United States       Science Advisory Board    EPA-SAB-RSAC-94-015
Environmental       1400         May 1994
Protection Agency      Washington, DC
AN SAB REPORT: REVIEW
OF MITRE CORP. DRAFT
REPORT ON THE EPA
LABORATORY STUDY
PREPARED BY THE RESEARCH
STRATEGIES ADVISORY
COMMITTEE
        U.S. E:™--,^, protecticn Agency
        R^n5 Ubr;ry(PL.12J)    Y
        C^fC??H!   12th Floor
        RECEIVED
         flAR 2 0 1995
           U.S. EPA.
        CENTRAL REGIQNAC

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                UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
                             WASHINGTON. D.C. 20460
                                 May 31, 1994
                                                               OFFICE OF THE ADMINISTRATOR
                                                                 SCIENCE ADVISORY BOARD
EPA-SAB-RSAC-94-015
Honorable Carol M. Browner
Administrator
U.S. Environmental Protection Agency
401 M Street, SW
Washington, D.C. 20460

      Subject: Review of Mitre's Draft Report on the EPA Laboratory Study

Dear Ms. Browner,

      The Research Strategies Advisory Committee (RSAC) of the Science Advisory
Board (SAB) met in Washington, D.C. on May 12-13,  1994 to review the Draft
Laboratory Study Report prepared by Mitre Corp. for EPA.  This review was conduct-
ed at the request of the Deputy Administrator in order to provide input to the Lab
Study Steering Committee when it meets in early June to develop final recommenda-
tions for improving  the service of the EPA laboratories to the needs of the Agency.

      The attached report presents our findings and recommendations, together with
additional commentary about our view of the management and organization of science
at EPA. We were struck by the fundamental importance that these issues play in
determining the success--or failure--of the Agency to carry out its mandate to protect
human health and the environment.  If the Agency cannot or does  not address these
issues that have bedeviled the Agency  directly and indirectly for years, the ultimate
success of the entire Agency will be in doubt. Given the central role that the Office of
Research and Development (ORD) plays in science at EPA, this report highlights the
conditions in the ORD laboratories, although the principles are applicable to the
regional and program laboratories  as well.   There are a number  of points that we
would like to emphasize.

      First, we  agree with your oft-stated premise that good environmental protection
must be founded on a solid  scientific base. That solid base consists of a continuum of
scientific activity ranging from long-term fundamental (strategic) research to shorter-
term applied investigations,  integrated across the spectrum to address current,
emerging, and future environmental problems.  Understandably, the Agency program
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 and regional offices more often focus on today's problems and how today's science >
 might be brought to bear to address these problems. They are the primary customer
 for applied and problem-oriented research.  Consequently, there are few institutional
 champions who have the perspective to argue for the resources needed to build the
 fundamental knowledge base that will provide the  information both to deal with today's
 difficulties, tomorrow's conundrums, and the future's problems.  As a result, there has
 been a steady long-term erosion of the Agency's research capabilities (in terms of
 both FTEs and dollars) over the pasi fifteen years which has only begun to turn
 around this year.  The Committee believes that a centralized R&D operation promotes
 strategic focus, as well as overall efficiency and quality of research efforts.  We are
 concerned that recent decisions in the Agency could open the door for Program
 Offices to set up their own research and development programs with extramural funds,
 a practice which would likely undermine any focus on strategic research which is vital
 to advance the course of environmental protection. We conclude and  urge that the
 Administrator of EPA be recognized as the principal customer and spokesperson for
 the basic research component of the scientific and engineering activity at the Agency.
 You have demonstrated an  awareness of this role.  The Committee urges that you
 pursue it with force and vigor, using the reaction to the EPA Laboratory Study as a
 vehicle to make needed changes in research management, human resources, and
 budget.

      Second, the rich collection of data in  the Mitre report has confirmed  earlier SAB
findings of a state of research management dysfunction within the Agency that is
 approaching a crisis level.  The management dysfunction has been exacerbated,
 rather than improved, by what were no doubt well-intentioned management actions  to
 remedy  past problems. For example, less that 50% of the average ORD research
scientist's time is spent at the bench; Agency-imposed, self-hobbling management
constraints limit creativity and intellectual yield; the focus appears to be on "bean-
counting administration," rather than "mission-achieving management"; vertical
management tracking of projects and human and financial resources is nearly
impossible; and data are collected and presented in ever-changing ways so as to defy
rational analysis over time.  The Committee urges  that immediate corrective action be
taken to create a more effective, efficient, and mission-oriented research management
system,  minimizing the barriers to achieving its scientific and engineering goals. The
present  band-aid approach of conducting a  plethora of management studies/initiatives
without correcting the fundamental  underlying  management problems is unlikely to be
successful.

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       Third, the Committee strongly recommends that actions to correct these basic
 management problems precede any considerations to realign the laboratories. We
 believe that sound management can lead to improved research  efficiency and
 effectiveness; however organizational structure is only one component of the more
 comprehensive approach needed to address the Agency's problem.  This concern
 about premature restructuring is particularly important since a new AA/ORD  is in the
 process of being confirmed.  It would be unwise and  unfair to make significant
 structural changes without his studied input.  Also, our Committee was seriously
 remiss in not pointing out earlier the necessity of including a critical assessment of the
 Headquarters ORD component in any study of the  EPA laboratories.  In fact, Head-
 quarters and the laboratories should form an integrated "research team," devising and
 conducting a research program to provide the necessary quality scientific basis
 required for quality management decisions.  Therefore, any study that excludes >15%
 of the Federal FTEs and nearly 25% of the team's budget is incomplete on its face.
 Regarding the regional  and program laboratories, we recognize the unique relation-
 ships with and the valuable contributions to their parent organizations.  At the same
 time, we urge the Agency to explore some sort of "dotted line" liaison relationship
 between the program/regional labs and ORD Headquarters as a means of promoting
 efficiency and common  approaches on generic scientific issues.  We believe that such
 an arrangement is far preferable to  any option that  would gather these disparate  labs
 into a single, separate,  and competing scientific organization within the Agency.   In
 short, without an integrated, comprehensive  mission/management plan that includes
 Headquarters, any structural change in the laboratories could work at cross purposes
 to the ultimate good and effectiveness of science at EPA.

      Fourth, while the Mitre report captures invaluable cross-sectional information
 about the EPA laboratories, it lacks  many insights into the human factors that the
 Committee believes are vital to the success of any organization.  Specific suggestions
 along these lines are included in our report.

      Finally, it was in the light of the above that the  Committee reviewed the options
generated in the Mitre report.  Again, assuming that the primary  management prob-
lems are initially and  successfully addressed, the Committee believes that some
variant of the Carnegie  Commission report recommendation holds the greatest
promise for an EPA Laboratory structure  that would meet the needs of the Agency.
Organizational,  if not  physical, consolidation  provides  strategic focus for the  efforts of
the research activities, shifts headquarters FTEs to  the laboratories, and reduces the
number of managers  under direct control of the AA/ORD.  Potential benefits include
greater empowerment at lower levels in the organization, as well as a greater number

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of scientists in the laboratories and increased scientist time at the bench.  In addition
to the megalabs envisioned by the Carnegie Commission, we recommend inclusion of
an integrating unit focusing on risk assessment.  Such a unit would force the Agency
into inter-laboratory, multidisciplinary collaboration that would  both provide more
relevant research products for the Agency and tend to prevent the megalabs from
becoming discipline-oriented fiefdoms.

      We appreciate the opportunity to provide advice on this matter of critical impor-
tance to the Agency and the future of environmental protection. The Agency staff and
the Mitre workers were of substantial assistance in providing the materials for this
review.  We look forward to receiving  your reaction to our recommendations.

                  Sincerely,
                         )r. Genevieve Matanoski,
                        Chair, Science Advisory Board
                        Dr. Roger 0. McClellan
                        Chair, Research Strategies
                        Advisory Committee

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                     U.S. Environmental Protection Agency

                                   NOTICE

      This report has been written as part of the activities of the Science Advisory
Board, a public advisory group providing extramural scientific information and advice
to the Administrator and other officials of the Environmental Protection Agency.  The
Board  is structured to provide balanced, expert assessment  of scientific matters
related  to  problems facing the Agency.  This report has not been reviewed for
approval by the  Agency and, hence, the contents of this report do not necessarily
represent the views and policies  of the Environmental Protection Agency, nor of other
agencies in the Executive Branch of the Federal government,  nor  does mention of
trade names or commercial products constitute a recommendation for use.

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                                 ABSTRACT

      The Research Strategies Advisory Committee of the Science Advisory Board
reviewed the Mitre Corporation report on the "EPA Laboratory Study", a compilation
of data and analysis.   This report  was prepared for senior EPA  managers and
evaluated the facilities, equipment, and staffing of three types of laboratories (ORD,
program office, and regional).  The SAB was asked to review the report and offer its
recommendations for laboratory realignment and management.

      The Committee found  that the research management  was  dysfunctional,
research funding and capacity  had declined significantly over the past 15 years, and
that long-term  strategic research lacked  a  customer/advocate.   The  Committee
recommended  the  Agency  correct its  management problems before it begin any
reorganization  of the  laboratories.  They recommended  that  ORD headquarters
resources  also  be  considered  as  part of a comprehensive reorganization of the
laboratories within  ORD.   They recommended that the Administrator become the
advocate and  primary client  for  centralized,  long-term  strategic research.   The
management plan should also  include a consideration of the  human  resources and
activities to develop and maintain the pool of scientific talent; options for coordinated
budgets and evaluations with  the client program office; a commitment to increase
extramural research; and plans to  convert contractor laboratory research personnel
to federal employees.  The Agency was advised by the Committee to resist pressure
to make decisions on laboratory realignment in the near term.

KEY WORDS: Laboratory organization, research  management, strategic research.
                                      n

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                Research Strategies Advisory Committee
                          EPA Laboratory Study
                                  Roster
CHAIR
Dr. Roger  O. McClellan,  President,  Chemical  Industry  Institute  of  Toxicology,
      Research Triangle Park, NC

MEMBERS

Dr. Judy A.  Bean, Professor  and Director of Biostatistics, University of Miami,
      Miami, FL

Dr. Joan M.  Daisey,  Director,  Indoor Environment Program, Lawrence  Berkeley
      Laboratory, Berkeley, CA

Dr. Paul Deisler,  Consultant, Austin, TX

Dr. Wm.  Randall Seeker,  Senior  Vice  President, Energy and  Environmental
      Research Corporation, Irvine, California

Dr. William  Smith,   Professor  of  Forest  Biology,  School  of  Forestry  and
      Environmental Studies, Yale University, New Haven, CT
DESIGNATED FEDERAL OFFICER
Dr. Edward S. Bender,  Environmental Protection Agency, Science Advisory Board
(1400F), 401 M Street, S.W, Washington, DC  20460

STAFF SECRETARY
Mrs. Dorothy Clark, Environmental Protection Agency, Science Advisorv Board, 401
M Street, S.W., Washington, DC  20460
                                    in

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                           TABLE OF CONTENTS

1.0 EXECUTIVE SUMMARY 	   1

2.0 INTRODUCTION	   3

3.0 FINDINGS AND RECOMMENDATIONS  	   5
      3.1   Need  for a primary customer/advocate  for long-term strategic
                 research  	   5
            3.1.1  FINDING 1: There is no easily identified spokesperson for
                 centralized, strategic, long-term research and its importance
                 to the Agency	   5
            3.1.2  RECOMMENDATION 1: The  Administrator must be the
                 primary customer/advocate for centralized strategic research
                 at EPA  	   6
      3.2  Need for  fundamental change in the  management of science at
                 EPA 	   7
            3.2.1  FINDING 2:  A state of research management dysfunction
                 exists at EPA	   7
            3.2.2    RECOMMENDATION   2:  The  Agency should  take
                 immediate action to create a more effective and efficient
                 research management  system,  including  an information
                 system	   10
      3.3   Need for proper sequencing of research management reform and
            scientific laboratory realignment 	   11
            3.3.1  FINDING 3:  Events  are  being driven  by considerations
                 other than "good science"	   11
            3.3.2     RECOMMENDATION   3:   Correction  of  research
                 management  problems should  precede any realignment of
                 the labs	   11
      3.4    Need  for  consideration  of  human  factors involved in  EPA
            laboratories	   15
            3.4.1   FINDING 4: The Mitre  report is  short  in considering
                 human  resources issues	   15
            3.4.2   RECOMMENDATION 4: The Agency should pay  clot j
                 attention to the human resources impact of any changes   .   15
      3.5  Selecting an  option for the laboratories  	   17
            3.5.1  FINDING 5: There are competing forces driving the Agency
                 to  make a   decision  regarding  an  option  for  the
                 laboratories   	   17
            3.5.2  RECOMMENDATION  5: The Agency should resist pressure
                 to make a decision on the laboratories in the near  term .  .   17
                                     IV

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4.0 ADDITIONAL CONSIDERATIONS AND GUIDANCE  	   19
      4.1  Pertinent consideration:? in making managerial changes, including
            organizational changes, to promote science at the Agency   	   19
      4.2  The Agency's commitment to extramural research	   20
      4.3  The importance of a centralized research organization	   21
      4.4  The need to focus research efforts	   22
      4.5  The need for additional contractor conversion	   22

5.0 APPENDICES  	   24
      Section A-l Resolving conflicts  between ORD and program offices  ....   24
      Section A-2    Use of partnerships to leverage EPA  leadership in
            science	   26
      Section A-3  Strengths and limitations of the Mitre report 	   28
      Section A-4  Strategic planning  	   31
      Section A-5  Human resource renewal and development  	   32

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  REVIEW OF MITRE'S DRAFT REPORT ON THE EPA LABORATORY STUDY
                           A Report from the SAB's
                 Research Strategies Advisory Committee (RSAC)

                          1.0 EXECUTIVE SUMMARY

      The Research Strategies Advisory Committee (RSAC) of the Science Advisory
Board (SAB) was asked by the Deputy Administrator of EPA and the Acting Assistant
Administrator of the Office Research and Development to review the scope of the
study and final draft of the EPA Laboratory Study prepared by Mitre Corp. for EPA
senior management.  The Laboratory Study was intended  to collect data on the
functions, facilities, staffing, and resources of almost  40 laboratory facilities which
support program offices, regional environmental services, and the Office of Research
and Development.  The National Academy of Public Administration also convened
panels in  science and  management to review the Mitre draft  report  and  offer
recommendations to EPA senior management  on the organization,  structure, and
management of the laboratories  to support science.

      RSAC provided comments on the scope  of the Mitre study through a  brief
conference call on January 19, 1994.  The Mitre report (April 18 and updated May
3) was review by RSAC  May 12-13, 1994.  Mitre's  work, conducted over a very short
time frame, collected extensive data on the labs, their  work force, facilities, and the
customers  which each laboratory served.    Program  office  laboratories  and
environmental service division laboratories were focused on the near-term applications
of science, particularly those  associated  with  monitoring, methods development,
inspections, and  enforcement of particular  media statutes and regulations.  There is
direct and  frequent interaction between the labs and their customers and a general
understanding of the mission they support.  The ORD  laboratories tend to focus on
problem oriented research and long-term research which is more strategic in that it
often leads to  new insights about  mechanisms  or interrelationships. Many of the
interactions with  clients  and program offices are controlled  or coordinated by
headquarters staff.  RSAC recommends that the  Administrator of EPA be recognized
as the principal client and spokes person for basic research within the Agency.

      The  Committee states that good regulatory decisions must be based on  good
science which  is  relevant and of  high quality.   Based on this  review, its  recent
evaluation  of  ORD's FY  1995  Presidential Budget Request to  congress, and its
experience  with  scientific research in EPA,  the  SAB  concludes  that  research
management is in a dysfunctional state. This dysfunctional state threatens research
productivity and undermines the reputation and creative potential for the Agency to
provide national environmental leadership.  The Committee notes that  the current
dysfunctional state was preceded by a fifteen  year period in  which the Agency's
budget (less grants)  and FTEs  nearly doubled  while  ORD declined  slightly.   The
Agency attempted to compensate for the lack of FTEs by hiring contract researchers,
but the  collaboration of researchers and contractor management are irreconcilably
incompatible.  This is perhaps  a major reason  it has been often stated that ORD

                                      1

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laboratory scientists spend less than half of their time engaged in research—shackled
by administrative requirements and contractor oversight procedures.  The Committee
also found  that the management information system was incapable of tracking the
costs of projects.  The Committee urges that immediate corrective action be taken to
create a more effective, efficient, and mission-oriented research management system,
minimizing the barriers to achieving its scientific and engineering goals.

      The  Committee  recommends that  actions  to  correct  the  basic research
management problems,  considering both the laboratories and ORD headquarters,
before any initiative is taken to realign the labs.  Such action should  include the new
AA for ORD.  They also opposed a proposal by the NAPA panel to consolidate the
Environmental Services Division and program office labs under a new AAship.

      The  Committee  recommended that  the Agency expand its  analysis  of the
human resource needs  of its work force and the impacts of the reorganization and
realignment on human resources.  The Committee offered several criteria which Mitre
Corp. may apply to each option.   Additional advice is provided in an Appendix.

      The Committee did not wish to  endorse a particular  option,  because several
tasks should precede that step.   As noted earlier,  changes in  management  are
essential precursors to  improvement.  Indeed, the Committee notes  that further
realignment  or  physical consolidation  may be  unnecessary if  the   problems  of
management dysfunction are resolved. Given those reservations, it appears that the
most appropriate  option for  configuring  the  ORD  laboratories  would  be  some
variation of the  Carnegie  Commission  recommendation   for Mega-Laboratories
representing particular themes related to EPA's mission.  The Committee envisions
an option which would favor strategic planning,  reduce the number of  coordination
points, and  provide greater responsibility and  accountability to lower levels in the
organization. The Committee recommends that Risk Assessment be included as  a
separate  thematic laboratory. The Committee  also recommended that EPA expand
its extramural research program.

      The Committee also provided guidance and suggestions for making management
changes,  setting priorities, and  conversion of contractor  employees.   Additional
comments on the recommendations were appended.

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                            2.0  INTRODUCTION

      The Research Strategies Advisory Committee (RSAC) of the Science
Advisory Board (SAB) met in Washington, D.C. on May 12-13, 1994 to review the
Draft Laboratory Study Report prepared by Mitre Corp. for EPA.  This review
was conducted at the request of the Deputy Administrator in order to provide
input to the Laboratory Study Steering Committee which  plans to meet in early
June to develop final recommendations for improving the  service of the EPA
laboratories to the needs of the Agency.

    The original charge to the Committee was to review recommendations that
the Laboratory Steering Committee was preparing for the Administrator regarding
whether and how the laboratory structure of the Agency could be altered to
improve the overall quality, quantity, and timeliness of scientific data for decision
makers  at EPA.  These recommendations were to have been generated,  in part,
from a review of the Mitre EPA Laboratory Study that would have been reviewed
by the National Academy of public Administration (NAPA). Given the constraints
of time, imposed by a need to provide a report to Congress, the Steering
Committee subsequently asked for SAB input  in a time and form similar to that of
the NAPA panel.  This change of sequence was not accompanied by a change in
the charge; therefore, the Committee generally interpreted its  charge as providing
advice to the Steering Committee regarding the recommendations that they were
going to give to the Administrator.

    The Committee review included the following:
a.  Review  of the April 18th draft of the Mitre "EPA Laboratory Study"  report and
      a  May 12th addendum
b.  A briefing by Mitre personnel on the results of the Study
c. A briefing by two members of the National  Academy of Public Administration
      (NAPA) panels involved in their own review of the  Lab Study
d.  A progress report on the NAPA's Congressionally mandated study of "EPA's
      Extramural/Intramural  Resource Use"

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e. An ORD February 7, 1994 report, entitled "Redesigning Research at EPA:
      Proposed Changes to Mission, Organization, and Streamlining in the Office
      of Research and Development",
f. A February,  1979, prepared by the SAB, entitled "Report of the Health Effects
      Research Review Group."

      The Committee notes that the Mitre Corporation, assisted by the staff and
laboratory personnel of the Agency have compiled valuable data and information to
assist both the laboratory study  and other important analyses which the Agency
should perform in the future.  At the time of our meeting,  limited analysis was
available because  data were still  being verified and reconciled with other sources.

    This report summarizes the  results of fact-finding meetings with the Agency
and the 1/2 day public meeting in  May, which  included a helpful briefing by two
members of the NAPA panels (Dr. David Chiu and Dr. Charles Bingmam)  on the
preliminary thoughts  of the management and scientific groups.  Section 2.0
contains the RSAC's major Findings and Recommendations. Section 3.0 presents
additional significant  points.  The Appendix contains further discussi a of these
and other issues that should be of help to the Agency.

    Our goal throughout has been to provide advice to the Administrator that will
lead to an improved management framework and laboratory structure that can
generate the kind of technical information that Agency managers need to make the
kind of  difficult environmental protection decisions needed to  protect public health
and the environmt... today...and  in the future.

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                  3.0 FINDINGS AND RECOMMENDATIONS

3.1  Need for a primary  customer/advocate for long-term strategic research

     3.1.1 FINDING  1: There is no easily identified spokesperson for centralized,
                  strategic, long-term research and its importance to the Agency

     The Committee's work involved reviewing the Mitre report and discussing
science with Agency personnel in the Office of Research and Development (ORD),
the program  offices,  and the regional offices.  Each of these encounters confirmed
the presence  of a dynamic tension between the need for a solid base of scientific
knowledge to  address tomorrow's problems and the need for technical assistance to
address today's problems.  This tension has existed since the beginning of the
Agency more than 20 years ago and still exists today.

     In the competition for time, attention, and resources, the need to expand the
base of fundamental  strategic research in the complex world of environmental
science is often sacrificed to address near-term needs.  Given the mission
orientation of regional and program offices, it is altogether understandable how
these offices would eschew longer-term research into new fundamental principles
in favor of shorter-term technical applications of existing principles.

     However, as the Administrator has often stated, the long-term credibility and
effectiveness of the Agency tomorrow is tied directly to the generation of new,
basic knowledge today.  It is by expanding that knowledge base and "looking uver
the horizon";  e.g., the ongoing SAB Environmental Futures Project, that the  most
cost-effective  environmental protection will emerge.

    In fact, the research mission of the EPA extends along a continuum from
highly applied research dealing with analytical or monitoring methodology to
fundamental strategic research attempting to anticipate future environmental
issues.  All types of research along this continuum are important, and all have
customers. For example,  the program and regional offices need the technical data

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supplied by targeted monitoring studies.  However, basic science—whose goal is th'e
discovery of new knowledge upon which technical  applications and sound
regulatory programs are built—is often without a champion when resources are
distributed. This has been reflected in a generally downward trend in the
Agency's research capabilities, relative to other Agency programs, over the past
fifteen years.

    The Committee was also concerned by a Feb., 1994,  memo from the Office of
the General Counsel to ORD that appeared to open the door for Program Offices
to establish their own research and development programs with extramural funds,
either their own or funds that would ordinarily  support the ORD activity.  We
believe that such a practice would likely undermine any focus on strategic research
which is vital to advance the course of environmental protection.

   3.1.2  RECOMMENDATION  1: The Administrator must be the primary
            customer/advocate for centralized strategic research at EPA.

    The EPA Administrator has a unique perspective from which to survey the
scientific needs of the Agency.  The Administrator should be recognized as the
principal customer and spokesperson for the basic  research component of the
scientific and engineering component at the Agency. The Administrator should
also be the guardian to ensure that a vital,  centralized strategic research program
is  maintained, even in  the face of competing needs from  program and regional
offices.  No program or regional office leader can be expected to fulfill such a role.
It  is unreasonable to expect that the Assistant Administrator for the Office of
Research and Development can successfully exercise this  leadership from a position
that is only collateral with colleagues heading other AAships and Regions.
Without aggressive leadership by the Administrator, we can anticipate a
continuation of the shrinking of ORD that has gone on uninterrupted for the past
15 years.

    The current Administrator demonstrates an awareness of the role as
envisioned by this Committee.  The Committee urges her to  pursue that vision

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'with force and vigor, using the vehicle of the EPA Laboratory Study as a means to
restate and  act upon the need for an expanding base of scientific knowledge.

       Without a suitable customer/advocate, no organizational or structural change
can resolve  the tension between competing needs  for short- versus long-term and
centralized versus dispersed research.

3.2 Need for fundamental change in the management of science at EPA

   3.2.1  FINDING 2:  A state of research management dysfunction exists at EPA

    The  Mitre EPA  Lab Study Report  is a rich, unique collection of raw and semi-
analyzed data, assembled with substantial assistance by the Agency.  It provides
valuable  input for further management analysis, review, and ultimate action.  [See
Appendix Section A-3 for limitations of the study.]

    In many respects the data in the EPA Lab Study confirm the findings of the
SAB (EPA-SAB-RSAC- 7TR-94-008)  that thjre  is a general management
dysfunction  with regard to the research operations of the Agency.  For example,
the data  present a picture of a well-educated cadre of scientists and engineers
spending less than 50% of their  time on the research work that is the intellectual
capital the Agency is amassing for the  future.  Instead, the record  of the past 15
years starkly reveals a steady long-term erosion of the base of scientific  and
engineering  researchers and research dollars (Figures 1 and 2).  For example,
while the FTEs in the Agency have increased by 50% during  that time, the
number of FTEs in ORD have actually declined.  This creates the untenable
situation of  many more laboratory customers being supported by even fewer
research  suppliers; a condition that  only exacerbates the tension along the entire
length  of the research continuum referred to above.

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Dollars (Billions)
     FTEs
                      T]

                      <5'
                      C
                      ^
                      
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    Further, existing management systems actually work against the Agency's
ability to rationally develop research strategies, implement them, and gauge their
effectiveness.  In some cases, self-inflicted constraints, imposed to guard against
conceivable, but arguably not likely, eventualities have hamstrung certain
operations, a practice that  would not be tolerated in the private sector.  The cost
of these constraints can be measured in terms of reduced responsiveness to
customers, lost creativity, and diminished intellectual yield.  A picture emerges  of
an organization more devoted to bean-counting administration than to mission-
oriented management.

    Even  the existing administration structures cannot provide the  kind  of
information needed for rational research management.  For example, it is nearly
impossible to track the research program from issue identification to research plan
to implementation plan to resource allocation to  product delivery to program
evaluation.  The data are collected and presented in ever-changing ways so as to
defy constructive analysis over time.

    There are a number of studies underway that impact on the way that research
is managed~or  should be managed~at the Agency.  These include the following:

a. The Mitre EPA Laboratory Study
b. The NAPA review of the Mitre EPA Laboratory Study
c. The Congressionally mandated study by NAPA, "EPA's Extramural/Intramural
      Resources Use"
d. The ORD streamlining report, "Redesigning Research at  EPA: Proposed
      Changes  to Mission,  Organization, and Streamlining  in the Office of
      Research and Development"
e. The research issue  based planning activity initiated with ORD leadership in the
      past two years
f. The "Setting  National Goals for Environmental Protection Activity" project
g. Your strategic plan for achieving the environmental goals over the next five
      years.

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      It is unclear how these efforts relate to one another.  Indeed, based on the
Associate Comptroller's remarks at the May 12 meeting of this Committee, the
conclusions of the NAPA panel on "EPA's Extramural/Intramural Resource Use" is
likely to increase management constraints and contract management
responsibilities, further reducing the time researchers will spend at the bench. We
were alarmed to learn from a senior manager from the Office of the Comptroller
that the goal is to have management equal to mission. Such a statement fails to
recognize that management is not an end in itself; it only exists to achieve the
mission.  It is most critical that recommendations from such narrowly focused
studies  be considered in the contexi; of ORD's mission, its goals, and your vision
for science within the Agency.
  3.2.2 RECOMMENDATION 2: The Agency should take immediate action to
            create a more effective and efficient research management system,
            including an  information system.

    The Agency must design and put in place a research management system that
integrates scientific activity from the problem development stage to publication of
peer reviewed results.  A key component will be a research information  system
that can easily respond to the need of different audiences; e.g., Congress, top
Agency management, intermediate Agency management, program/regional offices,
ORD, the  laboratories, and the public.  Therefore, the system should be capable of
presenting and reconciling budgetary, appropriation, and expenditure data over
time in terms of environmental media, specific intra- or cross-media issues,
individual laboratories, separate projects, and so forth.   The system should be
informed by the collective impact of the efforts described at the end of 3.2.1.

    The management system should have some easily measurable attributes; e.g.,
increased  time that researchers spend on research rather than  contract
management.  It should increase  the efficiency of providing support to the
researchers, increase the effectiveness of communication within the organization,
and increase responsibility and accountability of those in the lower hierarchical
                                      10

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'levels of the Agency.  Management must shift from a focus on quantities and
widgets to managing  for quality results to achieve the mission.
 3.3   Need for proper sequencing of research management reform and scientific
            laboratory realignment

   3.3.1  FINDING 3: Events are being driven by considerations other than "good
            science"

    The urgency given to the EPA Lab Study is obviously related to Congressional
 initiatives, which may stem from the best of intentions, admixed  with impatience,
 frustration, and perhaps some regional interest.  The underlying  motive, consistent
 with your goals, is to improve the science at EPA, but a rush to  action could
 inadvertently have just the opposite effect.

      Research requires teamwork between researchers, management, and
 technical services. The efficiency and effectiveness of the research can be
 facilitated by sound management practices.  Management must define a clear
 mission, goals, and objectives,  wherever possible, it should delegate authority and
 responsibility to working units to achieve the mission, and provide support for
 administrative needs of the researchers.  Structural change is only one aspect
management may consider to improve research productivity.

   3.3.2 RECOMMENDATION 3: Correction of research management problems
            should precede  any realignment of the labs

    As noted above, the research management dysfunction is at the core of many
of the science problems—laboratory and otherwise—at the Agency.  Therefore, these
problems need to be addressed before any initiative is taken to realign the labs.

      The  appointment of a new Assistant Administrator for the  Office of
Research and Development,  when it takes place,  should advance the process of
                                      11

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fashioning organizational or structural changes. The new AA, charged with this '
mission, should have latitude to act from a "hands-on" position.

    When this Committee reviewed the Mitre study plan for the EPA Lab Study,
we were remiss in not commenting that  the study should include a critical
examination of the Headquarters operations that support and direct the  EPA
laboratories.  In fact, Headquarters and the laboratories form a  "research team"
that must be considered as a whole. Within ORD alone, the HQ operations
involve more than 300 of the roughly 1800 FTEs in the total ORD organization
and $125.6M out of the total of $5L8M.  Figure 3, depicting the ORD structure for
both headquarters and laboratory operations, and Figure 4, showing the
Headquarters/ORD Laboratory  work force and budget, illustrate the issue.  To
exclude an analysis of the structure and  function of the HQ operation is quite
possibly to exclude an area in which pivotal management/direction changes should
and could be made.

    Regarding the regional and program laboratories, we recognize the unique
relationships with and ^he valuable contribations to their parent organizations.  At
the same  time, we urge the Agency to explore some sort of "dotted line" liaison
relationship between the program/regional labs and ORD Headquarters as a means
of promoting efficiency and common approaches on generic scientific issues.  We
believe that such an arrangement is far preferable  to any option that would gather
these disparate labs into a single, separate, and competing scientific organization
within the Agency.
                                      12

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         Figure  3  Organizational  Chart  for ORD  HQ and  Field  Components
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                                                            13

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                                          14

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 3.4  Need for consideration of human factors involved in EPA laboratories

    3.4.1 FINDING 4: The Mitre report is short in considering human resources
             issues.

    As noted above, the Mitre report contains a plethora of data that will provide
 additional valuable insights when they are analyzed in the future.  However, the
 "human face" of EPA science does not come through in these data.  How do the
 scientists and engineers working within the laboratory feel about their condition?
 What do they project as their future?  As they age,  are they recommending a
 career at EPA to their younger colleagues?  What is the long-term outlook for the
 contractor conversion process?  In an era when most of  the complex scientific
 problems faced by the Agency must be tackled by  multi-disciplinary teams, is it
 feasible to create effective teams using a mix of federal employees and "contract
 employees" and also abide by the rules?  We doubt it.  Figure 3 illustrates the
 magnitude of the problem.

   3.4.2 RECOMMENDATION 4: The Agency should pay close attention to the
             human  resources impact of any changes. These changes should
             include continued efforts to convert contractor  positions to Agency
             employee positions and promote professional development of its
             research staff.

    A key concern ^ the Committee is t.iat whatever option is adopted for ""he
 laboratories  is that it should meet certain criteria  that advance the state of science
 and technology at the Agency and EPA should examine  the impact of the option
 on individual scientists.  Examples of criteria that should be considered in the
 evaluation of the options in the Mitre  report include the following:

 a. Maximize  the time of laboratory personnel spend on scientific endeavors.
b. Allow for easy recognition of needs  for both additional and new kinds of
      scientific talent and provide for renewal of this scientific competency.
                                       15

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 c. Allow for the addition of senior scientists.
 d. Provide dual development career tracks for scientific contributors and
      management contributors.
 e. Support the nurturing, development, and re-creating of the agency scientists and
      engineers, including individual career development planning.
 f. Allow for cooperative  and coordinated environmental research and development
      with other agencies, universities and industry in which EPA scientists can
      work in off-site laboratories of other institutions.  However, Cooperative
      Agreements  should not be used as an alternate source of human resources
      but used only in those instances where a "true cooperative" program is being
      carried out with another institution.  (Appendix A-2).
 g. Develop a continual planning process that provides long-term stability to the
      enterprise, while maintaining the flexibility of reacting to significant changes
      in the environmental science and/or problems.
 h. Improve the mechanism by which timely and effective  technical assistance can
      be given to the  program and regional offices and monitor the results  and
      feedback.
 i. In short, address scientific career development "as if scientific achieveme-  * really
      mattered."

    A principal human resources action that the SAB  has long advocated is the
 conversion of positions currently occupied by contractor employees to positions to
be occupied by full-time  government employees.  The Agency has been able to
make a remarkably fine  start on this effort in the FY95 budget.  However, even
with this influx of  new > TEs, less than half of the potential contractor positions
on-site at EPA labs will be converted by the end of FY95.  By  demonstrating
imagination, creativity, and good stewardship with the FY95 contractor conversion
exercise,  the Agency should press the case to complete the job of full conversion as
soon as  possible.
      1ORD  estimates that roughly 600 of the 956 contract work years
in  the  research   laboratories   (Table   4-22,  May   3,   1994)   are
performing research functions  that are appropriate for  conversion.
The  FY  1995  Presidential  Budget  Request  included  265  FTEs  for
conversion of  contractors  to federal  employees.
                                     16

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3.5  Selecting an option for the laboratories

   3.5.1 FINDING 5: There are competing forces driving the Agency to make a
            decision regarding an option for the laboratories.

    As noted above, the Committee is troubled by the prospect of the Agency
selecting an option to improve laboratory structure and  function before the
underlying research management dysfunction situation is addressed.  In addition,
the Mitre report in its present form, without a detailed  analysis of the
headquarters ORD operations and their relationship to the laboratories and other
elements of the Agency, does not provide an adequate analytic basis for decisions
on reorganization of the laboratories.  At the same time, the Committee is aware
that there is pressure on the Agency from outside sources to reach some
conclusion in the near term.

  3.5.2  RECOMMENDATION 5: The Agency should resist pressure to make a
            decision on the laboratories in the near term; however, at this point
            some modification of the Carnegie Commission option has more
            obvious positive features than any other.

    Once there has been a clear articulation of the integrated mission of the EPA
laboratories and an integrated  research management system implemented,
consideration of a realignment  of the  laboratories to carry out that mission would
be in order. At this juncture, it is difficult to anticipate the best option for such a
configuration.  Certainly, the new AA for ORD, when  approved, should be  engaged
in defining the best, ultimate option and putting it into  place.

    However, based upon the limited information available today, it appears that
                                                     o
some variant of the so-called Carnegie Commission option  deserves the serious
       This  option  was  based  on  the  a  report  of  the  Carnegie
Commission on  Science,  Technology,  and  Government  "Environmental
Research and Development: Strengthening the Federal  Infrastructure"
December,  1992.
                                     17

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consideration.  The Mitre report identifies many of the positive aspects of the
Carnegie Commission option.  The Committee would like to emphasize a few of
them.

      First, by organizing around central themes,  the  Carnegie Commission option
provides a rational, focused  structure to the laboratory enterprise, thereby
encouraging strategic planning (Appendix A-4) and integration of the research
effort.  Second, the "mega-lab" concept could, but need not, be associated with any
physical changes; e.g., new labs or movement of personnel and equipment.  Third,
the thematic-based structure would reduce the headquarters span of control, which
would likely accrue to the benefit of both the laboratory scientists and
headquarters managers.  Coupled with greater responsibility and accountability for
those lower in the organization, this arrangement  could have a significantly
positive impact on the productivity of research endeavors.  Finally, the Carnegie
Commission option might be modified by including a unit that fosters integration
among the "mega-labs" themselves.  Specifically,  the  Committee sees virtue in
having another unit that would be devoted to both human health and ecological
risk assessment (RA). A focus on RA would draw upon--and draw together~the
efforts of the other mega-labs by keeping the Agency's mission of risk
identification, mitigation, and elimination  as a prominent, ever-present point of
reference.  In any event, the structure should be such  that it strongly encourages
interlaboratory, multidisciplinary collaboration so as  to avoid the megalabs from
becoming discipline-oriented fiefdoms.
                                      18

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            4.0  ADDITIONAL CONSIDERATIONS AND GUIDANCE

    In addition to the major findings and recommendations cited in Section 2, the
Committee generated many additional insights and suggestions that the Agency
should consider as they address the Mitre report and its implications.  These
points are presented below.  Some of the discussion was prepared by individual
members of the Committee but bear the endorsement of all members.  Given the
limited amount of time available for the preparation of this report, it was
impossible to integrate these additional points in the format of findings and
recommendations, but that should not detract from  their value to the Agency.

4.1  Pertinent considerations in making managerial  changes, including
            organizational changes, to promote science at the Agency.

      a. Establish clear, declarative statements of the mission and objectives for
            the Agency and all its sub-units which  will enable all Agency
            employees to  understand their  respective roles. Research issue
            management should be continued, developed and consolidated.
            Mission statements should include descriptions of the mutual role
            between all (each) lab(s) and customers  Further, the statements
            should have been agreed to by  the customers.

      b. Maximize the portion of  time that  ORD scientists, both individually and
            collectively, expend in the direct  conduct of research.

      c. Provide  for effective linkage and communication between the ORD
            laboratories and their customers: 1)  the Administrator for  long-term
            strategic research and 2) the program offices and Regions for nearer-
            term issues.

      d. Create focused research  teams as the primary ORD unit for carrying out
            cross-media, multidisciplinary research efforts.  These empowered,
                                      19

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             matrix-managed groups should be oriented toward problem-solving
             with a minimum number of supervisory/reporting links between the
             bench scientists and the Assistant Administrator for Research and
             Development.  The groups should consist of federal employees, joined
             through effective partnerships with extramural personnel; e.g., from
             universities, private research organizations, states, other federal
             agencies, and industry.  Such linkages should be oriented to solving
             scientific problems, not merely providing non-federal employee FTEs.

      e. Provide for continual revitalization of the ORD work force through
             continual training, professional development, and recruitment of
             individuals  with recent degrees and knowledge  of contemporary
             research technologies.   Resources should be available for scientists
             and engineers to maintain professional contracts through full
             participation in scientific societies.
      f. Foster stable senior scientific management to pilot the "reset . ch ship,"
            irrespective of changes in the political climate/leadership.

      g. Multidisciplinary and muluagency activity will be a hallmark of future
            environmental research..  EPA research funding and laboratory
            systems should facilitate and promote "multi-activity."

      h. Any chan0. takes time to accomplish and accommodate.   Take this into
            account in moving ahead.  Changes may have to be taken in steps,
            verifying value at each step.

4.2 The Agency's commitment to extramural research

      There is a critical need for the Agency to rigorously assess the role of
EPA-funded extramural research in achieving the  Agency's  mission and vision.  At
the present time only a very small portion of the  Agency's funding resources are
                                       20

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'used for grants and co-operative agreements awarded competitively for research
directed to achieve the Agency's mission and objectives.  The total level of support
is so small that EPA is not recognized as being a significant player in the support
of environmental research.  Substantial expenditures are made for contracts and
cooperative agreements that currently provides a non-federal work force on-site
that is approximately equal to the number of EPA employees performing research
on-sites.

      EPA scientists, as well as university scientists, should be eligible, on a
competitive basis to apply for unrestricted (unrelated to specific programs or
projects) exploratory research funds.

4.3 The importance of a centralized research organization

      The Committee recognizes that the issue of a centralized versus
decentralized approach to performance of research and development has been
debated from the beginning of the Agency, when the decision was made to
centralize administratively the research and development function.  The Committee
endorses the continuation of this mode of operation.  The Committee believes that
centralized R&D will promote a strategic focus, as well as the overall efficiency
and quality of research efforts.   If program offices have concerns as to the
responsiveness  of the ORD program, their efforts need to be increased to  make the
program more responsive.  ORD and program management  could establish budget
categories for program office support and  the program offices could in turn
contribute toward  evaluating laboratory research performance.  The answer  ^ not
to create research  and development functions in the program offices.  In this
regard, the Committee is concerned by the February,  1994 H.F. Corcoran/S.G.
Pressman (OGC) memorandum to  Clarence Mahan (ORD) entitled "Funding of
Extramural Research by Offices Other than ORD", which would appear to open
the door for Program Offices to set up their own research and  development
programs, in part, utilizing funds currently supporting ORD efforts.  Ad hoc R&D
efforts dispersed throughout the Agency are likely to have a long-term negative
impact on the Agency's overall  R&D program.  Likewise, installing an "AA for
                                      21

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Environmental Services" (a proposal which has  intrigued the NAPA lab study
review panel) is likely to make the conflicts worse, not better, especially if
Environmental Services include research program support.  There  is no apparent
justification for this organizational move that  would counterbalance its highly
probable negative  effects; i.e., creating "new turf," .

      The Committee believes that decentralization of the research mission
through fiat or organizational design would destroy the  viability of long-term
quality science at  EPA and urges  the Administrator to see that this does not
happen.

4.4  The need to focus research efforts

      The Committee fully recognizes that the resources available  to the Agency
are not sufficient for it to  have a  research and development  presence, let alone a
meaningful impact, in all areas of legislative concern to  the Agency.  In short, the
Agency R&D Program cannot be "all things to all people," This must be
recognized by Agency management, the Congress, and the public.   Therefore, the
Agency must strive to achieve a critical mass  of resources (budgetary and human
resources) in selected areas of greatest concern,  whose selection is  guided, but not
determined solely,  by risk considerations.   By  so doing, it will be possible for the
Agency to conduct significant research that is  of exemplary quality and utility.

4.5  The need for  additional contractor conversion

      The Committee is  of the opinion that the use of multiple control
mechanisms such as human resources ceilings and special budget accounts; e.g.,
Program Research Operations (PRO)  and Abatement Control and Compliance
(AC&C), in addition to total appropriations/obligations authority, have led
inexorably to systemic cases of poor research management.  In part, the existence
of these systems have led ORD to increase its use of what the Mitre report calls
"extramural personnel," principally through the use of contractors and cooperative
agreements.  The Committee strongly urges that the laboratory work force be
                                      22

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"converted to federal employees as soon as possible.  The only exception the
Committee would envision is the use of cooperative agreements when it is  truly a
cooperative  venture with another institution, not simply a means for bolstering the
work force through the on-site use of employees of a cooperating institution.
                                      23

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                               5.0 APPENDICES

Section A-l Resolving conflicts between ORD and program offices

      The program offices of the EPA, the major customers of ORD, generally
have a short-term view of their scientific needs.  In addition, ORD itself must
conduct research of a longer term,  strategic nature, dealing with possible future
issues.  These concerns are  not easily supported by Offices, individually or
collectively. Given the fact  that ORD's resources  are limited and always will be,
conflict must inevitably develop between those  who favor short-term and those
who favor long-term research efforts.  Such conflict can disrupt the research
program and be of such a nature that  ORD, by itself, cannot negotiate a
settlement agreeable to all parties.  In such a struggle, strategic (long-term)
research, having no clear  customer  or "user," has little chance of being pursued at
a reasonable and necessary  level.

      No simple organizational change will resolve these  conflicts. The changes
required for conflict resolution  are  inherent  in  management's practices and
methods.  The Committee identifies two aspects of this situation:

  a. There is a lack of an  identifiable customer for strategic research.
  b. There is no systematic method  for resolving the problems of allocating
            resources among competing customers.

      As to the first problem, the Committee suggests that, since strategic
research is aimed at problems of national and international scope and those
involving  multimedia  consequences, the Agency itself is the customer, based on the
broadest sense of its purpose and mission-environmental  protection.  Specifically,
the Administrator of the EPA should be the customer, should so declare, and
should so act on behalf of strategic research in planning,  budgeting, and setting
priorities.  Only in this way will strategic research receive the attention it deserves
among all the competing demands on ORD's resources.
                                      24

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      As to the second problem, specific linkages are needed between the Offices
and ORD.  Each Office needing ORD's services should have a conflict resolution
manager, or support manager, assigned whose function is not a) to represent the
interests of the Office  to ORD nor b) to  represent the interests of ORD to the
Offices, but rather to represent each to the other.  The primary job of each such
support manager would be to fit the needs of the customer to the capabilities of
the supplier (ORD), to assist the supplier of resources in seeing the need to
redeploy its resources, and to effect a marriage between needs and resources.

      For a support manager to be able  to work successfully, two things are
needed: a) a clear agreement between customer and supplier  as to how they will
work with the support manager and with each other during the allocation process
and b) a mechanism for elevating the issue to a higher level when the  support
manager cannot bring  about a successful marriage.

      The support manager may report "via a solid line"  to the office and "via a
dotted line" to ORD, or vice versa, depending on the sensitivities  of the parties
involved. The support manager, it must be remembered, is a link which is not  at
the Office/ORD interface, but rather is the interface.

      Apparently there is a successful prototype of such a system at the Health
Effects Research Laboratory (HERL) in RTF.  This example should be  examined
closely and adopted as appropriate.
                                      25

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 Section A-2  Use of partnerships to leverage EPA leadership in science
     Environmental research is inherently complex, multidisciplinary and broad. It
must address questions ranging from the molecular to the system-wide (e.g.,  global
climate) level.  EPA is only one of the many institutions conducting environmental
research, and its efforts account for less that 10% of the federal environmental
research budget. Thus,  EPA cannot be expected to maintain in-house expertise in
every area of environmental research.  If EPA is to have a national leadership
position in environmental science and research,  it must develop more effective and
strategic ways to partner with outstanding scientists in universities,  other federal
agencies, research institutions and states to develop multi-disciplinary research
programs that can provide the new scientific knowledge needed for developing
cost-effective environmental policies for the  nation.

    The most productive and effective scientific  partnerships are those in which
each partner brings a  different and  unique capability to the partnership.  They are
built upon mutual respect and trust.  For EPA to succeed  in partnering,  it  must
first identify those areas in which it already has outstanding scientific capabilities
to address EPA's mission, with particular emphasis on those areas in which there
is no other institution with such expertise.  It must also identify areas  in which it
lacks needed capabilities, identify those institutions which  have outstanding
scientific capabilities in those areas, and develop research partnerships  with such
institutions.

    There are several  existing mechanisms that  EPA can use to develop  such
research partnerships; e.g., cooperative agreements, interagency agreements,
contracts, and exploratory research grants.  Rigorous and objective external peer
review of all research  partnerships is  essential if the partnerships are to  provide
high quality and credible scientific bases for developing cost-effective
environmental policies for the nation.  The Exploratory Research Grants Program
is an excellent example of EPA partnerships with  outstanding university
investigators to develop new scientific knowledge of the environment. The
                                       26

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"research projects are subjected to a rigorous, objective peer review by scientists
selected for their expertise on topics of the projects.  The review panels also
evaluate and highly weight the relevance of the proposed research to EPA's
missions.  This small program has been very effective in producing some of the
more fundamental understanding of environmental systems needed by the Agency
for planning applied research and, ultimately, developing scientifically credible
environmental policies.

    Some of the key characteristics that have led to  the  success of this
partnership should be incorporated  into the other kinds of research partnerships
in which the Agency engages; specifically
   a. Use of the most expert scientists in a given environmental field.
   b. Rigorous, external peer-review of the scientific quality of the research.
   c. Consideration of the relevance of the research to EPA's  missions.
   d. More long-term commitments of funding; i.e., more than one
            year.

In addition, the many bureaucratic impediments to such partnerships shou_J be
reduced.

    In summary,  if EPA is to have a leadership role  in environmental research,  it
is  essential that development of long- and  short-term extramural research
partnerships become an integral part of its strategic thinking.
                                      27

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Section A-3 Strengths and limitations of the Mitre report

    The Mitre data collection program was comprehensive  and the data have been
organized into a database in  such a way that it can be quizzed to  address
important questions about human resources, facilities, and  laboratory capabilities.
As such, it represents a unique source of information about the EPA labs that can
and should be analyzed further in the months ahead.

    However,  the Mitre report has some limitations, and it can be improved.  For
example, it should carefully state that the data collection procedures involved
asking the laboratories themselves to  answer basic questions about their
perception of their mission and their  activities relative to the EPA mission.
Anytime a conclusion  or summary is provided it  should be  introduced with a
comment such as "the laboratory personnel indicated that their activities were..."

     One problem with this study is that it is being carried out largely by an
independent contractor. The Agency  would have been better served if they had
more  completely conducted the study  thembelves and only had contractor support
to compile and analyze the data.  The Agency management staff would have
gained more insight into the  workings and problems with their own organization if
they had conducted the interviews so  that they could have  heard the responses
and asked clarification questions.

      In one sense, the approach to the EPA Lab Study seems reversed, in that
Mitre had to work hard to define and clarify the missions of the Agency and the
individual laboratories.  The Agency needs to develop its own strategic plans with
a clear delineation of missions and vision statements before it can  begin to
reorganize the laboratory  systems to better address the Agency's missions.

    Some of the conclusions in the report are misleading.  For example, the
comment in the mission analysis summary "...all  current mission elements
requiring science  and  technology are being met through three types  of laboratories
[ORD, program, and regional]."  These three  types of lab serve very different
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"functions and customers.  Therefore, it is difficult to see how they can be treated
in a similar manner.  As it is, the quoted conclusion relies largely on Table E-2
Distribution of Laboratory Functions by Medium which identifies responses from
individual laboratories in a matrix of medium and science and technology
functions.  However, many of these responses represent a very limited amount of
FTEs applied  to these activities and mission elements which are related to only a
limited extent at best. This table would be more useful if it indicated the number
of FTEs in each of the media and functions. With these data, it would be clear
that the  Agency is not meeting the mission elements with the laboratories.

      The Committee  requested more breakdowns of research staff by highest
degrees,  instead of by  number of degrees.  For example, the usefulness of Figure 4-
18 through 4-20 would be enhanced if the  data indicated the number of Ph.D.s
and MS  in each of the disciplines and if other tables in Appendix E  indicated the
number of personnel with advanced degrees who are eligible for retirement.

    Section 6  of the Mitre report appears to be an excellent summary of the issues
and management ills of the Agency.  The Steering Committee should study and
discuss this information in order to understand fully the problems for which they
are seeking optimal solutions. The SAB Committee offered  specific comments at
the meeting on section 6.6.2 Systematic Responses which did not appear to be well
developed.  The concept of market-based competition is generally not compatible
with the Agency's working conditions.

      The ideas behind the "free market" and empowerment are carried too far in
the Mitre report: only some aspects of empowerment are valid and the free market
ideas are inapplicable within  EPA.  It is highly desirable that the lab managers
have greater flexibility in pursuing the objectives set for them, within given
budgetary constraints.

      Figure 8.3 is  very complex and hard to interpret.  Perhaps a "status quo"
base needs to  be defined-or a clearer definition of the "baseline" case-so there is a
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known base in which all characteristics are neutral  (=0) and from which other
alternatives may be compared more objectively (+,-  or 0).
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 Section A-4  Strategic planning

    The SAB has previously commented on the need for a comprehensive strategic
 plan that includes research which maps out the future directions of the Agency.
 In the last several years, the corporate world has made use of applied strategic
 planning models  that incorporate new concepts, such as strategic intent and core
 competencies, as  important aids for development of strategic decisions using
 analytical processes (see for example, the programs underway at AT&T, Colgate-
 Palmolive, 3M, Eastman Kodak and Northrup).  There are a number of schools of
 thought  on the best process, but the basic tenets are similar.  They include not
 only what  the plans should entail, but also how to involve the appropriate
 personnel in  the  process so that they are committed to implementing the  plan
 once it has been  formulated.

    The Agency should take advantage of these advances in modern management
 theory and employ the basic tenets of these processes for strategic  planning.  We
 encourage the Agency to implement this  activity on a continuous basis throughout
 the institution at all levels. From our perspective, it is especially important to
 institutionalize the strategic planning process for research in the Office of
 Research and Development with clear  linkages to other elements of the Agency,
 many of which are ORD customers.  This planning process should build on
 previous industry, academia and other government agency practice.  The Agency's
 current approach to research, including its use of the research laboratories, does
 not appear to be  a coordinated, planned effort, but rather a reactive series of
 seemingly disparate activities responding largely to the mandates of others.  The
Agency is again encouraged to take a more concerted and coordinated approach to
 strategic planning for research  within  an  overall strategic plan for improving the
efficiency and effectiveness of its research activities.
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Section A-5  Human resource renewal and development

    In evaluating the options for any modifications of the management or the
organization of Agency laboratories and related research and other scientific and
technical work, one of the principal criteria for consideration should be the degree
to which such options  enhance or detract from career planning and development.

    Human resource renewal and development on a continuing basis are keys to
excellence in EPA science and technology.
Human resource renewal  and development, within a laboratory-based, scientific
and technical establishment is accomplished through  the management of technical
personnel in order to achieve the necessary mixtures  of skills and abilities needed
to carry out the work of the organization effectively and efficiently, producing high
quality  products.  To reach  this goal requires continued attention to recruitment,
placement, and career development of the individual staff members.

    New hires, fresh from school (or  some with experience) bring new ideas and
technological and scientific approaches into an organization which, mixed \.ith the
existing reservoir of experienced personnel already on board, yields creative, high
quality research and development.

    Careful identification of the better staff, measured not only by their current
performance but also their future potential in research and development and/or
elsewhere in the Agency is the basis for pursuing individual career development.
Targeted transfers with'u and between laboratories of such personnel  should  lead
to planned, broadened  experiences that will prepare them for broader  tasks and
responsibilities.  Such a deliberate program will accrue to the benefit of
individuals,  the research and development organization, and the Agency as  a
whole.

    The Committee envisions experiences that involve temporary transfers  into
different program offices at HQ, different laboratories (ORD, program, and
regional), and into offices of different operating cultures;  e.g., HQ, program, and
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"regional labs.  It is especially critical that those who may in time become
 laboratory directors have the experience of being "on the other side of the fence."
 In any event, such transfers will enhance  the individuals' understanding of the
 Agency and its mission, will increase their feeling of contributing to the Agency's
 efforts, and will enhance their view of being a part of the Agency and not just of
 the research and development organization.  In time, career development  efforts
 should identify individuals who have broad potential and who should  be moved
 permanently to responsible positions within the Agency's offices.  This kind of
 career development and improvement will "salt" the Agency with individuals who,
 from their own knowledge and experience, know what science and technology can
 do for the Agency and what it takes to produce high quality, relevant scientific
 and technical work.

       Career planning can be  facilitated by instituting the concept of functional
 management as separate from line management: a laboratory reporting to regional
 or Office management, or within ORD (line management) would have dotted line
 to a locus within ORD whose responsibility would be to keep track of the careers
 of scientists/technologists within all laboratories (and of those people "on loan" to
 Offices, etc.) so as  to be able to act as advisors to line management on the career
 development,  promotion, etc. of people under  their line command.  Agreement is
 needed by both kinds  of management on this to make it work.

       Because of current regulations and  policies, transfers may not be as easily
 and flexibly achieved as is desirable for optimal career development. Where this is
 the case to a  detrimental degree, some further reinvention of government is then
 needed.  In short, there needs to be sound career development in order to meet
 the long term  interests of the Agency.

       Training can be an effective tool for improving performance.  This includes
 training scientists not only in technical or administrative areas, but also training
 for scientists and engineers to better understand the many different aspects and
 diverse work of the Agency of which they  are a part.  Such training should be
 given at various times throughout  individuals' careers, starting with a broad
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 orientation for new employees and regular refresher and update training.
 Management training, within a Federal context, should be directed at those in or
 destined for managerial positions.

     Resources should be available for scientists and engineers to maintain
 professional contacts through publication and full participation in scientific and
 professional societies. Active participation and leadership in such organizations
 should be encouraged as part of one's job.  This kind of professional interaction
 benefits not only the individuals maintaining their currency with their peers, but
 it also enhances the scientific credibility and reputation of the Agency.

      To  pursue the renewal and development of human resources, a focal point is
 needed in ORD specifically charged with this initiative which  works with all levels
 of ORD management and supervision to develop mutually agreed-upon plans and
personnel selections.  In time, this same focal point could become a resource of
broader utility throughout the Agency helping to identify individuals in program
office or Environmental  Services Division (ESD) laboratories for career
development.  In the latter activity, the ORD focal point would be a resource for,
and provide an overview to operating management responsible for these non-ORD
laboratories.
       UJ
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                             DISTRIBUTION LIST

The Administrator

Deputy Administrator

AA Office of Air and Radiation
      Director, Office of Atmospheric and Indoor Air Programs
      Director, Office of Policy Analysis and Review

AA Office of Prevention, Pesticides, and Toxic Substances

AA Office of Solid Waste and Emergency Response

AA Office of Research and Development
      Director, Office of Environmental Processes and Effects Research

AA Office of Water

AA Office of Policy Planning and Evaluation

AA Office of Administration and Resources Management

Regional Administrators
      Environmental Services Division Directors
EPA Headquarters Library
EPA Regional Libraries
EPA Research Laboratory Directors
                                      35      U.S. Environmental Protection Agency
                                              Region 5, Library (PL-12J)
                                              77 West Jackson Boulevard, 12th Floor
                                              Chicago, IL 60604-3590

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