Transition Management and Ownership

Executive Summary

Planning the closure, divestiture or acquisition of commercial/industrial assets requires business decisions regarding the fate of assets. Depending on whether assets are owned or leased may direct what actions are taken. Lease agreements may reflect, more or less accurately, environmental permit requirements or include vague statements requiring compliance with all applicable laws and regulations. Leases may have other Environmental, Health and Safety (EHS) conditions that require consideration, especially as a lease comes to an end. It is important to know the requirements and extents of the lease, including any offsite locations that are involved in the transaction.

Regarding assets, it will be necessary to maintain an inventory. This inventory should reference asset ownership, and that may be difficult. Consider equipment on order, off-site storage of critical spares, vendor-owned equipment, and materials on consignment.

Leased Facilities:

Planning the closure, divestiture and acquisition of assets has Environmental, Health and Safety (EHS) implications. For leased facilities, carefully review the terms of the facility lease to understand what EHS requirements apply to the transaction. If the site is being idled or closed, does all equipment and infrastructure have to be removed, or can it be closed in place? Are there wastewater connections that need to be disconnected or blanked? Another consideration is if there is a sprinkler system in place that must be maintained and a way to manage any discharged firewater. Or will the sprinkler system be drained and antifreeze used to maintain the plumbing integrity? Note that drained firefighting foam has the potential to contain PFAS and these may need to be managed as hazardous waste.

If a business is being purchased, the EHS requirements in the property lease should be understood. Significant costs could arise from both the landlord’s EHS expectations and any EHS requirements tied to a potential future facility closure. Further, insurance requirements are likely to be part of the transaction and the lease conditions may influence these arrangements.

If your facility leases space within an industrial park, and your landlord holds the environmental permits for that park, you should review and understand your landlord’s permit requirements. For example, a lease may require a facility to conduct weekly waste inspections while operating, or to excavate 6-inches of soil as part of ending the lease. This requirement may be based upon the landlord’s RCRA permit and associated Closure Plan if they are a large quantity generator or a treatment storage and disposal facility (TSDF). In this event, it would be beneficial to review and understand the specific requirements that the state agency is expecting, even though your facility may not, itself, be a TSDF. Will your facility be subject to environmental audits by the landlord? How will their relationship with the local environmental agency influence your operations? In the event of ending a lease, it is possible that the conditions in your lease agreement reflect requirements in a Closure Plan that was drafted to

Also consider any off-site property leases such as warehouses, office areas, or parking lots, and the condition of these assets.

Asset Inventory:

As part of closure, divestiture and acquisition of a business, it will be necessary to create an inventory of assets, cataloguing ownership of all equipment both onsite and offsite. Once you have created the inventory, identify the owner of each asset. This exercise may present challenges. For example, do you know who owns the compactors and associated roll off containers onsite? Do you have the bill of sale to prove that the container that has been used and serviced by the same waste hauler for the past 20 years belongs to the facility? Are there any fleet vehicles or lifts that will be sold as part of the transaction? If so, you will need to find their title documents. Is there any equipment that is on order, has been idled, is pending repairs, or critical spares that are in storage that need to be accounted for?

Also consider site vendors who may own assets onsite, such as pump skids or tanks. Consider if this equipment has value and will need to be retrieved by the vendor, or if you expect your vendor to abandon the equipment. If the facility business is being sold, new contracts will be needed for the vendor-owned and operated equipment. In the event that new vendors are being contracted, consider what equipment needs they will have.

Another aspect of your asset inventory will be any raw materials that are on consignment. Will these materials be used by a new owner, returned to the vendor, or transferred to another site? Some chemicals expire and have storage requirements to maintain their quality. In any event, concerns with the Chain Of Custody may drive the fate of chemicals on consignment. Consider the timelines involved for proper management of these chemicals. Further, consider the US DOT requirements should these materials have to be shipped out, when current operations are set up for only receiving chemicals.

In the event that raw materials are abandoned and have to be managed as waste, identify if these are hazardous or non-hazardous wastes and who the generator is. If a hazardous waste and the vendor can be established as the generator, this may help to prevent your hazardous waste generator status from changing. Perhaps you are in a state that will allow you to take advantage of episodic generator provisions. Otherwise, you may need to submit a generator ID form and comply with the requirements applicable to your new generator status.

Conclusion:

In summary, asset closure, transition and acquisition projects are complex. Understand lease requirements and identify asset owners to support good business decisions. Site specific permits, regulatory requirements, and operational plans can be leveraged to facilitate a safe and compliant transition in accordance with predicated timelines.

Trinity provides a network of resources and the regulatory knowledge to help understand the multimedia considerations associated with asset closure, divestiture and acquisition. For more information about the complexities of these transitions, you are welcome to attend one of Trinity’s free webinars in our Closure, Divestiture and Acquisition series:

Closure, Divestiture & Acquisition Series

Part 1: Closure and Future Use of Commercial/Industrial Assets

Presented July 2, 2025. Recording available.

This webinar is an introduction to the series and presents options associated with closure, divestiture and acquisition. What are the timelines and due diligence considerations you need to know? We will include information on assessments and inspections, equipment management, recordkeeping, budget impacts, and other multimedia requirements associated with the following course topics.

Course Topics

• Repurposing Assets
• Temporary Closure
• Transfer
• Permanent Closure

Closure, Divestiture & Acquisition Series

Part 2: Permit Management, Regulatory and Closure/Post Closure Requirements for Commercial/Industrial Assets

Date: Thurs, September 4, 12:00 – 1:00 PM CST

This webinar presents details for environmental permit management associated with closure, divestiture and acquisition. The information will be organized by media and describe how to document compliance for the changes you will need to manage.

Course Topics

• Air
• Waste
• Water
• DOT
• Nuclear Sources
• Records and Reporting

Closure, Divestiture & Acquisition Series

Webinar 3: Closure/Divestitures of Commercial/Industrial Assets

Date: Thurs, November 6, 12:00 – 1:00 PM CST

This webinar presents information on asset management associated with closure, divestiture and acquisition. What are the safety considerations for non-routine work? What infrastructure needs to be dismantled or isolated and how should that be done? Any closure plans written long ago by others as part of your permit application now need to be implemented.

Course Topics

• Safety
• Nuclear Sources
• Chemical Management
• Tank Systems
• WWTP
• Infrastructure
• Landfills
• Waste

Closure, Divestiture & Acquisition Series

Webinar 4: Continuity- Acquisition and Future Use of Commercial/Industrial Assets

Date: Thursday, January 8, 12:00 – 1:00 PM CST

This webinar rounds out our Closure, Divestiture and Acquisition series by planning for business continuity. We will focus on start up and shake down and what that may look like from both an infrastructure and legal perspective. As a tickler, due diligence with ASTM and remediation considerations will be included in this presentation.

If you would like to discuss your individual circumstance and the options you should consider, feel free to reach out to Andrea Simmons – Managing Consultant for more information and how Trinity can help.