{"ok":true,"canonical_url":"https://dealroom.so/glossary/environmental-violation","api_url":"https://dealroom.so/api/public/glossary/environmental-violation","data_freshness":{"sba_records_through":"2026-05-31","fdic_records_through":"2026-03-31","dealroom_last_updated":"2026-06-15","timezone":"America/Chicago"},"source_summary":["Public SBA 7(a) loan records","FDIC institution data","DealRoom lender and franchise enrichment"],"term":{"slug":"environmental-violation","term":"Environmental violation","group":"Reading the business","definition":"A breach of environmental laws or regulations. This is a major concern because violations can lead to hefty fines, clean-up costs, and legal liabilities for the new owner.","what_it_means":"During due diligence, always check for past or current environmental violations, especially for businesses in industries with high environmental impact. A Phase I Environmental Site Assessment is often required by the SBA and lenders to identify potential risks. Unresolved violations are a significant liability and can halt a deal.","url":"https://dealroom.so/glossary/environmental-violation","official_sources":[{"slug":"sop-50-10","title":"SOP 50 10 — Lender and Development Company Loan Programs","official_url":"https://www.sba.gov/document/sop-50-10-lender-development-company-loan-programs","official_label":"View on SBA.gov","authority_tier":2,"publisher":"U.S. Small Business Administration","source_guide_url":"https://dealroom.so/sba-7a/sources/sop-50-10"},{"slug":"13-cfr-part-120","title":"13 CFR Part 120 — Business Loans","official_url":"https://www.ecfr.gov/current/title-13/chapter-I/part-120","official_label":"View on eCFR","authority_tier":1,"publisher":"Office of the Federal Register","source_guide_url":"https://dealroom.so/sba-7a/sources/13-cfr-part-120"}],"related":[{"slug":"environmental-compliance","term":"Environmental compliance","url":"https://dealroom.so/glossary/environmental-compliance"},{"slug":"legal-liability","term":"Legal liability","url":"https://dealroom.so/glossary/legal-liability"},{"slug":"phase-i-environmental-site-assessment","term":"Phase I Environmental Site Assessment","url":"https://dealroom.so/glossary/phase-i-environmental-site-assessment"},{"slug":"phase-ii-environmental-site-assessment","term":"Phase II Environmental Site Assessment","url":"https://dealroom.so/glossary/phase-ii-environmental-site-assessment"}],"related_questions":[{"question":"What if the business I'm buying has a history of environmental violations or ongoing compliance issues?","url":"https://dealroom.so/sba-7a/questions/what-if-the-business-i-m-buying-has-a-history-of-environmental-violations-or-ongoing-compl"},{"question":"If the business has a history of environmental violations, can it still be acquired with an SBA 7(a) loan?","url":"https://dealroom.so/sba-7a/questions/if-the-business-has-a-history-of-environmental-violations-can-it-still-be-acquired-with-an"},{"question":"When a Phase I Environmental Site Assessment (ESA) identifies a Recognized Environmental Condition (REC), what are the lender's subsequent responsibilities?","url":"https://dealroom.so/for-lenders/questions/when-a-phase-i-environmental-site-assessment-esa-identifies-a-recognized-environmental-con"},{"question":"If a Phase I Environmental Site Assessment (ESA) identifies Recognized Environmental Conditions (RECs), what are the next steps for a lender?","url":"https://dealroom.so/for-lenders/questions/if-a-phase-i-environmental-site-assessment-esa-identifies-recognized-environmental-conditi"},{"question":"When is an Environmental Questionnaire (e.g., Form 1081) sufficient for real estate collateral, without requiring a Phase I Environmental Site Assessment (ESA)?","url":"https://dealroom.so/for-lenders/questions/when-is-an-environmental-questionnaire-e-g-form-1081-sufficient-for-real-estate-collateral"},{"question":"What are a lender's responsibilities if a Phase I Environmental Site Assessment (ESA) identifies a Recognized Environmental Condition (REC) but recommends no further action?","url":"https://dealroom.so/for-lenders/questions/what-are-a-lender-s-responsibilities-if-a-phase-i-environmental-site-assessment-esa-identi"}]},"caveats":["Definitions represent DealRoom's plain-English interpretation for buyers; verify regulatory terms against the official SBA and eCFR sources listed.","Not legal, tax, or financial advice, and not an SBA eligibility determination."],"citation":{"label":"DealRoom.so Glossary — Environmental violation","url":"https://dealroom.so/glossary/environmental-violation","source_type":"DealRoom Data"}}