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#####  SENT BY ELECTRONIC MAIL

> Subject: **[INFORMATION:]{.underline}** Environmental Management
> Systems
>
> (EMS) as a tool to demonstrate Environmental Stewardship

**[Original Signed by:]{.underline}**

> From: Cynthia J. Burbank, Associate Administrator for
>
> Planning, Environment, and Real Estate Services
>
> To: Division Administrators
>
> Directors of Field Services
>
> Resource Center Managers
>
> Federal Lands Highway Division Engineers
>
> **[Purpose]{.underline}**:\
> To clarify how the Federal Highway Administration (FHWA) can assist
> States in using Environmental Management Systems (EMS) to demonstrate
> environmental stewardship.
>
> **[Background:]{.underline}**
>
> FHWA's Administrator Mary Peters announced in 2001 that environmental
> streamlining and stewardship would be one of FHWA's vital few goals.
> While looking for stewardship measures, the "catchball" team initially
> proposed to count the number of States that implement EMS. Reviewers
> indicated they would need more information on EMS before they could
> make an informed decision, so it was dropped as a measure for this
> vital few goal.
>
> FHWA, however, continues to support EMS as a strategy for
> demonstrating environmental stewardship. Both the Bush and Clinton
> Administrations have encouraged agencies to use EMS to integrate
> environmental performance into daily business decisions, which should
> improve regulatory compliance and increase operational efficiency. The
> American Association of State Highway and Transportation Officials
> newly created Center for Environmental Excellence will also promote
> EMS as part of its environmental stewardship demonstration program.

Adoption of EMS is entirely voluntary, but FHWA can show environmental
leadership by helping States that decide to implement an EMS. Attached
is background information on what is an EMS, how an EMS can help, and
what Federal assistance is available for States that want to develop an
EMS. It also clarifies that EMS development is eligible for FHWA
funding.

> For easy reference, this information will be included on the
> environmental guidebook
>
> web site. For further information about this, you may contact Lucy
> Garliauskas, at lucy.garliauskas@fhwa.dot.gov or 202-366-2058.
>
> Attachments

Cc: Charlotte Adams, FTA

Ed Kussy, HCC

HEP Office Directors

Linda Lawson, OST

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| ## In                                                                 |
| formation on FHWA Promotion of Environmental Management Systems (EMS) |
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| ### July 16, 2002                                                     |
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1.  What is an Environmental Management System (EMS)?

2.  Who currently uses an EMS?

3.  What is ISO 14001?

4.  Why should State or local transportation organizations care?

5.  Why should FHWA care?

6.  What can FHWA do on a national level?

7.  What can FHWA do at a State or local level?

8.  What FHWA funds are eligible for EMS development?

9.  What other resources can States use to develop an EMS?

10. Where can I find more information on EMS?

*1. What is an Environmental Management System (EMS)?*

An EMS provides a standardized framework for an organization to
establish its own specific environmental goals and then measure its
performance in achieving those goals. It is a tool for applying the
following, well-accepted business principles to environmental issues:

-   Identify your key issues and establish what you want to do (policy
    and objectives);

-   Determine how you want to do it (programs, procedures and
    instructions);

-   Tell people what you want them to do (communication and training);

-   Make sure they do it (implementation, measurement and auditing); and

-   Periodically review the entire process to identify opportunities to
    improve.

Companies have applied this "plan, do, check, act" approach to other
business functions for decades. EMS just applies this to environmental
concerns. This process integrates environmental considerations into
day-to-day activities by setting measurable objectives, implementing
programs to achieve them, measuring performance, and verifying
implementation. It is more than just a systematic approach for complying
with environmental requirements; it is also a framework for improving
overall environmental performance and placing more emphasis on pollution
prevention, so that an organization can move beyond compliance.

***2. Who currently uses an EMS?***

Public and private organizations around the world are increasingly using
EMSs, especially since international standards (ISO 14001) were agreed
to in 1996. One expert estimated in 2001 that 32,000 entities have been
certified by third-party audits as compliant with ISO 14001, with
thousands more that have not gone through the formal process of
obtaining third-party certification. Some major corporations now require
suppliers to have ISO 14001 certification. Regulators are increasingly
demanding that defendants implement EMS as a condition of settling
claims associated with enforcement actions. Many public organizations
are using EMS to systematically demonstrate better performance. As more
and more organizations look for ways to systematically address the
growing complexity and variety of environmental requirements, the number
of EMSs will continue to increase.

Transportation organizations using EMS include Pennsylvania DOT, New
Hampshire DOT, and the Portland (OR) Metropolitan Transportation
District. Other State transportation departments that are considering
EMS include Maine, Colorado, Texas, Maryland, Oregon, and Virginia.
AASHTO's newly created Center for Environmental Excellence is planning
to provide more information on these efforts and other best practices.

***3. What is ISO 14001?***

ISO 14001 is one of many technical standards established through an
international consensus and implemented voluntarily by businesses and
agencies. The International Organization of Standards (ISO) works with
public and private representatives from over 100 nations to harmonize
standards for similar technologies in different countries. As
multinational corporations began to use EMS in different countries, they
needed a common standard that had international credibility and could be
audited by third parties. This market-driven effort led to the
establishment in 1996 of ISO 14001 as the consensus model for
identifying the environmental aspects of an organization's activities.

***4. Why should State or local transportation organizations care?***

[Reduced costs]{.underline}. Businesses often find that an EMS can make
them more competitive by improving their efficiency. Public agencies at
all levels -- Federal, State, and local -- have begun implementing EMSs
in an effort to reduce operational costs by using fewer resources,
optimizing the use of resources that are needed, and increasing reuse
and recycling. Although it requires an upfront investment in time,
staff, and management commitment, an EMS can result in cost savings over
time.

[Improved productivity]{.underline}. Organizations perform better when
they systematically manage their affairs. An EMS improves productivity
by systematically addressing environmental concerns as part of overall
management practices and organizational strategies. It gives the people
who best know operations (a) the responsibility to identify the
environmental aspects of their activities, (b) the means to measure
progress against a baseline, and (c) the incentive to make improvements.
This results-oriented approach by insiders is usually more effective
than the process-oriented oversight by outside groups that often want to
add extra steps that may not be cost-effective. In effect, an EMS is a
tool for reviewing all the environmental aspects of a job, including
external regulatory requirements, and coming up with a systematic way to
address them.

[Enhanced credibility]{.underline}. An organization has far more
credibility in claiming environmental stewardship when it has in place a
process to measure its environmental performance and find ways to
improve. Although regulators and environmental review agencies will
never relinquish all oversight responsibilities, they will recognize an
agency with an EMS is taking its environmental responsibilities
seriously. Some environmental groups may questions these "self-audits,"
but the general public will support an organization that can demonstrate
it continuously seeks to improve environmental performance.

[Improved Environmental Performance]{.underline}. The best way to reduce
environmental impacts is to make improvements from the inside out,
rather than impose requirements from the outside in. Constant minor
adjustments by people who know the process can often achieve better
results than one-size-fits-all regulations from people who do not. At a
minimum, an EMS can streamline how an agency addresses its various
regulatory responsibilities. Eventually, an EMS could form the basis for
States to seek greater environmental delegations of authority from
Federal agencies.

***5. Why should FHWA care?***

Environmental stewardship is one of FHWA's vital few goals. It is also
an government-wide objective, as codified in Executive Order 13148
(April 2000). Section 401 of this E.O. directs each agency to implement
an environmental management system at "all appropriate agency
facilities." FHWA actually owns, operates, and maintains very few
facilities subject to this E.O., as noted in a 2001 self-assessment.
Yet, FHWA is still expected to demonstrate environmental leadership in
other ways -- including through the promotion of EMS.

In an April 1, 2002, letter, the Bush Administration encouraged all
agencies to promote the use of EMS in Federal, State, local, and private
facilities. It also directed EPA to report annually on how well each
agency has done in promoting EMS. FHWA can demonstrate environmental
stewardship by encouraging the use of EMS in the construction,
operation, and maintenance of transportation facilities.

***6. What can FHWA do on a national level?***

FHWA Planning and Environment CBU is working with AASHTO's Center for
Environmental Excellence to include EMS as part of the environmental
stewardship demonstration program. FHWA is providing technical and
financial assistance to the Center, which in turn will support states
that have initiated EMSs. In addition to providing training and
disseminating information on best practices, the Center will assist
States in initial efforts to complete a gap analysis, establish an
environmental cost accounting system, and identify performance measures.
FHWA HQ will also work with EPA and other regulatory agencies to ensure
that the States using EMS to improve environmental stewardship are
recognized.

***7. What can FHWA do on a State or local level?***

FHWA Division offices can give credit to those States that have decided
to pursue an EMS, and encourage Federal and State resource agencies to
do so as well. Division offices should report cases where a resource
agency has or has not shown added flexibility to a State with a
functioning EMS. Division offices should clarify to States that they
have wide flexibility in using various Federal funding sources to
develop an EMS.

***8. Is implementation of EMS eligible for FHWA funding?***

Yes. Similar to other management systems, development of an EMS is
eligible for Statewide Planning and Research funds. In addition, other
categories of funds, such as Surface Transportation Program and National
Highway System funds could finance specific elements of an EMS relating
to eligible work items as authorized by statute. Consistent with FHWA's
encouragement of environmental stewardship initiatives, Division offices
should be flexible in interpreting FHWA funding eligibility for EMS
development efforts.

***9. What other resources may States use to develop an EMS?***

EPA has developed a number of guidance documents to assist an
organization in development and implementation of an EMS
([www.epa.gov/ems](http://www.epa.gov/ems)). In addition, EPA provides
support for EMS projects through the Compliance Assistance Program, the
Public Entity Environmental Management System Resource (PEER) Center
([www.peercenter.net](http://www.peercenter.net/)), the Sustainable
Industries Partnership Program, and other programs. EPA reports that
there are a number of other sources of EMS information and assistance,
including State environmental agencies (see
[www.epa.gov/ems/assist/programs/state.htm](http://www.epa.gov/ems/assist/programs/state.htm)
for a link to State websites).

***10. Where can I find more information on EMS?***

AAHSTO's Center for Environmental Excellence
(<http://itre.ncsu.edu/AASHTO/stewardship>) will be preparing additional
information on EMS, particularly as it applies to transportation
organizations. Because EMS development has been a bottom-up,
market-driven effort, many States are ahead of Federal agencies in using
EMS. All 50 States are participating with the Council of State
Governments on a Multi-State Working Group on EMS
([www.iwrc.org/mswg](http://www.iwrc.org/mswg)) to conduct research,
promote dialogue, and establish partnerships in using EMS. Specific case
studies can be found at the National Database on EMS
([http://ndems.cas.unc.edu](http://ndems.cas.unc.edu/)).