  Â Âproducts aren't exempt from this. General Electric's policy to
>  Â Âreverse auction professional services is probably one of the most
>  Â Âdegrading experiences you can ever be subjected to as a consultant.
>  Â ÂAnd, over and over, they're getting exactly what they don't pay for.
>
>  Â Â 
>  Â ÂJerry E. Kubal, P.G.
>
>  Â ÂKubal & Associates, Inc.
>
>  Â ÂP.O. Box 273210
>
>  Â ÂTampa, FL Â33688-3210
>
>  Â Â813-265-2338 (Office)
>
>  Â Â813-503-6493 (Cell)
>
>  Â Â 
>  Â Â 
>  Â Â 
>  Â Â 
>  Â Â 
>  Â ÂOn Feb 15, 2011, at 3:33 PM, larry@schnapflaw.com
>  Â Â<https://legacy.ch2m.com/owa/redir.aspx?C=d8d51f5696e141e2b0bb462801bc9b3c&URL="">>
>
>  Â Âwrote:
>
>
>
>  Â ÂI could speak hours on the volume of crappy and substandard phase 1
>  Â Âreports that are produced each year by so-called "commodity shops".
>  Â ÂThey typically miss historical contamination and prior uses, nearby
>  Â Âplumes that may be impacting a site, vapor intrusion, old tanks.
>  Â Âexistence of prior bombing ranges- the list goes on.
>
>  Â Â 
>  Â ÂThe problem was always there but EPA's AAI facilitated this mess by
>  Â Âdiluting the definition of EP. We should have mandatory state
>  Â Âlicensing for EPs who could then lose their licenses if they
>  Â Âcontinue to crank out (some would say spit out) these terrible phase
>  Â Â1 reports.
>
>  Â Â 
>  Â ÂLarry 
>   ÂSchnapf Law Offices   55 East 87th Street, Ste. 8B
>  Â ÂNew York, NY 10128
>  Â Â212-756-2205 (p) Â Â 646-468-8483 (c)
>  Â ÂLarry@SchnapfLaw.com
>  Â Â<https://legacy.ch2m.com/owa/redir.aspx?C=d8d51f5696e141e2b0bb462801bc9b3c&URL="">>
>
>  Â Âhttp://www.SchnapfLaw.com/
>  Â Â<https://legacy.ch2m.com/owa/redir.aspx?C=d8d51f5696e141e2b0bb462801bc9b3c&URL="">>
>
>  Â ÂNamed to Chambers USA 2009-10 Client Guide of America?s Leading
>  Â ÂLawyers for Business.
>
>  Â ÂAVÂ Preeminent Rating from Martindale-Hubbell
>
>  Â ÂListed in 2010 New York Super Lawyers-Metro Edition
>
>  Â Â 
>  Â Â Â Â-----Original Message-----
>  Â Â Â ÂFrom: Trilling, Barry [mailto:BTrilling@wiggin.com
>  Â Â Â Â<mailto:BTrilling@wiggin.com>]
>  Â Â Â ÂSent: Tuesday, February 15, 2011 02:50 PM
>  Â Â Â ÂTo: lsiegel@cpeo.org
>  Â Â Â Â<https://legacy.ch2m.com/owa/redir.aspx?C=d8d51f5696e141e2b0bb462801bc9b3c&URL="">>,
>
>  Â Â Â Â'Brownfields Internet Forum'
>  Â Â Â ÂSubject: Re: [CPEO-BIF] EPA's Inspector General reviews All
>  Â Â Â ÂAppropriate Inquiries reports
>
>  Â Â Â ÂHaving seen this curse spread in both the public and private
>  Â Â Â Âsectors, I favor the enactment of legislation or promulgation of
>  Â Â Â Âregulation that will give EPA and state agencies the authority
>  Â Â Â Âto issue monetary sanctions and/or lift the license to practice
>  Â Â Â Âof so-called environmental professionals who certify compliance
>  Â Â Â Âwith the regulatory standard when it is far from the truth to do
>  Â Â Â Âso. Corporate officials who certify statements submitted to EPA
>  Â Â Â Âare subject to criminal penalties; these folks who louse up the
>  Â Â Â Âprocess for everyone else and endanger human health and the
>  Â Â Â Âenvironment by doing so should also be subject to punishment.
>  Â Â Â ÂBarry J. Trilling ÂW I G G I N ÂA N D ÂD A N A -----Original
>  Â Â Â ÂMessage----- From: brownfields-bounces@lists.cpeo.org
>  Â Â Â Â<https://legacy.ch2m.com/owa/redir.aspx?C=d8d51f5696e141e2b0bb462801bc9b3c&URL="">>
>
>  Â Â Â Â[mailto:brownfields-bounces@lists.cpeo.org
>  Â Â Â Â<mailto:brownfields-bounces@lists.cpeo.org>] On Behalf Of Lenny
>  Â Â Â ÂSiegel Sent: Tuesday, February 15, 2011 2:24 PM To: Brownfields
>  Â Â Â ÂInternet Forum Subject: [CPEO-BIF] EPA's Inspector General
>  Â Â Â Âreviews All Appropriate Inquiries reports [This new reports
>  Â Â Â Âfinds that EPA does not normally review All Appropriate
>  Â Â Â ÂInquiries reports submitted by Brownfields Assessment grantees,
>  Â Â Â Âand that those reports often do not meet the legal requirements
>  Â Â Â Âunder the AAI rule. What can and should be done to improve the
>  Â Â Â Âquality of those reports? What can and should be done to ensure
>  Â Â Â Âthat AAI reports prepared for other purposes meet the legal
>  Â Â Â Ârequirements? Does anyone have evidence of serious on-the-ground
>  Â Â Â Âconsequences of poor AAI documentation?- LS] EPA Must Implement
>  Â Â Â ÂControls to Ensure Proper Investigations Are Conducted at
>  Â Â Â ÂBrownfields Sites U.S. EPA Office of Inspector General Report
>  Â Â Â ÂNo. 11-P-0107 February 14, 2011 At a Glance What We Found EPA
>  Â Â Â Âdoes not review AAI [All Appropriate Inquiries] reports
>  Â Â Â Âsubmitted by grantees to assure that they comply with federal
>  Â Â Â Ârequirements. Rather, EPA has relied on the environmental
>  Â Â Â Âprofessional conducting the AAI to self-certify that
>  Â Â Â Ârequirements are met. Of the 35 AAI reports we reviewed, from
>  Â Â Â Âthree EPA regions, none contained all the required documentation
>  Â Â Â Âelements. This occurred because the Agency does not have
>  Â Â Â Âmanagement controls requiring EPA project officers to conduct
>  Â Â Â Âoversight of AAI reports. Management controls regarding EPA
>  Â Â Â Âoversight of Brownfields grants funded by the American Recovery
>  Â Â Â Âand Reinvestment Act of 2009 (ARRA) are also missing. EPA has
>  Â Â Â Âissued specific guidance and management controls for ARRA grant
>  Â Â Â Âactivities. However, the guidance and controls do not address
>  Â Â Â Âoversight of AAI reports. Because of EPA's lack of oversight and
>  Â Â Â Âreliance on environmental professionals' self-certifications,
>  Â Â Â ÂAAI investigations not meeting federal requirements may go
>  Â Â Â Âundetected by Agency staff. The Office of Inspector General
>  Â Â Â Âfound instances of noncompliance that were not detected by
>  Â Â Â ÂAgency staff. Improper AAI investigations introduce risk that
>  Â Â Â Âthe environmental conditions of a property have not been
>  Â Â Â Âproperly or adequately assessed, which may lead to improper
>  Â Â Â Âdecisions about appropriate uses of brownfields properties.
>  Â Â Â ÂUltimately, threats to human health and the environment could go
>  Â Â Â Âunrecognized. Noncompliant AAI investigations may result in
>  Â Â Â Âfuture grant denials and possible government reimbursement. The
>  Â Â Â ÂAAI reports the OIG reviewed were generated from $2.14 million
>  Â Â Â Âin grant awards. If conditions merit, EPA is authorized to take
>  Â Â Â Âback funds from noncompliant grantees. The OIG questions the
>  Â Â Â Âvalue of the reports we reviewed. What We Recommend We recommend
>  Â Â Â Âthat EPA establish accountability for compliant AAI reports, to
>  Â Â Â Âinclude those conducted under ARRA Brownfields grants; develop a
>  Â Â Â Âplan to review AAI reports to determine the reports' compliance
>  Â Â Â Âwith AAI documentation requirements; and establish criteria to
>  Â Â Â Âdetermine whether noncompliant grantees should return federal
>  Â Â Â Âgrant money. The Agency did not clearly agree or disagree with
>  Â Â Â ÂOIG recommendations. In its final response to the report, the
>  Â Â Â ÂAgency needs to agree or disagree with recommendations and, as
>  Â Â Â Âappropriate, provide a corrective action plan to address the
>  Â Â Â Ârecommendations. To download the full 19-page 140 KB report, go
>  Â Â Â Âto http://www.epa.gov/oig/reports/2011/20110214-11-P-0107.pdf
>  Â Â Â Â<https://legacy.ch2m.com/owa/redir.aspx?C=d8d51f5696e141e2b0bb462801bc9b3c&URL="">>
>
>  Â Â Â Â-- Lenny Siegel Executive Director, Center for Public
>  Â Â Â ÂEnvironmental Oversight a project of the Pacific Studies Center
>  Â Â Â Â278-A Hope St., Mountain View, CA 94041 Voice: 650/961-8918 or
>  Â Â Â Â650/969-1545 Fax: 650/961-8918 http://www.cpeo.org
>  Â Â Â Â<https://legacy.ch2m.com/owa/redir.aspx?C=d8d51f5696e141e2b0bb462801bc9b3c&URL="">>
>
>  Â Â Â Â_______________________________________________ Brownfields
>  Â Â Â Âmailing list Brownfields@lists.cpeo.org
>  Â Â Â Â<https://legacy.ch2m.com/owa/redir.aspx?C=d8d51f5696e141e2b0bb462801bc9b3c&URL="">>
>
>  Â Â Â Âhttp://lists.cpeo.org/listinfo.cgi/brownfields-cpeo.org
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>
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-- 


Lenny Siegel
Executive Director, Center for Public Environmental Oversight
a project of the Pacific Studies Center
278-A Hope St., Mountain View, CA 94041
Voice: 650/961-8918 or 650/969-1545
Fax: 650/961-8918
<lsiegel@cpeo.org>
http://www.cpeo.org
_______________________________________________
Brownfields mailing list
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