The Business of Brownfields:
Managing Risk Using EQuIS and GIS
Presented by
Mitchell Beard, CEO
EarthSoft, Inc.
mbeard@earthsoft.com
November 3, 2005
2005 National Brownfields Conference
Denver, Colorado
Technology Solution Series
Nick Thomas, Moderator
November 2005
Copyright EarthSoft

The Business of Brownfields:
Managing Risk Using EQuIS and GIS
F E A T U R II N G
FEATUR NG
Environmental Quality Information System (EQuIS)
November 2005
Copyright EarthSoft

What is EQuIS?
• Sample data warehouse (Chemistry and Geology)
• Tools for checking and loading data from
lab and field, enforcing data quality
• ArcGIS ‘wrapper’ to query and extract data
spatially, creating labeled maps
• Links to many 3rd party tools commonly
used by environmental professionals for
visualizations and data analysis

EQuIS Clients
• Government
– EPA Regions 1,2,3,4,5,6,10
– States of AR, CA, CO, DE, LA, MS, NE, NJ, NV, NY, OH, RI, WV
– Cities and Counties: Denver, Seattle, San Bernardino, Los
Angeles, others
– Army, Navy, Air Force, DOE, Coast Guard
– Several Port Authorities
• Consultants
– Most! (80% of the consultants at this conference)
• Labs
– Most! (75% of the labs at this conference)
• Industrials
– Shell, BP, Rohm and Haas, Cemex, Olin, many others

The Business of Brownfields:
Managing Risk Using EQuIS and GIS
RAINIER COURT
Senior and Family
Housing
Redevelopment, Seattle
Brownfields 2005 -
Phoenix Awards
EPA R10 Pat Chemnick: Southeast
Effective Development (SEED)
Dave Cook, L.G.:
GeoEngineers, Inc.
SEED

The Business of Brownfields:
Managing Risk Using EQuIS and GIS
Specific Case Study for Brownfields
• GeoEngineers imported 50,000 analytical results for Brownfield
Properties into EQuIS. Speed was of the essence.
• GeoEngineers used EQuIS to integrate and validate their sampling
data so they could compare it to regulatory cleanup standards.
• Where standards were exceeded, GeoEngineers easily loaded data
into ArcGIS to display contamination across multiple sites.
• They used EQuIS + ArcGIS + GeoEngineers Decision Model to
calculate, map, and prioritize environmental risks—they managed
“real property” risks with confidence.

The Business of Brownfields:
Managing Risk Using EQuIS and GIS
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Brownfield A
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Assessments
(TBAs) and
graphically “sell”
approach

The Business of Brownfields:
Managing Risk Using EQuIS and GIS
Cleanup
Action:
Initial
Regulatory
Buy-In
• Soil sample
locations
exceeding
cleanup levels
PAH's
METALs
PETROLEUM
PCE
PCB's

Selecting a Remedy with Multiple Plumes
• PCE
• PCB’s
• Petroleum
Senior Housing
• Metals
Family
• PAH’s
Housing

Senior and Family Housing Phases:
Solutions
Building and Parking
Garage Concrete Slab
Liquid Boot Vapor
Barrier Beneath
Townhomes
Asphalt Concrete
Surface Parking
Hardscape
Pedestrian Walkway
Area

The Business of Brownfields:
Managing Risk Using EQuIS and GIS
In The Words of Our End-User
“All new data collected went into EQuIS as well, which allowed us to
easily display all phases of data collection together. We were able to ask lots
of detailed questions and quickly get answers through custom queries.”
“All of these outputs were also displayed using ArcGIS…a major
communication tool with regulators, helping to show where samples were
taken, what kind, how deep, and delineate areas of contamination.”
“We could even show areas where risks were not a concern. The
data
primarily spoke for itself. When data are presented clearly, there
is little room left for interpretation and disagreement.”
Rob Smith, Senior Scientist, Technical Systems Developer, GeoEngineers, Inc. (10.21.05)

Case Study
• State of NJ retained Environmental Alliance to
respond to impacted residential wells.
• Identified PRPs that subsequently retained
Environmental Alliance to define extent.
• Using ArcView and EQuIS, Environmental
Alliance quickly identified impacted properties
for installation of temporary “point of entry”
remediation systems.
• ArcView and EQuIS aided Environmental
Alliance in quickly generating maps and figures
defining the aerial extent of a one-mile long
plume.

Environmental Alliance, Inc.
1812 Newport Gap Pike
Wilmington, DE 19808
302.995.7544

Environmental Alliance, Inc.
1812 Newport Gap Pike
Wilmington, DE 19808
302.995.7544

Brownfield changes will affect
Data mgmt requirements...
Expect major modifications to Brownfields Revitalization
and Environmental Restoration Act of 2001.
EPA is expected to finalize the All Appropriate Inquiries
(AAI) rule around the end of 2005 or beginning of 2006
Major Changes: Considerable restrictions on who can complete Phase I
Environmental Site Assessments (ESAs) • More comprehensive research
requirements • One year shelf life for Phase I ESAs • Phase I ESA Updates will no
longer be allowed • Transaction Screens will not provide Federal liability
protection under the proposed AAI rule. ASTM is now rewriting the Transaction
Screen standard as a business risk management screening tool.
Our Favorite Change: Requires greater documentation of \"data gaps\" (no
available historical sources for some period of time). The Environmental
Professional (EP) must identify and discuss the reason for each gap, identify all
sources consulted to fill the gap, and comment on the significance of the data gaps
with respect to the EP's ability to identify releases.

EQuIS / GIS for Assessment Grants
The USEPA says they have a goal for FY 2006 of having 1,000 Brownfields
Assessed, spending up to $72M nationally.
They are executing this by giving three types of grants to government, local
community groups, and NGOs.
( We have not found instances where they have given a grant to a \"for-profit\" institution to
promote investments in Brownfields. )
The grants come in three forms:
1) Assessment (these require Phase 1s and 2s);
2) Revolving Loan Funds (capitalizing costs for clean-ups); and
3) Clean-ups (subsidizing actual costs of clean-ups).
It appears ASSESSMENT grants are typically capped at $200k either for one site, or for
several. We believe grants for clean-ups can go higher for certain sites.
Overall, grants can go to a Community-wide strategy to assess a number of
Brownfield sites (a portfolio), or they can target only one.

The Economics of Brownfields
(Using EQuIS/ArcGIS Vs. NOT Using)
EQuIS + ArcGIS can produce a National or Regional ‘Weather
Map’ for the Brownfields market. A Map where investors
could make informed decisions about “sunny” properties
versus “stormy” ones.
With this Map, transactions in the market would rise
considerably—and so would the economic benefits.
Greatest Opportunity: Identifying properties where Natural
Attenuation would remedy the site...
If the purchase of a Brownfield property results in a DIRECT positive economic/fiscal
benefit to the community…Then there is a measurable benefit to using tools that produce
valuable information about purchasing opportunities (e.g., where risks are understood).

The Business of Brownfields:
Managing Risk Using EQuIS and GIS
An Investment Opportunity
A Non-Profit or IB Launches a National
Brownfields Acquisition and Redevelopment
• Property data are
Strategy.
flagged where risks
Their strategy is to find and buy properties are above local,
Rank
where Real risks are LOWER than Perceived state, or federal
risks. Properties
regulatory levels
LOAD
Check Find
BUY
Map Risks
Historical and
Quality Risks
New data
directly from
the Field or
• Bank uses EQuIS to • Bank uses ArcGIS
Lab for many
manage disparate to delineate and
sites
data across a large display where real
portfolio of property risks are
Brownfield and are not.
properties.

The Business of Brownfields:
Managing Risk Using EQuIS and GIS
Applied to Brownfield Properties
= Valuable Intelligence About Real Vs. Perceived Risks!
Find and Integrate Good Sort Properties Meeting Top GIS Intelligence to
+ =
Data about Properties Environmental Risk Criteria Manage Property Risks

The Business of Brownfields:
Managing Risk Using EQuIS and GIS
Enter EQuIS and GIS
Geographic Information Systems (GIS) present real world
data as interactive layers of information
contamination
roads
parcels
GIS
elevation
land use
real world

The Business of Brownfields:
Managing Risk Using EQuIS and GIS
What We Get
If the data put into the GIS are Timely, Relevant, and
Accurate (e.g., good quality) then…
contamination
roads
parcels
GIS
elevation
land use
real world

The Business of Brownfields:
Managing Risk Using EQuIS and GIS
What We Get
We get valuable intelligence about locations and their
attributes—especially their Real risks
contamination
roads
Brownfields
GIS
elevation
land use
real world

The Business of Brownfields:
Managing Risk Using EQuIS and GIS
Price is Determined by Information about Risks
In other words:
Price of ‘clean’ property ($)
- Real Risks
- Perceived Risks
- Unknown Risks
= Property Price ($)
Note: The focus is on the impact of environmental risks to pricing. Clearly, financial,
demographic, and other risks will also impact pricing Brownfield properties.

The Business of Brownfields:
Managing Risk Using EQuIS and GIS
Pricing Environmental Risks @ Brownfields:
• If reliable data about environmental risks are abundantly
available, the market will price and trade them well.
• If reliable data about environmental risks are scarcely
available, the market will NOT price and trade them well.
The problem with #2 is that the market may shield itself by
assuming an over-protective risk level for a whole class of
Brownfield Properties—one that is false and inflated.
? to Insurance Company: Q) How do you price the policy for your brownfields (without a
data management system)? A) Who cares? We just take the consultants number and
multiply it by 1000....

5
win
income
4
settle
3
2
lose
probability
OPEX + budget
cost recovery
soil volume
MNA SVE site
site
site
e site
1
1
at
1
1
reserve
sum
av
xc
E
lifecycle
current reserve
cost
groundwater
MNA Pump/treat
30 yrs
10 yrs
2 yrs
cost
future reserve
probability
PRP share = cost
RemedyDEFENDER PortfolioDEFENDER

EQuIS/GIS for Petroleum
Brownfield Sites
In the Brownfields Law, there is a mandate that 20% of
these grants go explicitly for Petroleum sites. Grant
applications must state if they are applying for a
petroleum site grant or a hazardous waste site grant.
USEPA (really RCRA) makes a clear distinction between a
hazardous waste site and a petroleum contaminated
site.
EQuIS is already used by many companies to manage
petroleum waste data, including Shell, BP, Valero,
Tosco, and many consultants.

The Business of Brownfields:
Managing Risk Using EQuIS and GIS
The Business of Brownfields
Goal Resell damaged property that is valuable
if rehabilitated (e.g., remediated).
Gamble Will Fair Market Value exceed costs of
acquisition and remediation?
Theory The better the information about property
risk, the more accurate its market price.
Reality Final Price = What Someone is Willing
to Pay…but what drives this?

The Business of Brownfields:
Managing Risk Using EQuIS and GIS
The Size of the Business of Brownfields...
600,000 Resell damaged property that is valuable
sites if rehabilitated (e.g., remediated).
Gets Will Fair Market Value exceed costs of
progressively
acquisition and remediation?
harder
More Phase The better the information about property
2 ESAs risk, the more accurate its market price.
Data are Final Price = What Someone is Willing to
required to Pay…but what drives this?
quantify risk

Using EQuIS and ArcGIS at Brownfields
The Path to Economic Gains
1. Investments in Brownfields Yields Economic Benefits.
2. Great Information about Risks Promotes Investments.
3. EQuIS + ArcGIS Delivers Great Information about Risks.
As an Investor, Regulator, or Consultant to Either…How
can you afford NOT to know your risks?
Use EQuIS + ArcGIS to KNOW and MANAGE your risks.
Use EQuIS + Arc GIS to make wise investments in
Brownfields Redevelopment—the kind that deliver long-
term ECONOMIC GAINS.

The Business of Brownfields:
Managing Risk Using EQuIS and GIS
Other Problems
• Perceived Risks may be Higher than Real Risks
• Investors Falsely Assume that Brownfields are too
Risky as an Investment Class.
• Or just as bad, they invest in other properties where
reliable information is perceived as more abundant (e.g.,
Greenfields).

The Business of Brownfields:
Managing Risk Using EQuIS and GIS
The Value is in the Intelligence About Risks
The Value is “ We Make Good Decisions”
Because…
Quality Data + GIS + A Valid Decision Model
=
Minimized Risks and Maximized Benefits.

The Business of Brownfields:
Managing Risk Using EQuIS and GIS
Lowering Perceived Risks Improves
Opportunities for Investment
Where EQuIS is used to store, validate, and ensure the
quality of your property data.
Where EQuIS is used to query and prioritize site data
against regulatory risk levels.
Where ArcGIS is used to quantify and map risks to
manage properties with Valuable Intelligence.

Using EQuIS and ArcGIS at Brownfields
The Path to Economic Gains
1. Investments in Brownfields Yields Economic Benefits.
2. Great Information about Risks Promotes Investments.
3. EQuIS + ArcGIS Delivers Great Information about Risks.
As an Investor, Regulator, or Consultant to Either…can you
afford NOT to know your risks?
Use EQuIS + ArcGIS to KNOW and MANAGE your risks.
Use EQuIS + Arc GIS to make wise investments in
Brownfields Redevelopment—the kind that deliver long-
term ECONOMIC GAINS.

The Economics of Brownfields
(Using EQuIS/ArcGIS Vs. NOT Using)
TAKE THIS HOME...
What Drives the Market Demand for Brownfields?
What Drives the Market Supply of Brownfields?
ANSWER: GREAT INFORMATION
EQuIS + ArcGIS = GREAT INFORMATION
Can You Risk NOT Knowing?

Our Target Market
• Industrial clients with multiple large brownfields
• Investors or Non-Profits seeking brownfields
• Insurance agencies for brownfields
• Regulatory agencies with hundreds or
thousands of brownfields
• Consultants with multiple large brownfields
• Clients already having GIS and relational
database capability or infrastructure, directly or
through a consultant