State  Innovation  Grant  Program:  Washington  State
                       Exploring the Use of a Holistic Facility Performance Measure as a Tool for Finding
                       a More Comprehensive Method to Regulate the Pulp and Paper Industry
                       (2005 Competition)
                   ine t>iaie innovation urani rrogram 10 support enons
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 Innovation Grants
Project Background:

 The EPA Innovation Strategy states that "environmental
 programs should address a broader range of issues than they
 typically do today. The goal should be greater environmental
 responsibility and natural resource stewardship across all of
 society, along with successful integration of environmental,
 economic, and social objectives."  It also states that new
 approaches need to "emphasize results more than the means to
 achieve them, using regulatory and non-regulatory tools  and
 working in partnership with others. In such instances, public
 accountability should be provided through use of meaningful
 performance tools." Applying more holistic and  innovative
 approaches can help address some of the significant performance
 gaps created by the current array of media-specific state  and
 federal laws and regulations. Media-specific approaches tend to
 rely on a "one-size-fits-all" process to establish environmental
 priorities  and efforts to address  a broader range of issues
 (beyond compliance) have been limited to voluntary actions by
 progressive companies. The Washington State Department of
 Ecology (WA DOE), using a US EPA State Innovation Grant,
 is developing a performance measurement  tool for assessing
 environmental, economic, and social impacts for the pulp and
 paper industry in Washington State. The project will focus on
 eight Washington pulp and paper mills. This  sector was chosen
 by DOE because:

    •   it has significant, multi-media experience in regulation
        of this sector;

    •   the industry plays a major role in the State's economy;

    •   there is a large amount of environmental data available
        for these mills; and

    •   each mill has a significant environmental and economic
        impact on the community in which it is located.


 Project  Description

 This project provides a mechanism for industry in collaboration
 with WA DOE to test the use of a holistic facility performance
 measure as a tool to find a better, more comprehensive method
 to reduce the impacts of multi-media facilities. The WA DOE
 is implementing this project to test the use of an  "Industrial
 Footprint" approach.The results of this project may help the
 WA DOE design and implement specific regulatory approaches
 or other strategic tools, such as integrated permits, to facilitate
                           NCE
                           NATIONAL CENTER  FOR
                           ENVIRONMENTAL INNOVATION

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 more holistic environmental management.

 The sector footprint will consist of a series of measures common
 to all the pulp mills, including energy measures, greenhouse gas
 production, water use, effluent toxicity, and others. Economic
 and social indicators for the sector will be included if agreement
 can be reached among the participants. The individual footprint
 assessments will include all the sector indicators plus those specific
 to the facility and the local community. The project will generally
 follow these steps:

    1.   Selection of indicators for the sector and for each facility;
        this will be done in partnership with the facilities and
        with input from community members and requires the
        development of a stakeholder involvement plan.

    2.   Measurement of the baseline footprint for the sector
        and the facilities using the selected indicators; this step
        will require evaluation and analysis of a significant
        amount of data.

    3.   Issuance of an energy challenge to the sector facilities,
        using the footprint indicators to measure progress
        against the established baseline.

    4.   Development of a set of environmental priorities for
        the sector and each facility, working in partnership with
        the stakeholders.

    5.   Initiation of priority actions for improvement and
        measurement of results as appropriate.

    6.   Assessment of the utility of this approach for
        improving environmental results, including identifying
        barriers to implementation,  recommended
        improvements, and follow-up actions; this assessment
        will include a comparison of mills within the sector and
        a comparison of the holistic performance of those mills
        with an EMS in place to those without one.

 This Grant Funded Project will last  three years until April 2009.


Connection to  EPA's  Goals

 This program directly supports EPAs Strategic  Goals as well as
 several Cross-Goal Strategies. Exploring the use of a holistic facility
 performance measure tool (for Pulp and Paper sector) to improve
 environmental performance is consistent with EPAs Strategic Goal
 (Goal  5)  to "improve  environmental performance through
 preventing pollution and promoting environmental stewardship."
                          Project  Contacts:
               For more specific information on this Washington State
               Innovation Grant, please visit:
               (http://www.ecy.wa.gov/programs/swfa/industrial/
               IndFootprint.html)
               Or contact:
               Carol Kraege
               Manager, Industrial Section
               Washington State Department of Ecology
               PO Box 47600
               Olympia,WA 98504
               (360) 407-6906; FAX (360) 407-6102
               ckra461 (Stecy. wa.gov

               Carolyn Gangmark
               US Environmental Protection Agency — Region 10
               1200 Sixth Avenue
               Seattle, WA 98101 (MC OEA-095)
               (206) 553-4072; FAX (206) 553-0119
               gangmark.carolyn(g).epa.gov

               Kristina Heinemann
               U.S. Environmental Protection Agency
               Washington, DC 20460; MC (1807T)
               (202) 566-2183; FAX (202) 566-2211
               heinemann.kristina(g).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)
    October 2007
EPA-100-F-07-041

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