April 26, 2000

Richard T. Farrell
Associate Administrator
Office of Policy and Reinvention
Washington, DC 20240

RE: EPA's Performance Track Proposal, as announced March 9, 2000

Dear Mr. Farrell

SPI ¹ appreciates the opportunity to submit comments on EPA's Performance Track Proposal. SPI understands the relevance of EPA's efforts to "recognize and encourage facilities that achieve better environmental performance than is required under existing regulations." SPI also is encouraged that EPA recognizes the potential value of an environmental management system (EMS) in achieving improvements in environmental performance and that EPA is willing to provide appropriate incentives for companies that implement an EMS. SPI also appreciates EPA's acknowledgment that the size and type of company affects the type and level of formality of an EMS that is appropriate

SPI remains concerned, however, that facilities certified to ISO 14001 would not satisfy the EMS criteria as stated in the proposal. SPI also believes that the incentives EPA is offering are of limited value and recommends that EPA propose explicit incentives of sufficient value to encourage more facilities to participate in the program.

EPA Environmental Management System (EMS) criteria vs. ISO 14001 requirements

SPI believes, and provides the following examples of how, the minimum EMS criteria described in the proposal go beyond the requirements of ISO 14001.

• The proposal states that the EMS policy must include "compliance" with legal requirements, rather than a "commitment to compliance" as required by ISO 14001.
• EPA's EMS policy mandates ongoing external communication and reporting on a company's EMS and its performance. ISO 14001 encourages, but does not require external reportin
• EPA is requiring "improvements in environmental performance," rather than the "continual improvement of the EMS" as required by ISO 14001. It is SPI's belief, based on the experiences of many member companies, that improvements in the EMS do, in fact, lead to improvements in environmental performance
• EPA expects more system documentation than is required by ISO 14001. For example, summaries of environmental performance, summaries of the results of compliance and EMS audits performed, and documentation of performance achievements in specific categories, such as toxic use reduction or site restoration
• EPA's Performance Track program would also require participants to develop "active programs for reducing environmental impacts, including those not subject to regulation, with documented results." EPA states that it may select the categories and performance metrics to be used by participants. Such a requirement would appear to restrict the flexibility and/or judgement of participants. It also appears to be inconsistent with the "Plan-Do-Check-Act" model used in ISO 14001, whereby organizations identify the issues of significance for their specific circumstances and then act on those issues on a priority basis
• As noted above, participating facilities would be required to provide a "summary of their performance, including a summary of the results of compliance and EMS audits" in annual reports. SPI has significant concerns about the release of such information to the public, especially with regard to compliance audit results.

Incentives

SPI is concerned that companies are being asked not only to improve their environmental performance but to provide a substantial amount of information regarding their management systems and operations -- yet are not being given much in return. The incentives EPA is offering are vague and are arguably of limited value. Moreover, the possible incentives that are "under consideration" have been discussed by EPA for several years in the ISO 14001 arena, without any meaningful progress. SPI believes that real, bottom-line incentives should be offered if EPA expects to encourage companies to participate in this program. Tangible incentives need to be established especially for smaller businesses where the burden of meeting the Performance Track criteria, such as implementing an EMS, may be substantially greater than that for larger companies.

Furthermore, SPI is concerned that the states might object to the proposed incentives or find that they are not consistent with state law. SPI encourages EPA to secure state approval before program implementation.

SPI is also concerned about EPA's consideration of the "federal procurement preference" for program participants since there is no mention in this proposal about the environmental aspects of a program participant's products (as would be considered by federal agencies under EPA's Environmentally Preferable Purchasing Guidance).

Other Concerns

EPA is proposing to specify a minimum number of performance categories -- energy, air emissions, chemical releases, waste generation -- for which the applicant must demonstrate past achievements in continual improvement in environmental performance. EPA intends to identify specific performance measures within these categories. In other words, EPA intends to tell program participants not only what they must measure, but also how they need to measure it. As noted earlier, SPI is concerned that this approach would "handcuff" participants and remove the flexibility that they need to focus on the issues of greatest concern or that provides the greatest opportunities.

SPI appreciates the opportunity to submit these comments as part of the development of EPA's Performance Track Proposal. SPI remains available to discuss these comments and to respond to any questions you may have on these issues. Please do not hesitate to if we can be of assistance in any way.

Respectfully submitted,

Lewis R. Freeman, Jr.
Vice President, Government Affairs

FOOTNOTES

1. SPI is the trade association representing the fourth-largest manufacturing industry in the United States. SPI's 1,700 members represent the entire plastics industry supply chain, including processors, machinery and equipment manufacturers and raw material suppliers. The U.S. plastics industry employs 1.3 million workers and provides $274 billion in annual shipments. Founded in 1937, SPI is the voice of the plastics industry.

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