Environmental Protection
Observations on Elevating the Environmental Protection Agency to Cabinet Status Gao ID: GAO-02-552T March 21, 2002This testimony comments on legislation that would elevate the Environmental Protection Agency (EPA) to Cabinet status. Today, EPA's mission, size, and scope of responsibilities place it on a par with many Cabinet departments. The United States is the only major industrial power without a Cabinet-level environmental organization. It is important to consider that (1) environmental policy be given appropriate weight as it cuts across the domestic and foreign policies that other Cabinet departments implement and enforce and (2) the head of the agency is able to deal as an equal with his or her counterparts within the federal government as well as the international community. Conferring Cabinet status on EPA would not in itself change the federal environmental role or policies, but it would clearly have an important symbolic effect. Regardless of its status, however, EPA must respond more effectively to its fundamental management challenges. These challenges include (1) placing the right people with the appropriate skills where they are needed and (2) gaining access to high-quality environmental, natural, and social data on which to base environmental decisions. EPA must have the flexibility to use innovative approaches to address complex and intractable environmental problems. Meetings these challenges will require the sustained attention of top EPA management.
GAO-02-552T, Environmental Protection: Observations on Elevating the Environmental Protection Agency to Cabinet Status
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United States General Accounting Office:
GAO:
Testimony:
Before the Subcommittee on Energy Policy, Natural Resources and
Regulatory Affairs, Committee on Government Reform, House of
Representatives:
For Release on Delivery:
Expected at 9:30 a.m.
Thursday, March 21, 2002:
Environmental Protection:
Observations on Elevating the Environmental Protection Agency to
Cabinet Status:
Statement of John B. Stephenson:
Director, Natural Resources and Environment:
GAO-02-552T:
Mr. Chairman and Members of the Subcommittee:
We appreciate the opportunity to appear before you today in the
Subcommittee's hearing on legislation to elevate the Environmental
Protection Agency (EPA) to Cabinet status. As requested, my testimony
discusses (1) our views on providing EPA with Cabinet status and (2)
the major management challenges that the agency faces in meeting its
mission, regardless of whether it becomes a Cabinet department or
remains an agency.
My testimony today is based on a body of our reports on EPA's
organizational structure, human capital activities, information
requirements, and relationships with its state partners. We also have
testified on elevating EPA before”as early as 1988, when we discussed
EPA's increasing environmental policy role in shaping other domestic
and foreign policies.
While the decision to alter EPA's organizational status is a policy
matter for the Congress and the President to decide, we believe that
there is merit to considering elevating EPA to a Cabinet department.
Since EPA was created in 1970, its responsibilities have grown
enormously, along with greater understanding of the environmental
problems facing the nation. Today, EPA's mission, size, and scope of
responsibilities place it on a par with many Cabinet departments. As a
result, it is important to consider that (1) environmental policy be
given appropriate weight as it cuts across the domestic and foreign
policies that other Cabinet departments implement and enforce and (2)
the head of the agency is able to deal as an equal with his or her
counterparts within the federal government and within the
international community as well. Providing Cabinet status would also
clarify the organization's direct access to the President on
environmental matters.
Regardless of its status as a department or agency, EPA must respond
more effectively to the fundamental performance and accountability
management challenges it faces if it is to achieve its mission. These
challenges include (1) placing the right people with the appropriate
skills where they are needed and (2) gaining access to high-quality
environmental, natural, and social data on which to base environmental
decisions. Also, EPA must have the flexibility to use innovative
approaches to address the most complex and intractable environmental
problems. Meeting these challenges will require the sustained
attention of the agency's senior leaders.
Issues to Weigh in Considering Cabinet Status for EPA:
Organizational changes are common within the federal government,
occurring when federal missions change, when certain activities are to
be emphasized or de-emphasized, and when a new organizational
structure is needed to improve the effectiveness of federal programs.
In effect, the types of federal organizations and their activities
reflect shifting perceptions of national problems and how the
government can best deal with them.
Conferring Cabinet status on EPA would not in itself change the
federal environmental role or policies, but it would clearly have an
important symbolic effect. The United States is the only major
industrial power without a Cabinet-level environmental organization.
The additional visibility and prestige that comes with Cabinet status
would send the symbolic, but important, message to other federal
departments and foreign nations that the United States is fully
committed to solving the most serious and complex domestic and global
environmental problems.
Determining which federal activities should receive emphasis at the
highest levels of government is not a straightforward task. That is,
the criteria are not clear-cut for determining the type of
organizational structure that would be most suitable for establishing
and carrying out federal policy and programs for the activities.
Several factors, however, should be considered when deliberating the
structure and role of federal organizations. For example, budgetary
and staffing levels provide some measure of whether an organization's
programs warrant Cabinet-level emphasis. With an annual budget
exceeding $7 billion and a staffing level of 18,000 employees, EPA is
larger than several existing Cabinet-level departments.
Other factors, although less quantifiable than budgetary and staffing
levels, should also be considered in determining the most appropriate
organizational structure for formulating and implementing federal
polices and objectives. They include the (1) significance of the
problems to be addressed, (2) the extent and level of interaction and
coordination necessary with other federal departments, and (3) the
need for international cooperation in formulating long-term policies.
Such factors are clearly applicable to EPA's role and responsibilities
in managing the nation's response to domestic and foreign
environmental problems. In this regard:
* Environmental problems are often long-term, complex, and enormously
expensive, and pose significant threats to human health and natural
ecosystems. As one measure of economic impact, in 1990, EPA estimated
that total pollution control expenditures in the United States by
industry, government, and households in the late 1980s were between
$100 billion and $120 billion annually in 1990 dollars. These
estimated expenditures were for air and radiation, water, solid waste,
hazardous waste, leaking underground storage tanks, Superfund sites,
and pesticides and toxic substances. The agency projected that total
expenditures would rise from 1.9 percent of the U.S. Gross Domestic
Product (GDP) in 1987 to between 2.6 and 2.8 percent of the GDP by the
year 2000. Even as our government tries to solve old environmental
problems, new ones, such as global warming and the depletion of
stratospheric ozone, demand increasing attention. It is likely that
these issues will be even more difficult and expensive to solve.
* As the agency responsible for establishing environmental policy, EPA
must interact regularly with the departments of Agriculture, Defense,
Energy, the Interior, State, Transportation, and others. These
agencies spend billions of dollars annually to comply with
environmental laws and clean up past contamination. However, years of
experience have demonstrated that these agencies do not always provide
the support and cooperation necessary to further environmental goals.
In this regard, environmental consequences were largely ignored at
sites of the Department of Defense (e.g., in testing mustard gas at
Spring Valley in Washington, D.C.); Department of Energy, (e.g., in
using nuclear materials at Rocky Flats, Colorado); and Department of
the Interior (e.g., in dealing with thousands of abandoned mines on
federal lands). Such sites now are likely to cost the nation hundreds
of billions of dollars to correct polluted conditions. Furthermore,
jurisdictional conflicts have created roadblocks that are not
conducive to cooperating with EPA and that have sometimes resulted in
placing a low priority on environmental protection. Such conflicts
could be addressed more effectively in the future by placing the head
of the federal environmental organization on an equal footing with the
heads of other federal departments. This would enable environmental
issues to better compete with other national issues in policy,
budgetary, and programmatic decisions as they are being made.
* International environmental problems involving climate change,
stratospheric ozone depletion, and acid rain will require greater
attention in the 21st century. On these and other issues, EPA's key
international functions include providing technical expertise to the
State Department in integrating environmental policies into
environmental treaties and foreign trade agreements. For example,
under the Clean Air Act, EPA played a major role in implementing the
Montreal Protocol by issuing administrative changes to the final rule
to phase out ozone-depleting substances in 1995, and provides data and
funding that support the protocol. Cabinet status for EPA could
enhance the ability of the United States to provide leadership and
assistance to the rest of the world by conveying that the nation
recognizes the seriousness of domestic and global environmental
problems, and that the problems are receiving adequate attention.
EPA Faces Major Management Challenges That Hinder Its Efforts to Meet
Its Mission:
Whether or not EPA becomes a Cabinet-level department, the challenges
that await it are formidable. Department or agency, it must, first of
all, pay greater attention to strategic human capital management to
improve its performance and accountability in accomplishing its
mission of protecting human health and the environment. It must also
develop high-quality information to support its regulatory programs
and measure environmental results. Finally, it must find alternatives
to traditional regulatory approaches in order to streamline
environmental requirements while encouraging more effective risk-based
means of protecting the environment.
Implementing an Effective Workforce Strategy Would Help EPA to Achieve
Its Mission:
In the past, EPA, like most federal agencies, has not made strategic
human capital management an integral part of its strategic and
programmatic approaches to accomplishing its mission. To emphasize our
concern about and the importance of this area, in January 2001, we
included human capital management as a newly designated governmentwide
high-risk area.[Footnote 1] In addition, at the beginning of this
month, we released to federal agencies our "Model of Strategic Human
Capital Management",[Footnote 2] to help agency leaders effectively
lead and manage their people and integrate human capital
considerations into daily decision-making and the program results they
seek to achieve.
We also note that the administration is giving increased attention to
strategic human capital management. The President has placed human
capital at the top of his management agenda and the Office of
Management and Budget has assessed agencies' progress in addressing
their individual human capital challenges as part of its management
scorecard. Agencies have also prepared workforce analyses as an
initial phase of implementing the President's initiative to have
agencies restructure their workforces to streamline organizations.
To its credit, EPA is one of the agencies that recently has recognized
the importance of human capital and made substantial progress in
developing a strategy to more effectively manage its workforce. The
agency is now in a good position to move forward during the next few
years toward implementing the human capital activities that are
associated with high-performing organizations. Nonetheless, several
key actions will be necessary to ensure that EPA's efforts to better
manage its workforce become an integral part of the way it does
business, and not just another paper exercise. In this regard, EPA
must improve its strategic planning process to specifically address
how human capital activities will help the agency achieve its goals,
identify the specific milestones for completing actions to implement
its human capital objectives, and establish results-oriented
performance measures.
In addition, EPA must more aggressively manage its workforce to obtain
the economies, efficiencies, and effectiveness associated with
determining the appropriate size of its workforce, the deployment of
its staff geographically and organizationally, and the skills needed
to support its mission. For example, in October 2001, we reported that
without workforce planning and analysis, EPA was not able to determine
the (1) appropriate workforce size, (2) balance between staff carrying
out enforcement functions and staff providing technical and compliance
assistance, and (3) location of regional staff needed to ensure that
regulated industries receive consistent, fair, and equitable treatment
throughout the nation. We also noted that the number of enforcement
staff available to oversee state enforcement programs varied
significantly among EPA's 10 regions, raising questions about some
regions' ability to provide consistent levels of oversight to the
states.
As a result of our work, we recommended that the EPA Administrator
collect and review complete and reliable information on regional
workforce requirements and capabilities before transferring $25
million of EPA's fiscal year 2002 budget for a new state enforcement
grant program and eliminating 270 of EPA's enforcement staff
positions. (Citing our report, the Congress did not provide EPA with
authority to carry out this transfer.) We also recommended that the
EPA Administrator take agencywide actions to (1) develop a system for
allocating and deploying EPA's workforce, (2) target recruitment and
hiring practices to fill critical needs for skills such as those for
environmental engineering, toxicology, and ecology, and (3) implement
training practices that provide a link between developmental
opportunities and the competencies needed to accomplish EPA's mission.
EPA concurred with these recommendations and is in the process of
implementing them.
EPA Needs Better Environmental and Scientific Information to Manage
Risks and Measure Results:
More Complete and Accurate Data Are Needed to Characterize Risk
To ensure that it is meeting its mission effectively, EPA needs high-
quality scientific and environmental information to establish
priorities that reflect risks to human health and the environment, and
that compare risk reduction strategies across programs and pollution
problems. Such information is also needed to identify and respond to
emerging problems before significant damage is done to the
environment. While EPA has collected a vast amount of scientific and
environmental data, much of the data is not complete and accurate
enough to credibly assess risks and establish corresponding risk
reduction strategies.
Likewise, primarily because of inadequacies in its scientific and
environmental data, EPA has not been successful in identifying,
developing, and reaching agreement with its stakeholders on a
comprehensive set of measures to link EPA's activities to changes in
human health and the environment. Spurred by the Government
Performance and Results Act of 1993, (GPRA), EPA has made some
progress in measuring the results (outcomes) of its programs but doing
so has proved to be a difficult task for the agency, and relatively
few outcome measures have been developed to date.
We note that the Subcommittee is considering a bill that would, among
other things, create a Bureau of Environmental Statistics with broad
authority to collect, compile, analyze, and publish a comprehensive
set of environmental quality and related measures of public health. As
a focal point for information collection within a new department, such
a bureau, if managed properly, could not only inform the department
and the public about the state of the environment, but it could also
provide measures that can be linked to actions to protect the
environment.
More Complete and Accurate Data Are Needed to Characterize Risk:
Establishing risk-based priorities for EPA's programs requires high-
quality data on the use and disposal of chemicals. To assess human
exposure to a chemical, the agency needs to know how many people are
exposed; how the exposure occurs; and the amount and duration of the
exposure. To assess environmental exposure, EPA needs to know whether
the chemical is released to the air, water, or land; how much is being
released; and how wide an area is being affected.
Historically, EPA's ability to assess risks and establish risk-based
priorities has been hampered by data quality problems, including
critical data gaps, databases that are not compatible with one
another, and persistent concerns about the accuracy of the data in
many of EPA's data systems. Thus, while EPA's priorities should
reflect an understanding of the relative risk that a chemical poses to
the environment and human health and values, good data often do not
exist to fully characterize risk. For example:
* Substantial gaps exist in EPA's Integrated Risk Information System,
a database of the agency's consensus on the potential health effects
of chronic exposure to various substances found in the environment.
This database lacks basic data on the toxicity of about two-thirds of
the known hazardous air pollutants.
* EPA developed many program-specific databases over the years that
contain enormous amounts of data that cannot be integrated with one
another because they were developed and maintained to support specific
programs and activities and lack common data standards (definitions
and formats).
* EPA extensively relies on data provided by the states, but much of
the data have not been verified, and EPA does not know the quality of
the data.
We have made numerous recommendations over the years to help EPA
improve its data, including a recommendation that EPA develop a
comprehensive information management strategy to ensure the
completeness, compatibility, and accuracy of its data While concurring
with the thrust of our recommendations, EPA has made slow and
uncertain progress in addressing its long-standing information
challenges and will require a much more focused approach and top
management attention to meet its information needs.
Success in Developing Environmental Measures Will Depend on Data
Improvements:
Better data are also needed to measure the results of EPA's efforts
and determine its effectiveness in meeting its mission. Well-chosen
environmental measures inform policymakers, the public, and EPA
managers about the condition of the environment and provide for
assessing the potential danger posed by pollution and contamination.
They are also indispensable to sound decisions on EPA's future
priority-setting and budgeting.
GPRA requires EPA and other federal agencies to prepare performance
plans containing annual performance goals and measures to help move
them toward managing for results. Performance measures are the
yardsticks to determine success in meeting a level of performance
expressed as a tangible, measurable objective against which actual
achievement can be compared. Although EPA has made progress under the
act, our analysis of its fiscal year 2000 performance plan showed that
over 80 percent of the agency's performance measures were program
outputs, such as the number of regulations issued, rather than
reductions in pollutants or their adverse effects on the ecology or
human health.[Footnote 3]
The EPA Administrator recently announced a major initiative aimed at
developing measures of future environmental performance. The new
"Environmental Indicators Initiative" is intended to collect measures
of environmental quality and integrate them into a single agencywide
information system for reporting measures of both activities and
outcomes that reflect EPA's ability to show environmental progress.
Significantly, the effort also involves an advisory group led by the
Council on Environmental Quality (CEQ) that will collect environmental
indicators tracked by federal agencies. This effort should help EPA to
report health and environmental conditions beyond the agency's purview.
While this step is in the right direction, EPA will face an enormous
challenge in getting the scientific and environmental data that it
needs to develop outcome-oriented performance measures. Such data on
exposure to pollution and its effects is often difficult and costly to
obtain because of the monitoring equipment and staff resources
required. Consequently, EPA estimates the types and amounts of
exposure on the basis of a chemical's physical properties, how it is
used, the industrial processes for producing and processing it,
production volumes, and the type and amount of releases to the
environment. However, much of the basic data that EPA needs to develop
its estimates are not available, and the agency must rely on models or
other analytical techniques. Moreover, EPA rarely has sufficient data
to permit full analysis of a chemical, and the agency has little
assurance that its exposure assessments are accurate and complete.
Creating a Bureau of Environmental Statistics would place an emphasis
on obtaining high-quality data and could considerably strengthen the
agency's ability to manage its programs to obtain environmental
improvements, provided that the bureau is given sufficient authority,
resources, and staff expertise to accomplish its complex job.
Aggressive actions to find out more about what aspects of the
environment are most improved or most degraded should enable EPA to
better link its knowledge of these conditions with its programs and
activities. EPA could then determine which activities are successful
in correcting problems and which are not.
The creation of a Bureau of Environmental Statistics could be
particularly helpful with regard to obtaining the environmental,
health, and economic impact information collected by other federal
agencies but not currently integrated with EPA's data. The agency's
Science Advisory Board has recommended that EPA do more to link the
agency's databases with federal and other external databases, noting,
"answering many health-related questions frequently requires linking
environmental data to census, cancer or birth registry data, or other
data systems (such as water distribution maps) to determine whether
there is a relationship between the environmental measures and
health." While EPA officials recognize the importance of linking EPA's
databases with those of other agencies, neither EPA nor the other
agencies have made significant progress because data linkage is not
specifically required and the agencies have higher priority funding
demands.
Obstacles to Innovative Regulatory Programs:
In the current federal approach to environmental protection, EPA,
under various environmental statutes, prescribes regulations with
which states, localities, and private companies must comply. This
approach, commonly referred to as command and control, has achieved
some important benefits, but the additional improvements to address
some of the nation's most pressing environmental problems warrant new
and more cost-effective approaches. EPA responded during the 1990s
with a variety of initiatives intended to encourage its state partners
and others to propose innovative regulatory strategies that could
streamline environmental requirements while encouraging more effective
means of protecting the environment.
As we and other organizations have reported in past years, however,
EPA's effectiveness in promoting regulatory innovation has been
limited. Most recently, we evaluated the particular problems facing
states in their own efforts to pursue innovative regulatory programs.
We found their most significant obstacles to be the detailed
requirements of prescriptive federal environmental regulations, along
with a cultural resistance among many EPA staff toward alternative
approaches”often manifested in lengthy and costly reviews of state
proposals.[Footnote 4] In some cases, the cultural resistance was
traced back to the belief of EPA staff that strict interpretations
must be applied to detailed regulations if they are to be legally
defensible. This belief, in turn, has significantly hindered the
efforts of states in their efforts to test innovative proposals to
determine whether they could achieve greater environmental benefits at
lower costs.
Acting on a recommendation of the EPA Task Force on Improving EPA
Regulations, the agency plans to involve states early in the process
used to develop regulations in order to help ensure that the
regulations will be developed in a manner that encourages, rather than
inhibits, innovation. This approach, however, is a limited response
because it will not address prescriptive regulations that already
exist. To overcome the constraints on innovation imposed by a strict
interpretation of the existing prescriptive regulations, EPA would
need legislative changes providing the agency with broad statutory
authority, or a "safe legal harbor," for allowing states and others to
use innovative approaches in carrying out federal environmental
statutes. In the absence of such authority, the effectiveness of
future innovative efforts will require close monitoring by EPA and its
stakeholders and the continued attention of the Congress. In addition,
EPA needs to make a strong commitment to improving its performance
measures to ensure that the new approaches are more effective than the
traditional approaches they replace.
We recently initiated a comprehensive management review of EPA that
will include many of the areas being considered by the Subcommittee as
it deliberates the legislation before it to elevate EPA to Cabinet
status. Our review will assess the agency's management, analyze
problems, determine their underlying causes, and recommend actions to
improve the management of environmental programs. As we complete our
work over the coming months, we would be pleased to share our results
with the Subcommittee.
Mr. Chairman, this concludes my prepared testimony. I would be pleased
to respond to any questions that you or other Members of the
Subcommittee might have.
Contacts and Acknowledgments:
For information about this testimony, please contact John B. Stephenson
at (202) 512-6225 or stephensonj@gao.gov. This statement is available
on GAO's home page at http://www.gao.gov. Individuals making key
contributions to this testimony were Ed Kratzer and Ralph Lowry.
[End of section]
Footnotes:
[1] U.S. General Accounting Office, High Risk Series: An Update,
[hyperlink, http://www.gao.gov/products/GAO-01-263] (Washington, D.C.:
January 2001).
[2] U.S. General Accounting Office, A Model of Strategic Human Capital
Management Exposure Draft, [hyperlink,
http://www.gao.gov/products/GAO-02-373SP] (Washington, D.C.: March
2002.)
[3] U.S. General Accounting Office, Managing for Results: EPA Faces
Challenges in Developing Results-Oriented Performance Goals and
Measure: [hyperlink, http://www.gao.gov/products/GAO/RCED-00-77]
(Washington, D. C., April 28, 2000).
[4] U.S. General Accounting Office, Environmental Protection:
Overcoming Obstacles to Innovative State Regulatory Programs,
[hyperlink, http://www.gao.gov/products/GAO-02-268] (Washington,
D.C.:March 4, 2002.)
[End of section]
