Like Children, Some Properties Go Through Phases

Decades ago, health and safety regulations and environmental protections didn’t really exist, so people used materials that were toxic to people and the planet on a somewhat regular basis. Thankfully, this is no longer the case, but once in a while when a property changes hands, the buyer discovers an old problem that was never addressed, a mess that was never cleaned up or a toxin that was never removed.

When you purchase a property, the seller and/or his Realtor is legally obligated to disclose any contamination problems they know about (or should have reasonably have known about). Although you’re more likely to find toxic substances on commercial or industrial sites—or bare land you plan to develop—residential properties sometimes require environmental cleanup, too. Because strict environmental regulations have been in place for decades and single-family homes often change ownership every seven years or so, most issues in residential properties have already been addressed.

As a rule, I’m not a fan of regulations. However, I want houses to be safe to live in and I support environmentally sustainable practices that will allow our children’s children to live on a planet with clean water and plenty of fresh air. So I suppose a few regulations are in order here.

If you plan to buy a property and either the seller informs you there may be contamination or you see something amiss, be sure to investigate before closing escrow. You don’t want to buy someone else’s mess. If there’s any reason to believe a property is contaminated, a “Phase I” environmental assessment is initiated.

A Phase 1 assessment is the simplest. It consists of examining the paperwork related to a given property. It reviews who owned the property and who occupied it, as well as what they used the property for. If the only activity involved people pushing paper in an office building, the risk of contamination is comparatively low. If the property housed a gas station or a dry cleaning business, the risk for serious contamination increases.

Fun fact: before Ukiah had natural gas, most homes were heated with fuel oil that was delivered to the property and stored in underground tanks. When natural gas became available, very few property owners pulled out those old tanks, many of which were buried under the house. When the tanks were abandoned, they may have had a few gallons of fuel oil left. While we’d like to believe those sturdy metal tanks buried in 1932 didn’t leak in the intervening 87 years, we’re probably deluding ourselves.

Anyway, to figure out whether a property may have contaminants, investigators review county records, interview those familiar with the property, and investigate the ownership and use of surrounding properties. They will sometimes check museum or newspaper archives to see whether old photos are consistent with official records. If they find a picture of the seller’s Great Uncle Bob leaning against a 1930’s era gas pump on the property, there may cause for concern. Investigators also pay close attention to potential problems on adjacent properties, as contaminants are rarely respectful of property lines.

If the Phase I assessment uncovers a possible problem, like Great Uncle Bob, it’s on to Phase II. Check out next week’s blog to learn more about Phases II and III.

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