Summary of Demonstration Projects
OVERVIEW OF THE ECO-EFFICIENCY
The following sections describe the findings of the Task Force's six
demonstration projects: Automobile Manufacturing, Chemical Operations,
Cleaning Product Stewardship, Eco-Industrial Parks, Lithographic
Printing and other Small Business, and Pollution Prevention Pilot
Projects; as well as the Task Force's four policy clusters:
Information, Economics, Regulatory, and Money and Management. The work
of these teams was instrumental in shaping both the eco-efficiency goals
and policy recommendations described in the previous chapters. The
demonstration project reports are reproduced in Appendix B.
The demonstration projects were created to supply the "real-world"
experience while the policy clusters and the many study papers they
produced contributed to the intellectual vitality of the
Eco-Efficiency Task Force.
The findings of the demonstration projects and policy clusters do not
represent a consensus of thought among Task Force members. They were
used for discussion purposes only.
The Task Force established the Auto Team to study and improve the
envirorunental performance and eco-efficiency of a key component of
automobile manufacturing--auto painting (see Appendix B1). Auto painting
was chosen because a significant proportion of the environmental
emissions from auto assembly plants comes from painting operations. Auto
paint shops are also emerging as an economically vital and
technologically dynamic component of the industry, as the types of
paints, the types of auto bodies, and the technologies used to apply the
paints continually change.
A multistakeholder team, comprised of industry, U.S. Environmental
Protection Agency (EPA), local and national environmental groups, and a
national research laboratory conducted the "life-cycle" study.
Life-cycle, in this context, refers to the comprehensive look at the
environmental impacts of painting from design through disposal of an
auto. The analysis included the manufacture of auto body materials,
manufacture of auto paint and coatings, application of
paints and coatings to an auto during assembly, auto refinishing, and
auto recycling and disposal.
The life-cycle methodology was applied to the General Motors (GM) Lake
Orion Assembly Facility located in Orion, Michigan. The Team looked both
in the paint booth at the Orion plant for improvements as well as
"upstream" where the paint is actually manufactured. The Team
gathered data on key environmental inputs such as raw material, energy,
and water; and outputs such as air pollution, sludge and filter cakes,
and water and organic solvent effluent from equipment cleaning.
Findings of the Auto Team
Through the input/output analysis, the Team confirmed that auto painting
is resource-intensive and produces a substantial quantity of recognized
pollutants. Up to 95 percent of the smog-producing volatile organic
chemicals emitted from an entire assembly plant may come from
painting and coating.
Through the engineering analysis, the Team found several ways to save
money and reduce emissions. For example, by using water in the painting
process twice, rather than once, the cost of waste water treatment at
the plant could be reduced by 8 percent and the amount of water
needing treatment could be reduced significantly. The
Team found that substitutes to the current types of paints used could
result in decreased air, water and waste emissions. Water-based, rather
than solvent-based paints, and the next generation of powder paints
were all investigated by the Team. In addition to the engineering
analysis of material, water, and energy inputs and outputs,
the Team assessed the plant's programs for environmental management,
pollution prevention, chemical management systems, and vehicle design.
The Team also analyzed how much energy it takes to paint a car. GM
identified opportunities to reduce energy usage and the costs and
emissions associated with it. Fifteen alterations to the
plant's paint shop were identified and several of these are now under
consideration. Four of these have been projected to save enough energy
to pay back the cost of making. the alteration within
one year. If these four changes are made, air emissions associated
with acid rain and urban smog will be reduced. In this case, it is
projected that 51 tons of sulfur dioxide and 75 tons of nitrogen
oxide emissions will be avoided.
Most compelling of the Team's findings was the need for an alternative
system of environmental regulation. This system would be designed to
redirect resources currently devoted toward compliance into higher return
investments such as re-engineering, pollution prevention, and
The Team's Alternative Regulatory System (ARS), developed through
consensus of the Auto Team, enjoyed broad support of the Task Force
members and the Council members. The proposal provided the basis for the
Eco-Efficiency Task Force's Policy Recommendation 1: Environmental
Management System. This policy was also adopted by the full Council
under the theme of "A New System for A New Century."
While the findings of the Auto Team were plant-specific, one can assume
that the Orion facility is representative of other auto painting
processes, and that the findings could be useful for other
plants in the automobile manufacturing sector.
COMPONENTS OF THE AUTO TEAM'S
ALTERNTATIVE REGULATORY SYSTEM
The components of the Auto Team's Alternative
Regulatory System (ARS) are:
Sustainability Vision: the ARS must be oriented to achievement of
sustainable development goals.
Continuous Improvement. the ARS must encourage firms to continuously
improve their environmental performance beyond compliance with au
applicable aspects of the existing regulatory system as a standard
Multi-media Approach: the ARS must work across all environmental
media to foster whole facility pollution prevention.
Measurement and Reporting Progress: the measurement and reporting tools
in the ARS must minimize the generation of redundant or useless
information and emphasize information that can identify pollution
prevention opportunities and demonstrate that progress toward ARS goals
Enforcement and Performance Incentives: the ARS must provide
incentives to excel as well as deterrents if goals are not met.
Public Participation: the ARS must enhance public involvement in
environmental goal setting.
Life-Cycle Perspective: the ARS must encourage producers to take
responsibility for reducing the life-cycle environmental impacts of their
Flexibility and Participation Incentives: the ARS must be
flexible to promote the most efficient pollution prevention and control
Eligibility to Participate: the ARS must be designed to encourage
the participation of environmental
With that in mind, the Team recommended to the Task Force the following
measures for improving the eco-efficiency of automobile manufacturing and
improving the system of environmental policy and regulation affecting
it. These recommendations represent the consensus of the Auto Team
participants, including representatives from industry, citizens
groups, and leaders in local and national government.
- Implement an "alternative regulatory system" on a plant-specific
basis in order to redirect the resources currently devoted to compliance
toward innovative re-engineering, pollution prevention, and efficiency
- Improve material use tracking and accounting mechanisms within and
between companies in order to facilitate and advance pollution prevention.
- Broaden the scope of environmental management by involving a
life-cycle perspective in order to understand the full impacts and costs
of auto manufacturing and to arrive at an optimal plan to improve the
sustainability of auto manufacturing.
- Integrate environmental management into central business planning and
systems in order to facilitate "eco-efficient" manufacturing.
- Assess and improve the environmental aspect of supplier relationships.
- Develop industry-specific collaborative efforts to develop the necessary
life-cycle data base and inventories.
- Combine energy planning with environmental management and merge both
into existing best management practices, thereby harnessing the
"efficiency" drivers at work in industry today in service of sustainable
The Task Force chose chemical manufacturing for study in order to learn
about issues faced by a large, capital intensive, highly technical, and
heavily regulated industry (see Appendix B2).
The task of the Chemical Operations Project Team was to identify
opportunities to improve the environmental performance of US. chemical
companies without thwarting innovation or competition.
The Team first sketched a profile of the chemical industry, then traced
regulatory, technological, organizational, and other factors supporting
or thwarting eco-efficiency in the industry. The Team
drew up a number of policy options it thought could encourage the
establishment of eco-efficiency in the decisionmaking and core business
functions of the industry.
The Team planned to develop further these policy options in an
experimental and highly participatory roundtable format that would
include representatives of the entire chemical sector. It became
apparent, however, that this generalized approach was inappropriate for
such a multifaceted and diverse industry.
Instead, the Team learned, the industry could be better understood if
divided and studied by type of manufacturing operation, of which there
are two: continuous and batch. Continuous operations
are used in chemical plants in which millions of pounds of a single
commodity or of closely related products are produced annually. Batch
operations are used in specialty plants which produce a multiplicity of
custom products. These batch plants are typically smaller than
commodity operations and are characterized by the ability to respond
quickly to new customer specifications.
Understanding this basic division within the chemical industry, the
Team convened two separate roundtable discussions to analyze policy
options. In addition to corporate and plant-level managers,
participants included representatives from government and the
environmental community. The first roundtable, focusing on
continuous/commodity manufacturing, took place in Houston, Texas and the
second, focusing on batch/specialty operations, in Newark, New Jersey.
The roundtable discussions were very candid. "Inflexible, complex, and
technology-based environmental laws and regulations" were identified as
the greatest barriers to the adoption of eco-efficiency improvements by
the chemical industry. Industry participants contended that the
marginal benefit of certain environmental regulations fails to justify
the cost of the resulting incremental environmental gains and that these
regulations drain the limited pool of resources that are available to
spend on environmental improvements.
In some cases, the roundtable revealed, companies are reluctant or
unable to make eco-efficient improvements because of the dominant
regulatory orientation toward compliance and deadlines
rather than toward overall environmental performance and risk
reduction. According to one large chemical company in Texas, for every
seven people working on environmental compliance, they
have three people working on prevention.
In another example of regulatory barriers to eco-efficiency, a Louisiana
chemical plant testified it was unable to undertake pollution prevention
improvements because the only way of achieving the numerical standards in
the governing regulations was through end-of-pipe treatment. The
plant's own preferred approach--source reduction--would avoid a
media-transfer (as contaminant is transferred from water to land) that
the plant now must undertake in order to comply with regulatory
standards. In this case, compliance with existing effluent guidelines for
clean water prevented a cleaner and cheaper approach.
Such discussions clarified a number of important issues, particularly
the need for performance-based goals and for increased operational
flexibility. These findings, coupled with the Team's
own in-depth assessment of regulatory barriers to eco-efficiency, were
instrumental in shaping the final Task Force recommendation on a new
Environmental Management System (Policy Recommendation 1).
The Team made the following recommendations to the full Task Force:
- Create more flexible, effective environmental standards that are based
on environmental risk and sound science, focused on entities' enviromnental
performance, written clearly and concisely, and drafted with a
multi-media and facility-wide focus.
- Create environmental programs that allow more flexible implementation
and operation, with a focus on promoting good environmental performance
through flexible permit programs, compliance assistance, and increased
delegation to the states.
- Encourage greater communication and understanding among stakeholders to
build trust by establishing formal mechanisms for ongoing dialogue and
- Establish tangible rewards for facilities that operate at high
environmental performance levels, such as permit review prioritization,
less burdensome monitoring and recordkeeping requirements, and public
acknowledgment of facilities' high performance.
- Establish industry-wide incentives and promote the use of certain tools
that encourage facilities to continuously improve their eco-efficiency
through the use of marketable pollution credits and the promotion of
research and development into eco-efficient technologies.
CLEANING PRODUCT STEWARDSHIP
The Cleaning Product Stewardship Project Team was established to assess
opportunities for pollution prevention and product stewardship in the
design, manufacture, application, reuse, recycle, and disposal of
commercial cleaning products (see Appendix B3).
The Team took an in-depth look at how cleaning products are made, how
they are applied, and how these processes could be improved. It used a
survey and interviews with chemical manufacturers, distributors,
marketers, buildiing cleaning contractors, building owners and managers,
and cleaning personnel to find where the greatest opportunities lie for
encouraging shared responsibility for environmental stewardship.
The Team uncovered a number of issues that do not typically appear in the
headlines -- information flow, communication, trust, and individual
responsibility. It found the lack of an easy, agreeable, and measurable
definition of eco-efficiency impedes progress toward industry-wide
environmental, health, and safety improvements. The Team discovered
opportunities for all who operate within the cleaning products stream of
commerce to improve performance. These ranged from the way basic
chemicals are formulated to the way they are mixed with water and applied
to walls, floors, or windows.
Often information flow is the most significant barrier to eco-efficiency
in the cleaning products industry. Within their product development
units, manufacturers and methodologies to compare the environmental
preferability and efficacy of alternative products and processes. Once a
product is manufactured, environmental information needs to be relayed
adequately between each link in the chain of commerce, from maker to
purchaser to end-user. For instance, information on safe and effective
use of products may not reach the cleaning personnel, or if it does, may
not be in a useful form. Directions for use, pasted on bulk containers,
may not be transferred to the spray bottles actually employed by staff to
apply a product. Directions may be printed in a language the user does
In many industry sectors, the price signal provides a strong incentive
for reducing the volume of material luse. In the commercial cleaning
products industry this is not so. Dollars spent on cleaning agents
typically have little effect on overall profitability, so little
financial incentive exists to minimize their use. It appears that in some
cases greater environmental improvement comes not from reducing the
amount of cleaning agents used, but in reducing hot water and other
components of the cleaning process.
The Team also found that complications within the current regulatory
system may stifle the adoption of eco-efficient practices. Inconsistent,
confusing, or redundant regulations could be minimized with better
communication and more participatory goal setting among local, state,
and federal governments.
The findings of the Cleaning Products Stewardship Project were most
influential in formulation of the Task Force Recommendation 2, Extended
Product Responsibility, and also affected the full Council's policy on
The Team made the following recommendation to the full Task Force:
- Create a partnership to promote eco-efficiency. An industry-led
coalition should be formed that would review the eco-efficiency of
building cleaning processes in order to develop and implement a plan for
extending eco-efficiency throughout the chain of commerce. The coalition
should include members from the entire building cleaning chain of
commerce and should base its work on the life-cycle perspective.
- Improve communication to provide exchange of information on
environmental, health, and safety issues between cleaning personnel and
the rest of the chain of commerce.
- Reform regulations to promote better eco-efficiency. Regulations
should be nationally consistent and performance oriented, and should
lend appropriate consideration to the full product life-cycle.
- Promote the development and implementation of building maintenance
manager programs to reduce the environmental, health, and safety impacts
of building cleaning processes.
The Eco-Industrial Park (EIP) Project Team was established to investigate
the practical application of ecological principles to industrial
activities and community design (see Appendix B4). In designing its
project the Team assumed that economic growth, job opportunity, and
global competitiveness can be enhanced through the adoption of business
practices that protect the environment.
The concept of an eco-industrial park stems from the emerging discipline
of industrial ecology. This new spin on old science suggests that
industrial activities are interconnected just as individual organisms are
in biological systems. In the industrial setting, waste from one process
becomes food for the next, enabling optimal energy and material
efficiency utilization throughout the system.
By collectively managing environmental and energy issues, eco-industrial
park members seek to enhance their environmental and economic performance
and, as a result, achieve a combined benefit that is greater than the
benefits each company would realize from optimizing only its individual
The Team worked with four demonstration communities in Chattanooga,
Tennessee; City of Cape Charles and Northampton County, Virginia;
Brownsville, Texas/Matamoros, Mexico; and Baltimore, Maryland. These
communities were selected because of their unique circumstances and
differing approaches to eco-industrial park development.
Findings of the Eco-Industrial Park Team
Based on its work with the four demonstration communities, the Team found
that community participation and support are perhaps the most critical
determinant of successful EIP planning and development. Because each
community has a unique demography, geography, and culture, community
participation is vital to the development of screening criteria for
potential park participants.
The Team also determined that environmental regulations regarding
clean-up liability for past or present contamination may lead to the
deterioration of abandoned properties rather than encourage the
redevelopment of such "brownfield" sites. Liability risk was also found
to be a significant concern of prospective eco-industrial park business
tenants. Specifically, potential businesses are concerned that common
waste treatment systems operating within a park system may give rise to
joint and several liability under Superfund regulations.
Other regulatory barriers to the development of eco-industrial parks
steam from inflexibility in permitting procedures. A systems approach to
development requires a new definition of source -- no longer is a
discrete facility the unit of inquiry, but rather a system of
interconnected, symbiotic facilities.
The Team also identified limited access to capital as an obstacle to the
proliferation of ecologically designed industrial parks. This occurs
because some of the potential benefits of investing in an ecological
industrial park such as greater resource efficiencies and reduced
environmental emissions are undervalued in existing loan qualification
ratios. Inadequate infrastructure is also a barrier to the rapid
development of these environmentally-designed business complexes.
Each of the four eco-industrial park demonstration communities are
briefly described below.
Baltimore, Maryland, Fairfield Eco-Industrial Park
The Fairfield Eco-Industrial Park is a brownfield located within the
Baltimore City Empowerment Zone (see Appendix B4.1.). With seed money
from the Empowerment Zone program, a recent anti-poverty initiative which
granted $100 million to nine communities across the country, the City of
Baltimore leveraged an additional $800 million from private sources to
invest in the city. Development of the Fairfield eco-industrial park site
is part of this promising strategy.
The park will utilize closed-loop production/operation systems to
maximize resource use and minimize environmental degradation. The
system's hub will be a resource recovery plant where waste tires will be
removed and processed, and the steel cycled back to Bethlehem Steel,
located across the harbor. Cooperating with Cornell University's Work and
Environment Initiative, park management will ensure that the best human
resource and industrial relations practices are used within the park.
Brownsville, Texas/Matamoros, Mexico
The Brownsville site is located on the border of Texas and Mexico in the
Rio Grande Valley -- a region which has some of the hemisphere's most
severe environmental problems due to rapid industrialization (see
Appendix B4.2.). The eco-industrial park was envisioned as a prototype to
develop and diffuse innovative, cost-effective technologies and practices
that could promote sustainable industrial development along the
U.S.-Mexico border. Work with the City of Brownsville has also offered
the opportunity to link wtih the Environmental Defense Fund's
eco-industrial park project in Matamoros, Mexico.
The first phase of the project is a quantitative analysis of the
anticipated economic and environmental benefits of co-locating
manufacturing facilities, or locating them in close enough proximity to
physically share material inputs and outputs, reduce transportation
costs, and jointly manage the park. The second phase involves testing the
model at the site.
City of Cape Charles/Northampton County, Virginia
The Cape Charles Eco-Industrial Park Site is located on the Eastern Shore
of Virginia in NOrthampton County (see Appendix B4.3.). The park was
initiated by the local community of 1000 residents as part of an
aggressive effort to overcome the region's severe poverty while
protecting its acclaimed environmental resources. Among other treasures,
the region includes one of the most important East Coast flyways for
neotropical migratory songbirds.
The EIP will house agriculture, aquaculture, and food processing plants
that will cycle the byproducts of one industry into the raw materials for
The South Central Business District site is a 100-acre brownfield which
now houses both abandoned and operating foundries, dilapidated and active
commercial buildings, and worker housing and vacant lots (see Appendix
B4.4). Plans for this site include a zero-emissions manufacturing zone,
an urban ecology center, a community stadium, and an environmental
technology complex. The United Nations University Research Institute has
also expressed interest in locating within the Eco-Industrial Zone which
will act as a catalyst for recruiting new businesses, as well as
facilitate the transfer of new ideas and technologies.
In an effort to make a business out of its environmental leadership, the
city has been exploring the development of eco-industrial parks in the
context of an overall economic, environmental, and social revitalization
plaln. RiverValley Partners, the city's economic development
organization, surveyed existing and prospective businesses and identified
the need for a diversity of development options, which included
reclaiming "brownfield" sites in the inner city, new industrial parks
that reinvent the traditional notion of industrial parks, and zero
emissions/eco-industrial parks that pair manufacturing facilities in an
almost symbiotic relationship.
The EIP Team's discovery of significant liability and capital access
barriers shaped the Task Force's Policy Recommendation 6: Facilitatining
Capital Access. The Team also helped demonstrate the need for an improved
Environmental Management System (Policy Recommendation 1). Under this
system, communities could be "bubbled" in a new way for flexible
permitting and other regulatory matters.
The Team made the following policy recommendations for consideration by
the full Task Force:
- Environmental regulatory systems must be flexible enough to allow
park participants to trade their waste products so that environmental
goals can be reached in the most cost-effective way for the entire park.
- Federal, state, and local governments should coordinate and
streamline their regulatory requirements.
- One-stop networks or centers should be established so that
communities interested in developing EIPs can easily obtain regulatory,
technical, and financial assistance information concerning federal,
state, and local requirements.
- Environmental goals for EIPs should be developed through a
participatory process involving all community stakeholders.
- Market incentives should be used widely in the encouragement and
management of eco-industrial parks to enable cost-effective environmental
protection within parks.
- Barriers to investment in eco-industrial parks, including liability
and capital access, must be removed to promote ecologically sound park
- Information must flow openly between industry, government, and the
CHATTANOOGA'S PRINCIPLES OF SUSTAINABLE DESIGN:
Connections: Establilsh physical links using
transit, greenways, streets, open spaces, and the
Catalysts: foster development through the
major projects such as the new stadium, trade center, and warehouse
Diversity: mix uses -- "nature loves diversity."
diversity in housing would include loft conversions, multi-family
development, student housing, and single-family homes located in the same
Synergy: use land in a complementary manner. For
stadium parking should be configured to encourage smart development and
investment in the surrounding area.
Urban Character: build upon the area's unique
character, including its industrial legacy. For example, the scale,
rhythm, and craftsmanship of many buildings in the area should be treated
as valuable resources and leveraged to attract
Public Investment:invest in the area wisely to
leverage other amenities. For example, investment in public spaces and
services will make the location more desirable for new
The Small Business Job Engine
- 62 percent of the net new jobs in the United States come from firms
with less than 500 workers.
- Firms with less than 20 workers employ only 21 percent of the labor
force, but provide 48 percent of new jobs.
Lithographic Printing and Other Small Business
Small businesses generally operate with both narrow profit margins and
low production volumes. These factors make small businesses especially
vulnerable if economic and environmental objectives conflict.
The task of the Printers/Small Business Team was to identify policy
changes that could reduce such conflict and help small businesses meet or
exceed their environmental and health protection responsibilities while
at the same time improving their economic competitiveness.
The Team conducted three separate investigations of specific,
small-business dominated industrial sectors:
The Great Printers Project, sponsored by the Environmental Defense
Fund, Council of Great Lakes Governors, and Printing Industries of
America, focused on the lithographic printing industry in the Great Lakes
The Sustainable Industry Project, sponsored by the Environmental
Protection Agency, looked at photo-imaging, metal-finishing, and
thermoset plastics manufacturing; and
The Small Business Forum on Regulatory Reform, an interagency
effort coordinated by the Small Business Administration and Office of
Management and Budget, considered the chemicals and metals, restaurants,
food processing, trucking, and environmental disposal and recycling
Despite the variety of sponsors and industries, these projects resulted
in strikingly similar findings on how to improve environmental and
competitive performance in all nine small business sectors studied.
The Great Printers Project
They say small is beautiful. Evidence shows that in
the United States, small businesses are where most new jobs are created.
But when it comes to environmental regulations, small can be frustrating.
Unlike large corporations, small businesses do not have departments
dedicated to compliance, let alone someone who designs new ways of
reducing pollution. How does a small business keep up with the paperwork?
"There aren't enough hours in the day," says Robert Murphy.
Murphy - chief executive officer of Japs Olson Company, a
Minneapolis-based printer, and chairman of the board of the Printing
Industries of America - has first-hand experience with the paperwork
problem. His industry is dominated by small businesses: 80 percent of the
print shops in the United States employ fewer than 20 people. Printing is also a chemically intensive process,
subject to a complex web of environmental laws, including dozens of state
and federal regulations separately addressing air, water, and land pollution.
In 1993, the printing industry along with representatives from the
Environmental Defense Fund (EDF) and the Council of Great Lakes Governors
established the Great Printers Project, an effort focusing on printers in
the Great Lakes Region. The aim of the project is to find ways to ease
the compliance burden, reduce pollution, and lower costs. The three
partners invited technical and policy experts from the U.S. Environmental
Protection Agency (EPA), state regulatory agencies, local environmental
groups, labor, suppliers, and technical assistance providers to
participate in the project as well. At the outset, Murphy said he felt
himself in "perhaps the most diverse group I've ever dealt with. There
was a certain amount of distrust." Over time the mood changed. "By the
end, people were much different. After many, many hours of meetings, we
learned to see each other's viewpoint."
On July 22, 1994, in conjunction with a Chicago meeting of the
President's Council on Sustainable Development, the Great Printers
Project released its findings, which included recommendations on how firms
could save money and reduce pollution. Following the group's
recommendations, General Litho Services, a Minneapolis printer,
successfully reduced its smog-inducing isopropyl alcohol use from 605
gallons to 95 gallons, saving $1,355. It reduced chemical solvlents use
from 1,595 gallons to 790 gallons, saving $3,824. And it reused or
reformulated its printing ink, which is listed as a hazardous waste,
saving $18,000 in annual costs. At first glance these savings -- both to
the bottom line and to the environment -- may seem small. But for small
companis with narrow profit margins, they are significant. And for the
environment, the cumulative pollution prevention efforts can be even more
Another recommendation was aimed at consolidating environmental reporting
requirements to streamline administrative efforts. EPA Administrator
Carol Browner, a Council member, endorsed the proposal, stating that it
"will allow print shops to do their work cleaner, cheaper, and smarter."
EDF executive director Fred Krupp, also a Council member, says these
findings could be transferred to small businesses in other industries.
"For industries composed of small businesses, focusing only on permits
and inspections cannot attain environmentall achievements," according to
Krupp. "The Great Printers Project suggests replacing redundant
bureaucracy with simpler forms that guide the small business person to
reduce photochemical smog, hazardous waste, and wastewater discharges."
Communication is often the most significant barrier to improving the
environmental performance of small businesses. They have difficulty
obtaining informatioin on regulatory requirements, available
technologies, and available technical and financial resources, in part
because many small firms do not belong to trade associations and lack
This lack of compliance assistance reduces the environmental performance
of small businesses. They are often unsure about the applicability of
multiple federal, state, and local regulations, and the arcane language
of regulations exacerbates this problem. Businesses may simply not
understand the core regulatory requirements and how to comply, much less
how to exceed those requirements.
The Team found small businesses using their limited resources to decipher
new environmental rules and to report redundant information. These
resources could better be devoted to pollution prevention and source
reduction efforts. However, a lack of technical expertise further hinders
adoptions of these eco-efficient practices.
A related finding is that a piecemeal and medium-specific regulatory
structure often results in piecemeal, medium-specific solutions. If firms
were instead presented with their regulatory requirements simultaneously,
they would be more likely to find solutions to more than one regulatory
requirement at a time. This would improve the cost-effectiveness of small
business compliance efforts.
One innovative compliance aid, developed by the Great Printers Project,
is a software program that walks print shop owners and managers through
all the regulatory requirements and illustrates possible pollution
Access to the capital needed for environmental improvements can also be
problematic for small businesses. Conventional leaders may view small
businesses as inherently risky and may fear potential liabilities
associated with underwriting new techniques or technologies.
The Team found that businesses often have a limited understanding of the
environmental impact of their operations. Their attention is necessarily
devoted to tohe demands of their customers, which usually are not
governed by environmental considerations. At the same time, suppliers
often lack an understanding of the needs of their small business
customers regarding environmentally superior products.
Finally, the Team found that good environmental performance on the part
of small businesses is neither recognized nor rewarded. There is a lack
of positive incentives for firms to improve their environmental
performance or to go "beyond compliance" (i.e., beyond the minimum
environmental regulatory requirements).
The Team found numerous ways in whicih small blusinesses can be helped to
improve environmental performance and economic competitiveness. Five
priority recommendations the Team distilled from its findings directly
shaped the Eco-Efficiency Task Force's Policy Recommendation 1:
Environmental Management System, and Policy Recommendation 6: Facilitate
Capital Access. The Team also developed an implementation action plan for
its five priority recommendations.
The Small Business Team recommendations are:
- Improve regulatory effectiveness. Federal, state, and local
officials can make the regulatory process more effective by:
blocking piecemeal legislation designed for large facilities
and focused on specific environmental media, which can hinder
coordination among EPA prograrm offices and among federal agencies on
communicating regulatory information in plain English and organizing
regulations by industry operation rather than by environmental statutes; and
avoiding redundancies, inconsistencies, and confusion in reporting and
- Use enforcement to improve performance. Enforcement is not the
end; it is the means to improve environmental performance. Federal and
state enforcement efforts can be made more efficient and effective as
incentives to better performance by:
targeting the facilities with the worst problems;
familiarizing inspectors with the industry they are inspecting;
conducting multi-media, multi-program inspections; and
exploring innovative ways to level the playing field between
- Use the customer service approach. Federal and state agencies
should adopt a customer service approach when implementing pollution
prevention and compliance assistance activities. Though the product of
multiple levels of government and of other intersted parties, the
assistance and informatioin small business customers receive should be
provided in a unified manner.
- Participatory goal setting. Companies, regulators, and
environmental organizations should work together to define environmental
performance goals for industries. Participatory goal setting that results
in consistent, accepted standards for environmental performance, is a
pathway to environmental improvement, and can also be a potent marketing
tool for companies.
- Improve communication "upstream" and "downstream." Improved
communication among suppliers/distributors, manufacturers, and
end-users/customers encourages environmentally sound prodoucts and
helping businesses better understand how to minimize the
environmental impact of their job specifications; and
helping suppliers understand and address the environmental needs of
Pollution Prevention Pilot Project
A related project is the Pollution Prevention Pilot Project. This project
is a joint effort undertaken by representatives of the environmental
community, industry, and government. The objective of the project is to
determine whether, and under what circumstances, facility-specific
environmental management can be accomplished with greater benefits at
lower cost in a credible, enforceable, and predictable manner. It is
examining the lessons learned and is recommending the appropriate steps
that should be taken by environmental policy makers.
Core group members include the Natural Resources Defense Council, Amoco
Corporation, Dow Chemical Company, Rayonier, Monsanto Company, and the
New Jersey Department of Environmental Protection.
 See Appendix B1, PCSD Auto Team Report, p. 8.
 Ibid., p. 28.
 Ibid., p. 24.
 Joint and several liability under the Comprehensive Environmental Response, Compensationm and Liability Act (CERCLA), or "Superfund," means that companies may be found liable for entire cleanup costs even if only contributing to a portion of the problem.
 "Bubbling" derives its unusual name from the treatment of multiple emission points as if they were contained within an imaginary bubble, regulating only the amount leaving the bubble. Currently used in the Clean Air and Clean Water Acts, these bubbles can be extended to include not only emission points within the same facilities, but emission points in facilities owned by other entities as well.
 Small Business Administration Economic Research Division.
 US Department of Commerce, Bureau of the Census, Census of Manufacturing (Washington, DC: Government Printing Office, 1995), p.13.
Summary of Policy Clusters |