Review of Data to Support Compliance with Sarbanes-Oxley Act: 250 Sites in Seven States
Between 1995 and 2005, a large gas utility characterized and remediated (as required) environmental issues at approximately 250 facilities in several states under an AOC with USEPA Region III. Remedial work was performed to meet both residential and industrial clean-up standards. To comply with the Sarbanes-Oxley Act, the gas utility was required to develop liability costs for future remediation of sites where industrial clean-up standards were applied, if the sites were eventually remediated to residential standards and then sold. In 2005, AGES Energy was contracted to conduct this evaluation and develop defensible costs.
To identify sites where affected constituents exceeding residential standards were left in place, AGES Energy reviewed all available environmental documents for each site. Based on this evaluation, sites were grouped into categories according to the scope of remediation required to achieve residential clean-up standards for all affected media. To develop these categories, the volume of work at each site was calculated. The sites were then ranked by percentile dependent on the volume of work: Small (less than the 50th percentile); Medium (between the 51st and 90th percentile) and Large (between the 91st and 100th percentile). An average cost for remediation was then calculated for each category and applied to the specified number of sites. Defensible costs for remediation were developed based on this approach.
Developed a defensible approach that allowed client to comply with Sarbanes-Oxley requirements for projecting potential cost liability.