UNITED STATES ENVIRONMENTAL PROTECTION \GENCY
WASHINGTON. D C 20460
April 29 , 1994
EPA-SAB-RSAC-LTR-94-008
OfFCE Of THE ADMINISTRATOR
SCIENCE ADVISORY BOARD
Honorable Carol M. Browner
Administrator
U S. Environmental Protection Agency
401 M Street, S.W.
Washington, DC 20460
Subject: Review of the FY 1995 Presidential Budget Request for the Office of Research and
Dear Ms. Browner:
The Budget Review Subcommittee of the rtesearch Strategies Advisory Committee (RSAC)
met on April 8, 1994 to review the FY 1995 Presidential Budget Request for the Office of Research
and Development activities within the Environmental Protection Agency. This review was con-
ducted to provide the Agency and Congress with insights on the adequacy of the budget to cany out
a research program, responsive to the needs of the Agency and the Nation and of high scientific
The Subcommittee's approach included a) a broad review of the total research and develop-
ment program and related budget and b) a more detailed review of four specific activities: the Eco-
system Protection Initiative, the Environmental Technology Initiative,and the Human Health Risk
Assessment Methods and Criteria Air Pollutant Issues.
The review was earned out using background matenals provided by the Agency, as well as
materials specifically requested by the Committee, supplemented by briefings from Agency senior
managers.
Major Findings and Recommendations
1. The Agency's research and development budget for 1995 represents an increase of S37.9M
(S570.6M compared to S532.7M for 1994) and a reduction of 33 work years (1830 work years
compared to 1865 work years in 1994). However, it is the Subcommittee's understanding that 265
Federal workyears will be allocated to research and development activities as a result of the conver-
sion of contract dollars to Federal workyears proposed as part of the Agency's Contract Reform
Initiative.
We are pleased to note the increased funding in 1995 for research and development activities.
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However, the budget does not indicate this change nor the tunds that might be altered to reflect the
changing personnel structure The nature of the Agency's budget submission makes it difficult to
assess the adequacy of the research and development budget to meet the Agency needs.
The Subcommittee notes the long-term erosion that has occurred in the level of the Agency's
research and development activities This is apparent from a comparison of the Agency's Research
and Development budget (presented in 1987 dollars) for 1980 - S460M and the 1995 request -
S440M and the related workforce of 2300 FTEs in 1980 to 1800 FTEs in 1995. See figures 1 and 2
This change is even more sinking when it is recognized that in 1980 the research and development
personnel represented 17% (2300/13,200) of the total Agency personnel which has eroded to less
than 10% (1830/19,400) in 1995 This is especially disturbing in view of the scope of new issues
that need a research effort in order to provide an adequate science base for Agency decisions. Thus,
the Agency does not appear to be heading in the direction of creating the stronger science base that is
so desperately needed.
The Subcommittee strongly recommends
that the Agency critically review the adequacy
of the agency's total science program relative
to its legislated regulatory responsibilities and
explore the opportunities for re-engineering
that would increase the agency's scientific
staff and associated capabilities. The Sub-
committee is aware that the Agency is cur-
rently generating a new strategic plan. The
development of the strategic plan provides an
ideal opportunity for considering a major shift
in resource allocation to the research budget in
order to complement shift from a command
and control paradigm to alternative paradigms
that require a stronger science base.
2. The Agency does not have in place <
with provision for planning, budgeting,
implementing, reporting, and oversight of
its research and development activities.
Meaningful budgeting cannot be done
without a clear plan regarding what is to be
addressed. The present "management
system" appears to be a disjointed collec-
tion of elements of a management system
functioning with variable degrees of effec-
tiveness at different organizational levels
within the agency. The absence of an
integrated management system serves to
impede communication among researchers,
research managers, and "customers" of the
research results.
Figure 1. Budget Trends
(SB)
Agency
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The absence of a well-developed program management sysiem which includes provision for
planning, budgeting, implementing, reporting, and oversight of its research and development activi-
ties makes it difficult to determine whether the budget and allocation of funds are appropriate to
accomplish the research and development goals of the \gency Year-to-year changes in the mana^
ment system and uncertainties in the integranon of the management process between
headquarters-based activities and laboratory operations left the Subcor/imittee uncertain as to
whether changes in research and development actmues delineated in the budget documents repre-
sent actual changes in the scientific ^vork being conducted in the laboratories or not.
The Agency is strongly encouraged to develop a management system that vertically is inte-
grated from laboratory bench operations through the Office of the Assistant Administrator for Re-
search and Development to the research programs of the total Agency. Further, it should have
clearly identified linkages to the acuvities and needs of other segments of the Agency for which the
research and development activities provide a significant part of the scientific basis for action. A
reporting system capable of presenting the research program in different ways for different audiences
is needed, e.g . by issues, by media, or by projects.
3. The Agency's 1995 budget implies new investments in ecosystem protection, criteria air
pollutants (PMio and troposphenc ozone), human exposure, environmental technology initiative and
the high performance computing. These investments resulted both from shifts in funding from low
priority areas and an absolute increase in overall research and development funding. The Subcom-
mittee encountered some difficulty m assessing these new investments/disinvestments because of
changes that have been made in how the research activities are reported from 1994 to 1995.
In general, the Subcommittee was supportive of these new investments. They appear to be
well-justified and timely. However, it should be recognized that the increases for research on the
catena pollutants (PMio and troposphenc ozone) are coming at a time when current revisions of u..
cntena documents for these pollutants are either in the late stages of planning and/or review. There-
fore, this research will have little impact on pending decisions. There is a need for a strategic vision
of how today's research will fit into tomorrow's decision. Obviously, this viewpoint must extend to
the total research and development program, not just the cntena air pollutants.
4. The Subcommittee was favorably inpressed with the specific research issue plans that were
provided and reviewed. However, the current documents appear to be first iterations and n some
cases are already in need of updating. We also gained the impression that some Agency personnel
have not yet accepted research issue planning as a central element of the Agency's approach to
management.
The Subcommittee strongly endorses the use of research issue plans as part of an integrated
management system. We feel strongly that senior EPA management must provide strong endorse-
ment of the process for developing and using the research issue plans as part of an integrated ap-
proach to managing the research and development program. Further, the Subcommittee urged that
additional attention be given to the implementation phase of the research issue plans in order to
provide a stronger and on-going linkage to the actual conduct of the research in both the internal
(EPA) and external laboratones. It was noted that the research issue plans should be "lr. ing docu-
ments" which are updated on an annual basis.
5. The Subcommittee received an oral bnefing on the process for converting from use of con-
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tractor personnel to the performance of research by tull-time Federal employees vvorkina in EPA
laboratories
The Subcommittee is strongly supportive of the conversion process The Subcommittee is of
the opinion that the conversion of contractor personnel to full-time Federal employees can only
improve the efficiency and effectiveness of the EPA research program The Subcommittee urges the
Agency to use a significant number of the conversion positions to hire new entry level Ph D person-
nel as one means of re-vitalizing the Agency's scientific staff
6 The ORD budget justification and support information on its research programs provided to
the Subcommittee initially was not adequate with regard to explaining theunderlying rationale for
new investments/disinvestments and reprogramming of the budget and the direction of its research
program. In response to SAB requests, some additional information and analysis was provided at
the review meeting, including step charts and long term trends The Subcommittee was also pro-
vided a summary of the total Agency budget and a copy of the complete Agency budget submission
to the Congress was provided after the April 8 meeting of the Subcommittee. Recommendations for
information to support future SAB budget reviews are listed in Appendix B.
The inability of the Agency to provide the Subcommittee with the relevant information
needed for evaluating the research and development budget and the rationale for changes probably
relates to several factors: a) the lack of an integrated management system as noted in findings and
recommendations #2 above; b) the difficulty of communicating research and development budget
that is ultimately presented to the Congress in a cross-cutting format (i.e., by media - Air, Water,
etc.); and c) a perception that some members of the Agency staff may not appreciate the value of
the Science Advisory Board oversight review of the Agency's research and development budget.
The Subcommittee concerns in this area can be addressed if the Agency provides the Sub-
committee a well-organized package of budget and related program information well in advance of
its meeting in 1995 for review of the 1996 budget. Details as to the materials requested for an
adequate review are listed in the appendix to this letter. If the Agency does not wish to comply with
this request, then consideration should be given to discontinuing the SAB review of the ORD re-
search program in the context of the President's Budget Request.
In summary, the Subcommittee is supportive of the Agency's 1995 research and development
budget in the aggregate na in its major initiatives. However, the Subcommittee is concerned that
the Agency does not have an integrated management system (for planning, budgeting, implementa-
tion, reporting, and oversight) which functions in an adequate manner to meet the Agency's legis-
lated responsibilities. The Subcommittee is aware of current management initiatives such as the
Administrator's strategic planning initiative, the laboratory organization study, and the on-going
issues planning activity. And at the April 22nd Executive Committee meeting, we learned of yet
another review related to risk issues. The Subcommittee is concerned that these activities, clearly
well-intentioned, do not address a central need—an integrated system extending from the operational
level in laboratories to the Office of the Administrator. If such a management system were in place,
it would not only provide for more effective and efficient management of the research program, but
it would inherently provide a structure that would permit ready examination of the research program
as to its responsiveness to specific concerns such as environmental justice, pollution prevention, and
risk assessment.
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The Subcommittee would be pleased to expand on any of these findings and recommenda-
tions presented in this letter report, and we look torward to your response
Sincerely,
Dr Genevieve Matanoski. Chair Dr Roger O McClellan, Chair
Executive Committee Research Strategies Advisory
Science Advisory Board Committee
Science Advisory Board
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Appendix A Subcommittee Roster
Research Strategies Advisory Committee
ORD Budget Subcommittee
Roster
CHAIR
Dr Roger O. McCIellan, President, Chemical Industry Institute of Toxicology,
Research Triangle Park, NC
MEMBERS
Dr. Judy A. Bean, Professor and Director of Biostatistics, University of Miami,
Miami, Florida
Dr William Cooper. Director, Institute of Environmental Toxicology, Michigan
State University, Ann Arbor, MI
Dr. Paul Deisler, Consultant, Austin. TX
Dr. Wm. Randall Seeker, Senior Vice President, Energy & Environmental Research Corp., Irvine,
California
DESIGNATED FEDERAL OFFICER
Dr. Edward S. Bender, Environmental Protection Agency, Science Advisory Board
401 M Street, S.W., 1400-F, Washington, DC
STAFF SECRETARY
Ms. Lori Anne Gross, Environmental Protection Agency, Science Advisory Board
401 M Street, S.W., 1400, Washington, DC
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Appendix B Specific Findings and Recommendations
This appendix provides specific findings and recommendations to complement the letter
report
1 The Subcommittee noted that the budget is a snapshot of a pan of the overall management
process. The exercise of the budget focuses on classifying dollars and positions according to spe-
cific object codes, however, this is not particularly useful in managing the program. In order to
evaluate the adequacy of the budget, it is essential to understand the overall management process
being used to carry out research the Agency's research and development program. The Subcommit-
tee believes that issue plans are an important part of the management process. The plans should
clearly delineate the vision, mission (including EPA's role in the larger context of all research on the
issue), objectives, and goals associated with an issue. The research issue plan provides the link to
appropriately designated budget items. This information is essential for technical reviewers who
want to understand the contribution of individual activities and funds to the overall objectives. As
the Agency begins to apply the issue plans, they should serve as a guide for management and imple-
mentation of the research program.
2. Specific Committees of the SAB and the Research Strategies Advisory Committee will
review specific research issue plans periodically, so there was no attempt to review these plans in
detail here. However, the Subcommittee would like to offer a few comments:
a. The research issue plans should not be extremely detailed or prescriptive. They should
emphasize vision and direction for the research. It is understood that the labs will develop detailed
descriptions of specific tasks and subtasks.
b. The basic vision and structure of the research issue plans need only be updated annually,
with the vision and the direction remaining more or less consistent from year to year and having a
consistency with the overall vision and strategic plans of the Agency. They should also idenufy the
responsibilities "f other agencies as they interface with EPA's responsibilities.
c. Each research issue plan should contain a discussion of what the Agency is doing, what
level of effort is actually needed to address the issue, and what is or can be done outside the Agency
and within the Agency. For example it was disappointing that more coordination with DOE and
DOD was not apparent with respect to Superfiind research. It is important to explain the magnitude
of the problem and an estimate of resources (dollars, people, and time).
d. Research issue plans should avoid being excessively detailed to reduce the administrative
burden of preparing them. The plans would typically not detail activities of less than $ lOOK/year or
1 FTE. If this level of detail is needed, it can be handled at the laboratory level.
2. The ORD Budget Trends indicate thai the relative proportion of ORD funding in the
Agency's total budget, less construction grants, has declined from over 20% in 1980 to less than 7%
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in 1995 The level of funding has remained nearly constant in 1987 dollars(S460M in 1980 versus
S440M proposed for 1995) for ORD in spite of nearly two fold increase in the Agency's total budget,
less construction grants.
a. Budgets may have actually declined further because, in the past, ORD received funds from
program offices to conduct specific research programs. ORD was not able to supply any information
on this source of funding during the review on the current level of funding from the program office.
b. The trends toward contractor support for the ORD laboratories has changed. In accord
with previous recommendations from the Research Strategies Advisory Committee, this year the
Agency will convert many positions currently filled by contractor personnel to positions filled by
federal employees. The Subcommittee recommends that ORD use these positions wherever possible
to hire entry level doctoral scientists to revitalize the scientific staff.
c. The trends in ORD's budget are disturbing given the desire of the past and current Admin-
istrators to achieve high stature of EPA as a science agency.
3 The Agency's mission appears to be increasing in breadth with every Congress. This mission
must have a solid science base if it is to be achieved effectively and efficiently.. In the past, the SAB
has recommended a series of steps that the Agency must undertake to assure that it attracts and
retains high quality scientific staff and supports their work. (See for Example Reducing Risk
(1990)). These recommendations need to be more fully implemented.
In addition, ORD needs to seek ways to expand its program of extramural funding for inves-
tigator initiated research conducted in Universities and other research institutions. The expertise of
scientists external to the Agency can be better used than it has in the past to complement the m-house
activities.
4. The Subcommittee was pleased to hear that ORD is making conscious efforts to improve its
ecosystem science by consolidating its programs and increasing its use of partnerships. However,
this consolidation appears to be a mere repackaging, without actual changes in program content and
without a clear direction or vision. We recommend that ORD document this plan and take it to the
Ecological Processes and Effects Committee for detailed review.
Also, the discu; 3
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The Subcommittee is pleased by the lifting of the freeze on hiring non-supervisory positions
above Grade 13 If this arbitrary "glass ceiling" were imposed, it would make it difficult for the
Agency to recruit and retain skilled scientists
6 The Subcommittee believes the Agency does not have a well-defined management approach
for planning, budgeting, implementing, and reporting the research. The lack of a well-defined man-
agement approach, with clear objectives, long-term goals, and consistent measures of progress,
means there is less than optimal communication with any of the clients of ORD The following
suggestions are offered:
a. As noted, the Subcommittee supports the research issue plan approach. However, there
also needs to be an associated, integrated management information system that extends from the
laboratory working level to the top level of the organization. EPA should commit to develop and use
a system which can aggregate and display data by issue, media, or project. The issue planning
process should be developed in a manner which is consistent and complementary to the current
streamlining efforts. For example, responsibility and tracking of individual laboratory tasks should
be delegated to specific laboratories and these tasks need to be clearly identified within the overall
management system.
b. Issue planning needs the support of senior management in ORD and within the Agency's
program offices. It represents a paradigm shift approach to strategic planning and implementation
which will not be achieved without some difficulty. This issue planning approach has already
demonstrated it can help the Agency to make significant changes in the direction of research. The
Agency should make a long term commitment to implement this process.
7. The Subcommittee was concerned that the printed material and the presentations did not
provide a clear sense of 5 to 10 year goals for any area of research. Although these goals are prob-
lematic in the political arena, they are needed to ensure that EPA has clear vision. As an example,
funding the negotiated rule for regulation of disinfectants and disinfection by-products in drinking
water was not apparent in the research and development budget, even though the Agency agreed to
perform this important research in partnership with the water treatment industry.
8. The pending review of the EPA Laboratory Study is Likely to add to the list of recommenda-
tions for research, planning and coordination. Following that study, ORD should consider reorgani-
zation of its Headquarters structure and laboratory alignment to reflect the revised list of issue plans,
the mission of ORD, and the Administrator's strategic vision for the Agency. The budget process is
but one factor to consider in the organization of the laboratories. Ultimately, ORD should be con-
cerned with how well the laboratories can perform their functions and support the mission of the
Agency. The ORD labs must match people, facilities, and dollars with priority issues.
ORD and the program offices must also consider further changes in the structure of its
headquarters staff and the mechanisms for streamlining consultations with program offices. Some
individuals favor reducing ORD headquarters coordination activities, replacing them with more
direct contact between scienusts and those who use the science.
9. The "Multimedia" category appears to be a catchall; the more it becomes one, the less useful
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it is as a category It should be noted that almost any ecological or human he., n research has multi-
media implications, but they should not be placed in that category This large portion of the budget
(S272 million) may be very difficult to manage efficiently and identify its products, unless clear,
well-defined implementation plans are developed. Instead, the Subcommittee recommends that the
category Multimedia should only include research done specifically to understand multimedia
phenomena or problems. Cross referencing between and among other programs which have possible
multimedia attributes and with those strictly classified as "Multimedia would be useful
10 The Subcommittee has determined that the background material sent to the it was not ad-
equate communicating the ORD's research program. More thought on the Agency's pan, working
with the SAJB's Designated Federal Official and the Subcommittee, would help in identifying useful
background material. This would have allowed the Subcommittee time to consider ORD's own
questions and concerns at the meeting Several last minute supplements provided useful informa-
tion. but they were not delivered early enough to be analyzed and discussed at the review The
following types of information, provided to the SAB four weeks in advance of the review meeting,
would significantly improve the results of future budget reviews.
a. A concise summary of the ORD research program that relates the program objectives to the
budget (including both FTEs and $). This should be aggregated by both media and issues with some
type of a cross walk.
b. Charts of the long term trends (15 years) tn budgets (S and FTEs) for each media program
and a comparison of the total ORD budget with total agency budget.
c. Step charts and narrative discussions of the changes between the proposed budget and the
previous year budget. The narrative should include additions, deletions and areas of increase or
decrease in funding.
d. A discussion of the overall planning, rationale for priorities, and the management process
for developing and tracking the budget. This should include an example drawn from a high priority
issue plan.
e. A copy of the materials provided to Congress and package of information released to the
press and the public. This information should be provided as soon as it is available.
f. For comparisons, the total expenditures (with PRO identified by media and issue) assigned
to specific tasks) should be delineated. The current reporting of PRO and R (research) and D (devel-
opment) is very misleading when one tries to compare intramural allocations between programs.
12. Comments on specific programs in the Budget
a. Research on Criteria Air Pollutants-The Subcommittee supports the increases proposed for
research on troposphenc ozone and PM 10 as they both represent major challenges for
non-attainment of the ambient air quality standards.
b. Multimedia lnitiative-The Subcommittee supports the concept of a multimeuia focus,
however, it must be structured so that it meets the needs of its media-based clients, and also avoids
serving as a "catchall" research issue plan.
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c Non-Point Source Poliution-This research has been consolidated into the Ecosystems
Protection research issue plan While this may be logical for research on some mechanisms and
mitigation strategies, it is unclear where vital research on microbial sources contaminating dnnJ
water supplies will be supported The Subcommittee recommends that this research is more apptu-
pnateiv tied to human health research issues. The level of funding for non-point source research
seems low considering the scope of the problem.
d Socio-economic research-The SAB has advised the Agency several times (most recently
EP\-SAB-RSAC-92-0I7) that socioeconomic research is needed to support development of risk
reduction tools other than command and control, and that it must be integrated with other environ-
mental research activities.
e Toxic Substances-indoor air pollution involves a lot more than just asbestos. This program
should be expanded and a more integrated program should be developed with clear vision and
statements of objectives.
f Superfund-Most of the increase is extramural (SI 9M), but there is no explanation for the
infrastructure increase (SI 6 M) which is intended to support intramural activities.
g. Water Quality-The consolidation of many research activities into Ecosystems protection
makes sense. It is not clear that the same amount of R and D monies were also transferred.
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