One of the tools utilized by the Small Business Administration’s environmental policy is the Transaction Screen Assessment, which is essentially a scaled down version of the Phase 1 Environmental Site Assessment. The Transaction Screen includes a site visit, regulatory records review, key personnel interviews and limited environmental research.

The only place in the SBA Policy that specifically states when you can use a Transaction Screen as a minimum starting point for environmental due diligence, is when you are financing a car wash only facility (as long as the property doesn’t also have a gas station, automotive servicing, etc). This is because car wash facilities are relatively low-risk operations when it comes to potential environmental contamination. For all other higher risk operations, including auto repair and maintenance, the due diligence must start with a Phase 1 Environmental Site Assessment. (To clear up any confusion: If you are using the NAICS code list to determine if your property operation is “environmentally sensitive,” the code for car wash only facilities is 8111 Automotive Repair & Maintenance, which is technically an environmentally sensitive industry; however, the subtext reads except for “car wash only” facilities which can start with a Transaction Screen.)

Transaction Screens are also often ordered in place of the Records Search with Risk Assessment or “RSRA” by lenders who don’t want to fill out the Environmental Questionnaire themselves - either because the property is far away (since the Environmental Questionnaire requires a site visit), or because they are uncomfortable filling out the Environmental Questionnaire.