ENVIRONMENTAL PROTECTION AGENCY
           ENVIRONMENTAL FINANCIAL ADVISORY BOARD
                        STRATEGIC ACTION AGENDA
                           FISCAL YEARS 2009-2010
BACKGROUND
The nation has made huge investments in, and significant progress toward, controlling pollution
discharges and restoring environmental quality.  Much of the credit for this success is due to
EPA's use of regulatory and enforcement tools, and to the transfer of significant resources from
the federal  government to state  and local  governments to help  construct environmental
infrastructures.

Two trends challenge our ability to maintain and improve our standard of environmental quality.
First,  needs and expectations for environmental protection continue to grow.  Second, federal
deficits, tax  reduction  initiatives, and growing overall demands on  state resources constrain
traditional public sources of environmental funding.  The result is an increasing  tension between
the costs of environmental protection and the resources available to meet those costs.

To address these environmental and resource challenges in a sustainable manner, EPA will need
to consider  a  full  range of finance-related  alternatives  available.   This effort will  include
traditional regulatory and enforcement tools and federal assistance programs.  It  will also require
innovative projects  and technologies, improved efficiencies, creative financing  techniques, and
leveraged public-private partnerships.

The Environmental  Financial  Advisory  Board  (EFAB)  and  Environmental  Finance  Center
(EFCN) Network look  to be and integral part of this EPA effort.  EFAB is chartered under the
Federal Advisory Committee  Act  to  advise  EPA  on  environmental finance  issues,  options
proposals, and trends.  EFAB seeks practical ways of lowering costs and increasing investments
in public purpose environmental facilities and services.  The  EFC Network consists  of nine
university-based programs that deliver traditional and innovative financial outreach services to
the regulated communities.

EFAB is supported  by  EPA's Office of the Chief Financial Officer.   The Chair of the Board is
A. James Barnes, Professor of Public and Environmental Affairs at Indiana University. EFAB's
Designated Federal Official is A.  Stanley Meiburg, Deputy Regional Administrator, EPA Region
4 in Atlanta, Georgia.  EFAB's plans  and operation are aligned with the major environmental
goals presented in EPA's strategic plan.

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EPA GOALS AND EFAB ISSUES

EFAB's work is organized in support of the five major goals in EPA's Strategic Plan 2003-
2008:

•      Clean Air and Global Climate Change:  Protect and improve the air so it is healthy to
       breathe and risks to human health and the environment are reduced. Reduce green house
       gas intensity by enhancing partnerships with businesses and other sectors.

•      Clean and Safe Water:  Ensure drinking water is safe.  Restore and maintain oceans,
       watersheds, and their aquatic systems to protect human health, support economic and
       recreational activities, and provide healthy habitat for fish, plants, and wildlife.

•      Land Preservation and Restoration: Preserve and restore the land by using innovative
       waste management practices and cleaning up contaminated properties to reduce risks
       posed by releases of harmful substances.

•      Healthy Communities and Ecosystems:  Protect, sustain, or restore the health of
       people, communities, and ecosystems using integrated and comprehensive approaches
       and partnerships.

•      Compliance and Environmental Stewardship:  Improve environmental performance
       through  compliance  with  environmental  requirements,  preventing  pollution,  and
       promoting environmental stewardship.  Protect human health and the environment by
       encouraging innovation and provide incentives for  governments, businesses, and  the
       public that promote environmental stewardship.

In its own strategic planning process, EFAB annually applies these thematic EPA goals in the
context of the requirement in its charter to provide advice and recommendations on the following
issues:

•      Reducing the costs of financing environmental facilities and discouraging polluting
       behavior;

•      Creating incentives to increase private investment in the provision of environmental
       services  and removing or reducing constraints on private involvement imposed by
       current regulations;

•      Developing new and innovative environmental financing approaches and supporting
       and encouraging the use of effective existing approaches;

•      Identifying approaches specifically targeted to small community financing;

•      Assessing  government  strategies  for  implementing  public-private partnerships,
       including privatization,  operations and maintenance issues,  and other alternative
       financing mechanisms;

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•      Improving government principles of accounting and disclosure standards and how
       they affect environmental programs;

•      Increasing the capacity of state and local governments to carry out their respective
       environmental programs under current Federal tax laws;

•      Increasing the total investment in environmental protection of public, and private
       environmental resources to help ease the environmental financing challenge facing
       our nations; and

•      Removing barriers and increasing opportunities for the U.S. financial services and
       environmental goods and services industries in other nations;

Based on these goals and objectives and input from the Agency, EFAB develops its Strategic
Action Agenda describing the workgroup structure and listing completed, ongoing, and new
projects. Given the number, scope, and nature of the issues, workgroups take the lead in
developing projects for consideration and approval by the Full Board.
CURRENT EFAB WORKGROUPS
             SRF Investment Options: Chaired by George Butcher, ButcherMark Financial
             Advisors LLC, New York, NY

             Innovative Financing Tools:  Co-Chaired by Michael Curley, The International
             Center for Environmental Finance, Towson, MD and Langdon Marsh, National
             Policy Consensus Center, Portland State University, Portland, OR

             Financial  Assurance Mechanisms:   Chaired by Mary Francoeur, Assured
             Guaranty Corporation, New York, NY

             Commercial Insurance:  Co-Chair, Justin Wilson, Waller Lansden, Nashville, TN
             Cost Estimation:  Co-Chair, Kelly Downard,  Louisville Metro City Council,
             Louisville, KY

             Water Loss  Reduction  (Leaky Pipes):   Chaired by  Terry  Agriss, TAgriss
             Advisory Services, New York, NY

             Carbon Capture and  Sequestration:   Chaired by Jim  Tozzi, Multinational
             Business Services, Washington, DC

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STATUS OF EFAB PROJECTS
                     I     On-Going Projects FY 2009      I
      1.    Innovative Use of Assessments and Special Districts in Air Pollution and Non-
            Point Water Pollution
                   EPA Strategic Goals: Clean Air and Global Climate Change; Clean and
                   Safe Water; and Healthy Communities & Ecosystems
                   Primary Customer: Office of Water

      2.    Financial Assurance Mechanisms: Commercial Insurance
                   EPA Strategic Goals: Land Preservation and Restoration and Compliance
                   and Environmental Stewardship
                   Primary Customers: Office of Solid Waste and Emergency Response
                   and Office of Enforcement and Compliance Assurance

      3.    Financial Assurance Mechanisms: Cost Estimation
                   EPA Strategic Goals: Land Preservation and Restoration and Compliance
                   and Environmental Stewardship
                   Primary Customers: Office of Solid Waste and Emergency Response
                   and Office of Enforcement and Compliance Assurance

      4.    SRF Investment Options
                   EPA Strategic Goal: Clean and Safe Water
                   Primary Customer: Office of Water

      5.    Carbon Capture and Sequestration
                   EPA Strategic Goals: Clean and Safe Water and Clean Air and Global
                   Climate Change
                   Primary Customers: Office of Water and Office of Air and Radiation

      6.    Water Loss Reduction
                   EPA Strategic Goal: Clean and Safe Water
                   Primary Customer: Office of Water

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                     Completed Projects FY 2008
                    ^^^^^^^^^^m

1.    Innovative Finance Programs for Air Pollution Reduction, November 2007
             EPA Strategic Goal: Clean Air and Global Climate Change
             Primary Customer: Office of Air and Radiation

2.    Environmental Management Systems and the Use of Corporate Environmental
      Information by the Financial Community, May 2008
             EPA Strategic Goal: Cross-Cutting Strategy: Innovation
             Primary Customer: Office of Policy, Economics and Innovation

3.    Public-Private Partnerships in Water and Wastewater Services, May 2008
             EPA Strategic Goal: Clean and Safe Water
             Primary Customer: Office of Water

4.    Relative Benefits of Direct and Leveraged Loans in State Revolving Funds
      (SRF) Programs, August 2008
             EPA Strategic Goal: Clean and Safe Water
             Primary Customer: Office of Water

5.    Public-Private Partnerships in Water and Wastewater Services: The Canadian
      Experience, August 2008
             EPA Strategic Goal: Clean and Safe Water
             Primary Customer: Office of Water

This Strategic Action Agenda is a flexible planning tool and it will be updated during the
fiscal year as needed.  All revisions will be shown on the Board's home page at:
http://www.epa.gov/efmpage/efab. htm

The spring meeting of the full board will he held March 16-17, 2009 in Washington, DC.
The primary purpose of this meeting is to hear from informed speakers on environmental
finance  issues, proposed legislation,  Agency  priorities, and to discuss progress with
current workgroup projects.  The summer meeting of the full board will be held August
10-11, 2009 in San Francisco, CA. The purpose of this meeting is to discuss progress
with current work projects and to develop an action to direct the Board's future ongoing
and new activities.

EFAB members also contribute their time to assisting other EPA initiatives, most notably
the Environmental Finance Center (EFCN) Network. The EFC Directors serve as expert
witnesses to the Board and provide key assistance to EFAB.  The home page for the EFC
Network is: http://www.epa.gov/efmpage/efc.htm.

Your comments  are important and welcome.  Please call or  e-mail Vanessa  Bowie,
Center for Environmental Finance at (202) 564-5186 or bowie.vanessa.bowie@epa.gov.

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