States Forum - Stakeholder Partnerships Change Colorado's Regulatory Process

Patti Shwayder

T I here is a new look to environmental regulation in Colorado as it moves beyond traditional confrontation and win-lose ap- proaches to a more collaborative and prob- lem-solving way of doing business.

The Colorado Health Advisory Network for Government Efficiency (CJ3ANGE) ef- fort, launched just two-and-a-half years ago, is the prime engine behind this new regulatory approach at the Colorado De- partment of Public Health and Environ- ment and thus in environmental regulation in Colorado.

The vision behind CHANGE is one of more effective and collaborative environ- mental problem solving: of an approach aimed at results and not process; of part- nership not confrontation, litigation, and agitation. Key to this new vision is a new paradigm for environmental regulation, in which the focus is on outcomes and results not on enforcement actions and activity measures .

It is the direct outgrowth of the strong beliefs of Colorado Governor Roy Rorner and Patti Shwayder, who launched the CHANGE process a month after Romer ap- pointed her to serve as the state health department's executive director, emphasiz- ing that government can and must be more efficient and user-friendly while also doing its job better.

Because the health department had long been Colorado's state agency that ev- eryone loved to hate, Ms. Shwayder began CHANGE by first bringing its severest crit-

ics from the state's business, environmen- tal and public interest groups to the con- ference table and letting them vent for sev- eral sessions.

It was an effort designed to first hear their views and then to begin to lay the groundwork for understanding how the de- partment could and should improve.

The goal was to collectively assess what was and was not working in the Colo- rado environmental regulation arena and to target some tangible priorities for action. Key department staff were then brought into the process of exploring where the Colorado Department of Public Health and Environment needed to improve and to change.

Targeting some areas that appeared ripe for change, six task forces, composed of leading business executives, key envi- ronmental and public interest group repre- sentatives and high-level department per- sonnel, were organized to explore major concerns and to recommend new ap- proaches. Also identified were some changes that could be immediately imple- mented.

The ERVirORmentd Incentives Task Force was given responsibility for develop- ing a packet of proposed incentives to busi- nesses to spur them to go beyond environ- mental regulation and to get better bottom-line environmental results. The challenge was to figure out how best to provide business with meaningful incen-

The task forces included:

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tives to go beyond requirements and to take corporate citizenship to new environmen- tal heights.

With this challenge goes the awareness that there are skeptics. Many are stuck in the 1970s mentality that business is here to foul the earth and that protectionism and command and control are the only ways to prevent environmental disaster.

On the other side there are those who believe that incentives, partnerships and problem solving are the new wave of how environmental protection programs should be structured and conducted.

With all of this in mind, an environ- mental leadership proposal was crafted and presented to the 1997 Colorado legis- lature for consideration. Although it did not receive final approval at this year’s ses- sion, it started the debate and will provide the basis for establishing a new framework for future partnerships between state gov- ernment regulators and businesses in the state.

As envisioned, the Colorado Environ- mental Leadership Program would create financial and nonfinancial incentives such as fewer inspections, longer permit life, and public recognition by the department and by the governor. Eligibility for these in- centives would be based on a demonstra- tion of more than mere compliance.

The Environmental Permit Streamlin- ing Task Force is well on its way to creat- ing a more user-friendly environmental permitting process in Colorado.

An Environmental Customer Service Center has been created at the Colorado De- partment of Public Health and Environ- ment where staff with technical and pro- grammatic expertise are available to walk customers through the initial permit appli- cation process and then to continue to work with them to determine what steps need to be taken next in this often byzantine process. This is particularly helpful to small businesses and small com- munities that do not have the resources or knowledge necessary to easily and suc-

cessfully use the permit process. The Permit Streamlining Task Force is

continuing to look for ways to make envi- ronmental permitting more straightfor- ward and timely. Underlying the entire permit streamlining push is an effort to provide accountability and predictability in the system.

This push includes enforcing strict per- mit completion deadlines; eliminating the need for unnecessary or duplicative data from the pennittee; and instilling new ways of thinking among permit writers who are being taught that cumbersome correspon- dence is not required when a simple tele- phone call or E-mail would suffice.

Technology is playing a new role in this effort also. The status of stationary air source permits now can be checked at any time on the Internet where department customers also can find all department regulations and regulatory meeting agendas.

Complex permitting systems cannot be streamlined or customer service improved without employing technology to the full- est. Many businesses figured this out a long time ago, but government has not moved into the vital new arena nearly as rapidly or completely as it should have.

Environmental Indicators Task Force has done work second to none in the coun- try on developing a whole new set of per- formance measures.

This group is laboring to find ways of throwing out traditional bean-count- ing and activity measures and replacing them with an outcome, results-oriented approach.

Many businesses with sophisticated environmental management programs have performance measures while in some instances government has lagged behind- still counting the number of fines and en- forcement actions and the number of pages in a report as a measure of success.

At the Colorado Department of Public Health and Environment, this new ap- proach has broad ramifications with pro- grams now being organized with an eye

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toward measuring whether Colorado’s en- vironment is improving rather than count- ing the number of regulatory activities undertaken. The department is working toward measuring progress, not process.

The environmental indicators established by the state health department include:

Air quality as determined by monitor- ing and reportable emissions by indus- try; Amount of hazardous waste generated by large generators: Effectiveness of efforts to control hu- man exposures and groundwater re- leases of hazardous waste: Solid waste disposal and capacity: Number of contaminated sites under remediation, and total contaminated area of each site: Radon testing and mitigation rate: Water quality in public water systems and in lakes and streams.

The Problem Solving Task Force - brought outside interests together with the department’s environmental staff to discuss ways in which the department could apply a problem-solving approach toits day-to-day operations. As such, the task force took on the very culture of the department and of some of its business counterparts.

Career employees have embraced this new challenge, often coming up with com- mon sense, new ideas for greater efficien- cies and effectiveness in their own pro- grams. As one staff person put it, department environmental staff members now realize they have been given a license to think.

Businesses, trade associations and other department customers also have made hard and fast commitments to deal with the department in a different way- to talk before throwing grenades, to make a focused attempt to reach consensus and to just plain work it out.

As a result of the work of the task force, commitments have been made to establish

more direct communication between the department and the businesses and indus- tries it regulates, as well as the public. Such proactive communication is de- signed to find solutions to issues before they become problems.

The Voluntary Cleanup Task Force has forged a landmark agreement with EPA to expedite the voluntary cleanup of hun- dreds of contaminated industrial and com- mercial sites in Colorado.

In the memorandum of understanding between the Colorado Department of Pub- lic Health and Environment and EPA, EPA agrees to forgo further enforcement actions against businesses which comply with Colorado’s voluntary cleanup law.

Specifically, under this operating agreement, EPA assures a property owner that, barring the discovery of an imminent and substantial endangerment to human health, Superfund action will not be insti- gated on any site which has an approved and implemented cleanup plan under the Colorado program.

Furthermore, if a site is listed on CERCLIS, the federal Superfund list, ap- proved cleanup action under the state pro- gram will cause EPA to remove that site from the list.

The Enforcement Policy and Compli- ance Assurance Task Force is reviewing department environmental enforcement and compliance policies to make certain they are appropriate and consistently ap- plied. The task force also is looking for workable methods of helping Colorado businesses achieve compliance and for ways to deter noncompliance.

Some of the methods already under way include technical assistance, training, workshops, educational materials and other collaborative approaches. The state health department has made substantial progress in compliance assistance through the efforts of its nonregulatory pollution prevention program.

The intention of the Enforcement and Compliance Task Force is not to eliminate

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the proverbial hammer from the enforce- ment tool box, but rather to ensure that en- forcement policies are woven into a frame- work that includes incentives and a problem-solving culture. Best practices and new techniques are being modeled and implemented across the department.

IMMEDIATE CHANGES In addition to these six longer-term ef-

forts, the Colorado Department of Public Health and Environment also imple- mented a number of immediate depart- mental changes identified by the CHANGE task force. These include:

Establishment of a Colorado Air Qual- ity Forum to serve as a vehicle for discus- sion and resolution by consensus of the state’s air quality issues and problems.

Developing one of the nation’s first performance partnership agreements.

Taking the place of the more rigid and restrictive state/EPA agreements of the past, the new agreement permits the state health department to redirect some re- sources out of the more restrictive cat- egorical grant requirements into strategic initiatives such as pollution prevention, customer service, compliance assistance, and community-based environmental protections.

Improved customer service throughout the department with all employees receiv- ing customer service training and with a new focus on problem solving.

Eliminating outdated and outmoded rules and regulations through an aggressive review process in which all department rules and regulations are being scrutinized and changed as needed with the help of fresh thinkers called critical review teams. No rule has been found that did not war- rant at least some level of common sense improvement. Several have been elimi- nated altogether and others have been strengthened.

Placing all department environmental and health rules, policies, and regulations

on the Internet along with monthly hear- ing calendars and agendas for the rule mak- ing boards.

Conducting of diagnostic audits in each environmental division to identify better ways of doing business while cutting costs. These audits have shown the need to hold the line on costs and to concentrate on efficiencies.

Implementation of a new program, es- tablished by the Colorado legislature, which gives the state’s smallest towns flex- ibility in meeting EPA requirements for water, sewer, and landfill improvements by phasing in these needed improvements over a ten-year period on the basis of effec- tive planning and infrastructure financial commitments.

Establishing a quality assurance and control system for making staff correspon- dence less technical and more responsive.

Creating a job exchange program to per- mit department employees to learn from other governmental agencies and private businesses while employees from such or- ganizations spend time at the department.

Launching efforts to streamline the department’s management and to make it less bureaucratic and more responsive.

BARRIERS TO CHANGE The barriers the department has en-

countered in changing the way it does business have come from a variety of areas, both internal and external.

At the employee level, a staff of 1,100 is being asked to switch ways of thinking and to approach things differently, ranging from how they implement their programs to the ways they communicate with indus- try and the public. While this is difficult and resisted by some, it is also clear that many department employees are ready and willing to rise to the challenge. Many em- ployees are anxious to be able to think cre- atively to improve work practices and to focus on results.

The state/EPA relationship has been both a help and a hindrance to the

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CHANGE effort. The Colorado Department of Public Health and Environment has worked hard to establish itself as the lead regulatory agency for the day-to-day envi- ronmental issues of the state.

EPA is to be commended for taking the lead on a national basis to craft the new and more flexible environmental perfor- mance partnership agreement frameworks within which the states can operate.

However, EPA must not misinterpret Colorado’s new emphasis on partner- ships with stakeholders, including the regulated community, as being “soft” on environmental lawbreakers. Instead, EPA must move to recognize state rein- ventions and new techniques as helpful and innovative, rather than adhering to and demanding more of its inflexible, one-size-fits-all approach.

The state health department and EPA still have work to do to make the new per- formance partnership agreement work sat- isfactorily for both parties. It also is coun- terproductive to have situations in which the department has been working produc- tively with companies to achieve compli- ance, only to have EPA overfile with a separate enforcement action.

The state health department has en- countered some additional barriers from its own regulations when requirements act as disincentives to achieving the best out- comes. For example, a mining company set out to perform a voluntary cleanup in Colo- rado with the support and cooperation of the department. Although the cleanup was largely successful and avoided the Superfund process, the mining company chose not to construct wetlands for passive treatment of mine drainage because of the state water discharge permit issues it raised.

Another barrier comes from the envi- ronmental community, which historically holds a large stake in the command-and- control, win-lose nature of environmental

regulation. In Colorado, environmental groups have objected to the state’s self-au- dit law, and to portions of the performance partnership agreement with EPA.

But the message being sent to EPA and to the department’s friends in the environ- mental community, is-watch for results and judge accordingly. It is a cultural change for the environmental community to back away from black-and-white advo- cacy in favor of problem solving and con- sensus. It is a paradigm shift that requires new thinking on all sides.

CHANGE is not synonymous with look- ing the other way or caving in to business de- mands. Rather it is a new approach to obtain- ing results that benefit the environment and saves hard-core enforcements for hard-core problems. The department is promising to be creative and flexible in the ways compliance can be achieved as long as business lives up to its end of the bargain.

The Colorado Department of Public Health and Environment remains commit- ted to cleaning up the environment and to keeping it clean, not to exacting pounds of flesh simply because that is what past prac- tices dictate. This is a cultural shift that takes time to achieve. But it certainly is worth working toward.

Patti Shwayder was appointed as executive director of the Colorado Department of Public Health and Envi- ronment in January 1995 by Colorado Governor Roy Romer. She implemented the CHANGEprocess in Feb- ruary 1995. Prior to coming to the department, she spent20 years in public policy in Denvec Colorado and in Washington, D.C. She has served as deputy direc- tor and director of legislative and public affairs with the Regional Air Quality Council in Denver where her accomplishments included drafting and passage of severalinnovative Colorado laws designed to improve air quality. She served in Washington, D.C., from 1979 to 1986 as a congressional staffer and as a senior policy analyst for the U S . House of Representatives Subcommittee on Telecommunications, Consumer Protection and Finance. Ms. Shwaydercan be reached ar303-692-2011, or€-mail: parti.shwayder@state.co.us.

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