Month: June 2020

BE PROACTIVE BY CONTACTING AN INSURANCE ARCHEOLOGIST AND AN ENVIRONMENTAL CONSULTANT

BY: DRU CARLISLE

We understand that most people are unhappy when environmental issues pop up. This can happen when a Phase I Environmental Site Assessment (ESA) has uncovered Recognized Environmental Conditions (RECs), you’ve received a demand letter from an environmental regulatory agency, or you’re aware that you most likely have contamination. Back in the day, many industrial solvents and chemicals used in operations like dry cleaning and manufacturing were not known to be hazardous, so regulations were different than they are today. Even newer industrial operations can have minor hazardous leaks and spills causing environmental impacts that will need to be addressed when they are discovered. Depending on the past business operations at certain properties, sometimes environmental issues are inevitable. Fortunately, there are steps you can take to protect yourself and potentially minimize your out of pocket expenses.

In this blog, we’ll dive into effective strategies to address environmental issues.

BE PROACTIVE WITH INSURANCE ARCHEOLOGY

It’s never too early to prepare for the potential challenges associated with environmental issues; whether it’s finding funds to cover the expenses through insurance archeology or finding the right partner to lean on for support. This is why it’s important for drycleaners, industrial launderers and textiles, and manufacturers to be proactive and assemble their available resources before an environmental issue is discovered.

LOCATE YOUR OLD POLICY INFORMATION AND BUSINESS RECORDS

Business owners that search for their old comprehensive general liability (CGL) insurance policies before an environmental investigation begins will have an important step taken care of because these policies can be used to help pay for resolving environmental liabilities.

Historical CGL policies, once located and leveraged, typically cover the costs of your legal defense and will pay on your behalf of damages if you are found liable—up to the limits of your policy. Historical CGL policies are valuable assets that may be worth millions of dollars and depending on your situation and the state in which you conduct business, the out-of-pocket environmental cleanup costs may be minimal.

If locating your old policy information and business records proves to be too difficult to do on your own, you can bring in an experienced insurance archeologist to help find your old policy information, put together a corporate history and coverage chart for your company and property.  Insurance Archeologists utilize a number of methods for tracking down evidence of policies, whether your own, or past owners or operators.

Learn more about our insurance archeology services 

TAKE CHARGE OF YOUR ENVIRONMENTAL INVESTIGATION WITH AN ENVIRONMENTAL CONSULTANT

Since contamination devalues a business and a cleanup can take some time to do, it’s smart to act sooner than later, like when you’re ready to sell or pass on your business to the next generation. And now that you know how to find your old policy information and business records, it’s time to start strategizing with environmental experts to prepare for an environmental investigation.

DETERMINE THE RIGHT CONSULTANT FOR YOUR ENVIRONMENTAL STRATEGY

Experience matters and choosing an environmental expert with the right background and knowledge to guide you as you prepare your environmental strategy is crucial. Find environmental experts with significant experience in your industry. For example, drycleaners and industrial launders and textiles should look for experts with proven chlorinated solvent experience while manufacturers should look for experts with proven polychlorinated biphenyl (PCB) or hexavalent chromium experience.

The strategy may include an environmental investigation, a vapor intrusion assessment or maybe even an environmental remediation if contamination is found. It’s hard to know exactly what to expect when the process starts but having an experienced environmental consultant with expertise in your industry can make a big difference. They’ll have a better sense of what to expect at your business and will be there to help you navigate the decisions you’ll need to make to move forward with your environmental strategy.

While cleanup strategies are personal for each business, the overall steps are similar. A smart strategy begins with 1) finding what coverage is available, 2) determining the extent of contamination, and 3) implementing a site-specific cleanup plan.

There’s no need to face environmental liabilities or demand letters on your own. Business owners can take proactive steps to get in the driver’s seat and protect their assets with the support of insurance archeologists and environmental consultants. We strongly believe there shouldn’t be a financial barrier to performing meaningful environmental restoration work and that insurance policy coverage for environmental liabilities should be honored by the carriers.

Do you have questions about environmental investigations? Contact us today.

Dru Carlisle, Director of Drycleaner Accounts
For over 10 years, Dru has helped numerous business and property owners facing regulatory action, navigate and manage their environmental liability. Dru has vast experience in assisting dry cleaners in securing funding for their environmental cleanups through historical insurance policies. Dru is a member of numerous drycleaning associations in addition to serving on the Midwest Drycleaning and Laundry Institute (MWDLI) advisory council and on the Drycleaning & Laundry Institute Board (DLI) as an Allied Trade District Committee Member.

EVERYONE IS MAKING TOUGH DECISIONS RIGHT NOW ABOUT WHAT TO SPEND MONEY ON, AND WHAT CAN WAIT. IN THIS ARTICLE, I’LL WALK YOU THROUGH WHAT CAN WAIT AND WHAT CANNOT WAIT EVEN IN OUR CURRENT COVID-19 BUSINESS ENVIRONMENT.   

BY: JEFF CARNAHAN 

The EPA and many State environmental agencies have issued statements providing loose guidance related to the potential availability of some slack in regulations due to COVID-19  and the financial stress that it has put on many responsible parties who are in a cleanup program. If you are in a position where there is a known release of hazardous substances from your operations or previous operations at your site, there are decisions that need to be made about whether or not to proceed with various aspects of the environmental investigation and cleanup process. Some things can wait, and some just cannot.   

 ENVIRONMENTAL CONTAMINATION ISSUES THAT CANNOT WAIT 

There is an adage that says, “Do whatever you want, so long as it doesn’t hurt anyone”. With environmental contamination issues, there is often the possibility that others could be put in harm’s way from exposure to hazardous substances. The work related to investigating and eliminating a direct exposure to contamination should be top priorities, and it really can’t be put on hold. Here are three scenarios where environmental cleanup shouldn’t wait: 

1. VAPOR INTRUSION ASSESSMENT

At sites where a subsurface release of volatile organic compounds (VOCs) such as PCE, TCE, or Benzene has occurred, the potential for vapor intrusion most likely exists at nearby buildings. If there are residences, daycare facilities, schools, or medical care facilities close by, that threat carries an even higher urgency. Whereas many investigations that include soil or groundwater sampling are measuring a potential exposure, vapor intrusion assessments measure actual exposure situations. If vapor intrusion is actually occurring at a building, the occupants are breathing the contamination directly. The VOCs mentioned above are all carcinogenic to some degree and are highly regulated. Exposure scenarios where their levels are identified at concentrations higher than risk-based screening levels are strictly enforced by regulatory agencies. If you are the responsible party for a release of VOCs and the vapor intrusion exposure pathway hasn’t been ruled out, appropriate sampling of the inhalation exposure pathway at nearby structures should not be delayed. If it is confirmed that levels of VOCs in the indoor air at sampled buildings are higher than the regulated levels, immediate actions to protect the occupants, such as the installation of a sub-slab depressurization system, will also be required.  

2. GROUNDWATER SAMPLING IN DRINKING WATER WELL PROTECTION AREAS

It is not uncommon for releases of contamination to migrate into the groundwater, and then become mobile and transport downgradient. Since groundwater is a valuable drinking water resource in many areas, the potential exists for contamination to make its way into potable water supply wells. Like vapor intrusion assessments, the sampling of groundwater for the presence of contamination within a well-head protection area is an assessment of a direct exposure for those who may drink that water. This type of exposure scenario, if likely or probable, is one where there should not be delay in making a determination if your release is impacting others. The timing is unfortunate, but sampling of the ingestion exposure pathway in this situation will be strictly mandated by regulatory agencies.  

3. SURFACE SOIL SAMPLING WITHIN INHABITED AREAS

One factor that allows subsurface soil sampling at contamination sites to proceed at a calculated pace is that many times the impacts are well below the ground surface. When this is the situation, the likelihood of people coming into contact with the hazardous substance is pretty low and may be limited to construction workers who may be digging in the area. When contamination appears to be present at the ground surface in a location that is frequented by people, especially children, the potential for direct contact with that soil is much higher. While this threat is less common than vapor intrusion or groundwater ingestion exposure, if your site fits into this scenario, be prepared for the regulators to demand that investigation and exposure mitigation measures be carried out, with little to no leniency.  

ENVIRONMENTAL CONTAMINATION ISSUES THAT CAN WAIT 

If you’ve already advanced your site investigation and/or remediation process past the point where you know whether there is a threat of an ongoing exposure, you can probably get some concurrence from the regulators to slow things down a bit. Here are two scenarios where environmental work could be postponed: 

1. POST-REMEDIAL ACTION MONITORING

Typically, after a cleanup action has been implemented, say a source area soil excavation or a groundwater cleanup, there is a period of time during which routine quarterly, semi-annual or annual groundwater monitoring is required to demonstrate that the project was successful. Sometimes the cleanup mark can be missed, and it isn’t known until post-remedial monitoring shows a rebound in contaminant concentrations. Although any delay in the performance of this monitoring has the effect of prolonging the amount of time until you get your regulatory closure, if it is necessary to route the funding to other, more critical business efforts, it is likely that you can get the relief you need. 

2. CLEANUP ACTIVITY IF ONLY YOUR PROPERTY IS IMPACTED

If you are involved in an environmental investigation and cleanup, and you have already shown through sampling that the extent of contamination doesn’t extend beyond your own property boundaries, it is also likely that you can put off cleanup for a period of time. Of course, if conditions were to arise in the meantime that involve the potential sale or refinancing of your property, the issue would once again be at the forefront and most likely the work would need to move forward to complete the deal.   

When economic conditions turn sour, as they are now, business leaders look to save cash on things that don’t absolutely need to happen right now. There are some situations, as we’ve discussed, where environmental projects may be delayed for a period of time to help out. Keep in mind, however, that as long as there is an environmental condition at your property that has not been closed through a regulatory program, your business and your property will never have its full value. Perhaps now is the time to seize the day and protect your assets’ value If this is your goal, it makes sense to keep the project moving.  

Contact us today to review your environmental investigation and remediation priorities. 

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As seen in Cleaner and Launderer  

Jeff Carnahan, President 
Jeff Carnahan, LPG, has 20+ years of environmental consulting and remediation experience. His technical expertise focuses on the investigation and interpretation of subsurface releases of hazardous substances for the purpose of evaluating and controlling the risk and cost implications. He has been a partner of the drycleaning industry for the past decade, and is a frequent contributor to the national drycleaning publication Cleaner & Launderer. He is an industry leader in understanding that environmental risk includes not only cleanup costs, but also known and unknown third-party liability.