Glossary of Terms
EMG - Glossary of Terms for real estate transactions, due
diligence and capital planning.
Actual Knowledge - The knowledge actually possessed by an individual
rather than an entity. Actual knowledge is to be distinguished from
constructive knowledge, which is knowledge imputed to an individual
Air Emissions - Any physical, chemical, biological or radioactive
substance or matter that is emitted into or otherwise enters the
ambient air surrounding a property and contains air pollutants as
defined in Section 302 of the Clean Air Act, as amended, 42 U.S.C,
Aerial Photograph Review - A study or review of aerial photographs
of a site obtained for the historic period of interest. The
photographs are reviewed to ascertain site conditions and features
that may no longer exist and to serve as a source of historic site
Ancillary Structures - Structures that are not the primary
improvements of the Property but which may have been constructed to
provide support uses.
Applicable Surface - All intact and non-intact interior and exterior
painted surfaces of a residential structure, per HUD Regulations, 24
CFR 200.820 as delineated in the Architect's Analysis and Inspection
for Project Mortgage Insurance Handbook No. 4860.1 Rev I.
Appropriate Inquiry - An inquiry into the previous ownership and
uses of a property, as defined in 42 U.S.C. 9601 (35)(B), that will
give a party to a real estate transaction the defense to CERCLA
liability provided by 42 U.S.C. 9601 (35(A) and (B) and 9607(b),
assuming compliance with other elements of the defense.
Asbestos - Six naturally occurring fibrous minerals found in certain
types of rock formations. Of the six, the minerals chrysotile,
amosite and crocidolite have been most commonly used in building
products. When mined and processed, asbestos is typically separated
into very thin fibers. Because asbestos is strong, incombustible and
corrosion-resistant, asbestos was used in many commercial products
beginning early in this century and peaking in the period from World
War II into the 1970's.
Asbestos Containing Material (ACM) - Any material or product which
contains more than one percent asbestos.
As-Built Plan - A drawing which covers property boundaries, streets
bordering the site and building layouts and provides accurate scale
and a north arrow.
Building Codes - A compilation of rules adopted by the municipal,
county and/or state governments having jurisdiction over the
Property that govern the property’s design &/or construction of
Building Systems - Interacting or interdependent components that
comprise a building such as structural, roofing, side wall,
plumbing, HVAC, water, sanitary sewer and electrical systems.
Chewable Surface - All protruding painted surfaces up to 5 feet from
the floor or ground, which are readily accessible to children under
7 years of age per HUD Regulations, 24 CFR 200.820 as delineated in
the Architect's Analysis and Inspection for Project Mortgage
Insurance Handbook No. 4860.1 Rev I (eg., corners, window sills and
frames, doors and frames, and other protruding woodwork.)
Client - Purchaser of project services.
Comprehensive Environmental Response, Compensation and Liability
Information System (CERCLIS) - The list of sites compiled by EPA
that have been investigated or are currently being investigated for
potential hazardous substance contamination for possible inclusion
on the National Priorities List.
Commercial Real Estate - Any real property except a dwelling or
property with only one to four dwelling units for residential use.
The term “commercial real estate" includes but is not limited to
properties used for industrial, commercial, medical or educational
purposes and properties used for residential purposes which have
more than four residential dwelling units.
Commercial Real Estate Transaction - A transfer of title to, or
possession of real property or receipt of a security interest in
real property, except that it does not include transfer of title to
or possession of real property or the receipt of a security interest
in real property with respect to an individual dwelling or a
building containing less than five dwelling units, nor does it
include the purchase of a lot or lots to construct a dwelling for
occupancy by a purchaser, but a commercial real estate transaction
does include real property purchased or leased by persons or
entities in the business of building or developing dwelling units.
Construction Debris - Concrete, brick, asphalt and other such
material discarded in the construction or demolition of an
improvement to property.
Construction Document Review and Budget Analysis - A comprehensive
review of construction documents, including a budget comparison
analysis. The service also includes the review of many related
construction documents including specifications, soils report,
architectural contracts, engineering contracts, construction
contracts, environmental reports, utility agreements, and regulatory
requirements. Documents are reviewed to determine the viability of
the project and budget, along with the completeness of the
documents. A site visit is recommended for any renovation work.
Construction Loan Administration Services - The review and
monitoring service for commercial construction projects that helps
identify problems and oversights. CLA services resolve these
project-stopping issues while they are small and manageable.
Construction Monitoring - A comprehensive site observation and
evaluation summary, which includes EMG’s evaluation and
recommendations on the construction draw request. Draw documents
must be provided before the site visit. The service is designed to
provide EMG’s client with up-to-date data on the validity of the
draw request compared to actual percent of construction completed,
construction progress, and quality of construction. It also includes
a review of schedules, change orders, lien waivers, regulatory
compliance and quality control.
Defective Paint Surface - Paint on applicable surface that is
cracking, scaling, chipping, peeling or loose, per HUD Regulations,
24 CFR 200 820 as delineated in the Architect's Analysis and
Inspection for Project Mortgage Insurance Handbook No. 4860.1 Rev 1.
Deferred Maintenance - Deficiencies that result from postponed
maintenance, or repairs that have been put off until a later time
and that require repair or replacement to an acceptable condition
relative to the age of the system or property.
Docket - Docket of civil actions filed by the Department of Justice
for EPA since 1972.
Draw Request - A package of legal and other related documents
supplied by the Borrower to the Lender for the purpose of receiving
a funding advancement.
Drum - A container (typically 55 gallon) which is used to store
hazardous substances, hazardous wastes or other regulated materials.
Due Diligence - The process of inquiring into the environmental
characteristics of a property.
Dwelling - Structure or portion thereof used for residential
Emergency Response Notification System (ERNS) - ERNS contains over
25,000 spill records and stores information on reported releases of
oil and hazardous substances. The data is collected from spills
reported to EPA and the Coast Guard National Response Center.
Environmental Audit - The investigative process to determine whether
an existing facility is in compliance with applicable environmental
laws and regulations.
Engineering - Analysis or design work requiring extensive formal
education, preparation and experience in the use of mathematics,
chemistry, physics, and the engineering sciences as provided by a
Professional Engineer licensed to practice engineering by any state
of the 50 states.
Environmental Lien - A lien, which is a charge, security or
encumbrance upon property, imposed on a property to secure the
payment of a debt, obligation or duty arising out of an
environmental release, contamination or cleanup or a hazardous
substance including but not limited to liens imposed pursuant to
CERCLA 42 U.S.C. 9607(1) and similar state or local statues.
Environmental Professional - A person possessing sufficient training
and experience necessary to perform a records review, a site
reconnaissance and other activities and from this information, has
the ability to develop conclusions regarding the environmental
status of the property in question. An individual's status as an
Environmental Professional may be limited to the type of assessment
to be performed or to specific segments of the assessment for which
the professional is responsible. The person may be an independent
contractor or an employee of the User.
Environmental Site Assessment (ESA) - The process by which certain
levels of appropriate inquiry or due diligence are conducted for a
property. At the option of the User, an environmental site
assessment may include more inquiry than that required to constitute
Expected Useful Life - The average amount of time in years that a
system or component is estimated to function when installed new.
Facility Index System - A list compiled by EPA of all facilities
identified by EPA for regulation under one or more environmental
Federal Register - Publication of the United States government
published daily (except for federal holidays and weekends)
containing all proposed and final regulations and some other
activities of the federal government. When regulations become final,
they are included in the Code of Federal Regulations (CFR), as well
as published in the Federal Register.
Fill Dirt - Dirt, soil, sand or other earth obtained off-site, that
is used to fill holes or depressions, create mounds or otherwise
artificially change the grade or elevation of real property. It does
not include material that is used in limited quantities for normal
aesthetic landscaping activities.
Friable Asbestos Material - Any material that contains more than one
percent asbestos by weight, that, when dry, can be crumbled,
pulverized or reduced to powder by hand pressure. This may also
include previously non-friable material which becomes broken or
damaged by mechanical force.
Funds Administration - Monitors the project over its duration and
ensures that project funds are properly being applied to work and
materials on the borrower’s project.
Hazardous Chemicals - Chemicals or materials used in the workplace
that are regulated under the OSHA Hazard Communication Standard or
the 'right-to-know' regulations in Title 29 CFR 1910.1200.
Hazardous Material - A hazardous material (HM) is any substance or
mixture of substances having properties capable of producing adverse
effects on the health and safety or the environment of a human
being. Legal definitions are found in individual regulations.
Hazardous Materials Incident Report System (HMIRS) - HMIRS contains
hazardous material spill incidents reported to the Department of
Transportation. These spill incidents are not necessarily listed in
Hazardous Substances - Chemicals, mixtures of chemicals or materials
subject to the regulations contained in Title 40 CFR For
transportation purposes, means a material, and its mixtures or
solution identified by the letter in Tide 49 CFR 17.010 when offered
for transportation in one package, or in one transport vehicle if
not packaged, and when the quantity of the material therein equals
or exceeds the reportable quantity (RQ). For details, refer to Title
49 CFR 171.8 and Title 49 CFR 172,101.
Hazardous Waste - Any material listed as such in Title 40 CFR 261,
Subpart D or that possesses any of the hazard characteristics of corrosivity, ignitability, reactivity or toxicity as defined in Tide
40 CFR 261, Subpart C or that is contaminated by or mixed with any
of the previously mentioned materials (see Title 40 CFR 261.3).
Hazardous Waste Data Management System (HWDMS) - HWDMS includes
selective information on over 324,000 sites which generate,
transport, store, treat or dispose of hazardous waste as defined by
the Resource Conservation and Recovery Act (RCRA). Records available
on HWDMS will eventually be transferred to the RCRIS database.
Hazardous Waste Generation - The act of producing hazardous waste.
Hazardous Waste Management - Systematic control of the collection,
source separation storage, transportation, processing, treatment,
recovery and disposal of hazardous wastes.
Hazardous Waste Manifest Uniform (EPA Usage) - The shipping
document, originated and signed by the waste generator or his
authorized representative that contains the information required by
Tide 40 CFR 262, Subpart B.
Hazardous Waste Site - A location where hazardous wastes are stored,
treated, incinerated or otherwise disposed.
Immediate Repairs - Physical deficiencies that require immediate
action as a result of: (i) existing or potentially material unsafe
conditions, (ii) significant negative conditions impacting
tenancy/marketability, (iii) material building code violations, or
(iv) poor or deteriorated condition of critical element or system,
or (v) a condition that if left “as is”, with an extensive delay in
addressing same, has the potential to result in or contribute to
critical element or system failure within one (1) year.
Inaccessible Area - Space enclosed with wall board or other similar
material, locked area or any space which would require destructive
measures (i.e., cutting, hammering, removing, etc.) to gain access.
Infectious Waste - Waste that contains pathogens or consists of
tissues, organs, body parts, blood and body fluids that are removed
during surgery or other procedures. See Tide 42 CFR Part 72.
Lead-Based Paint Hazard - A lead content of 1.0 milligram or higher
per square centimeter of painted surface, per HUD Regulations, 24
CFR 20.820 as delineated in the Architect's Analysis and Inspection
for Project Mortgage Insurance Handbook No. 4860.1 Rev 1.
Lead Containing Paint - The U.S Department of Housing and Urban
Development (HUD) has defined a lead containing painted surface as
one (1) of the following (Limits may vary by State): A surface
coating material containing more than one milligram per centimeter
squared (1.0 mg/cm2) of lead as determined by utilizing the X-ray
fluorescence analysis method; and/or A surface coating material
containing greater than 0.5% lead concentration by weight utilizing
the flame atomic absorption spectrophotometry analysis method.
Local Government Agencies - Those agencies of city or county
government having jurisdiction over the Property. City and county
government agencies include but are not limited to parishes,
townships and similar terms.
Material Safety Data Sheet (MSDS) - Written or printed material
concerning a hazardous substance which is prepared by chemical
manufacturers, importers and employers for hazardous chemicals
pursuant to OSHA's Hazard Communication System, 29 CFR 1910.1200(g).
National Fire Protection Association (NFPA) - An international
voluntary membership organization to promote and improve fire
protection and prevention and establish safeguards against loss of
life and property by fire. Best known on the industrial scene for
the maintenance of National Fire Codes, (i.e., 16 volumes of codes,
standards, recommended practices, and manuals) and periodically
updated by NFPA technical committees.
National Priorities List (NPL) - List compiled by EPA pursuant to
CERCLA 42 U.S.C. 9605(a)(8)(B) of properties with the highest
priority for cleanup pursuant to EPA's Hazard Ranking System. See 40
CPR Part 300.
NESHAPs - National Emission Standards for Hazardous Air Pollutants,
CAA Section 112 also refers to chemicals regulated under this
NIOSH - National Institute for Occupational Safety and Health of the
Public Health Service, United States Department of Health and Human
Services (DHHS). Federal agency which, among other activities, tests
and certifies respiratory protective devices and air sampling
detector tubes, recommends occupational exposure limits for various
substances and assists OSHA and MSHA in occupational safety and
health investigations and research.
National Pollutant Discharge Emission Systems (NPDES)
system created by Section 402 of the Clean Water Act to regulate
discharges of hazardous materials into waterways.
Non-friable Asbestos Material - Any material that contains more than
one percent asbestos by weight, that when dry, cannot be crumbled,
pulverized or reduced to powder by hand pressure.
Non-PCB Transformer - Any transformer that contains less than 50ppm
Operator - Person or entity occupying or using commercial real
Owner - Holder of legal or equitable title to real property.
PCB Activity Database (PADS) - EPA regulates under TSCA the storage
and disposal of PCBs. Those who handle PCBs (generators,
transporters, commercial storers and/or brokers and disposers) are
required to notify EPA of their PCB waste activities.
PCB-Contaminated Transformer - Any transformer that contains 50 ppm
PCB or greater, but less than 500 ppm PCB.
PCB Transformer - Any transformer that contains 500 ppm PCB or
Phase I Environmental Site Assessment - The process of evaluating a
Property which typically includes: review of records, both public
and private; site reconnaissance of the Property; interviews with
current owners and operators of the Property; and evaluation and
Physical Deficiency - Patent, conspicuous defects, or significant
deferred maintenance of the Property’s material systems, components,
or equipment as observed during the Project Manager’s Walk-through
Survey. Material systems, components, or equipment that are
approaching, have realized, or have exceeded their typical Expected
Useful Life (EUL); or, that have exceeded their useful life result
of abuse, excessive wear and tear, exposure to the elements, or lack
of proper or adequate maintenance. This definition specifically
excludes deficiencies that may be remedied with routine maintenance,
miscellaneous repairs, normal operating maintenance, and conditions
that do not present a material deficiency to the Property.
Pits, Ponds or Lagoons - Man-made or natural depressions in a ground
surface that are likely to hold liquids or sludge containing
hazardous substances or petroleum products. The likelihood of such
liquids or sludge being present is determined by evidence of factors
associated with the pit, pond or lagoon, including, but not limited
to, discolored water, distressed vegetation or the presence of an
obvious wastewater discharge.
Pre-Construction Document and Budget Analysis Review - An up-front
comprehensive review to make sure a construction project is
completely and adequately planned before significant commitments are
made and construction begins. The PCR validates that the key
components of a project are in-place, reasonable, and financially
Primary Improvements - The site and building improvements that are
of fundamental importance with respect to the Property.
Project - Scope of services to be performed in conjunction with a
Property - The real property which is the subject of the inquiry.
Real property includes buildings and other fixtures and improvements
located upon the property and affixed to the land.
Property Condition Assessment - Determines the present physical
condition of the Project improvements and provides a professional
opinion regarding future anticipated issues, which may result in a
financial risk or liability to the Client. The process includes a
visual walk-through to observe the existing conditions along with
review of available construction documentation, public records and
current budgets. This information is then deciphered and presented
with recommendations for repair or further detailed review if the
issues cannot be determined through visual observation alone.
Radon - A radioactive gas which occurs form the natural breakdown
(radioactive decay) of uranium. Radon cannot be seen, smelled or
tasted. Radon can be found in high concentrations in soils and rocks
whether from natural sources, industrial wastes or by-products of
uranium or phosphate mining. Outdoor air contains such low
concentrations of radon that there is generally not a health
problem. However, in an enclosed space, such as a home, radon can
become concentrated in higher levels which may cause health
Readily Available/Reasonable Ascertainable - Information that is
obtainable from researching accessible sources commonly known to
Environmental Professionals obtainable upon request within a
reasonable time and at a reasonable cost in the context of a
commercial real estate transaction. The period of time that is
reasonable will vary depending upon the circumstances. For business
records to be obtained from a current owner or operator, ten
business days is a reasonable time within which to obtain such
records. For public records, ten business days is a reasonable time
within which to obtain such records.
Remaining Useful Life - The consultant’s professional opinion of the
number of years before a system or component will require
replacement or reconditioning. The estimate is based upon
observation, available maintenance records, and accepted EUL’s for
similar items or systems. Inclement weather, exposure to the
elements, demand on the system, quality of installation, extent of
use, and the degree and quality of preventive maintenance exercised
are all factors that could impact the RUL of a system or component.
As a result, a system or component may have an effective age greater
or less than its actual age. The RUL may be greater or less than its
Expected Useful Life (EUL) less actual age.
Replacement Reserves - Major recurring probable expenditures, which
are neither commonly classified as an operation or maintenance
expense. Replacement Reserves are reasonably predictable both in
terms of frequency and cost. However, they may also include
components or systems that have an indeterminable life but
nonetheless have a potential liability for failure within the
Short Term Repair Costs - Opinions of Costs to remedy Physical
Deficiencies, such as deferred maintenance, that may not warrant
immediate attention, but requiring repairs or replacements that
should be undertaken on a priority basis, taking precedence over
routine preventive maintenance work within a zero to one year time
frame. Included are such Physical Deficiencies resulting from
improper design, faulty installation and/or substandard quality of
original system or materials. Components or systems that have
realized or exceeded their Expected Useful Life (EUL) that may
require replacement to be implemented within zero to one-year time
frame are also included.
Small Quantity Generators (SQGs) - Defined as facilities producing
less than 1,000 kilograms of hazardous waste per calendar month
(kilograms per month), which is the equivalent of about 300 gallons
or about five 55-gallon drums; note, however, some states define
SQGs more narrowly.
Soil and Groundwater Analysis - Tests used to determine the presence
of superficial or subsurface contamination and concentration levels;
may involve soil borings and installations of test pits and/or
Soil Vapor Surveys - Surveys using gas chromatography equipment to
map potential soil and groundwater contamination.
Solid Waste Facilities/Landfill Sites (SWF/LS) - SWF/LS type records
typically contain an inventory of solid waste disposal facilities or
landfills in a particular state. Depending on the state, these may
be active or inactive facilities. The Federal Open Dump Inventory
has been incorporated into SWF/LS.
Solvent - An organic chemical-based liquid that is capable of
dissolving another substance and is itself a hazardous substance;
used in a number of manufacturing/industrial processes including the
manufacture of paints and coatings for industrial and household
purposes, equipment clean-up and surface degreasing in metal
Specialty Consultants - Practitioners in the fields of engineering,
architecture; or, building system mechanics, specialized service
personnel or other specialized individuals that have experience in
the maintenance and repair of a particular building component,
equipment, or system that have acquired detailed, specialized
knowledge in the design, evaluation, operation, repair, or
installation of the particular component, equipment, or system.
State Hazardous Waste Sites (SHWS) - State hazardous waste site
records are the states' equivalent to CERCLIS. These sites may not
be listed on the federal CERCLIS list. Priority sites planned for
cleanup using state funds (state equivalent of Superfund) are
identified, along with sites where cleanup will be paid for by
potentially responsible parties. Available information varies by
Structural Component - A component of the building which supports
non-variable forces or weights (dead loads) and variable forces or
weights (live loads).
Topography - The configuration of the land surface area, including
its relative elevations and the position of natural and artificial
TSD Facility - A facility that treats, stores and/or disposes of
Toxic Release Inventory System (TRIS) - TRIS includes all facilities
which release toxic chemicals in reportable quantities to the air,
water or land as required under SARA (Superfund Amendments and
Reauthorization of 1986), Title III, Section 313. Reporting covers
approximately 20,000 sites and is required (Form R) each July 1st
for the previous year.
Toxic Substances Control Act (TSCA) - TSCA promulgated a rule
requiring manufacturers and importers of certain chemical substances
included on the TSCA Chemical Substance Inventory list to report
current data on the production volume of these substances by plant
Underground Storage Tank (UST) - Any tank, including underground
piping connected to the tank, which is or has been used to contain a
hazardous substance or petroleum, and the volume of which is ten
percent or more beneath the surface of the ground.
User - The party seeking to use the Phase I Environmental Site
Assessment to perform appropriate inquiry with respect to the
Property. A User may include without limitation, a purchaser of
property, a potential tenant of property, an owner of property, a
lender or a property manager.
Walk-through Survey - The Project Manager’s site visit of the
Property consisting of his visual reconnaissance and scan of readily
accessible and easily visible components and systems. This
definition connotes that such a survey should not be considered in
depth, and is to be conducted without the aid of special protective
clothing, exploratory probing, removal of materials, testing, or the
use of special equipment such as ladders, scaffolding, binoculars,
moisture meters, air flow meters, or metering/testing equipment or
devices of any kind. It is literally the Project Manager’s walk of
the Property and observations.
Wastewater - Water that (i) is or has been used in an industrial or
manufacturing process, (ii) conveys or has conveyed sewage, or (iii)
is directly related to manufacturing, processing or raw materials
storage areas at an industrial plant. Wastewater does not include
water originating on or passing through or adjacent to a site, such
as storm water flows, that (i) has not been sued in industrial or
manufacturing processes, (i) has not been combined with sewage,
(iii) or is not directly related to manufacturing, processing or raw
materials storage areas at an industrial plant.
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