From a national point of view, "sectors" refers to an all-inclusive system of classification. From a local point of view, "sectors" tends to be much more specific, referring to "the sectors I deal with".
This implicit specificity characterizes a co-implementer's point of view. When a co-implementer describes a sector approach, there is generally a story attached. Here is where the approach worked, while there it did not. Coming from real-world experience, co-implementers' observations can illuminate the potentials, limitations, and opportunities of the sector approach.
The description of "point A" -- where we are now --- provided in this section is an amalgamation of many stories. It is by no means a comprehensive collection of all the sector-based initiatives that have been attempted at the local level. Nor is it meant to be a statistically valid picture of successes and failures correlated with local characteristics and the nature of individual sectors. Such studies might indeed be useful, but are beyond the scope of what has been attempted here. Rather, this summary represents an attempt to provide some representative examples of the current state of practice, and to draw out testable hypotheses that could be confirmed or refuted by follow-on efforts.
Three topics are considered in this section:
Some of the raw material for this section may be found in the Appendix.
As a general rule, larger municipalities, and strongly industrialized smaller municipalities, have been most innovative in exploring sector-based programs. There are notable exceptions, however. A sector approach represents a departure from standard practice. Consequently, at this stage of development, readiness to try a sector approach may have as much to do with the personalities and inclinations of the potential co-implementers than with nature of the city, county or state they are responsible for.
For example, the Metal Finishing Strategic Goals Program (SGP), a sector-based, voluntary, "beyond compliance" program, is a nationwide effort to enlist the active support of metal finishing companies and other stakeholders (including state and local government co-implementers) in a five year program of environmental performance improvement. It is not surprising that several large municipalities with a high concentration of metal finishers (such as New York, Chicago, and Los Angeles) have very active levels of SGP participation. However, one of the most active states is Pennsylvania, although it has a smaller concentration of metal finishers than several other less active states. The reason is an interest in piloting the program and evaluating its potential. The experience is expected to be valuable for future initiatives directed toward other sectors which have a higher profile in the state, but which have proved more of a challenge. In contrast, another state, with a higher concentration of metal finishers and a good track record with other innovative programs, has so far not become actively involved in the SGP. The reason in that case appears to be a reluctance on the part of local POTWs in the state to commit resources to the program when the current level of performance of the sector seems acceptable to them.
Of all the activities that state and local environmental agencies carry out on a regular basis, providing environmental assistance is the category co-implementers mention most often as a good candidate for a sector-based approach. It is a natural fit, for several reasons:
In addition to its clear applicability for the assistance function, a sector approach has proved useful for several aspects of the traditional regulatory processes. Many states have found it convenient to provide specialized permit application forms for specific sectors, for example.
Co-implementers suggested several other phases of the regulatory process where a sector approach has been beneficial. One example is in the rule-making process. The involvement of the trade organizations representing sectors affected by a rule can be very helpful in eliciting and focusing comments on proposed rules.
Several co-implementers noted that sector-based programs are often initiated when a sector is about to be affected by a change in regulations, or when a sector that has not previously been heavily regulated is about to be. Several communities have taken the opportunity to carry out targeted compliance assistance programs before the rules go into effect.
Other aspects of the regulatory process have been less amenable to a sector-based approach. Processing permit applications and writing specific permits, for example, is generally done on a facility basis, although general guidelines for permit conditions can be formulated on a sector-specific basis. (There are exceptions: for example, at least one state, Connecticut, issues general permits covering a specific type of activity, which often falls out on a sector basis.) Enforcement is also not typically done on a sector basis by local co-implementers. However the EPA Office of Enforcement and Compliance Assurance (OECA) issues sector-specific enforcement targets as a directive for the EPA regions.
A large number of examples of sector based programs and resources can be found in Appendix A, a review of the sector-based programs and resources to be found at the websites of the fifty state environmental regulatory agencies.
The use of industry sector as a regulatory category has a long history. Sectors are often used in conjunction with media-based regulations. The Maximum Achievable Control Technology (MACT) standards formulated under the provisions of the Clean Air Act Amendments (CAAA) of 1990, for example, are issued according to source category (essentially a breakdown by industry sector). Effluent guidelines under the Clean Water Act (CWA) refer to categorical industries, another sector-specific breakdown. In these and other examples, a sector-based categorization is being used as a subcategorization of an essentially media-based framework.
In the past few years, the idea of a primarily "sector-based" approach has acquired a meaning beyond its bare definition as a breakdown according to industry sector. Perhaps the one feature of sector-based programs that sets them apart from other approaches is an aspect of how the programs are implemented. Sector-based programs are often collaborative programs. Co-implementers cite this aspect of the sector approach as the characteristic that both offers the greatest promise and presents the greatest challenge. (The collaborative approach is discussed in more detail in the next paragraph, and in Section 4 of this document.)
Facility-based programs can also involve an element of collaboration, in the sense that co-implementers and industry representatives, often adversaries in the regulatory process, agree on common goals and work jointly toward them. However, the modern notion of collaboration goes beyond parallel work toward common objectives. The hallmark of collaboration is leverage. Each partner's efforts are amplified by the efforts of the others. Different collaborators bring different strengths or capabilities, and the collaboration can accomplish goals, or can accomplish them more easily, than the collaborators could working separately. Facility-based programs can stimulate a company to rise to its highest attainable level of performance. Sector-based programs can, at least in principle, make it possible for a collaboration to go beyond the capabilities of any single company.
The fact that sector-based programs typically involve more than one company, while enabling processes such as leverage, can also make the sector approach less applicable for some purposes. For example, a sector is not a legal entity. One cannot inspect, bring an enforcement action against, levy a fine on, or strike a deal with a sector. Certain regulatory activities are necessarily directed toward individual facilities.
A further distinction between facility-based and sector-based approaches lies in the fact that dealing with a single facility can set it apart from others. The sector approach maintains a level playing field for companies in the same line of business. Some facility-based approaches explicitly seek to give an advantage to companies whose practices and impacts are environmentally preferable. This is not necessarily unfair. One might argue that lower environmental standards are associated with a competitive advantage, which the facility-based approach is simply neutralizing. (However, when good environmental practices actually result in lower costs, the argument would not apply.) One might also point out that facility-based environmental improvement programs are typically set up so that any company is eligible to join the program and qualify for the benefits.
One co-implementer pointed out a classic example of a type of sector-based approach leading to an implementation difficulty. The case involved a set of wastewater effluent guidelines for the Metal Processing and Materials sector (MP&M). As originally written, the guidelines for this category were to apply, in two phases, "to process waste water discharges from sites performing manufacturing, rebuilding or maintenance on a metal part, product or machine to be used in one of the following industrial sectors ...". There followed two lists of sectors, one pertaining to each phase. The phases were to be implemented at different times.
Note that the definition of sector for this purpose does not refer to the processing of the part, but to the sector in which the part is to be used. It is essentially the customer's sector, rather than the manufacturer's, which is the determining factor. This would have resulted in some odd consequences. For example, during the years in which Phase 1 was in effect, but Phase II had not been completed, identical parts coming from the same process line might have to have met two different standards, depending on which customer's order they filled. (Fortunately, this implementation dilemma was avoided when the rule was revised. The revised MP&M rule, scheduled for release in October, 2000, will presumably now be implemented in a single phase.)
While this situation would not occur for rules based on the manufacturer's sector (which presumably does not change in the middle of a process), it does indicate a potential problem for different sectors which happen to have some processes in common. Surface cleaning steps involving the same solvents and the same equipment can occur in a variety of different sectors, for example. From a technical perspective, there is no reason why, for example, emissions standards for identical processes should vary from one sector to another. One could argue that such standards should properly be process-based, rather than sector-based. On the other hand, from an economic standpoint, the cost-benefit analysis of environmental impact abated as a function of the investment, and possibly additional operating cost, required to upgrade the process might well follow along sector lines.