Controlled Recognized Environmental Condition (CREC)

Controlled Recognized Environmental Condition (CREC) is a term introduced in the ASTM E1527 standard for Phase I Environmental Site Assessments (ESAs). The Controlled REC concept was introduced to address contaminated sites that have received risk-based regulatory closure, where no further remediation is required but residual contamination still exists at a site and the property is subject to some sort of control or use restriction. These sites, where contamination is controlled but could still pose ongoing or future obligations on the owner (such as special precautions during construction or grading activities), have been a source of some confusion to the environmental due diligence industry with regards to how they should be classified.

The CREC, as subset of the Recognized Environmental Condition (REC) category and a distinct category from Historical Recognized Environmental Condition (HREC), is intended to clarify the level of risk these sites represent. The environmental professional is required to list any CRECs (as well as RECs) identified in the findings and conclusions section of the Phase I Environmental Site Assessment report.

The ASTM definition of CREC in the E1527-21 standard is as follows: “a recognized environmental condition affecting the subject property that has been addressed to the satisfaction of the applicable regulatory authority or authorities with hazardous substances or petroleum products allowed to remain in place subject to implementation of required controls (for example, activity and use limitations or other property use limitations).”

The ASTM definition includes a discussion for further clarification:

“Discussion—Identification of a controlled recognized environmental condition is a multi-step process that shall be reflected in the report’s Findings and Opinions section(s), as described in 12.5 and 12.6, including the environmental professional’s rationale for concluding that a finding is a controlled recognized environmental condition:

1. When determining whether a recognized environmental condition has been “addressed to the satisfaction of the applicable regulatory authority or authorities with hazardous substances or petroleum productsallowed to remain in place,” the environmental professional shall review reasonably ascertainabledocumentation, such as no further action letters (or similar certifications or approvals) issued by the applicable regulatory authority or authorities, or, in the case of self-directed actions, documentation and relevant data that satisfy risk-based criteria established by the applicable regulatory authority or authorities.
2. In determining whether a recognized environmental condition is “subject to implementation of required controls (for example, activity and use limitations or other property use limitations),” the environmental professional shall identify the documentation providing the control(s) that addresses the recognized environmental condition in the report’s Findings and Opinions section(s).
3. When the environmental professional determines that a recognized environmental condition is “subject to implementation of required controls,” this determination does not imply that the environmental professional has evaluated or confirmed the adequacy, implementation, or continued effectiveness of the control(s).
4. A past release that previously qualified as a controlled recognized environmental condition may no longer constitute a controlled recognized environmental condition at the time of the Phase I Environmental Site Assessment if new conditions or information have been identified such as, among other things, a change in regulatory criteria, a change of use at the subject property, or a subsequently identified migration pathway that was not previously known or evaluated.”