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Business Officer Magazine

Expand Your Environmental Due Diligence

Spotlight: Research Universities, from "Business Briefs" department in November 2010 issue of Business Officer

By Greg Haet

The University of California-Berkeley (UC Berkeley) leases approximately 10,000 square feet of space to commercial tenants, both private and public, including booksellers, restaurants, vehicle-repair shops, private research labs, and a government analytical laboratory building. Because some of these tenants use chemicals and radioactive materials that generate hazardous wastes, the potential exists for these operations to create a liability through contamination of UC property.

Starting in 2009, Berkeley's Office of Environment, Health, and Safety (EH&S) developed a program to formally review tenant operations for potential risk to the environment. “In addition to inspecting our own activities,” says Mark Freiberg, EH&S director, “we realized it was important for us to review tenant operations to protect our property from potential environmental contamination.”

Colleges and universities that lease space to tenants with the potential to generate hazardous waste can benefit from UC Berkeley's experience in evaluating, documenting, and acting on such operational risks.

Check Your Leases

Because of the need for expertise in evaluating chemical and other hazards, the overall review process is best managed by the campus EH&S office. The first step is to obtain a tenant list from the campus real estate office. In reviewing the list, it should become evident which businesses may use chemicals or otherwise have the potential to contaminate the property. Businesses with equipment maintenance activities or those that conduct laboratory research are prime examples.

Make sure each lease contains specific language regarding responsibility for (1) use and management of hazardous substances, (2) notification information in case of a release of contaminants, (3) requirements for regulatory permits, (4) a standard right-of-entry clause, and (5) a protocol for government agency inspections that informs and engages university representatives when appropriate. Also check that all leases indemnify the university in the event of any environmental problems caused by the tenant.

Paying a Visit

Once you determine businesses that may pose a risk, schedule visits by your EH&S staff, ensuring that your real estate office is involved. You will need to provide the required notice to your tenant, consistent with the lease's right-of-entry clause, prior to each inspection. Once on site, discuss the components of the inspection with the tenant. During the visit, evaluate the following areas:

  • Overall facility management and cleanliness.
  • Past and present chemical or radioactive material storage and use patterns.
  • Drain disposal practices.
  • Waste management.
  • Applicable permits and records.
  • Details of any spill history.
  • Legacy contamination, such as asbestos or PCBs (polychlorinated biphynels).

Follow Up

Although the site visit examines only a snapshot in time, it provides a reasonable basis for determining whether the tenant is operating in a manner that does not create a liability. Your real estate and EH&S offices can then determine if any follow-up actions are necessary. Where corrective changes are needed, document the requirements and recommendations in formal correspondence consistent with the lease agreement.

Among the issues identified during the recent inspections at Berkeley were a water leak into a room storing hazardous materials and a tenant's previously unknown use of radioactive materials. According to Freiberg, “Expanding our inspections to include tenant operations has allowed us to identify potential environmental risks and work with the tenants to quickly correct any problems.”

SUBMITTED BY Greg Haet, associate director of environmental protection, Office of Environment, Health, and Safety, University of California-Berkeley


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