State Innovation Grant Program: Minnesota
                      Environmental Results Program Applied to Feedlots  (2005 Competition)
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efforts led by state environmental agencies to test innovative approaches
for achieving better environmental results and improved efficiency in
permitting programs. Between 2002 and 2007, the State Innovation Grant
program competition awarded over six million dollars to support 35 state
projects that test permitting innovation for a variety of regulated entities
including several small business sectors. Asummary of the awards by year
appears in the table below.
    State Innovation Grant Program Statistics, 2002-2007
 Competition   Proposals  Proposals    Total  Program
    Year      Submitted  Selected       Funding ($)
  2002/2003
                                         $618,000
                                       $1.425 Million
                                       $1.479 Million
 Cumulative
                                        $1.243 Million
                                        $1.611 Million
                                       $6.376 Million
"Innovation in Permitting" has been the theme of the State Innovation Grant
competition since its inception. In the last three competition cycles states
received awards for projects in the following three categories:
• The Environmental Results Program (ERP) is an innovative
  approach to improving environmental performance based on a system
  of the interlocking tools of compliance assistance, self-certification
  (sometimes, where permissible, in lieu of permitting), and
  statistically-based measurement to gauge the performance of an entire
  business sector. The program utilizes a multimedia approach to
  encourage small sources to achieve environmental compliance and
  pollution prevention. (See: http://www.epa.gov/permits/erp/)
• Environmental Management System (EMS) is a system involving a
  continual cycle of planning, implementing, reviewing and improving the
  processes and actions that an organization undertakes to meet its
  business and environmental goals. EMSs provide organizations of all
  types with a structured system and approach for managing
  environmental and regulatory responsibilities to improve overall
  environmental performance and stewardship.
  (See: www.epa.gov/ems/info/index.htm)
• Performance Track is a partnership that recognizes top
  environmental performance among participating US facilities of all types,
  sizes, and complexity, both public and private.
  (See: http://www.epa.gov/performancetrack/)
NCEI has provided awards also for projects testing watershed-based
permitting, and for permit process streamlining in past competitions. For
more information on the history of the programs, including information on
solicitations, state proposals, and project awards, please see the EPA State
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Project  Background:
 In Minnesota, the state dairy association offers third-
 party environmental compliance  assessments and
 assistance supplied by their technicians through an
 Environmental Quality Assurance (EQA) program.
 The EQA program  is built on the experience of
 swine, poultry, and egg producer associations in
 several states that  have achieved environmental
 benefits through innovative  quality or management
 system driven initiatives.  The Minnesota Pollution
 Control Agency (MPCA) seeks to foster additional
 improvements in  environmental performance  at these
 small facilities by implementing an  Environmental
 Results Program (ERP) self-assessment model with
 dairies, and eventually other animal feedlot
 operations, around  the state.  With EPA State
 Innovation Grant funding, MPCA  is adapting other
 states'  ERP  experiences, plus lessons learned from
 the EQA program, creating  a pilot program for
 feedlots.

Project  Description
 Minnesota's State Innovation Grant pilot program will
 test and implement a voluntary ERP approach for
 smaller dairies that operate below the concentrated
 animal feeding operation (CAFO) regulatory
 threshold  of 700 cows. Through this program, MPCA
 aims to achieve more rapid improvements in
 environmental performance and compliance than
 might be  possible through  conventional inspections.

 To help address pollution from agricultural runoff
 (phosphorus, nitrogen, biological oxygen demand,
 and disease-causing pathogens), MPCA
 implemented  updated feedlot rules in the year 2000.
 These rules included a requirement that owners
 register their feedlots and manure storage areas.
 Since then, the MPCA has focused its staff on
 permitting and inspecting the approximately 1,000
                          NCEI
                         NATIONAL CENTER FOR
                         ENVIRONMENTAL INNOVATION

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larger sites (CAFOs) while county staff have focused
on inspecting the approximately 20,000 smaller
operations that are required to register under the
updated rules.  MPCA's ERP pilot project is designed
to address not only the basic water quality protection
and manure application management aspects of
Minnesota's updated feedlot rule, but also septic
systems, wells, pesticides, solid waste, cropping  and
other environmental aspects of typical dairy farms, thus
moving toward a multi-media, "whole-farm"
management system.

The self-assessment, self-certification, education,
assistance, and other tools of MPCA's ERP pilot are
designed to help dairies improve environmental
performance and compliance in a more timely way,
and without the typical level of MPCA and county effort.
Collaboration with the dairy  producer association,
counties, the Board of Water and Soil Resources, Soil
and Water Conservation Districts and Clean Water
Partnerships have been essential in the development
and implementation of the program. The project's
results will also inform MPCA's decision whether to
extend the pilot to other feedlot sectors and whether to
consider making ERP mandatory for the dairy feedlot
sector.

If Minnesota is successful in applying the ERP
approach to feedlots, this project could serve as a
model to other states also working to  improve the
compliance and performance status of smaller feedlots
that operate below the thresholds of federal
regulations.

Likely outcomes from project implementation include:

  •   Faster, broader adoption of best practices -
      MPCA expects that participating feedlots will
      self-assess environmental performance and
      adopt improvement techniques  for more areas
      of the farmstead and sooner than under a
      conventional inspection program.
    ERP process in a new sector - dairy feedlot
    operations.  Although currently limited to a few
    counties, if the pilot is successful, MPCA will likely
    broaden the use of ERP tools to a larger number of
    dairies and other animal feedlot sectors throughout
    more counties, and eventually to sectors outside
    agriculture.

 Quantifiable environmental improvements include:

    •   Self-corrections to ensure compliance
    •   Best Management Practices (BMPs)
    •   Tested soil nutrient levels
    •   Nutrient management plans (both on-farm and at
       application sites)
    •   Water conservation
    •   Buffer strips along rivers and streams to keep
       pollutants out of the water
    •   Reductions in runoff (particularly runoff reaching
       surface water) from lots, manure stockpiles and
       manure application sites

 The pilot project will span four years. The State
 Innovation Grant project period is 1/1/05-9/30/08.
Connection  to  EPA Goals
 This program directly supports EPA's Strategic Goal #2
 by promoting water quality protection.  It also supports
 strategic Goal #5, focused on compliance and
 environmental stewardship, as well as  EPS's Cross-
 Goal Strategy of promoting innovation and
 collaboration with states.
      Wider application of ERP tools in feedlots and
      perhaps other sectors - MPCA is testing the

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 Project Contacts:

  For more specific information on the
  Minnesota State Innovation Grant,
  please contact one of the individuals
  below:

  Kate Brig man
  Minnesota Pollution Control Agency Regional Division
  Mankato.MN 507-389-1775
  kate.brigman@pca.state.mn.us
               Program  Contact:
                Sherri Walker
                State Innovation Grant Program
                U.S. Environmental Protection Agency
                Washington, DC 20460 (MC1807T)
                (202)-566-2186; FAX (202) 566-2220
                walker.sherri@epa.gov
  Al Innes
  Minnesota Pollution Control Agency Prevention and
  Assistance Division
  St. Paul, MN 651-296-7330
  alister.innes@state.mn.us


  Marilou Martin
  US EPA. Region 5
  Chicago, IL 312-353-9660
  martin.marilou@epa.gov


  Jennifer Linn
  US EPA, National Center for Environmental Innovation
  Washington, DC
  202-566-1258
  linn.jennifer@epa.gov
United States
Environmental Protection
Agency
Office of Policy,
Economics and Innovation
(1807T)
       April 2008
EPA-100-F-08-037

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