State Innovation Grant Program: Texas
Developing an Innovative Permit Initiative to Promote EMSs
(2002 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 2001, the Texas legislature passed two laws: the
first mandated the creation of the Strategically
Directed Regulatory Structure (SDRS) to support
innovative programs and promote performance-
based regulation; and the second required the state
to develop regulatory incentives for implementing
Environmental Management Systems (EMSs).
Building on the state's environmental leadership
program (CLEAN TEXAS), the SDRS was envisioned as
a way to offer incentives to regulated facilities that
can demonstrate that their practices are more
protective of the environment and public health than
existing standards.
In response to these new laws, the Texas
Commission on Environmental Quality (TCEQ)
applied for and received a State Innovation Grant to
help support the implementation of the SDRS. With
these funds, TCEQ launched a project to:
. Encourage innovative permitting activities to
address significant air and water quality issues;
and
. Support innovative pollution prevention initiatives
(i.e. involving EMSs, permitting actions,
incentives).
The project had three main components: 1)
integrating EMSs into permitting activities and
encouraging improved environmental performance
via incentives; 2) providing EMS training for TCEQ
permit staff and regulated facilities; and 3) evaluating
performance and documenting project results.
NCEI
NATIONAL CENTER FOR
ENVIRONMENTAL INNOVATION
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Project Description
At the outset of the SDRS project in 2004, TCEQ
sought to establish incentives for CLEAN TEXAS members
to improve their environmental performance. TCEQ
identified permits for integration with EMSs activities
and incentives, established a process for accelerated
permitting for CLEAN TEXAS members with an approved
EMS, and created trainings for permitting staff on
EMSs. These efforts culminated in an inter-agency
Memoranda of Agreement (MOA) formalizing the
incentives for CLEAN TEXAS members (i.e. expedited
permitting and reduced inspection frequency).
Once the structure of permit incentives was in place,
TCEQ worked to pilot test these incentives among
CLEAN TEXAS members with an EMS approved by
TCEQ. The Agency granted expedited reviews for
permit amendments to a number of eligible facilities,
and piloted incentives involving flexibility in permitting
requirements for two CLEAN TEXAS members. One
facility received a "flexible permit," that provided
operational flexibility to make predefined changes
without advance approval from TCEQ. For the other
facility, TCEQ authorized a reduction in the frequency
with which the facility conducts required fugitive
emissions monitoring.
TCEQ also adapted a rule allowing landfills with a
TCEQ-approved EMS to use the EMS as their required
site operating plan. To date, no facility has taken
advantage of this option.
As part of the SDRS, TCEQ also conducted a series of
outreach and education activities for agency
management and staff, industries, and municipalities,
which included:
. Briefings on the CLEAN TEXAS program and EMSs for
the TCEQ management team.
. EMS-specific training for permitting and enforcement
personnel.
. Training workshops for regulated entities throughout
the state designed to show them how to use an EMS
to meet or exceed permit and other compliance
requirements, and improve their environmental
performance.
. Sessions to introduce EMS concepts to local
government officials and demonstrate how EMSs
can help municipalities comply with regulations (e.g.,
the Municipal Separate Storm Water Sewer System
rule).
Results
TCEQ's SDRS project succeeded in integrating EMSs
into the agency's permitting process and developing
specific permitting incentives for CLEAN TEXAS members.
It also increased knowledge and understanding of
EMSs among approximately 500 industry and
municipality representatives, and educated TCEQ staff
about the role EMSs can potentially play the permitting
process. TCEQ did note a few challenges to
achieving a higher level of success, specifically with
quantifying results, measuring time and cost
effectiveness, and limitations on its ability to develop
and offer incentives:
. TCEQ had difficulty quantifying the direct impact
SDRS had on reducing environmental impacts.
Annual environmental results reports submitted by
CLEAN TEXAS facilities during the grant period show
measurable environmental reductions in pollutant
emissions. These results occurred at all CLEAN TEXAS
facilities, not just those participating in the SDRS.
. TCEQ was not able to quantify cost and time savings
for participants and the state as a result of expedited
permit reviews and greater permit flexibility. TCEQ
did see higher costs associated with the project,
particularly in time invested by facilities seeking
regulatory incentives. These costs were attributed to
a number of factors including: facilities submitting
incomplete permit applications causing repetitious
reviews, competing priorities for permitting staff, the
difficulty of obtaining agency approval for non-
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standard or new innovative actions or procedures,
and the extensive compliance screening process
required for CLEAN TEXAS members.
. Limitations on the types of incentives that could be
developed and implemented for CLEAN TEXAS
members also reduced facility participation, which
impacted the SDRS project. Although many
incentives were proposed, only a few were
ultimately approved, in part because of federal
and state regulatory constraints and programmatic
concerns. TCEQ found that interest among
facilities in CLEAN TEXAS was often tied to the type of
incentives offered, and their perception of
tradeoffs between membership benefits versus the
time and effort required. Companies showed less
interest when the incentives were tied to
completing all CLEAN TEXAS membership
requirements or when available incentives would
not provide flexibility for certain federal
regulations.
TCEQ will continue to encourage facilities to use
EMSs to improve environmental performance by
conducting additional trainings with small businesses
and municipalities, as well as expanding its CLEAN
TEXAS recruitment efforts.
Connection to EPA's Goals
TCEQ's permit initiative directly supports EPA's
Strategic Goal #5, focused on compliance and
environmental stewardship, by promoting an
innovative approach to improve environmental
performance through pollution prevention measures.
It also supports several Cross-Goal Strategies
through exploration of improved compliance
assistance approaches and incentives to help
achieve environmental protection.
Project Contacts:
For more specific information on the Texas
State Innovation Grant, please contact one of
the individuals below:
David James
Texas Commission on Environmental Quality
Austin, Texas
512-239-3184
djames@tceq.state.tx.us
David Bond
U.S. Environmental Protection Agency- Region 6
Dallas, TX
214.665.6431
bond.david@epa.gov
Beth Termini
U.S. Environmental Protection Agency-Region 1
Boston, MA
617.918.1662
termini.beth@epa.gov
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
United States
Environmental Protection
Agency
Office of Policy,
Economics and Innovation
(1807T)
February 2008
EPA-100-F-08-019
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