Phase I vs. Phase II Environmental Site Assessments

Last updated: October 8, 2026

A Phase I Environmental Site Assessment (ESA) identifies potential environmental contamination at a property, while a Phase II ESA investigates those concerns through environmental sampling and laboratory testing. Both assessments help property buyers, municipalities, developers, and lenders evaluate environmental conditions before making decisions about property acquisition or redevelopment.

The two assessments serve different purposes. A Phase I ESA evaluates current and historical property uses to identify recognized environmental conditions (RECs). A Phase II ESA collects and analyzes soil, groundwater, or soil gas samples to investigate whether contamination is present in areas of concern.

Not every Phase I ESA leads to a Phase II ESA. Whether further investigation is appropriate depends on the property’s history, the findings of the initial assessment, and the intended use of the site.

Understanding these differences is an important part of environmental due diligence and helps project teams address environmental concerns before they interfere with acquisition, construction, or redevelopment.

Phase I vs. Phase II Environmental Site Assessments: What’s the Difference?

Category	Phase I ESA	Phase II ESA
Primary purpose	Identify potential or known environmental concerns	Investigate suspected or known contamination
Assessment methods	Historical research, site observations, regulatory reviews, and interviews	Soil borings, groundwater testing, soil gas sampling, and laboratory analysis
Environmental sampling	Not typically performed	Yes, based on the investigation objectives
ASTM standard	ASTM E1527-21	ASTM E1903-19
Findings	Identifies RECs and other environmental conditions	Provides analytical data about contaminants in sampled areas
Typical use	Initial property due diligence	Further investigation when contamination is suspected or known

The Phase I ESA identifies potential environmental concerns. The Phase II ESA provides physical evidence to help determine whether those concerns have resulted in contamination.

What Is a Phase I Environmental Site Assessment?

A Phase I Environmental Site Assessment is a nonintrusive investigation of a property’s current and historical environmental conditions. Environmental professionals examine available records, inspect the property, and interview people familiar with its use to identify conditions that may indicate a release of hazardous substances or petroleum products.

Phase I ESAs are commonly performed before property acquisition, refinancing, or redevelopment. They are also used to support environmental planning for public infrastructure and brownfield projects.

For commercial properties, Phase I ESAs are generally conducted according to ASTM E1527-21, the standard recognized by the U.S. Environmental Protection Agency (EPA) as meeting its All Appropriate Inquiries (AAI) rule under 40 CFR Part 312.

AAI is one of the conditions that qualifying landowners must satisfy to seek certain liability protections under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), commonly known as Superfund.

Completing a compliant Phase I ESA alone does not automatically establish liability protection. Property owners must also meet other applicable conditions, including certain obligations after acquisition.

What Does a Phase I Environmental Site Assessment Include?

A Phase I ESA generally covers four areas of investigation. For a closer look at the process, F&V’s Phase I Environmental Site Assessment checklist explains what property owners and project teams should prepare for.

1. Historical Property Research

Environmental professionals examine historical records to determine how a property and its surrounding land have been used over time.

Documents may include:

• Historical aerial photographs
• Sanborn fire insurance maps
• Historical city directories
• Topographic maps
• Property development and land-use records
• Previous environmental investigations

For example, a property currently used as a municipal office may have previously housed an automotive repair facility. That history may warrant further investigation if the former operation included underground storage tanks, petroleum releases, or other potentially contaminating activities.

2. Environmental Records Review

The assessment includes a review of available federal, state, tribal, and local environmental records.

This research may identify prior spills, underground storage tanks, regulatory cleanup actions, or nearby contaminated properties.

Environmental conditions beyond the property’s boundaries can also matter. Contamination originating on an adjoining property may migrate through groundwater or other pathways and affect the property under review.

3. Site Reconnaissance

An environmental professional conducts a visual inspection of the property and adjoining properties, to the extent accessible and appropriate.

The inspection may identify evidence of potential environmental concerns, including:

• Aboveground or underground storage tanks
• Stained soil or pavement
• Chemical storage areas
• Drums and abandoned containers
• Waste disposal areas
• Distressed vegetation or other visible indicators of a possible release

A Phase I ESA does not ordinarily include collecting soil or groundwater samples. Its purpose is to identify environmental conditions that may warrant closer examination.

4. Interviews and Property Owner Information

Environmental professionals interview current or former owners, operators, and occupants when appropriate. Additional information may be obtained from neighboring property owners, government agencies, and local officials.

The party commissioning the assessment is also responsible under ASTM E1527-21, including providing available information on environmental cleanup liens, activity and use limitations, and relevant knowledge of the property.

The information collected through these activities is evaluated and documented in a written Phase I ESA report.

What Are Recognized Environmental Conditions (RECs)?

A recognized environmental condition, or REC, is a finding that indicates the presence, likely presence, or material threat of a future release of hazardous substances or petroleum products at a property, as defined under ASTM E1527-21.

The standard distinguishes among three classifications:

• Recognized environmental condition (REC): Evidence indicates an existing release, likely release, or material threat of a future release of hazardous substances or petroleum products.
• Controlled recognized environmental condition (CREC): A previously identified release has been addressed to the satisfaction of the applicable regulator, but the contamination remains subject to property-use limitations or other controls.
• Historical recognized environmental condition (HREC): A past release has been addressed to the satisfaction of the applicable regulator or to unrestricted-use criteria, with no remaining property-use limitations.

These classifications help determine whether additional investigation, monitoring, or management of existing environmental controls may be appropriate.

An REC does not automatically mean that contamination has been confirmed or that a Phase II ESA is required. The environmental professional evaluates the available evidence and recommends an appropriate course of action.

What Is a Phase II Environmental Site Assessment?

A Phase II Environmental Site Assessment is an investigation that uses environmental sampling and laboratory analysis to evaluate suspected or known contamination.

While a Phase I ESA relies primarily on historical information and observations, a Phase II ESA produces analytical data about environmental conditions in the areas investigated.

Phase II assessments may be conducted in accordance with ASTM E1903-19, which establishes a process for developing investigation objectives, collecting scientifically defensible data, and evaluating the results.

The scope of a Phase II ESA is developed around the site’s environmental concerns. For example, suspected petroleum contamination near a former underground storage tank would call for a different investigation than a possible solvent release at a former manufacturing facility.

What Does a Phase II Environmental Site Assessment Include?

1. Investigation Planning

The environmental professional reviews available information, including the Phase I ESA findings, historical site activities, previous sampling results, and local geology.

This information helps determine where samples should be collected, what environmental media should be evaluated, and which contaminants should be analyzed.

2. Field Investigation and Sampling

Depending on the suspected contamination, field activities may include:

• Soil borings: Collecting soil samples from selected depths to evaluate potential contamination.
• Groundwater sampling: Collecting groundwater samples from temporary or permanent monitoring wells to evaluate subsurface conditions.
• Soil gas or vapor sampling: Investigating volatile compounds that may migrate through the subsurface and potentially affect buildings.
• Geophysical surveys: Using methods such as ground-penetrating radar to help locate suspected buried tanks, utilities, or other subsurface features.

Field methods depend on site conditions, investigation objectives, and access limitations. Not every Phase II ESA includes all of these activities.

3. Laboratory Analysis

Collected samples are submitted to a laboratory for chemical analysis.

Laboratory testing is selected based on the contaminants associated with the property’s history. Examples may include petroleum hydrocarbons, volatile organic compounds (VOCs), metals, or other substances associated with previous site activities.

The analytical results provide information on the presence and concentrations of contaminants in the collected samples.

4. Data Interpretation and Reporting

After laboratory results are received, environmental professionals evaluate the findings against applicable regulatory criteria and the objectives of the investigation.

The Phase II ESA report generally documents the sampling locations, field methods, laboratory results, interpretation of environmental conditions, and recommendations for further investigation or action.

An initial Phase II ESA does not always establish the full horizontal or vertical extent of contamination. Additional sampling may be appropriate when the original investigation identifies environmental impacts that need further characterization.

When Is a Phase II Environmental Site Assessment Needed?

A Phase II ESA is often recommended when a Phase I ESA identifies a REC that warrants additional investigation.

Common examples include:

• Former gas stations and automotive facilities: Underground storage tanks, fueling operations, and petroleum handling may have affected soil or groundwater.
• Former manufacturing properties: Industrial operations may have used solvents, metals, degreasers, or other substances that can contaminate the subsurface.
• Former dry-cleaning facilities: Historical use of chlorinated solvents may create soil, groundwater, or vapor intrusion concerns.
• Properties with undocumented fill or waste disposal: Historical landfilling or disposal activities may warrant investigation of buried materials and associated contamination.
• Properties near known contamination: Releases from nearby properties may have affected soil, groundwater, or soil gas beneath the property being evaluated.

A Phase II ESA can also be conducted to investigate known contamination or address questions related to a property’s future use, even when those objectives extend beyond the findings of a Phase I ESA.

Does Every Phase I ESA Lead to a Phase II ESA?

No. If a Phase I ESA does not identify RECs or unresolved concerns warranting investigation, a Phase II ESA may not be necessary.

Even when a REC is identified, the next step depends on the nature of the finding and the available information. Additional record reviews, targeted investigation, or other actions may be appropriate.

The decision should consider the property’s proposed use, applicable environmental regulations, and the level of information needed to make acquisition or redevelopment decisions.

How Long Is a Phase I Environmental Site Assessment Valid?

The timing of a Phase I ESA matters when the assessment is being used to support CERCLA landowner liability protections.

Under EPA’s AAI rule and ASTM E1527-21:

• The overall assessment must be completed or updated within one year before property acquisition.
• Certain components must be completed or updated within 180 days before acquisition. These include interviews, regulatory records reviews, site inspections, and environmental cleanup lien searches.

These time periods are measured from the completion dates of the applicable assessment components, not simply the date printed on the final report.

An older Phase I ESA may contain useful historical information, but it should not be assumed to satisfy the current AAI rule without evaluation and appropriate updates.

For property transactions involving environmental liability concerns, coordinating the assessment schedule with the anticipated acquisition date is an important part of due diligence.

What Happens if a Phase II ESA Finds Contamination?

Finding contamination does not automatically prevent a property from being purchased, developed, or reused.

The next step depends on the contaminants identified, their concentrations and distribution, potential exposure pathways, applicable regulations, and the property’s intended use.

Possible actions include:

Additional environmental investigation. Further sampling may be conducted to define the extent of contamination or evaluate how contaminants could migrate.

Regulatory evaluation and reporting. The project team may need to evaluate contamination against state cleanup criteria, determine whether notification obligations apply, and coordinate with the applicable environmental agency.

Exposure controls and due care planning. Depending on site conditions, measures such as soil management procedures, engineered barriers, vapor mitigation systems, or land-use restrictions may help manage environmental exposure.

Remediation. When necessary, contaminated soil, groundwater, or other affected materials may be treated, removed, contained, or managed through another appropriate response action.

Environmental investigations provide the information needed to evaluate these options. Not all contaminated properties call for the same response.

An example is F&V’s work on Western Michigan University’s Business Technology and Research Park expansion. The property had previously operated as a commercial orchard where arsenic-containing pesticides had been used. F&V conducted Phase I and Phase II ESAs, identified arsenic contamination in the soil, and developed a due care plan to support the university’s expansion.

Environmental Site Assessments in Michigan and Indiana

Environmental due diligence should account for both federal liability provisions and the laws governing contaminated properties in the state where a project is located.

Michigan Baseline Environmental Assessments

In Michigan, a Phase I or Phase II ESA may provide information used to prepare a Baseline Environmental Assessment (BEA).

A BEA is a separate process under Michigan’s Part 201 and Part 213 environmental laws. It documents contamination existing at the time a new owner or operator acquires an affected property and can establish protection from liability for cleanup of that preexisting contamination when applicable conditions are met.

According to the Michigan Department of Environment, Great Lakes, and Energy (EGLE):

• A BEA must be completed before or within 45 days after becoming the owner or operator of the contaminated property.
• The BEA must be submitted to EGLE within six months after the applicable acquisition, occupancy, or foreclosure date.

A BEA includes environmental due diligence and information documenting contamination. It is not interchangeable with a Phase II ESA and does not, by itself, establish CERCLA liability protection.

Property owners may also have continuing due care obligations under Michigan law, even when they qualify for protection from liability for preexisting contamination.

For more information, see EGLE’s Baseline Environmental Assessment guidance.

Environmental Due Diligence in Indiana

In Indiana, Phase I and Phase II ESAs likewise help property buyers and municipalities identify environmental concerns before acquisition or redevelopment.

Where contamination is present, project teams may need to evaluate the Indiana Department of Environmental Management’s (IDEM) applicable cleanup programs, risk-based criteria, and land-use controls.

The approach depends on the site’s history, environmental conditions, and intended redevelopment.

Environmental Assessments and Brownfield Redevelopment

Phase I and Phase II ESAs can play an important role in returning former industrial and commercial properties to productive use.

For municipalities, the assessments help answer questions about environmental liability, future land use, construction planning, and whether additional investigation or cleanup activities are appropriate.

Environmental investigations are also an early part of brownfield redevelopment planning, helping communities evaluate contaminated or potentially contaminated land before committing to redevelopment activities.

Fleis & VandenBrink has supported these efforts on projects throughout Michigan, including the redevelopment of the former Performance Paper site in Kalamazoo.

For the Kalamazoo Brownfield Redevelopment Authority, F&V performed Phase I and Phase II ESAs, Baseline Environmental Assessments, and due care evaluations as part of property acquisition and redevelopment efforts. F&V also provided surveying and site development engineering services for the project.

The work illustrates how environmental due diligence connects with the larger process of acquiring, preparing, and redeveloping formerly industrial properties.

Work With F&V on Your Environmental Site Assessment

Environmental due diligence is about more than identifying contamination. It gives property owners, municipalities, and redevelopment teams the information needed to evaluate land acquisition, understand environmental liability, and plan for future site use.

Fleis & VandenBrink’s geologists and engineers have decades of experience conducting Phase I and Phase II Environmental Site Assessments throughout Michigan and Indiana. Our environmental team also assists with Baseline Environmental Assessments, due care evaluations, contaminated site investigations, and brownfield redevelopment.

Whether you’re evaluating a single property, coordinating a municipal redevelopment, or reviewing a portfolio of sites, F&V can help you determine the appropriate level of investigation and evaluate the findings in the context of your project.

Learn more about our environmental consulting services, or contact F&V to discuss your property and next steps.

Frequently Asked Questions

Can you conduct a Phase II ESA without a Phase I ESA?

Yes. A Phase II ESA can be conducted to investigate known contamination or address defined environmental concerns without first completing a new Phase I ESA.

However, if a property buyer intends to qualify for CERCLA landowner liability protections, a compliant All Appropriate Inquiries assessment must still be completed before acquisition.

Does a Phase I ESA include soil testing?

No. Soil and groundwater sampling are not part of the typical ASTM Phase I ESA process. A Phase I ESA primarily examines existing information and visible property conditions.

Environmental sampling is generally performed during a Phase II ESA or another separately defined investigation.

Is a Phase II ESA always necessary if an REC is found?

No. A REC identifies an environmental concern, but the need for additional testing depends on the circumstances. The environmental professional should evaluate the finding and determine what additional information would be useful.

Can a contaminated property still be redeveloped?

Yes. Contaminated properties can be redeveloped when environmental conditions are evaluated and applicable cleanup, exposure control, and regulatory obligations are addressed.

The appropriate approach depends on the contamination present, site conditions, and proposed land use.