A few years ago, Mary Gade realized that managers of small businesses in Illinois were scared to death of being severely punished for accidentally violating complicated environmental laws. These managers were so scared, in fact, that they often didn't want to ask for the state's help in fixing their environmental problems. Gade thought that was a shame, and as the director of the Illinois Environmental Protection Agency, she was in a position to do something about it. In 1995, Gade set up Clean Break, a program that offers small businesses help in complying with environmental regulations and relief from penalties, provided they fix their problems within a reasonable time.
Gade also felt that contaminated industrial sites in Illinois were taking too long to redevelop. The cleanup standards were unrealistically strict, and developers were afraid that if they took the trouble to clean up a site, they not only would have to waste money chasing the last stray molecule of pollution but could be sued by a future user of the property for contamination they didn't even cause. Many sites were abandoned or remained perpetually undeveloped. In 1993, the Illinois EPA created a set of flexible cleanup standards and limited liability releases that have made possible the voluntary redevelopment of hundreds of contaminated sites.
Gade, who worked for the U.S. EPA for 13 years before heading the Illinois EPA, stresses that these kinds of imaginative initiatives would have been impossible at the federal level. "States are particularly well positioned" for experimentation, she says. "We make great laboratories." Gade adds that the U.S. EPA may no longer be the best place to make many sorts of environmental decisions. "The federal government is not being as helpful and constructive as they could be," she says, and "the environmental management system of this country, after 30 years, is ready for a major rethinking and overhaul."
Environmental regulation is undergoing a sea change in the United States. The old environmental vision, shaped in the 1960s and '70s, was crisis-driven. It distrusted markets, property, and the private sector, and so punishment rather than cooperation was the preferred method for getting people to comply with the law. It assumed that environmental problems and conditions were pretty much the same everywhere and accordingly called for one-size-fits-all regulations mandating acceptable technologies and approved cleanup methods. The regulations were written by government experts, and it was taken for granted that environmental problems would be solved through the public sector. Furthermore, the prevailing wisdom said the states were incompetent regulators who would strike cozy deals with evil polluters and "race to the bottom," cutting environmental standards to attract businesses. Federal regulators were the ones wearing the white hats.
The new vision of environmental regulation stresses problem-solving instead of punishment. It seeks flexibility in compliance methods so that companies can choose the cheapest way of achieving a given level of environmental quality, instead of having to adopt a single prescribed method. It views the private sector as a necessary partner in environmental improvement. And it tries to bring decision-making authority to the lowest level where it makes sense--so that local problems can have local solutions, state problems can have state solutions, and national problems can have national solutions.
Over the past few years, several states have begun to implement reforms embodying these principles. Their experiences contradict the race-to-the-bottom theory, which does not allow for the possibility that state-driven environmental protection could achieve superior results at lower cost, with less regulation and less intrusiveness. These are some of their stories.
"Brownfields" of Dreams
"Superfund," says Jim Seif, secretary of the Pennsylvania Department of Environmental Protection (DEP), "is the least effective federal environmental statute in history." Seif is referring to the federal law dealing with hazardous site cleanup, officially called the Comprehensive Environmental Response, Compensation, and Liability Act. Superfund was enacted in 1980, in the wake of the Love Canal scare. Today it is widely criticized for making cleanups needlessly expensive and time-consuming, for engendering unnecessary litigation, and for making it almost impossible to return a contaminated site to productive use.
Fortunately, the Superfund program applies only to the sites classified by the federal government as most contaminated. For the remaining sites, known as "brownfields," the Pennsylvania DEP developed the Land Recycling Program, which was authorized by state legislation passed in 1995. The program standardizes cleanup procedures, so owners and potential developers know exactly how much cleanup is necessary. It sets realistic goals--unlike Superfund, which established what Seif describes as "Garden of Eden" standards, "a practice which, of course, produced no cleanups" because of the prohibitive expense. Pennsylvania grants liability releases to owners, developers, and financial institutions that are otherwise reluctant to clean up properties for fear that they will be sued by future owners. And it provides some funding assistance, though most of the cleanups are conducted at private expense.
In contrast with Superfund, the DEP tries to avoid prescribing the specific technology to be used in the cleanup, instead only saying how clean the site should be. While the Pennsylvania program is still prescriptive in some areas, the regulations are by and large based on actual environmental and health risks, encouraging businesses to develop innovative cleanup methods. Instead of requiring the complete elimination of chemicals left by commercial activity, the state sets acceptable levels based on established risks to human health and the environment, taking into account the intended use of the property. (Residential sites, for example, have to be cleaner than industrial sites.) As one DEP official puts it, "We have kind of taken a novel approach in Pennsylvania, trying to base our cleanup program on sound science."
Previous state law held current owners responsible for cleanup, even if prior owners were responsible for the contamination; as a result, it was sometimes more cost effective to abandon a site than to restore it. The Land Recycling Program releases owners or developers of a site from liability associated with their cleanup, as long as the work is done according to specified standards and procedures. State grants or low-interest loans can cover up to 75 percent of the cost of completing an environmental study and implementing a cleanup plan. Once the property has been cleaned up, the DEP releases the landowner from state liability, and state law provides protection from citizens' suits.
One of the highest-profile properties to be redeveloped under the program is the 160-acre site of a shuttered plant owned by Bethlehem Steel. In February 1996 the company signed a partnership agreement with the Smithsonian Institution to establish the National Museum of Industrial History on the plant site, which is being tested for the presence of heavy metals and other materials associated with steelmaking. The first stages of the project--sampling the soil and monitoring the ground water to determine what sort of cleanup is necessary--are mostly completed. The company expects that not much cleanup will be required beyond tearing down buildings and removing debris. Some soil might have to be removed, but more drastic methods, such as pumping and treating ground water or putting in large underground walls to isolate it, are not expected to be necessary.
Once the cleanup is finished, any residual contamination shouldn't pose any health problems because the property will be covered with clean soil, parking lots, and buildings. The museum, which is expected to open in 2001, will be part of a larger education and entertainment complex. "It's been said that Pennsylvania has the most progressive brownfields law in the country," writes Hank Barnette, chairman and CEO of Bethlehem Steel. "Certainly, this is making possible the revitalization of our site in Bethlehem that might otherwise have had a very limited future."
Direct comparisons between Superfund and the state program are tricky, since they cover different types of sites. But in the brief existence of the Land Recycling Program, more than 300 sites have been enrolled and 100 have been cleaned up, while over the last 16 years the Superfund program has worked on 33 of 103 sites in Pennsylvania, and just 10 of these have been removed from the list.
Pennsylvania officials were therefore annoyed at recent federal efforts to limit the scope of state brownfield cleanup programs. One obstacle to cleanups was that no matter what the state guaranteed, the federal government could decide that a site needed additional work under Superfund. To avoid this problem, some states have signed "memoranda of agreement" (MOA) with the U.S. EPA, essentially stating that if a site enters the state cleanup program the feds will leave it alone. In September 1997, the U.S. EPA released a guidance document severely restricting the conditions under which it would sign an MOA: The more flexible a state tried to be in its efforts to get sites cleaned up quickly, the less likely it was to get an MOA. State regulators called the new federal guidelines overly prescriptive and unnecessarily intrusive.