If you`re in the real estate industry in Oregon and you`re looking to purchase a property with potential environmental risks, then you need to be familiar with the Oregon Department of Environmental Quality`s (DEQ) Prospective Purchaser Agreement (PPA).
What is a Prospective Purchaser Agreement?
A Prospective Purchaser Agreement is a legal document that allows prospective property buyers to conduct due diligence on a property, without assuming responsibility for any environmental liabilities that may be present on the property.
In simpler terms, a PPA is a contract between the buyer and the DEQ, which states that the buyer can purchase the property and conduct any necessary environmental assessments before closing the deal, without assuming responsibility for any past environmental contamination on the property.
The PPA serves as a shield for the buyer against unforeseen environmental liabilities, as long as the buyer complies with all of the PPA`s terms and conditions.
Why is a PPA Important?
A PPA is particularly important in cases where a property has a history of environmental contamination, such as sites that were previously used for industrial purposes or sites that have underground storage tanks.
Without a PPA, a buyer would be responsible for all cleanup costs associated with any environmental contamination that was discovered or occurred after the purchase of the property.
A PPA provides a level of protection for the buyer, allowing them to conduct due diligence on the property without assuming responsibility for past contamination. This makes purchasing environmentally risky properties more feasible and less risky for buyers.
How Does a PPA Work?
A PPA is a voluntary agreement between the buyer and the DEQ. Both parties agree to certain terms and conditions before the sale of the property.
The agreement typically includes:
– A property description
– A list of known and potential environmental liabilities
– An outline of the buyer`s responsibilities, including conducting any environmental assessments and cleanup, if necessary
– A timeframe for completing assessments and cleanup, if necessary
– A release of liability for the buyer, as long as they comply with the terms and conditions of the PPA
The buyer is responsible for conducting all necessary environmental assessments and cleanup, if necessary, in accordance with the PPA.
Once the buyer has completed all of the required assessments and cleanup, they can submit a completed certification to the DEQ. This certification states that the buyer has complied with all of the terms and conditions of the PPA, and that they are released from any environmental liability associated with the property.
If you`re looking to purchase a property with potential environmental risks in Oregon, then a Prospective Purchaser Agreement is a must-have. It provides protection for the buyer against unforeseen environmental liabilities and makes purchasing environmentally risky properties more feasible.
Remember that a PPA is a voluntary agreement between the buyer and the DEQ, and it is important to carefully review and comply with all terms and conditions of the agreement. With a PPA, buyers can conduct necessary due diligence and purchase a property with confidence.