SBA Phase I ESA
Adherence to the EP’s Recommendations
It is important to note that the SBA requires adherence to all recommendations for further investigation made by the Environmental Professional (EP) within the Phase I ESA report including any investigations regarding Recognized Environmental Conditions (RECs) such as a Phase II Subsurface Investigation.
Non-scope items in an SBA Phase I ESA
The SBA also requires adherence to any non-scope or non-REC additional investigations recommended by an Environmental Professional in the SBA Phase I Environmental Site Assessment. Examples of this include a recommendation to complete an asbestos survey or add secondary containment around hazardous-substance containers; these are known as “housekeeping” actions. Some lenders choose to have these housekeeping actions discussed and completed prior to the completion of the Phase I ESA report in an effort to avoid slowing down the process.
Partner emphasizes communication on every project and will be happy to assist in addressing housekeeping items in the most cost- and timeeffective manner. It should also be noted that these items may entail additional fees.
SBA Reliance Letter
Another nuance of the SBA Phase I Environmental Site Assessment is that it must be accompanied by an SBA Reliance Letter, which grants the SBA ability to rely on the report. The SBA has specific language that it requires be used for its reliance letter and will not accept a Phase I ESA Report that does not have this signed reliance letter.
