When my team and I start investigating a client’s facility, as part of due diligence for a real estate transaction for example, we nearly always discover overlooked environmental issues… obvious risks that our clients just didn’t see.After 20+ years as environmental consultants, we stopped being surprised when we find these overlooked issues. We’ve seen them so often we can spot them right away because we know where to look. In fact, we’ve even put together a checklist of the most common issues, so that when we start assessing a property, it’s top of mind – I’ll share it with you in just a moment.
It’s not that our clients are being negligent. It’s simply a matter of being too “familiar” with their facility. Often, it’s a process or other element of the facility that’s always been there or has always been done a certain way. It hasn’t caused problems in the past, at least none they can see on the surface. But a trained eye looking at the facility without these preconceptions, such as my team and I from Envision Environmental, Inc., can spot these overlooked issues immediately.
You might have one – or more – of these overlooked environmental issues at your facility right now. The goal in reading this article is to get you thinking and looking around to spot potential risks and liabilities you hadn’t considered before.
You might believe it’s better to not know what’s lurking at your facility. But consider the long-term impact of not addressing a problem right now: an accident with hazardous materials; enforcement actions and fines from regulators; or contamination that builds up over time, requiring extensive and expensive remediation.
We covered the first five overlooked issues in the first part of this two-part series, including: Property History, Insufficient Protective Measures, Unknown Regulations for Your Facility, Compliance Is Not Elimination of Liability, and Understanding of Current Risks.
Now let’s round out the top 10.
Just about any facility that’s been around for any length of time has production lines, storage tanks, machinery, or other equipment that gets replaced. As technology advances, out with the old, in with the new, as they say.
The old equipment is often hard to dispose of properly… or even move. So, it’s often abandoned in place or put into storage somewhere else in your facility. Everybody – especially you – is focused on getting the new equipment online and operational, anyway.
But it could be a ticking time bomb, so to speak, if it’s not properly decommissioned. At one job site, we came across a storage tank that was so old, nobody remembered what it was for, and it was leaking contaminants. Clean up costs: $150,000.
Think about the neighborhood where you live. If there was a tall dead tree looming over your house in the yard next door… you would talk to your neighbor about cutting it down safely, before it fell and crushed your new car.
It’s something to consider at your facility too, especially if you’re in a crowded industrial area. What are your neighbors up to? You could have the strongest environmental standards and mitigation and inspection efforts, but it could be wasted if the facility next door is careless and something they’re doing contaminates the soil and/or groundwater on your property.
Perhaps they have a catch basin that overflows onto your property… or an underground storage tank is leaking.
It’s important to take note of these potential risks so you don’t have to pay for remediation affecting your property – you send them the bill after hiring an environmental consultant to prove they’re the culprit.
You can take preventative measures as far as talking to them about cleaning up their act, although you might even have to involve regulators or take legal action as the worst-case scenario.
Of all the overlooked environmental issues we see, the top problem area is by far in areas where our clients handle, store, or use chemicals and liquids. We're talking solvents, paints, fuels, or other items used in some part of your manufacturing process.
The material might be in tanks, drums, or other containers… or leaking from a piece of equipment. Often, we see problems where liquids are offloaded at a facility, say from an over-the-road tanker or from a rail car. And if the material is flammable or combustible, that adds a whole other layer to the problem – and makes it very urgent.
Thankfully, often a very inexpensive fix can take care of these types of issues.
Still this is your area of highest risk, with potential for very expensive liability. So, it pays to focus on these areas yourself and take proactive measures, bringing in an environmental consultant if necessary. You should also take care to note possible “historic” risks in this area. For example, do you have underground storage tanks that haven’t been used for years? If so, what’s their location and their status?
You probably have a program to protect the environment, the facility, the company’s assets, and, of course, your employees.
Don’t view it as a necessary evil, something you have to do to keep the government regulators happy. Instead, consider your environmental program a way to avoid costly liabilities in the future. It gives you a strong layer of protection and can potentially prevent future incidents that require costly clean up.
The start of any environmental program is a thorough environmental assessment so you can identify potential problem areas that need to be addressed. It’s a good idea to prioritize these issues so you can tackle more serious concerns first.
You should also regularly review your policies and update as necessary, maintain any resources you need to keep your program deployed, and make sure that you have the capability to identify and control environmental liabilities. Buy-in from every member of your team is the key to success.
There could be something going on right now at your facility, warehouse, or manufacturing plant that could affect you years down the road. That’s why it’s so important to consider the long-term impact of your standard practices and examine all of your procedures closely.
We’ve been involved in many Superfund sites where parties were pulled into the proceedings because their company’s name was on a drum label found at the contaminated site. Did they put the drum there? No. They returned the drum to the vendor or sent it to be recycled without removing the drum labels… and the drum was used again by another company and may have been disposed of improperly. But their name remained on the drum, so they were pulled into the Superfund issue.
By paying attention to details and paying attention to possible long-term impacts of your decisions today, you can avoid this sort of problem.
Use this article as a starting point to examine potential “weak spots” in your facility with a critical eye. What issues could be hiding right under your nose?
As I’ve said, it’s better to know what’s going on and act on it, rather than letting the problem grow into something that’ll cost you a lot of money. These issues won’t go away on their own, and you can’t let somebody else deal with them. If you ever try to sell your facility, you can bet the potential buyers will find these types of issues during their due diligence investigation… possibly shutting your deal down.
It doesn’t have to be an arduous or expensive process. After checking for current risks, simply continue to monitor your facilities, equipment, and processes on an ongoing basis.
To keep your mind on all the potential issues that you should be paying special attention to, I’ve come up with a 10-point checklist that you could post in your office and circulate among your team so that overlooked issues become top of mind.
You can download The Top 10 Environmental Gorilla Checklist here.