Full Definition
Under the federal Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), current property owners can be held liable for environmental contamination regardless of whether they caused it. This is why Phase I Environmental Site Assessments are critical — they establish the 'innocent landowner' or 'bona fide prospective purchaser' defense.
Related Terms
Phase I Environmental Site Assessment
Records-based investigation to identify potential environmental contamination. Required by virtually every commercial lender.
Phase II ESA
Physical environmental testing with soil borings and groundwater sampling, triggered when a Phase I identifies contamination risks.