T OWARDS

A S USTAINABLE

A MERICA

May 1999

Advancing Prosperity, Opportunity, 

and a Healthy Environment for the 21st Century

The Presidents Council on Sustainable

Development
T OWARDS

A S USTAINABLE

A MERICA

May 1999

Advancing Prosperity, Opportunity, 

and a Healthy Environment for the 21st Century

The Presidents Council on Sustainable
Membership

CO-CHAIRS

Ray C. Anderson, Chairman and CEO, Interface, Inc.

Jonathan Lash, President, World Resources Institute

EXECUTIVE DIRECTOR

Martin A. Spitzer

MEMBERS

John H. Adams, President, Natural Resources Defense Council

Aida Alvarez, Administrator, U.S. Small Business Administration

Bruce Babbitt, Secretary, U.S. Department of the Interior

Scott Bernstein, President, Center for Neighborhood Technology

Carol M. Browner, Administrator, U.S. Environmental Protection Agency

David T. Buzzelli, Director and Senior Consultant, The Dow Chemical Company

Andrew Cuomo, Secretary, U.S. Department of Housing and Urban Development

William M. Daley, Secretary, U.S. Department of Commerce

Dianne Dillon-Ridgley, Executive Director, Womens Environment and Development Organization

E. Linn Draper, Jr., Chairman, President, and CEO, American Electric Power

Randall Franke, Commissioner, Marion County, Oregon

Dan Glickman, Secretary, U.S. Department of Agriculture

Samuel C. Johnson, Chairman, S.C. Johnson & Son, Inc.

Fred Krupp, Executive Director, Environmental Defense Fund

Kenneth L. Lay, Chairman and CEO, Enron Corporation

Harry J. Pearce, Vice Chairman, General Motors Corporation

Steve Percy, Chairman and CEO, BP America, Inc.

Michele Perrault, International Vice President, Sierra Club

Bill Richardson, Secretary, U.S. Department of Energy

Richard W. Riley, Secretary, U.S. Department of Education

Susan Savage, Mayor, City of Tulsa, Oklahoma

John C. Sawhill, President and CEO, The Nature Conservancy

Rodney Slater, Secretary, U.S. Department of Transportation

Theodore Strong, Executive Director, Columbia River Inter-Tribal Fish Commission

EX OFFICIO MEMBERS

D. James Baker, Under Secretary for Oceans and Atmosphere, U.S. Department of Commerce

Sherri Goodman, Deputy Under Secretary of Defense, U.S. Department of Defense

Richard Rominger, Deputy Secretary, U.S. Department of Agriculture

EMERITUS MEMBERS

Richard Barth, Novartis, Inc. (Retired)

Richard Clarke, Pacific Gas and Electric Company (Retired)

Jay D. Hair, President, World Conservation Union

LIAISON TO THE PRESIDENT

George Frampton, Acting Chair, Council on Environmental Quality

The federal officials who serve on the Council participated actively in developing the recommendations in this report, bu

those recommendations do not necessarily reflect Administration policy. The Council will deliver its report to the Presiden

for his consideration. He has not yet reviewed or endorsed the recommendations.
TABLE OF CONTENTS

Preface ................................................................................................................................................................i

National Goals Towards Sustainable Development ..................................................................................iii

Definition and Vision Statement ..................................................................................................................iv

We Believe Statement........................................................................................................................................v

Chapter 1  Introduction ................................................................................................................................1

The Journey ..................................................................................................................................................................................

The Unique Roles of the Council..............................................................................................................................................

Organization of the Report and Key Findings ......................................................................................................................

Use of this Report and Relationship to Earlier Work............................................................................................................

Cross-Cutting Lessons ................................................................................................................................................................

Next Steps......................................................................................................................................................................................

Chapter 2  Climate Change............................................................................................................................9

Introduction ................................................................................................................................................................................1

Key Findings........................................................................................................................................................................1

Principles for Climate Protection Strategies ..........................................................................................................................1

Principles for Climate Policy ............................................................................................................................................1

Sooner is Better: Incentives for Early Action........................................................................................................................1

An Incentive-Based Early Action Program....................................................................................................................1

Technology Matters....................................................................................................................................................................1

A Systematic Approach to Accelerate Development and Deployment of Technology ........................................1

Recommendations ........................................................................................................................................................................

Electric Power ................................................................................................................................................................................................2

Transportation ................................................................................................................................................................................................2

Industry ............................................................................................................................................................................................................2

Electric Power and Industry ........................................................................................................................................................................2

Buildings ..........................................................................................................................................................................................................2

Agriculture and Forestry ..............................................................................................................................................................................2

Cross Cutting Actions ....................................................................................................................................................................................2

Seeking Broader Benefits in Climate Protection Strategies ................................................................................................2

Forum on Quality of Life and Climate Change ..............................................................................................................

Fostering Broad Based Community Participation ........................................................................................................3

Towards Sustainable Climate Action ..............................................................................................................................3

Chapter 3  Environmental Management ..................................................................................................33

Introduction ................................................................................................................................................................................3

Key Findings........................................................................................................................................................................3

Building a New Environmental Management Framework..................................................................................................3

Attributes of a New Environmental Management Framework ........................................................................................3

Improve Performance ........................................................................................................................................................3

Ensure Stewardship ............................................................................................................................................................3

Involve Communities ........................................................................................................................................................3

Engage Workers ..................................................................................................................................................................3

Provide Information ..........................................................................................................................................................3
Adopt Integrated Approaches ..........................................................................................................................................3

Use Market Mechanisms and Accounting Systems ......................................................................................................4

Recommendations ......................................................................................................................................................................4

Measuring Progress and Accountability..........................................................................................................................4

Measure Environmental Progress ....................................................................................................................................................4

Define Common Metrics for Environmental Performance..........................................................................................................4

Link Environmental, Economic, and Social Information ..........................................................................................................4

Improving Environmental Management ................................................................................................................................4

Differentiate by Sector and Size ....................................................................................................................................4

Promote High Performance ................................................................................................................................................................4

Align with the Economy ......................................................................................................................................................................4

Market Mechanisms......................................................................................................................................................4

Environmental Management Systems ..........................................................................................................................5

Third-Party Certification of Environmental Performance............................................................................................5

Linking Places and Strategies....................................................................................................................................................5

Foster a Collaborative Regional Approach to Environmental Protection ................................................................................5

Involve Individuals and Communities in Improving Environmental Protection..................................................................5

Identify Risks and Protect Communities Against Disproportionate Impact ..........................................................................5

New Approaches for Persistent Problems and Emerging Issues ......................................................................................5

Chapter 4  Metropolitan and Rural Strategies ........................................................................................57

Introduction ................................................................................................................................................................................5

Key Findings........................................................................................................................................................................5

Strategic Opportunities for Sustainable Community Development ..........................................................................6

The Momentum is Building for Sustainable Community Development..................................................................................6

Five Strategic Areas of Sustainable Community Development ..................................................................................................6

Common Characteristics of Successful Initiatives ..........................................................................................................6

Overcoming Obstacles on the Path to Sustainability ..................................................................................................6

Information and Technical Assistance: Supporting Continuous Community Learning ................................................6

Public Education ................................................................................................................................................................6

Learning Networks ............................................................................................................................................................6

Data Dissemination and Improved Analysis Methods ................................................................................................6

Indicators and Evaluation Methods ................................................................................................................................6

Economic Incentives and Financial Assistance: Putting Place in Marketplace..............................................................6

Research and Pilots of New Market Mechanisms ........................................................................................................7

Linking Urban and Rural Markets....................................................................................................................................7

Financial Assistance............................................................................................................................................................7

Tax and Subsidy Policy ......................................................................................................................................................7

Economic Development Planning ..................................................................................................................................7

Business and Industry Activity ........................................................................................................................................7

Workforce Development ..................................................................................................................................................7

Local Capacity and Partnerships: Creating Civic DNA......................................................................................................7

Multicultural Relationships ................................................................................................................................................8

Local Capacity ....................................................................................................................................................................8

Partnerships..........................................................................................................................................................................8

Conclusion ..................................................................................................................................................................................8
Chapter 5  International Leadership..........................................................................................................85

Introduction ................................................................................................................................................................................8

Key Findings................................................................................................................................................................................8

International Connections of PCSD Activities ....................................................................................................................8

The Importance of Collaborative Approaches ....................................................................................................................9

International Capital Flows and Sustainable Development ................................................................................................9

A Look at the Proposed Multilateral Agreement on Investment ..............................................................................9

International Capital Flows, Climate Change, and the Clean Development Mechanism ......................................9

Future Opportunities in Integrating Sustainable Development and Investment Issues ........................................9

Appendix A: Endnotes................................................................................................................................100

Appendix B: Environmental Management ..............................................................................................109

Environmental Performance Indicators ..............................................................................................................................10

Next Generation Reports........................................................................................................................................................11

Appendix C: Examples of Sustainable Community Initiatives............................................................118

Examples of Sustainable Community Initiatives ................................................................................................................11

Tailoring the Tools to Advance Strategic Areas of Sustainable Community Development........................................12

Appendix D: International Capital Flows................................................................................................126

Appendix E: Council Member Profiles....................................................................................................136

Appendix F: Staff and Task Force Membership ....................................................................................142

Appendix G: For Further Reading............................................................................................................148

Appendix H: Meetings and Speakers........................................................................................................151

Appendix I: Acknowledgements ..............................................................................................................155
PREFACE

Humanity faces an unprecedented challenge as our numbers grow, while Earth and its capacity to support us do

not. People across the United States and around the world aspire to better lives for themselves and for their

children: food, shelter, a safe and healthy environment, education, jobs, and other material needs and conveniences. Industries strive to produce more goods, farmers to grow more crops; and human demands on forests, fields,

rivers, and oceans increase. Our challenge is to create a future in which prosperity and opportunity increase while life

flourishes and pressures on oceans, earth, and atmosphere  the biosphere  diminish; to create, as the Councils vision

suggests, a life-sustaining Earth that supports a dignified, peaceful, and equitable existence.

It is a powerful vision, and the two of us, brought together as co-chairs of the Presidents Council on Sustainable

Development (PCSD), fervently believe it is achievable  a unifying and necessary goal for the boundless capacity of

human ingenuity so manifest in America. One of us leads a company committed to achieving that goal within its own

operations, the other heads an organization whose purpose is to provide information and ideas to make progress

toward that goal possible for all. And even as we see evidence that damage to natural systems is accelerating, we also

see individuals, companies, and communities finding solutions that work: new products, new technologies, changed

minds and changed approaches that provide improved service, better information, and wider choice with drastically

reduced impact on the environment.

The Council, building on the wisdom of citizens, and business and government leaders, has sought in this report

to articulate the goal of a sustainable America in terms of concrete ideas, examples of success, and proposals for

national policy. From creative ways to eliminate pollution to mortgages that fight sprawl, the Councils report highlight

approaches that work and has built consensus around innovative ideas. As the debate over climate change has heated

up, the Council found agreement on constructive proposals to reduce emissions of greenhouse gases, and provided

knowledge and opportunities for further reductions in the future. We have seen our first report, Sustainable America: A

New Consensus for Prosperity, Opportunity, and a Healthy Environment for the Future, used as the basis for debates about the

future of urban and rural America, and to help build the smart growth movement as people get together to create

more livable communities.

We have seen our members take these ideas back to their own communities. Sam Johnson, chairman of S.C.

Johnson & Son, for example, recognizes the importance of bringing new and diverse faces and opinions to the table,

and giving each voice equal weight and consideration. As he notes, Today, my company is a catalyst for dialogue in

Racine, Wisconsin, our headquarters home, and other communities around the world.

Scott Bernstein, president of the Center for Neighborhood Technology, points out that The Councils policy recommendations are the first to put people, places, and markets together, and they reflect how greatly Americans care

about their communities. By putting the place back into marketplace, these recommendations will bring home the benefits of sustainable development for everyone.

PCSD members have also carried the Councils work to many other countries where the idea of government,

industry, and civil society collaborating on an equal footing to develop vision, goals, and policies for sustainability is

astonishing. We have seen those countries launch efforts of their own, drawing on the U.S. experience, and providing

remarkable and important examples of pluralism within their own societies.

As Deputy Under Secretary of Defense Sherri Goodman notes, the participation of federal agencies in the

Council has sharply changed the nature of the discussion within the federal government. Sustainable Development is

no longer just a concern of the Environmental Protection Agency, but one of Commerce, Transportation, and other

agencies, she says. PCSD has helped me elevate the concept of sustainability here at the Department of Defense.

i
Above all, the Council has demonstrated the will and capacity of leaders from different sectors of

American life to find agreement on issues of importance about our future. As the co-chairs preface to

Sustainable America noted, The politics of mistrust are the greatest obstacle to the process of innovation and

change that we all believe is necessary to achieve the goals we share. We believe consensus will move America

forward both faster and farther than confrontation. Moreover, we believe that consensus is the publics job, not

the governments.

John Adams, president of the Natural Resources Defense Council, speaking to the Councils role as a place

for diverse ideas to flourish and take root, observes that Never before have cabinet officials, heads of major corporations, and environmental and community organizations...joined together to work out the difficult decisions we

face. If we are to have a healthy environment, we must achieve a sustainable world. The PCSD is a strong start.

Aside from its role in developing consensus recommendations on environmental policy, the Council has

become to much of the world a symbol of national commitment to sustainable development, and the social

capital invested in forging the consensus-building process ought to be preserved and kept working for a sustainable America. It is an important process and an important symbol that should be built upon.

After delivering this report to the President, the Council will conclude its work by co-sponsoring the National

Town Meeting for a Sustainable America. The Town Meeting will convene May 2-5, 1999, centered in Detroits

Cobo Conference Center. Over 160 events will lead up to the meeting, and over 50 concurrent events will take

place in American communities. The objective is to draw Americans together around the theme of sustainable

development, to share the wisdom of our best thinkers and the energy of our best doers. As the awareness of sustainable development continues to increase in Americans from all walks of life  and as the Town Meeting contributes to this process  the Council hopes and believes that a consensus will build in the land, as it has over the

last six years in the PCSD itself, that sustainable development is both right and smart for America. That

groundswell among the people will move government and business alike to do the things that will further the wellbeing of our society, sustainably, and set an example for the world.

We want to thank the PCSD staff, and their exceptional leader, Marty Spitzer; the people in communities

across America who made our work possible; and the PCSD members and their staff whose hard work, wisdom,

and dedication made chairing the Council an inspiring experience.

Ray Anderson Jonathan Lash

Chairman and Chief Executive Officer President

Interface, Inc. World Resources Institute
National Goals Towards

Sustainable Development

The Council first published these goals in its 1996 report, Sustainable America. They emerged from our vision

and still express the Councils shared aspirations. They are truly interdependent and flow from our understanding that it is essential to seek economic prosperity, environmental protection, and social equity together. The

achievement of any one goal is not enough to ensure that future generations will have at least the same opportunities to live and prosper that this generation enjoys: all are needed.

GOAL 1: HEALTH AND THE ENVIRONMENT

Ensure that every person enjoys the benefits of clean air, clean water, and a healthy

environment at home, at work, and at play.

GOAL 2: ECONOMIC PROSPERITY

Sustain a healthy U.S. economy that grows sufficiently to create meaningful jobs,

reduce poverty, and provide the opportunity for a high quality of life for all in an

increasingly competitive world.

GOAL 3: EQUITY

Ensure that all Americans are afforded justice and have the opportunity to achieve

economic, environmental, and social well-being.

GOAL 4: CONSERVATION OF NATURE

Use, conserve, protect, and restore natural resources  land, air, water, and biodiversity  in ways that help ensure long-term social, economic, and environmental

benefits for ourselves and future generations.

GOAL 5: STEWARDSHIP

Create a widely held ethic of stewardship that strongly encourages individuals, institutions, and corporations to take full responsibility for the economic, environmental,

and social consequences of their actions.

GOAL 6: SUSTAINABLE COMMUNITIES

Encourage people to work together to create healthy communities where natural and

historic resources are preserved, jobs are available, sprawl is contained, neighborhoods are secure, education is lifelong, transportation and health care are accessible,

and all citizens have opportunities to improve the quality of their lives.

GOAL 7: CIVIC ENGAGEMENT

Create full opportunity for citizens, businesses, and communities to participate in

and influence the natural resource, environmental, and economic decisions that

affect them.

GOAL 8: POPULATION

Move toward stabilization of U.S. population.

GOAL 9: INTERNATIONAL RESPONSIBILITY

Take a leadership role in the development and implementation of global sustainable

development policies, standards of conduct, and trade and foreign policies that further the achievement of sustainability.

GOAL 10: EDUCATION

Ensure that all Americans have equal access to education and lifelong learning

opportunities that will prepare them for meaningful work, a high quality of life, and

an understanding of the concepts involved in sustainable development.

iii
VISION STATEMENT

Our vision is of a life-sustaining Earth. We are committed to the achievement of a 

dignified, peaceful, and equitable existence. A sustainable United States will have a

growing economy that provides equitable opportunities for satisfying livelihoods and

a safe, healthy, high quality of life for current and future generations. Our nation will

protect its environment, its natural resource base, and the functions and viability of

natural systems on which all life depends.

The Presidents Council on Sustainable Development
We b

As Council members, we share certain beliefs that underlie all of our agreements. We first published these

beliefs in our 1996 report, Sustainable America: A New Consensus for Prosperity, Opportunity, and a Healthy

Environment for the Future. They are as valid now as they were then. We believe:

1. To achieve our vision of sustainable development, some things must grow  jobs, productivity,

wages, capital and savings, profits, information, knowledge, and education  and others  pollution, waste, and poverty  must not.

2. Change is inevitable and necessary for the sake of future generations and for ourselves. We can

choose a course for change that will lead to the mutually reinforcing goals of economic growth,

environmental protection, and social equity.

3. Steady progress in reducing disparities in education, opportunity, and environmental risk within

society is essential to economic growth, environmental health, and social justice.

4. The United States made great progress in protecting the environment in the last 25 years, and must

continue to make progress in the next 25 years. We can achieve that goal because market incentives

and the power of consumers can lead to significant improvements in environmental performance at

less cost.

5. Economic growth based on technological innovation, improved efficiency, and expanding global

markets is essential for progress toward greater prosperity, equity, and environmental quality.

6. Environmental regulations have improved and must continue to improve the lives of all Americans.

Basic standards of performance that are clear, fair, and consistently enforced remain necessary to

protect that progress. The current regulatory system should be improved to deliver required results

at lower costs. In addition, the system should provide enhanced flexibility in return for superior

environmental performance.

v
elieve

7. Environmental progress will depend on individual, institutional, and corporate responsibility, commitment, and stewardship.

8. We need a new collaborative decision process that leads to better decisions; more rapid change; and

more sensible use of human, natural, and financial resources in achieving our goals.

9. The nation must strengthen its communities and enhance their role in decisions about environment

equity, natural resources, and economic progress so that the individuals and institutions most imme

diately affected can join with others in the decision process.

10. Economic growth, environmental protection, and social equity are linked. We need to develop integrated policies to achieve these national goals.

11. The United States should have policies and programs that contribute to stabilizing global human

population; this objective is critical if we hope to have the resources needed to ensure a high quality

of life for future generations.

12. Even in the face of scientific uncertainty, society should take reasonable actions to avert risks where

the potential harm to human health or the environment is thought to be serious or irreparable.

13. Steady advances in science and technology are essential to help improve economic efficiency, protect and restore natural systems, and modify consumption patterns.

14. A growing economy and healthy environment are essential to national and global security.

15. A knowledgeable public, the free flow of information, and opportunities for review and redress are

critically important to open, equitable, and effective decisionmaking.

16. Citizens must have access to high-quality and lifelong formal and nonformal education that enables

them to understand the interdependence of economic prosperity, environmental quality, and social

equity  and prepares them to take actions that support all three.
CHAPTER 

INTRODUCTIO
2 CHAPTER 1

INTRODUCTION

The Journey

As the world stands at the threshold of the 21st

century, the Presidents Council on Sustainable

Development is completing its sixth year working

to envision and realize a new American dream. In our

dream of a better future, prosperity, fairness, and a healthy

environment are inseparable threads woven into the fabric

of our everyday life at work, at play, with our families and

communities, and among nations.

We began this journey in June 1993 when President

Clinton asked the Council  a groundbreaking partnership of leaders from industry, government, nonprofit organizations, and Native American groups  to 

recommend a national action strategy for sustainable

development. We began by exploring some of the most

challenging issues of our day, including the rapid social,

economic, environmental, and technological changes all

about us  locally, nationally, and internationally. We

struggled with many difficult and seemingly inconsistent

ideas. We listened to, occasionally argued with, and learned

from one another. We traveled the country and spoke to

Americans from all walks of life, taking inspiration from

the many wonderful people and projects under way across

America. Thousands of people participated in Council

workshops, conferences, task forces, and public meetings.

By early 1996, we reached agreement on a set 

common beliefs and recommendations and delive

them to the President in our first report, Sustaina

America: A New Consensus for Prosperity, Opportunity, an

Healthy Environment for the Future.1 These beliefs and r

ommendations, which remain timely, are a compass fo

more sustainable future. They are also the basis of all 

work since then. The recommendations are compreh

sive, addressing everything from economic and regulat

policy to natural resource management, from strength

ing communities and education to population, consum

tion, and international leadership. Crafted to move 

nation towards sustainability, the recommendations 

directed towards public and private sectors, as well as c

zens.

Upon receiving the report, the President asked u

begin implementing our recommendations. Among 

first actions, the Council supported efforts to replicate 

successful collaborative approach at the local and regio

levels. The Council worked in partnership with the fed

al government to support the efforts of the U

Conference of Mayors and the National Association 

Counties as they created the Joint Center for Sustaina

Communities in 1996. This unique partnership has p

vided a forum for local political leaders to support regi

al and multistakeholder strategies, share success stor

and provide peer-to-peer learning.

In response to our recommendations to cre

regional councils that could address sustainable devel

ment closer to the communities where it needs to 

implemented, several Council members led the creation 

the Pacific Northwest Regional Council. The regio

council took the successful model established by 

Presidents Council and applied it to the challenging iss

facing the U.S. Pacific Northwest. Using our multista

holder approach and goals as a starting point, the regi

al council completed a regional visioning process, imp

mented an awards program to recognize regional lead

in sustainability, and is completing a comprehensive se

policy recommendations for the Pacific Northwest. T

Council also directly spurred the creation of the Bay A

Alliance for Sustainable Development, a regional effor

the San Francisco Bay area led by several Council me

bers, among others. Drawing on local community, b

ness, and government leaders, the Bay Area Allianc

building consensus in a metropolitan area with hundr

of local political jurisdictions and challenging econom

environmental, and social issues.

Upon receiving our initial recommendatio

President Clinton asked Vice President Gore to over

Our vision is of a life-sustaining Earth.

We are committed to the achievement of

a dignified, peaceful, and equitable existence. A sustainable United States will

have a growing economy that provides

equitable opportunities for satisfying

livelihoods and a safe, healthy, high quality

of life for current and future generations.

Our nation will protect its environment,

its natural resource base, and the functions and viability of natural systems on

which all life depends.

 Sustainable America, 1996
CHAPTER 1

INTRODUCTION

implementation of the report within the federal government. Federal Interagency Working Groups on

Sustainable Development, Education for Sustainability,

Material and Energy Flows, and Sustainable Development

Indicators have accomplished a great deal since 1996.

These groups have inventoried domestic federal programs

that support or hinder sustainability, fostered the

Administrations work on livable communities, and produced path-breaking reports that are either now available,

or will soon be available, to the public.2 Additionally, since

1997, the White House Council on Environmental Quality

and the Community Empowerment Board in the Office

of the Vice President have co-chaired the Interagency

Working Group on Sustainable Communities. Starting

with the recommendations from Sustainable America, the

working group laid the policy groundwork for the livable

communities agenda Vice President Gore announced on

January 11, 1999.

In late 1996, we produced a second report, Building

on Consensus: A Progress Report on Sustainable America.

3 In

this report, the Council recommended to President

Clinton that he fully integrate sustainable development

into his second term agenda. We also recommended a set

of specific ideas for moving Sustainable Americas original

policy goals to concrete action.

By early 1997, at the Presidents request, we focused

on forging consensus in four specific policy areas of sustainable development, increased our efforts to promote

implementation, began getting the word out about s

tainable development to larger audiences, and encoura

efforts to evaluate and report on progress. Substantiv

the President asked us to focus on (1) policies to red

greenhouse gas emissions; (2) the next steps in build

the new environmental management system of the 2

century; (3) policies and approaches to build partnersh

to strengthen communities; and (4) policies to foster U

leadership in international sustainable development po

particularly in international capital flows.

Like our earlier reports, this one is the result of 

open, multistakeholder process. We traveled the coun

and worked collaboratively to overcome differences 

opinion and perspective to find common ground. In so

cases, we found common ground in uncommon 

sometimes difficult circumstances. Our work on clim

change was some of our most challenging. As we navig

ed through the often heated public debates surround

the international climate negotiations, we reached ag

ment on critical steps needed to reduce greenhouse 

emissions independent of agreement on internatio

treaties. By listening to each other and working toget

we were able to overcome many of our differences 

other policy areas as well. The mounting evidence that 

Councils efforts and recommendations can lead to 

progress inspired us as we tackled some of the most c

lenging policy issues facing the United States at the da

of the 21st century.

We have also been inspired by the hundreds of 

ative efforts all across America to make sustainable de

opment real in our homes, workplaces, and communi

We document and honor many of these efforts in 

report.

unique roles of the council

The Presidents Council on Sustainable Developm

has served a variety of valuable, interrelated, 

unique roles. In its advisory capacity, the Council 

been the only presidential (or federal advisory) panel char

with recommending to the President policies across a 

spectrum of economic, environmental, and social issues. T

Councils diverse and high-level membership, drawn fr

leadership throughout the public and private sectors, sugg

that our recommendations have broad enough support to 

implemented successfully.

Sustainable Racine is a community-based effort to achieve 

sustainable development in Racine, Wisconsin. Community forums

helped shape the groups vision for a sustainable future. Council

member Sam Johnson helped spur this local initiative. Photo:

Ron Thomas, S.C. Johnson, Inc.
In policymaking, the Council has been a thoughtful

and neutral place for people of different views and backgrounds to come together and listen to and learn from

one another, outside the limelight and glare of the news

story or controversy of the day. For many people, it has

served as an incubator for new and creative policy and

implementation ideas. For others, it has provided a bully

pulpit for advancing issues important to the American

people.

The Council also has served several important symbolic roles. The existence of a presidential advisory commission on sustainable development has demonstrated the

national and international importance of sustainable

development and the U.S. commitment to a more sustainable future. The symbolism has been heightened because

the Council has been comprised of leaders from all sectors of society who stand together in their belief that our

economic, environmental, and social futures are inextricably linked and must be given equal respect.

The Councils symbolic value has empowered thousands of everyday champions for these issues in communities, businesses, and governments. We have heard from

many people over the years who have told us, Your work

legitimizes my work. We have heard people describe how

our report, Sustainable America, personally inspired the

or gave them credibility to continue innovative proje

for which they did not yet have widespread support.

At a time when society is tiring of adversarial stra

gies for solving our most pressing problems, the Coun

has demonstrated that collaborative strategies can wo

We believe that collaboration is a cornerstone for a s

tainable future and that the Council stands as a pub

symbol of its possibilities.

Internationally, the Council has been the focal po

for carrying forward U.S. commitments made at the Ea

Summit in Brazil in 1992. We have been held out a

model for many other countries national sustaina

development councils, and many nations have drawn fr

our experiences in creating their own councils. Against 

other national councils formed exclusively from the g

ernment sector, the business sector, or both, we stand 

contrast as a model of inclusiveness and democra

ideals. The Councils most visible product, Sustaina

America, has been translated into several languages.

The Councils symbolic value has also been symbio

Our work has been inspired and legitimized by the v

people who say we have supported them. We are grate

for the opportunity to serve in this capacity and to m

and learn from so many inspiring people. Though intan

ble, symbolic leadership will continue to be fundamen

for the United States to become more sustainable.

The Council has also had tremendous conven

power, and we have received an outpouring of offers fr

people all across the country to participate in our work

our six years, we have been sought after by hundreds 

organizations that wanted to serve on our task forces 

co-sponsor events, meetings, and initiatives. Clearly, aff

ation with a White House advisory council was a moti

tion for many. Just as important, we believe, was 

Councils reputation for operating collaboratively a

inclusively, with respect for the diverse ideas and intere

represented throughout America.

During its latter years, the Councils convening r

has shifted somewhat. Where we once focused exclusi

ly on generating policy ideas, we now advise also 

spurring implementation and demonstrating the succ

of policy ideas previously recommended. We have mov

in this direction in part because our charter requested t

of us, but also because it is clearly time to move ideas in

action.

4 CHAPTER 1

INTRODUCTION

Efforts of Five Es Unlimited to achieve sustainable community

development celebrate diversity and focus on our childrens 

children as the reasons to exist and act. 

Photo: R. Warren Flint, Five Es Unlimited, Pungoteague, Virginia.
Finally, the Council has served as a clearinghouse for

people looking for or wanting to disseminate information

and ideas on sustainable development. Through reports,

our Website,4 speaking engagements, responses to citizen

requests, and the National Town Meeting for a Sustainable

America, we have served as a hub for information. We

have spent as much time referring inquiries to other

experts, sources of information, and the like, as we do

directly providing information.

ORGANIZATION OF THIS

REPORT AND KEY 

FINDINGS

Each chapter of this report corresponds to one of

the substantive policy areas the President asked us

to consider. The introduction establishes the context and illuminates some of the cross-cutting lessons,

findings, and recommendations that inform much of our

work and may also assist the thousands of people working

on sustainability around the country.

We approached each policy area differently. For our

work on environmental management and metropolitan

and rural strategies, the Council had a foundation of previous work. Previous task forces had explored these subjects in some detail; thus the Council sought to build on

this wealth of previous work and advance critical issues.

For climate change and international leadership, particularly international capital flows, this report is the first time

we have directly addressed these issues in detail. The

depth and nature of the recommendations we offer consequently vary for each subject. The appendices supplement the text with additional detail, examples, and explanation of the people, meetings, and events the Council

convened to prepare this report.

CLIMATE CHANGE (CHAPTER

2 )

We agreed on a set of principles to guide overall U.S. climate policy. With an accord on principles, we (1) concluded that climate protection policies should be fundamentally linked to any national agenda for economic growth,

environmental protection, and social justice; (2) developed

principles for an incentive-based program and voluntary

early action to reduce greenhouse gas emissions; (3)

agreed on policies to spur the rapid development a

deployment of climate-friendly technologies in the n

10 to 15 years; and (4) recommended many climate p

tection strategies that offer multiple benefits by help

solve other social, economic, and environmental pro

lems, creating global opportunities, and meeting the ne

of current and future generations.

ENVIRONMENTAL

MANAGEMENT (CHAPTER 3)

Our work on environmental management builds on the e

lier efforts of the Council5 and others to make the exist

system more effective, flexible, and accountable. We rec

nize that we are reaping some benefits and learning a gr

deal from existing reform efforts, but that most of th

reforms are not designed to promote sustainable develo

ment. This report begins to answer the question, W

would environmental management look like if we 

address sustainable development? We identify the attrib

es of an environmental management framework design

for sustainable development and recommend the crit

steps that can move the existing environmental mana

ment framework towards one that is more sustainable.

We concluded that moving the environmental m

agement system into the 21st century requires a broa

understanding of the nature, source, and linkage of en

ronmental problems and a recasting of potential solutio

The system must be goal-, performance-, and inform

tion-driven; be attuned to natural ecological cycles; inc

porate the values of community and place; and be sen

tive to variations in the business sector and changes in 

economy. Moreover, it must continue to refine traditio

tools of environmental management, while encourag

the development of new tools and collaborative strateg

METROPOLITAN AND RURAL

STRATEGIES FOR

SUSTAINABLE COMMUNITIE

(CHAPTER 4)

Sustainable and livable community concepts have beco

mainstream, and communities all across the country 

implementing innovative initiatives and projects. Howev

many existing efforts face technical, financial, and insti

tional obstacles; and it is difficult to nurture new ideas a

pilot programs so they gain wider acceptance and use. 

addressed a fundamental question: What will it take to h

sustainable and livable community initiatives get over 

hump from inspiration to implementation? In our vi

the principles needed for greater success have not 

CHAPTER 1

INTRODUCTION
become the way Americas communities do business and

need to be applied more widely. We also agree that concerted and coordinated investment in five community development areas  green infrastructure, land use and development, community revitalization and reinvestment, rural

enterprise and community development, and materials reuse

and resource efficiency  could make a substantial difference.

Finally, we agreed that three types of tools are critical

to overcoming major implementation obstacles: information and technical assistance, economic incentives and

financial assistance, and local capacity and partnerships.

This report recommends specific actions that will make

these tools more widely available and increase their use.

INTERNATIONAL (CHAPTER

5 )

In our earlier work, we identified key international sustainable development issues and the importance of leadership for the United States. In our current effort, we examined  among other things  how international private

capital flows affect sustainable development, particularly

investments in developing countries. We also reached out to

other national councils on sustainable development with the

goal of strengthening this important international network.

We concluded that (1) the United States must use its

leadership role to help chart a path towards sustainable

development both at home and abroad; (2) champions from

all sectors are required for change to occur; (3) multilateral

agreements should recognize and address economic, environmental, and equity considerations together; (4) foreign

investment, assistance, and all government activities should

be progressively and consistently conducted in ways that

promote recipient countries efforts to achieve sustainable

development; and (5) the Council, or a similar body, should

continue as a forum for thoughtful consideration of sustainable development issues by high-level leaders in all sectors.

USE OF THIS REPORT AND

RELATIONSHIP 

TO EARLIER WORK

We hope this report help lights the path to a m

sustainable America, and continues to move 

from idea to action. It is based on the prem

that sustainability requires persistence in its pursuit. T

report therefore recommends actions that can move 

immediately in a more sustainable direction and provi

concrete examples of successes and innovations in all sect

of society. We hope this report inspires and guides the effo

of countless people and organizations as they take st

towards a better future. Much of what we recommend 

and should begin immediately, will take years to put in pla

and must involve the work of innumerable people and or

nizations.

As the President requested in our most recent ch

ter, we addressed a narrower set of issues in this rep

than we did in Sustainable America (1996). Where t

report probes topics previously addressed in Sustaina

America (such as environmental management reform a

sustainable communities), it complements that work 

incorporating recent experiences and making more spe

ic recommendations. In Sustainable America, the Coun

spoke to other important sustainable development iss

and subjects including:

 National goals for sustainable development,

 Definition of sustainable development,

 Information and education,

 Natural resource stewardship,

 U.S. population and sustainability (including consumption), and

 International leadership (more generally).

We remain committed to our original recommen

tions, and refer interested readers to this report for 

Councils views on these topics. The report may be fou

electronically on our Website.

CROSS-CUTTING LESSONS

Each chapter of this report is designed to stand on 

own. Nevertheless, we found several compelli

cross-cutting ideas. Many of these conce

emerged initially in Sustainable America. The fact that th

recrystallized during our current effort is significant. 

demonstrates that these ideas form the building blocks fo

6 CHAPTER 1

INTRODUCTION
sustainable future.

The Councils recent experience reaffirms our view that

collaboration, stewardship, and individual responsibility are

cornerstones of the path to a more sustainable America. By

bringing diverse interests together, we can build the durable

coalitions of common beliefs and values needed for a better

future. By following the intuitive and essentially moral commitment Americans have to preserving Earths beauty and

productivity for future generations,6 we can create a stewardship ethic as our guide. If we make choices on the basis

of a broader, longer view of self-interest. . . get involved in

turning those choices into action; and. . . be held accountable for [our] actions,7 we can foster individual responsibility. By working together, we can achieve economic growth,

environmental protection, and social justice for ourselves

and our children.

In all of our work, we saw connections between the

specific policy issues we were asked to study. We learned, for

example, that community development decisions affect

greenhouse gas emissions, just as reducing greenhouse gas

emissions affects community development. Similarly, we

learned that an environmental management system designed

to create incentives for sustainable development would also

provide incentives for reducing greenhouse gas emissions

and increasing community reinvestment. A more sustainable

future requires all of us, as individuals and institutions, to

look for these types of connections wherever we can,

because they are the foundation of new coalitions of interests that can lead to meaningful progress.

We also see a convergence of problem-solving strategies. Every chapter of the report demonstrates the importance of the linkages between community, environmen

and economic problems and the need to find integra

solutions to these connected problems. We see 

approaches designed to solve one problem at a time giv

way to new policies designed to solve several problems at 

same time. Each chapter recognizes that community, e

nomic, health, and technology-based strategies are needed 

create the synergies required for success.

One measure of success for the future, we believe

the extent to which we find, test, and implement more 

these integrated, cross-cutting strategies. Pursuit of th

opportunities is one of the most exciting and promising o

comes of our work.

Capacity building is a fundamental cross-cutting c

cept and an important step towards sustainable devel

ment. Many great ideas languish too long before becom

mainstream simply because people and institutions do 

yet have the capacity to carry out these innovatio

Improved capacity is a critical first step.

Information is critical to every area of sustaina

development. Information helps us understand basel

conditions in the economy, the environment, and citiz

health and welfare. We can chart a more direct course t

sustainable future if we agree where we have been, where 

want to go, and what metrics could tell us whether we 

there. The use and collection of information is importan

each policy area we explored.

Partnership is another central theme. We can acco

plish much more working together than we can acting alo

We need to build on existing collaborations to create form

and informal partnerships that can be institutionalized a

productive over time.

Finally, making markets work for sustainability is cr

cal. Innovative programs to address community, envir

mental, and social challenges explicitly harness the pow

and incentives of financial markets. For example, in en

ronmental management reform, better accounting syste

that incorporate the environmental benefits and costs 

business decisions are a growing phenomenon. Equ

exciting are businesses learning how to explain their en

ronmental strategies in the financial terms that Wall Str

can understand and reward. Both examples show how 

can find more ways of doing well by doing goo

Location efficiency, an idea explained more fully in chap

4, captures the unrealized economic advantages of liv

close to mass transit, ones workplace, or local ameni

such as shopping. Institutions are being created to h

CHAPTER 1

INTRODUCTION

Photo: Center of Excellence for Sustainable Development.
businesses and citizens realize the economic value of saving

energy. In our view, we have just begun to tap the opportunities of using markets to drive sustainable development.

Recent efforts at building community-based decisionmaking capacity suggest that dramatic progress is eminent.

The Metropolitan Initiative, a partnership of the Center for

Neighborhood Technology and leading philanthropic organizations growing directly out of the Councils work in 1997,

sponsored 12 forums8 in major metropolitan areas among

community leaders to foster regional strategies and more

productive relationships between metropolitan areas and the

federal government. The National Association of Regional

Councils, an association of community-based regional decision-making organizations, recently began a long-term initiative to promote regional cooperation. The National

Academy of Public Administration has begun its own effort

to advance better regional decisions. The Council fully

expects this momentum to continue to build in the future.

As we finish our work developing policy recommendations, we are heartened by the belief that sustainable development is alive and well in America. We present this report

to the President knowing that the challenges to improve our

quality of life are as great as ever. But as we said three years

ago, We view this challenge with considerable optimism. . .

But optimism is not complacency. Vigilance and perseverance will be needed if we are to meet these local, nation

and global challenges.

8 CHAPTER 1

INTRODUCTION

Pomegranate Center, through their Community Gathering Places

program, spearheads projects to reinvest communities in their physical

places. The Salishan Gathering Place was designed and built with the

input and labor of over 200 volunteers of all ages from a culturally

diverse community representing the languages of 23 nations and their

respective customs and aesthetic sensibilities. The shelters posts are

inlaid with recycled copper, and the gathering circle is made from

materials reclaimed from historic Tacoma, Washington. 

Photo: Pomegranate Center for Community Innovation, Issaquah, Washington.
CHAPTER 

CLIMATE CHANG
10 CHAPTER 2

CLIMATE CHANGE

NEXT STEPS

I

nitiatives in many sectors suggest that dramatic

progress on sustainable development is now possible.

One example is the National Town Meeting for a

Sustainable America in Detroit, Michigan, and points

across America on May 2-5, 1999, sponsored by the

Council and its partners.9 This event and others like it will

have used the ideas in this report and those from tens of

thousands of Americans who are joining together with us

to demonstrate the building blocks to make America a

more sustainable, livable place. We believe that the principle of sustainable development is clearly taking hold in the

United States, judging from the success of these recent

events. Our hope is for people all across America to use

this momentum to advance important issues in their own

communities.

In June 1999, the month after the National Town

Meeting, the Councils charter from the President will

have expired. For six years, the Council has worked to

build the foundation for a more sustainable future and

served a variety of valuable, interrelated, and unique roles

 as a unique presidential blue ribbon panel addressing

economic, environmental and social issues, as a representation of the U.S. commitment to sustainable development, and as a symbol of the international importance of

sustainable development. For these reasons, we recommend to the President that he:

 Continue to promote sustainable development 

part of his policy agenda.

 Continue to support integration of sustainable dev

opment into federal programs.

 Support the continuation of a sustainable develo

ment council or another body as a forum 

thoughtful consideration of sustainable developm

issues by high-level leaders in all sectors. Whate

organization is created to carry forward this imp

tant work should have adequate public and priv

support and resources to perform its duties.

Advise the President on domestic implementation of policy options to reduce

greenhouse gas emissions. The Council

should not debate the science of global

warming, but should instead focus on the

implementation of national and local

greenhouse gas reduction policies and

activities, and adaptations in the U.S.

economy and society that maximize societal benefits, minimize economic impacts,

and are consistent with U.S. international

agreements.

 PCSD Charter, April 1997

The risk of accelerated climate change in

the next century has emerged as one of

the most important issues we will face as

we seek to achieve our sustainable development goals.
CHAPTER 2

CLIMATE CHANGE

INTRODUCTION

The United States cannot ignore the risk of climate

change in the next century as it seeks to achieve

sustainable development. Although the challenges

of taking action are significant, failure to act could mean

that we miss opportunities to improve our quality of life.

We can benefit from protecting the climate as we strive to

achieve economic growth, environmental protection, and

social justice for ourselves without compromising the ability of future generations to meet their own needs.

In its work on climate change, the Council benefited

from the wealth of available scientific research, technical

and economic studies, and policy analysis that is available.

Rather than focus on the entire range of issues that

emerge when considering climate change, the Council

KEY FINDINGS - CLIMATE CHANGE

 Climate protection policy should be fundamentally linked to any national agenda for economic growth, environmental

protection, and social justice. If we are to achieve all of these goals together, climate change must be drawn onto the

roadmap for the achievement of our other national aspirations.

 We urge timely action to reduce the risks of climate change. Incentives for early action, international agreements,

accountability, flexibility, broad-based measures to encourage technology, and fairness are essential in any climate mitiga

tion strategy.

 Many actions that protect the climate have multiple benefits. Actions to protect the climate can help solve other social,

economic, and environmental issues; benefit society; create global opportunities; and meet the needs of current and

future generations.

 An incentive-based program is essential in catalyzing voluntary early action to reduce overall greenhouse gas emissions.

The program should include broadly based participation; encourage learning, innovation, flexibility, and experimentation

grant formal credit and other incentives for legitimate and verifiable measures to protect the climate; ensure accountabil

ty; be compatible with other climate protection strategies and environmental goals; and be inspired by government lead

ship.

 Climate-friendly technology will play a critical role as we strive to achieve reduced greenhouse gas emissions as well as o

other sustainable development goals. Rapid deployment of existing technologies and continued investment in research

and development are essential elements of any strategy that aims to help the United States and the rest of the world

reduce greenhouse gas emissions and protect the climate. Because greenhouse gases are released from sources both sma

and large, stationary and mobile, throughout the economy, a broad and diverse policy portfolio to develop and disseminate climate-friendly technologies rapidly is critical.

 Consensus building, outreach, and inclusive approaches are essential components of sustainable climate action.

Climate includes averages and extremes

of rainfall, snowfall, temperature, winds

and storms, and ocean currents. Climate

is not just the magnitude or number of

events we experience, but when they happen as well. The productivity of farms,

fisheries, and forests; the livability of our

cities in summer and winter; the distributions and abundance of species; and the

geography of disease all depend on climate.
12 CHAPTER 2

CLIMATE CHANGE

focused on policies and actions that could reduce overall

greenhouse gas emissions in ways that maximize societal

benefits, minimize economic impacts, and are consistent

with U.S. international agreements. The Council reached

agreement on a set of principles for climate policy and

focused on developing consensus recommendations in

three key areas:

 An incentive-based and voluntary early action program to reduce greenhouse gas emissions,

 Policies to encourage the rapid development and

deployment of climate-friendly technologies in the

next 10 to 15 years, and

 Strategies to realize the broader benefits and global

opportunities of climate change mitigation strategies.

The set of actions recommended in this chapter comprises nonproscriptive guidance about ways everyone 

small and large businesses, nongovernmental organizations,

individuals, communities, and local, state, and federal governments  can reduce the risk of climate change while

helping the United States achieve sustainable development.

PRINCIPLES FOR CLIMATE

PROTECTION STRATEGIES

To understand how climate change might affect u

the next century, the Council began with an exa

nation of what is known and what is still uncert

about the nature and consequences of change in the glo

climate. The Council also sought to understand the e

nomics of the climate issue; the technological challen

and opportunities; and the links between the global, nati

al, and local actions needed to begin to address the pr

lem.

The Council integrated these lessons into a set of 

mate principles that served as the basis for its deliberatio

on an incentive-based program to achieve voluntary and ea

reductions of greenhouse gas emissions, climate-frien

technologies, and the broader benefits and global opportu

ties of climate change mitigation strategies. In this effort, 

the merits of individual scientific studies were not weigh

nor were the overall costs and benefits of climate protect

policies estimated. Rather, the Council acknowledged 

risks of climate change and focused on developing reco

mendations that could reduce greenhouse gas emissions 

ways that are consistent with national aspirations for e

nomic growth, social justice, and environmental protectio

Figure 1. Global carbon dioxide concentration has increased over time. 

Source: World Resources Institute.
CHAPTER 2

CLIMATE CHANGE

GROWING CONCERNS

THAT GREENHOUSE GAS 

EMISSIONS COULD 

IMPEDE PROGRESS

TOWARDS A SUSTAINABLE FUTURE

The possibility of change in the climate system is a

concern because many aspects of human society rely on

a stable climate. Most human infrastructure and institutions  where to build, where to live, what to leave

untouched  assume that past patterns of temperature,

precipitation, storm frequency and severity, and sea level

are a reasonable surrogate for the future.

After decades of research, an increasing amount of

evidence suggests that human emissions of heat-trapping

greenhouse gases, including carbon dioxide, methane, and

nitrous oxide, may be altering the natural rhythm of

climate variability.1 Atmospheric concentrations of these

gases have increased over the last century in near lock-step

with industrialization and rapid population growth. Figure

1 shows the trend for carbon dioxide; trends for the other

trace gases are similar. Every year, more greenhouse gases

are released into the atmosphere through the combustion

of fossil fuels, land use changes, deforestation, and other

activities than can be absorbed or destroyed by natural

processes.

Many greenhouse gases stay in the atmosphere for

decades to centuries.2 Because of the gases long atmospheric lifetime, both their concentrations and the rate at

which those concentrations increase are important factors

in determining the risk of climate change: the effects of

todays emissions on climate literally could be felt for generations to come.

Computer models used by the Intergovernmen

Panel on Climate Change in its 1995 assessment rep

predict an average global warming of 1o to 3.5oC (1.8o 

6.5oF) by the year 2100 if emissions of greenhouse ga

go unabated.3 The panel predicts that higher average te

peratures and resulting changes in precipitation patter

sea level, and ecosystems may have significant con

quences. The local effects of this global phenomen

remain uncertain because of limitations in the mod

Based on the body of emerging science on the regio

impacts of climate change, beneficial and damag

effects could vary by region, and some sectors will g

new advantages and others be adversely affected.4 In ad

tion, the possibility of surprises  unanticipated, rap

and nonlinear changes in the climate system that co

have significant impacts  cannot be ruled out given c

rent scientific understanding.5

The potential for climate change in the next century 

a result of human activity poses particular challenges to 

ability to achieve sustainable development. To address t

growing concern, nations of the world have set in mot

ambitious plans to protect the climate. Led by th

President George Bush, the United States joined over 1

other countries in signing the UN Framework Convent

on Climate Change, negotiated at the 1992 Earth Summi

Rio de Janeiro. The objective of the convention is to:

achieve. . . stabilization of greenhouse gas conc

trations in the atmosphere at a level that would p

vent dangerous anthropogenic interference with 

climate system. Such a level should be achieved wi

in a time frame sufficient to allow ecosystems 

adapt naturally to climate change, to ensure that fo

Figure 2. Total World Emissions Increase Over Time. In 1995, 

6.46 billion tons CO2 released; by 2035, project 11.71 billion tons.

Source: Office of Science and Technology Policy.

1995 2035
14 CHAPTER 2

CLIMATE CHANGE

production is not threatened, and to enable economic development to proceed in a sustainable manner.6

As a first step, both developed and developing

nations pledged to take steps to protect the climate on

the basis of equity and in accordance with their common

but differentiated responsibilities and respective capabilities.7 Industrialized nations also voluntarily aimed to

return their level of greenhouse gas emissions in the year

2000 to the level released in 1990.8 The United States was

one of the first nations to ratify the convention.

Recent international agreements seek to build on existing commitments to achieve the conventions objective. T

1997 Kyoto Protocol commits all nations to continue effo

to protect the climate. If the protocol enters into force a

becomes a binding agreement among nations, industrializ

nations would be required to reduce overall aggregate em

sions of six greenhouse gases9 by at least 5 percent bel

1990 levels in the 2008-12 time period; the U.S. obligat

would be set at 7 percent below 1990 levels.10 Develop

countries would not be obligated to reduce greenhouse 

emissions by a specified amount. Programs such as em

sions trading, joint implementation, and the Cle

Development Mechanism (CDM) are intended to prov

flexibility to achieve these reductions both at home a

abroad.11 To date, 84 nations, including the United Sta

have signed the protocol, and seven nations have ratified 

none of which is a large emitter of greenhouse gases.12

LEADERSHIP BY 

PRINCIPLES FOR CLIMATE POLICY

1. The Need for Action.

The risk of climate change caused by human actions and the potential for serious impacts to nature and human wellbeing is of sufficient concern that timely and effective actions should be taken to reduce those risks.

2. Incentives for Early Action.

Greenhouse gases have atmospheric lifetimes ranging from decades to over a century, and both the concentration and

the rate of increase of these gases in the atmosphere are important factors in determining the risk of climate change.

Therefore, policies to reduce emissions of greenhouse gases and other measures to protect the climate should include

incentives for early action.

3. Clear Commitments, Predictable Results, and Flexible Implementation.

Global climate change policies should be based on national commitments and accountability to produce predictable

results and should allow emissions sources to select their own strategies. U.S. policies to address climate change should

be based on the integration of environmental, economic, and social goals.

4. Development and Dissemination of Improved Technologies.

To protect the climate cost effectively, technology breakthroughs, technology incentives, and the elimination of barri

ers for the deployment of existing technologies are needed. Broad-based cooperative programs to stimulate markets

and develop and disseminate new and existing technology to industrialized and developing countries must be a high

priority.

5. Fairness.

Climate change is a global issue and requires a global response. The U.S. response should include policies that maintain

and foster the competitiveness of U.S. business; stimulate opportunities for all; and avoid approaches that place an

unreasonable burden on lower income individuals, particular sectors, or future generations.

The Presidents Council on Sustainable Development Climate Change Task Force agreed to these principles and reported them to the President in November 1997.

Sustainable development provides a constructive framework for considering climate change.
CHAPTER 2

CLIMATE CHANGE

INDUSTRIALIZED

NATIONS 

IS NECESSARY

The United States contributes about 22 percent of global

annual greenhouse gas emissions, with a per capita emissions rate higher than that of any other industrialized country.13 In the future, emissions from the developing world

will increase rapidly as their economies grow; atmospheric

concentrations of greenhouse gases will rise as a result

Without change, emissions from developing nations will

surpass those from industrial nations (figure 2).14

Although the United States is currently the worlds

largest emitter, it cannot solve the potential problems

associated with climate change alone. Even if all industrialized nations reduced their greenhouse gas emissions,

atmospheric concentrations would continue to rise as a

result of increasing emissions from the developing world.

But it is also clear that industrialized nations must show

leadership to demonstrate the feasibility and benefits of a

different development path.

SUSTAINABLE 

DEVELOPMENT AFFORDS 

A CONSTRUCTIVE 

FRAMEWORK

Although the predicted impacts of climate change might

not appear for decades, reducing greenhouse gas emissions

means we would have to change many of the ways we produce electricity, get to work, build our homes, and ma

facture products. These changes would pose many ch

lenges and opportunities. Some argue that we should w

for more scientific certainty before acting because the co

of retooling the world economy are significant. Oth

argue that we have already waited too long to avoid so

costly impacts of a warming world and that climate prot

tion will yield economic as well as environmental benefi

Sustainable development provides a construct

framework for considering climate change. Both 

potential impacts of a changing climate and strategies 

reduce greenhouse gas emissions will unfold over ma

decades. Consequently, policy choices made over the n

10 to 15 years will have a lasting impact on future gene

tions. In addition, the amount of energy used to creat

good or service and the amount of greenhouse ga

emitted as a result are fundamental measures of o

progress towards sustainable development. Cost-effect

approaches that increase energy efficiency and red

greenhouse gas emissions could help reduce energy costs 

consumers, result in fewer environmental impacts fr

pollution and waste, increase international competitiven

and create new economic opportunities in many indust

sectors.

Figure 3. Projected U.S. CO2 emissions from fossil fuel 

combustion without change in energy use patterns.

The new U.S. courthouse in Denver, Colorado, will incorporate

sustainable design principles. In addition to photovoltaic cells on

the roof, the structure is designed to maximize natural light to

reduce or in some cases eliminate the need for lighting during day

light hours. 

Sketch: Anderson Mason Dale and Hellmuth, Obata & Kassabaum, Inc.,

courtesy of U.S. Government General Services Administration-Denver

Regional Center.
16 CHAPTER 2

CLIMATE CHANGE

To guide its deliberations, the Council developed a set

of climate principles that recognize that policies to protect

the climate could help achieve sustainable development

goals. These principles served as a framework for the

Councils policy recommendations to reduce greenhouse

gas emissions in ways that are consistent with national aspirations for economic growth, social justice, and environmental protection for current and future generations.

SOONER IS BETTER: INCENTIVES FOR EARLY ACTION

Atmospheric concentrations of greenhouse ga

increased rapidly over the last century (figure 

because our emissions of these gases overwhelm

the ability of natural systems to absorb or destroy them. 

noted earlier, the United States in 1993 pledged to return 

level of greenhouse gas emissions in the year 2000 to 

level released in 1990.15 Despite an ambitious program 

voluntary action,16 the United States will not meet this go

If the country does not change its patterns of energy c

sumption, U.S. greenhouse gas emissions could be m

than 30 percent above 1990 levels by 2010, and more th

45 percent above the benchmark by 2020 (figure 3

Withou

additional and timely action to reduce greenhouse gas em

sions, the nation might have to make abrupt changes in 

patterns of energy use sometime in the future. In additi

opportunities to save money, create jobs, and improve 

quality of life could be missed by failing to act early.

Slowing the buildup of greenhouse gases in 

atmosphere is an essential first step in restraining some 

the potential impacts of rapid climate change and can h

the United States meet any future limit on greenhouse em

sions cost effectively. Incentives for early action co

encourage the development of new and innovative ways 

reduce, avoid, or sequester emissions at the same time 

benefits of using energy in smarter ways are realized.

Bluffsview Elementary School in Worthington, Ohio, is the first

school to participate in the Solar School Project, an initiative of

American Electric Power, the Foundation for Environmental

Education, BP Solar, and other partners. Everyone worked together

to put the 30 panels on the steel support structures and wire them

together. Students can use the Internet to monitor electricity generation from the array and the schools energy consumption.

Photo: American Electric Power.

Without incentives, some businesses and

communities are concerned that if they

take voluntary steps to protect the climate today, they could be penalized by

having to achieve the same level of emissions reductions in the future as those

that did not act. As a result, opportunitie

to make cost-effective emissions reductions may be missed, and achieving goals

could become an even greater challenge.

Greenhouse gases have atmospheric lifetimes ranging from decades to over a century, and both the concentration and the

rate of increase of these gases in the

atmosphere are important factors in

determining the risk of climate change.

Therefore, policies to reduce emissions of

greenhouse gases and other measures to

protect the climate should include incentives for early action.
CHAPTER 2

CLIMATE CHANGE

BENEFITS OF EARLY

ACTION

The greater the buildup of greenhouse gases in the atmosphere and the faster the rate of climate change, the less

time ecological and socioeconomic systems will have to

adapt. Early action could help avoid some of these prob

lems by slowing the buildup. By reducing these emission

early action could provide opportunities to improve the

livability of homes and communities, and increase the p

ductivity and efficiency of businesses and governments.

Leveraging existing networks and partnerships at 

community level could encourage everyone to learn ab

AN INCENTIVE-BASED EARLY ACTION PROGRAM

1. Appropriate Incentives for Early Action to Protect the Climate. An early action strategy should aim to reduce greenhouse gas emissions. Any program should ensure that those that take or have taken voluntary steps to protect the climate are rewarded and not inadvertently penalized for their efforts. Market-based incentives, fiscal policies, federal funding, procurement policies, regulations, and public recognition should be combined into a coherent effort that effectively

stimulates early action.

2. Broadly Based Participation. Incentives for early action should encourage activities that protect the climate with the

broadest possible level of participation by businesses, communities, government agencies, academia, nongovernmental

organizations, and individuals. These incentives should facilitate the formation of partnerships and the leveraging of

resources among participants.

3. Learning, Innovation, Flexibility, and Experimentation. The program should accommodate economic growth while contributing to the achievement of significant emissions reductions by encouraging flexibility, innovation, and experimentation to facilitate learning about cost-effective ways to protect the climate. Policy should allow a broad menu of options

that can also result in environmental and societal benefits for all segments of the population.

4. Formal Credit for Greenhouse Gas Emissions Reduction Efforts. As part of the overall early action strategy, formal

credit should be granted to early actors for legitimate and verifiable measures that reduce overall greenhouse gas emissions relative to defined benchmarks. Those undertaking these efforts should receive assurances that earned credits can

be applied towards future reduction obligations. The program ultimately needs to be codified to provide certainty to

these actors. Formal credit for domestic actions s\hould be issued with the understanding that these credits are allocated

from any future limit on U.S. emissions.

5. Accountability for Emissions. Dependable measurement techniques and credible reporting methods should be used to

account for claimed emissions reductions. Policies to grant formal credit should aim to keep transaction costs and risks

low while ensuring the integrity of awarded credits.

6. Compatibility With Other Climate Protection Strategies and Environmental Goals. The design of an early action program should be compatible with other domestic or international strategies to protect the climate and with other environ

mental goals.

7. Government Leadership. Governments should demonstrate leadership in an early action program by achieving significant greenhouse gas emissions reductions from their activities relative to their defined benchmarks.

The Presidents Council on Sustainable Development Climate Change Task Force reached agreement on these principles and reported them to the President in October 1998.
18 CHAPTER 2

CLIMATE CHANGE

and participate in innovative and flexible ways to protect

the climate. For example, expanded home weatherization

and energy-efficiency programs could help people use less

energy to light, heat, and cool their homes. In some cases,

upgraded lighting in residential buildings could reduce

energy consumption by 53 percent compared to older systems.18 Not only would residents of energy-efficient

homes save money on their energy bills and reduce air

pollution, but they would also reduce greenhouse gas

emissions.

Increased demand for climate-friendly technologies

would boost job creation in this industrial sector and help

the United States compete internationally in a rapidly

growing global market for environmental protection.19 But

transforming ideas and plans into reality takes time and

money, and lead times are quickly evaporating if new technologies are to be deployed on a large scale in the next 10

to 15 years. By starting now, businesses can integrate climate concerns into their long-term business plans. As

some financial institutions are already beginning to

reassess and project the value of energy efficiency, renewable energy, technology, and environmental management

in future markets, some businesses may gain a competitive

advantage by acting early.20

INCENTIVES CAN 

CATALYZE EARLY

ACTION

Some businesses and communities are concerned tha

they take voluntary steps to protect the climate today, th

could be penalized by having to achieve the same level 

emissions reductions in the future as those that did not 

now. As a result of this uncertainty, opportunities 

reduce emissions cost effectively may be missed  a

meeting any emissions reductions goal could become 

even greater challenge.

Incentives to reduce, avoid, or sequester emissio

could help resolve this concern. One option would be 

award credits to those that produce legitimate and verifia

emissions reductions below a certain level. Credits for ea

action would be allocated from any future limit on U.S. em

sions, so that the United States would never exceed wha

would be allowed to emit. Other incentives could spur ea

action more broadly, such as tax credits or grants for te

nology research, development, and deployment; tax defe

or deductions for early action initiatives; changes in gove

ment funding, procurement policies, and regulations; a

public recognition of those entities that undertake ea

action.

PRINCIPLES 

FOR EARLY ACTION

The Council recommends an incentive-based early act

program that includes broad participation; encoura

learning, innovation, flexibility, and experimentati

grants formal credit for legitimate and verifiable measu

to protect the climate; ensures accountability; is comp

ble with other climate protection strategies and enviro

To protect the climate cost effectively,

technology breakthroughs, technology

incentives, and the elimination of barrier

for the deployment of existing technologies are needed. Broad-based cooperative

programs to stimulate markets and develop and disseminate new and existing

technology to industrialized and developing countries must be a high priority.
CHAPTER 2

CLIMATE CHANGE

mental goals; and is inspired by government leadership. A

systematic approach to broadly stimulate early action

could facilitate voluntary efforts by businesses, governments, and consumers to protect the climate before any

domestic or international binding requirements are in

place. Although the award of formal credit has taken center stage in recent policy discussions,21 other incentives can

also help catalyze broad participation.

An early action strategy must respond over time to

advances in scientific knowledge and technology.

Improved understanding of the climate system and accurate accounting of the sources and sinks of the various

greenhouse gases can help inform how to target appropriate incentives to protect the climate. As we deploy existing

technologies more rapidly and develop more technologies,

new cost-effective early action strategies may emerge.

The benefits of early action justify the program on its

own merits because it could improve economic performance and reduce local environmental pollution as well as

greenhouse gas emissions. However, the Council recognizes that discussion of the value of an early action program has also become tied to the debate over the Kyoto

Protocol. These principles do not presume a decision as to

whether the United States should become a party to 

protocol, but they do allow for the possibility that 

United States could agree to limit its greenhouse gas em

sions in the future. An early action program that gra

credits against any future limit on emissions could fac

tate achievement of any binding agreement because 

would create a powerful incentive for many emitters to 

on a gradual glide path for emissions reductions.

TECHNOLOGY MATTERS

Climate-friendly technologies  those technolog

that reduce, avoid, or sequester emissions of gre

house gases  will play a critical role as we str

to protect the climate while the U.S. economy and glo

marketplace grow. Rapid deployment of existing techno

gies and continued investment in research, developme

and commercialization of new climate-friendly techno

gies are essential if the United States and the rest of 

world are to reduce greenhouse gas emissions cost eff

tively.22

OVERCOMING CHALLENGES TO RAPID

DEPLOYMENT OF TECH

NOLOGY

The extent to which climate-friendly technologies h

reduce greenhouse gas emissions will depend on h

quickly and thoroughly they are adopted. By overcom

legal, fiscal, and policy barriers and impediments, the 

of cost-effective technical advances can be accelerat

The Council believes the most significant impedime

include:23

1. High upfront cost of new technologies compared 

the low cost of fossil energy.

2. Lack of awareness of the availability of clima

friendly technologies and their value in address

other quality-of-life concerns.

3. Long time frame for natural turnover of cap

stock.

4. Fiscal or regulatory policy disincentives that impe

early retirement of carbon-intensive technologies 

fail to encourage continuous improvement in te

nology and environmental performance.

5. Political uncertainty about future greenhouse 

control policy.

A SYSTEMATIC

APPROACH TO 

ACCELERATE DEVELOPMENT AND DEPLOYMENT

OF 

TECHNOLOGY

1. Fiscal policy should encourage the replacement of

greenhouse gas-intensive technologies with those

that are climate friendly and increase investment in

innovation through performance-based incentives

and other mechanisms.

2. Statutory and regulatory authority should facilitate

flexible and performance-based approaches that

provide incentives to install and employ climatefriendly technologies.

3. Voluntary commitments should be used to learn

how to reduce emissions and put these lessons

into practice.

4. Information dissemination should be accelerated

to inform everyone about the availability and benefits of climate-friendly technologies.

5. Research, development, and deployment efforts

should help ensure that future emissions reduc-
20 CHAPTER 2

CLIMATE CHANGE

Flexible and performance-based approaches can help

remove these roadblocks and accelerate the deployment of

technologies that are now available into the marketplace.

However, realigning the regulatory structure, market forces,

and fiscal policies to overcome the impediments has been a

difficult task. Since few obvious or easy solutions have been

proposed to remove the multiple impediments, approaches

remain piecemeal, and the clearly identified problems

remain. Unless existing impediments to technological innovation are overcome, significant differences will persist

between the amount of emissions reductions that can be

achieved cost effectively and actual performance.24 

A BROAD AND DIVERSE 

POLICY PORTFOLIO TO 

REALIZE THE MULTIPLE 

BENEFITS OF CLIMATEFRIENDLY TECHNOLOGIES

In addition to the benefit of greenhouse gas reduction, adoption and development of energy efficiency improvements,

renewable energy sources, low-carbon technologies, and

other technological advances can stimulate economic

growth, reduce environmental pollution, and improve U.S.

energy security. Reduced reliance on petroleum can improve

the U.S. balance of trade and make the nation less vulnerable

to political instability in major oil-producing regions such as

the Middle East. By using energy more efficiently, businesses

and consumers can save money on energy costs.

Technologies that emit less air pollution and fewer greenhouse gases can help achieve air quality goals as well as

reduce the risk of climate change. Just as the effort to put a

man on the moon made America a leader in space, so too

could reducing greenhouse gas emissions as the econo

grows make the United States the world leader in envir

mental and energy technologies.

Many policies may incidentally raise or lower net U

greenhouse gas emissions by advancing or hindering 

development and deployment of new technologies. W

systematic approaches to promote the use of clima

friendly technologies, greenhouse gas emissions can 

reduced as a co-benefit of other environmental, soc

economic, and energy policy goals. A broad and dive

policy portfolio is needed to encourage the adoption of 

mate-friendly technologies and methodically address 

myriad sources  small, large, stationary, and mobile 

that emit or remove greenhouse gases from the atm

phere. The Council recommends a systematic appro

that uses a variety of policy levers to spur the rapid dif

sion of climate-friendly technology throughout the econ

my.

The impacts of human activity on the environme

including the climate, can be described as the combin

influence of population, affluence, and technolog

Technologies that allow for the production of goods a

services using fewer natural resources, fewer toxic mat

als, and less energy can help mitigate some of the en

ronmental impacts  including greenhouse gas emissio

 of a global population that grows in number and co

sumes more goods and services per capita each ye

Technologies that help restore the environment wh

accommodating economic growth and improving 

quality of life for everyone epitomize the goal for susta

able development.

Technology clearly will play an important role 

reducing the risks of climate change. However, our p

success in developing new and efficient ways of produc

goods and services does not mean we need only wait for 

right technologies to arrive to protect the climate. Su

complacency may be overly optimistic. Moving new c

cepts to the marketplace is a time-consuming proc

Efforts to commercialize new and deploy existing techn

ogy must be accelerated to reduce overall greenhouse 

emissions. Although a number of challenges must 

overcome, the potential benefits for the economy, 

environment, and society are significant. A broad a

divers

policy portfolio can help the United States realize the m

Figure 4. Sources of U.S. Greenhouse Gas Emissions in 1996.

Total does not sum due to rounding. Source: Environmental Protection Agency.
CHAPTER 2

CLIMATE CHANGE

tiple benefits of protecting the climate.

Recommendations

Understanding the sources of greenhouse gas

emissions in the United States (figure 4) can help

inform the design of a successful climate-friendly technology policy portfolio. In 1996, the United States

emitted the equivalent of 1,788 million metric tons of carbon (MMTCE).26 Over 81 percent of total greenhouse gas

emissions came from four sectors of the economy, primarily through combustion of fossil fuels.27 The electric

power, transportation, industry, and buildings sectors

accounted for almost 99 percent of carbon dioxide emissions and just under one-third of the nations methane

and nitrous oxide emissions that year.28 Although not

major emitters of carbon dioxide, the agriculture and

forestry sectors are important because agricultural activities accounted for 66 percent of the methane and 66 percent of the nitrous oxide emissions, and because U.S.

forests and soils removed some greenhouse gases from

the atmosphere. Developing and deploying technologies

that reduce, avoid, or sequester greenhouse gas emissions

from these sectors are critical elements of U.S. climate

policy.

Technology breakthroughs, new incentives, and the

removal of impediments are needed to move climatefriendly technology into the U.S. agriculture, buildings,

electric power, industry, and transportation sectors. For

each of these sectors, the Council reached agreement on a

set of actions that could accelerate the development and

deployment of climate-friendly technology.

The recommendations presented here reflect consensus among the Councils diverse membership a

demonstrate that the nation could take many steps 

encourage climate-friendly technology that have a bro

base of support. In putting forth these actions, the Coun

did not estimate the amount of greenhouse gas emissio

reductions that could be achieved by taking these steps, 

assess the overall costs and benefits of doing so. Rather, 

Council focused on actions that were consistent w

efforts to achieve national aspirations for economic grow

environmental protection, and increased equity, and cou

 Overcome the roadblocks to technological innovati

 Accelerate the development and diffusion of prom

ing classes of climate-friendly technologies in 

United States.

 Help reduce greenhouse emissions in the next 10 

15 years.

Taken together, these recommendations would repres

a solid course of action to spur climate-friendly techolo

and reduce U.S. greenhouse gas emissions.

ELECTRIC POWER

The type of fuel used to generate electricity has a 

nificant effect on the amount of greenhouse gases emit

by the electric power sector. Coal, generally the cheap

source of fossil fuel, also emits the most air pollution a

greenhouse gases per unit of energy. Natural gas comb

tion emits the least amount of greenhouse gas per unit 

fossil energy. Currently, over 85 percent of electricity-rela

greenhouse gas emissions comes from coal-fired pow

plants.29

Coal-fired power plants generate over half of U

electricity (52 percent); followed by nuclear (22 percen

natural gas (14 percent), and renewable energy sources 

percent, predominantly conventional hydropower).30 T

industry is undergoing a shift in the sources of electric

generation as a result of electric power sector restruct

ing and environmental regulations, and as existing nucl

power plants reach the end of their planned lifetim

Fossil-fuel-powered plants are expected to generate ab

80 percent of the U.S. electricity supply over the next 

years as the existing stock of nuclear plants is phased o

Greenhouse gas emissions from the electric pow

sector could be reduced by replacing or repowering ex

ing coal-based power plants with combined-cycle natu
22 CHAPTER 2

CLIMATE CHANGE

gas facilities, converting existing coal-fired facilities to run

on fuels that emit fewer greenhouse gases, employing

combined heat and power technology in appropriate sites,

using more renewable energy technology, and increasing

the efficiency of existing plants as well as transmission

and distribution systems.

Recommendations

1. Replace or convert carbon-intensive-generating technologies with low-carbon, carbon-free, or high-efficiency technologies such as combined-cycle natural

gas, renewable sources, more advanced clean coal,

and clean distributed generation in ways that ensure

reliability of the electricity supply.

2. Enhance development, commercialization, and introduction of, and capital flow towards new climatefriendly technologies.

3. Enable and enhance markets for retail energy services

that encourage energy efficiency and the use of lowcarbon and carbon-free energy technologies.

4. Recognize the environmental characteristics of existing carbon-free power generation.

Action 1

Owners and operators of publicly and privately owned

power projects should establish voluntary goals to reduce

greenhouse gas emissions from their facilities and imp

ment a plan to meet them.

Action 2

Move towards improved environmental performance 

power generation facilities, recognizing the efforts be

made to attain health-based air quality standards and 

need to reduce greenhouse gas emissions cost effectiv

while maintaining economic growth and reliable elec

service, and avoiding unreasonable burdens on particu

sectors or geographic regions.

Action 3

As part of restructuring legislation, permit demand-s

management services currently provided by electric pow

utilities to be sold separately from other services so t

value-added services such as energy efficiency and cons

vation can be offered for profit.

Action 4

States should establish a wire charge to encourage devel

ment and installation of cleaner energy systems as the el

tric power sector is restructured, recognizing that, as m

large industrial facilities subject to global competit

already make significant investments in energy efficiency 

a business mainstay, incentive programs involving s

charges may not be warranted in all cases.

Action 5

Improve the information provided to consumers and s

ers of power about the cost savings of energy efficien

and conservation, particularly in industrial settings a

commercial buildings.

Action 6

Establish uniform requirements for disclosure of 

environmental characteristics of power sources, and 

amounts and types of air and other pollutants genera

by these sources.

Action 7

Eliminate or lower grid exit fees for cleaner power sour

used on site for small commercial or residential applicatio

that fall below a de minimis standard of power generation

Action 8

Develop a certification program for green power t

takes into account the varying availability of renewable a

Using electric vehicles in regions that have cleaner sources of electricity generation such as Souther California can help reduce air pollution as well as greenhouse gas emissions. 

Photo: General Motors Corporation.
CHAPTER 2

CLIMATE CHANGE

other clean power sources in different regions of the country. Electricity consumers should stimulate demand for

clean energy products by purchasing certified green power.

Additional actions for this sector are listed on page 23.

TRANSPORTATION

Fossil fuel combusion by passenger cars and light-duty

trucks account for the majority of greenhouse gas emissions

(58 percent) from the transportation sector; however, airplanes (13 percent), freight trucks (15 percent), and rail and

marine (7 percent) are also responsible for a significant

amount of emissions. Other sources make up the remaining

7 percent.31 The transportation sector is the second largest

and is the fastest growing source of greenhouse gas emissions in the United States, due in large part to the continuing growth in vehicle-miles traveled, new fleet fuel economy

levels that are not increasing, and growth in the relative proportion of light trucks. Significant growth in air travel also

will contribute to increasing emissions from this sector.

A number of technologies could help lower greenhouse gas emissions from the transportation sector. Some

of the more promising options include high-efficiency

gasoline-powered engines for cars and light trucks; hybrid

fuel and hybrid electric vehicles; high-efficiency diesel

engines for heavy trucks, buses, and off-road equipment

(e.g.; agricultural and construction); alternative fuels; fuelcell-powered vehicles; new aircraft engine designs; modernized air traffic control technologies; systems to

improve rail system efficiency; land use planning technologies; traffic management technology; and other technologies that help people travel less distance or less frequently.

Recommendations

1. Reduce greenhouse gas emissions from vehicles.

2. Accelerate development and use of cleaner fuels and

engines.

3. Reduce vehicle-miles traveled.

Action 1

Government and businesses should accelerate efforts to

procure clean fuel/engine fleet vehicles and fuel them in

ways that result in real reductions of greenhouse gas emissions.

Action 2

Establish consumer tax incentives for purchase of e

cient, advanced technology vehicles.

Action 3

Establish new programs and strengthen existing polic

that foster alternative transportation choices and prov

an incentive to drive fewer miles including:

a. Policies that encourage the use of mass transit su

as tax benefits for employer-subsidized transit p

and parking cash-out programs.

b. Credits or incentives for compact development.

c. Policies that promote car-sharing programs such 

those already established in Europe and the Uni

States, which offer the potential to reduce gre

house gas emissions by lowering the total number 

vehicle trips and vehicle-miles traveled within ma

cities.

d. Public education and outreach efforts to identify a

promote the benefits of efficient vehicles and ot

transportation choices to stimulate demand for th

technologies.

e. Research on the impact of telecommuting, inform

tion technologies, and Internet commerce on red

ing greenhouse gas emissions.

Action 4

Improve infrastructure for intermodal transportation (i

bike racks, bus shelters, train stations).

Action 5

Photo: Stephen Delaney, U.S. Environmental Protection Agency.
24 CHAPTER 2

CLIMATE CHANGE

States and localities should establish appropriate road pricing policies that reduce congestion, mitigate greenhouse

gases, and mitigate any impact on low-income commuters.

Action 6

In cases where greenhouse gas reductions can be quantified and verified against credible benchmarks, give communities the opportunity to receive credit when they use

community design to lower traffic by adopting zoning

codes and other changes that encourage more efficient

land use patterns to reduce pollution from motor vehicles.

Action 7

Increase and redirect existing support for research, development, and deployment and production of advanced

vehicle components towards technologies that enable

greater efficiency including hybrid electric systems, lightweight materials, clean engines, energy storage systems,

and fuels.

Action 8

Support research to determine the potential of intelligent

transportation systems (a group of technologies that

could improve the flow of traffic through urban areas) to

reduce greenhouse gas emissions.

Action 9

Prioritize and accelerate efforts to develop infrastructure

for alternative-fueled vehicles that reduce greenhouse gas

emissions.

Action 10

Perform additional research on how to reflect the number

of vehicle-miles traveled as a variable cost of insurance so

that drivers better understand the price associated with the

number of miles they drive.

INDUSTRY

Industry is the most diverse of the end-use sectors, cons

ing of many activities  such as mining, manufacturi

pulp and paper processing, and construction  that are p

formed by businesses of every size. Individual subsect

have vastly different energy use patterns and emit vary

amounts and types of greenhouse gases. In 1994, the sev

most energy-intensive industrial subsectors were petrole

refining (26.4 percent of energy used by the sector), che

cals and allied products (24.7 percent), paper and allied pr

ucts (14.8 percent), steel (9.1 percent), aluminum (1.6 p

cent), glass products (1.1 percent), and metal casting (

percent).32 Most energy-related greenhouse gas emissio

from this sector result from producing steam and proc

heat. In addition to emissions resulting from the combust

of fossil fuels, several primary industrial processes gener

greenhouse gas emissions.

Emissions of greenhouse gases from this sector co

be lowered using several types of technologies includ

those that increase energy efficiency, switch fuels, utilize co

bined heat and power, and improve industrial processes.

Recommendations

1. Replace or convert carbon-intensive industrial b

ers, power-generating facilities, steam-generating s

tems, and industrial process equipment such 

motors, pumps, and compressed air systems w

low-carbon, carbon-free, or high-efficiency techno

gies that increase energy efficiency and lower gre

house gas emissions from industrial processes.

2. Encourage design and manufacture of clima

friendly products and processes.

3. Encourage energy-efficient recycling of feedstoc

products, and waste streams.

Action 1

Establish a rebate program of limited duration for co

mercial, residential, and small manufacturing users 

electric power to reduce the upfront costs of renewa

energy technologies.

Action 2

Help communities that want to create eco-industrial pa

by making relevant information available, allowing fle

bility in permitting and other regulatory areas while ens

ing that environmental goals are met or exceeded, a

enacting mixed-use zoning that allows for eco-indust

parks that have low or zero emissions of greenhouse ga

and other pollutants.
CHAPTER 2

CLIMATE CHANGE

Action 3

Offer incentives to encourage climate-friendly business

development.

Action 4

Develop accounting systems that value the energy savings

of buying efficient equipment.

Action 5

Develop methods to account for the greenhouse gas emissions avoided if new facilities employ climate-friendly

technologies.

Additional actions for this sector are listed in the following section.

ACTIONS FOR THE 

ELECTRIC POWER AND

INDUSTRY SECTORS

Both the Electric Power and Industry sectors use equipment to generate electricity and use energy to operate

machinery and other equipment. A number of actions

could help carry out the recommendations for each sector.

Action 1

Streamline the permitting process for new low-carbon or

carbon-free generating facilities and related infrastructure

in ways that preserve public comment and provide

accountability for performance. Relevant statutes t

affect the Electric Power and Industry sectors include 

Clean Air Act, the Clean Water Act, the Natio

Environmental Policy Act, Federal Energy Regulat

Commission rules, and state environmental laws.

Action 2

Offer targeted temporary tax credits or incentives, lo

interest revolving loan funds, matching grants, or ot

appropriate incentives or rewards to reduce the cost 

installing climate-friendly power-generating technolog

and related infrastructure.

Action 3

Improve the energy efficiency of equipment that u

electricity.

Action 4

Facilitate expansion of natural gas pipeline infrastruct

and capacity and expand natural gas markets by streaml

ing duplicative and conflicting regulations, removing e

nomic disincentives, and simplifying the permitt

process in ways that preserve public comment and p

vide accountability for performance.

Action 5

Harmonize tax schedules for depreciation of new elec

power-generating equipment and related infrastruct

with the schedule for depreciation of other types of c

ital equipment to create an economic incentive to ins

climate-friendly electric power-generating equipm

more frequently.

Action 6

In partnership with the private sector, governm

research should focus on improving scientific understan

ing and practical applications for the use of renewa

energy and distributed energy technologies such as f

cells and micro turbines.

BUILDINGS

The number, size, and geographic distribution of resid

tial and commercial buildings  as well as the mar

penetration of heating and cooling technologies a

major appliances  combine to influence the energy co

sumption and greenhouse gas emissions from the bu

ings sector. Residential buildings account for about 56 p

cent of emissions within this sector.33 Among the m

promising options for reducing emissions from the bui

ings sector are increased deployment of energy-efficien

The Partnership for Advanced Technology in Housing aims to

ensure that new homes of the future use 50 percent less energy

than todays standard new home, and that the energy use in 20

percent of existing homes is reduced by 30 percent through retrofits. 

Photo: U.S. Department of Housing and Urban Development.
26 CHAPTER 2

CLIMATE CHANGE

technologies and greater use of combined heat and power

generation in commercial facilities.

Recommendations

1. Encourage retrofits of existing buildings to reduce

greenhouse gas emissions through more efficient

electricity and fuel use.

2. Encourage design and construction of new buildings

that would reduce emissions in the construction

phase and during the operation of the building in its

lifetime.

3. Improve the efficiency of appliances and other products within the building.

4. Optimize building efficiency by integrating systems

for their design, operation, and maintenance.

Action 1

Provide tax incentives or credits for installation of climate-friendly technologies.

Action 2

Adopt fiscal or regulatory policy incentives that encour

continuous improvement of codes and standards for bu

ings and appliances.

Action 3

Governments should consider offering temporary a

targeted tax credits or incentives for new residential co

struction that exceeds building code energy-efficien

standards by at least 50 percent, and for retrofits of ex

ing residential buildings that significantly improve bu

ing code energy-efficiency standards. Eligibility for th

incentives or credits should include appropriate verifi

tion of the improvements against recognized ben

marks.

Action 4

Amplify government procurement practices to achi

greater use of energy-efficient materials and technolog

in buildings.

Action 5

Build on existing efforts in local, state, and federal gove

ments to promote energy efficiency by establishing go

for greenhouse gas emissions reductions from gove

ment-owned buildings and implement a plan to meet the

Action 6

Build on existing awards, recognition, and assistance p

grams such as EnergyStar and Rebuild America to rec

nize leadership in achieving energy efficiency in building

Action 7

Develop methods that allow industry and entrepreneu

consumers to aggregate greenhouse gas emissions red

tions from the manufacture or use of more efficient ap

ances, and ensure that appropriate protocols to verify a

quantify those reductions are available to facilitate part

pation in emissions trading.

Action 8

Develop methods to account for greenhouse gas em

sions reductions if builders choose to construct hom

that are more efficient than local standards. The metho

should include appropriate protocols to verify and quan

fy those reductions against a credible benchmark.

Action 9

Provide information to consumers, builders, archite

This Texas rancher uses a wind-powered turbine to pump water

for his cattle.

Photo: American Wind Energy Association.
CHAPTER 2

CLIMATE CHANGE

developers, materials producers, and others on the cost savings and climate benefits of energy efficiency and conservation.

Action 10

In partnership with the private sector, government

research should improve scientific understanding and

practical applications for the use of energy-efficient and

renewable energy technologies in buildings.

Action 11

Recognize and document increases in worker productivity

due to energy-efficiency improvements in buildings.

AGRICULTURE AND

FORESTRY

Agricultural activities emit primarily methane and nitrous

oxide.35 Ruminant animals (65 percent) and manure management (30 percent) are the major sources of methane in this

sector, followed by rice cultivation (~5 percent) and crop

waste burning (0.4 percent). Application of fertilizers and

other cropping practices account for almost 96 percent of

the nitrous oxide emissions from this sector.36 Within the

United States, the direct effects of deforestation on

greenhouse gas emissions are minor to none.37

Technologies that improve land and resource management practices; improve energy efficiency on farms, forests,

and ranchlands; abate methane emissions from ruminant

animals; and reduce nitrous oxide emissions from soils can

help reduce greenhouse gas emissions.

The agriculture and forestry sectors can help the

United States reduce emissions in other ways, as well.

Biofuel crops could provide an alternative energy source.

Carbon removed from the atmosphere during crop growth

is returned when the crop is burned for energy. Although

energy is required to produce and process the crop, biofuels

may reduce overall greenhouse gas emissions compared to

fossil fuels.

The two sectors also can help the United States meet its climate objectives if forest and soil management includes consideration of their potential to remove carbon dioxide from

the atmosphere. Deforestation and land use changes in

industrialized nations are historically important sources of

greenhouse gas emissions, and clearing of tropical forests

for agricultural use is currently a significant source of emissions globally. However, U.S. forests remove more carbon

dioxide from the atmosphere each year than they release. In

1996, U.S. forests sequestered 171.3 MMTCE.38 Removal 

carbon by agricultural croplands could complement carb

sequestration by forests. One recent assessment found t

farmlands could potentially sequester as much as 75 to 2

MMTCE per year if conservation programs were enhanc

degraded soils restored, tillage practices and crop resid

management improved, and new cropping systems ado

ed.39 

Recommendations

1. Encourage opportunities to create alternative sources 

fuel on farm, grazing, and forest lands.

2. Promote carbon sequestration on farm, grazing, a

forest lands.

3. Reduce fossil energy requirements for farming, grazi

and forestry production processes.

4. Reduce greenhouse gas emissions from agricultu

byproducts.

Action 1

Local, state, and federal governments; businesses; and in

viduals should identify among their own lands appropr

land restoration projects that could increase carbon sequ

tration.

Action 2

Focus agriculture research on renewable energy crop p

duction, recycling of organic wastes, fertilizer use, and nu

ent management.

Action 3 

Focus forestry, crop lands, and grazing lands research on c

bon sequestration, specifically measurement of carbon st

age in forest and other ecosystems, certification and verifi

tion of carbon sequestration in forests and soils, monitor

of sequestration projects, and leakage issues related to c

bon storage in forests. Link research efforts to support on

ing international efforts to manage forests sustainably, incl

ing the Montreal Process Criteria and Indicators 

Sustainable Forest Management programs.

Action 4

Develop eco-efficient ways to capture energy from agric

tural byproducts (i.e., crop waste and manure), includ

methane.40

Action 5

Develop accurate and precise methods to quantify a
28 CHAPTER 2

CLIMATE CHANGE

verify the amount of carbon sequestered in soils and

forests as a result of changes in land use. If the potential

for carbon sequestration is adequately demonstrated and

reliable methods are developed, promote a more comprehensive treatment of land use practices in international

agreements which includes appropriate credit for those

practices that sequester carbon.

CROSS-CUTTING

ACTIONS

Some climate technology issues go beyond sectoral

boundaries. For example, exports of certain climatefriendly technologies can help lower their costs in the

United States because businesses attain economies of

scale for their production. Other cross-cutting issues

focus on actions that could catalyze early adoption of climate-friendly technologies by all sectors and encourage

systematic and sustainable approaches to land use planning and use of natural resources.

Recommendations

1. Expand trade in cleaner technologies to stimulate

domestic markets and transfer technologies to developing countries.

2. Encourage early action to adopt climate-friendly technologies.

3. Encourage systematic approaches to land use plann

that promote reuse of materials and brownfie

reduce sprawl, and preserve greenspace.

Action 1

Support the development and deployment of systems a

institutions that assemble information about availa

incentives and options to reduce greenhouse gas em

sions to enable easier and more effective choices of 

mate-friendly technologies.

Action 2

Pursue export policies that foster cleaner infrastructure 

less developed countries and stimulate opportunities 

domestic manufacturers of climate-friendly technolog

to lower the cost of their products through economies 

scale. These policies should pay special attention to 

sustainable development and climate protection needs 

developing nations.

Action 3 

Begin to move towards tax policies that  with

increasing overall tax burdens  encourage employm

and economic opportunity while discouraging enviro

mentally damaging decisions.

Action 4

As an extension of previous studies on environment

and economically damaging subsidies, and building 

previous Council recommendations, establish a natio

commission to review the effect of federal tax and subs

policies on the goal of climate protection. In Sustaina

America, the Council recommended that this commissi

should review all existing tax and spending subsi

to determine if a national need remains to contin

individual subsidies. . .[and]. . .should recommend 

the President a list of subsidies that fail to meet t

test and should be phased out or rapidly eliminat

Figure 5. Emissions in the buildings sector (left) and uses of energy in residential buildings. 

Source: Energy Information Agency.

American cities and towns account for

over 80 percent of national energy use.

Land use planning and urban design

affect about 70 percent of that, or 56

percent of the nations total energy use.
CHAPTER 2

CLIMATE CHANGE

Any remaining subsidies should be made subject to a

sunset or review clause that would require the appropriate government agency to ensure on a regular

basis that these subsides are not inconsistent with

national sustainable development goals.41

These goals should include climate protection. The

Council also recommended that the commission should

conduct an explicit assessment of alternative tax policies

and...assess opportunities for increased use of pollut

taxes while reducing reliance on more traditional inco

taxes. The commission should make recommendatio

to the President and Congress on tax reform initiati

that are consistent with the goals of climate protect

and sustainable development.

Action 5 

UNDERSTANDING THE BENEFITS OF CLIMATE 

PROTECTION: PCSD FORUM ON COMMUNITIES 

AND CLIMATE CHANGE IN ATLANTA, GEORGIA

Together with local businesses, government, and nongovernmental organizations, PCSD convened a forum on

Communities and Climate Change at its November 1997 public meeting. (The co-conveners of the forum were the

Regional Business Council, Interface, Inc., Fulton County Commissioners, Atlanta Regional Commission, Emory

University, Georgia Institute of Technology, Southface Energy Institute, the Natural Step, and the Georgia

Conservancy.) The meetings objectives were to:

 Make climate change real to the people of Atlanta;

 Connect current quality-of-life concerns in the region to the climate issue; and

 Explore relationships between solutions to quality-of-life concerns and climate mitigation.

After hearing briefings on climate change science, the potential impacts of climate change, the opportunity for 

technology to reduce emissions, and the estimated costs of greenhouse gas emissions reductions, the 150 forum partici

pants broke into four groups focusing on work and economy, home and family, outdoors and recreation, and learning

and education. Each group answered the following questions:

 What are the most important quality-of-life issues affecting the region?

 Are any related to climate change? If so, which ones and how are they related?

 Can you come up with solutions that solve multiple quality-of-life problems and address climate change at the

same time?

 What do we need to do to make solutions happen? 

Many common issues emerged from the breakout groups. These included traffic, land use and urban sprawl, lack of

alternative transportation, availability and access to jobs, air quality, preservation of open space, and the need for urban

revitalization.

The groups found many connections to their quality-of-life issues and climate change as well as linkages among their

quality-of-life concerns. For example, many groups noted that urban sprawl results in the loss of carbon sequestration

potential as well as increased vehicle travel. In addition, sprawl can destroy wildlife habitat and reduce availability of

green space for recreation, increase travel distances which makes communities less accessible, contribute to increased

flash-flooding and erosion, and incur significant costs for municipalities which must provide infrastructure and utilities

to support new development.

Forum participants identified many solutions that could address their quality-of-life concerns and protect the climate:

 Preserving green space and trees could enhance carbon sequestration as well as provide more opportunities for

recreation.

 Reducing government fragmentation would improve local land use planning as well as strengthen local democracy

 Increasing funding for alternative transportation would help reduce vehicle travel and improve local air quality.

 Improving the quality and safety of urban school would create an incentive for families to stay in the city rather

than move to the suburbs. This could avoid increasing emissions from vehicles, as city dwellers tend to drive less

than their suburban counterparts.
30 CHAPTER 2

CLIMATE CHANGE

Encourage aggregation of small customers and sources to

increase market penetration of low-carbon power and

facilitate participation in emissions trading.

Action 6

Offer an incentive-based early action program that

encourages broad-based participation, learning, innovation, flexibility, and experimentation; grants formal credit

for legitimate and verifiable measures to protect the climate; ensures accountability; is compatible with other climate protection strategies and environmental goals; and is

inspired by government leadership.

Action 7

Encourage voluntary emissions trading to reduce greenhouse gas emissions and provide opportunities for businesses and communities to learn about emissions trading.

Action 8

Government should work individually and in partnership with businesses to improve scientific understanding

of and practical applications for the use of energy-efficient and renewable energy technologies. Governments

should complement their efforts to fund the development of new technologies with a serious commitment to

help businesses that wish to commercialize the technology.

Action 9

Develop methods that allow small businesses, residential

customers, and entrepreneurial consumers to measure

and track their greenhouse gas emissions reductions

efforts. Ensure that appropriate protocols and mechanisms to verify, quantify, and aggregate those reductions

are available.

Action 10 

The federal government should work with lenders and

municipal bond underwriters to expand research on the

costs and greenhouse gas emissions associated with urban

sprawl and determine if objective measures could be

established to assess them.

Action 11 

Support government-industry partnerships to strengthen

precommercial research and development efforts for new

climate-friendly technologies.

SEEKING BROADER 

BENEFITS IN CLIMATE PROTECTION STRATEGIES

The predicted impacts of climate change co

affect many segments of society, regions, a

individuals, and could reduce their capacity 

pursue a sustainable future. In meetings around 

country, the Council heard from many citizens and co

munity organizations about the importance of clim

protection. A consistent thread in these presentatio

was that local areas can realize multiple benefits 

reducing their greenhouse gas emissions. The Coun

also learned that the converse is true: climate protecti

is an important benefit of many strategies and actio

that contribute to sustainable community developme

SMALL SOURCES OF 

EMISSIONS AND 

COMMUNITIES ARE

INTEGRAL PARTS OF

ANY SOLUTION

Greenhouse gas emissions for each of the major s

tors (figure 4) reflect the aggregation of many small sour

Advances in technology allow AT&T employees to telework from

their home office, thereby providing individuals the opportunity to

balance family and work, reducing pollutants associated with tran

portation, and enabling economic activity and increasing productiv

ty. 

Photo: AT&T.
CHAPTER 2

CLIMATE CHANGE

of greenhouse gases. For example, in the buildings sector,

over half of the emissions come from residential buildings

(figure 5).42 Examined in detail, it becomes clear that overall

residential emissions result from millions of daily decisions

and actions that consume energy and result in greenhouse

gas emissions.

As population and economic centers, cities and metropolitan areas are major consumers of energy and emitters of greenhouse gases. Local decisions significan

influence energy use, particularly in the buildings a

transportation sectors. Policies made at the local level a

affect overall U.S. greenhouse gas emissions. Local ge

raphy and climate partially determine the amount of en

gy used to heat and cool buildings. Together, land 

planning and urban design affect about 56 percent of 

nations total energy use.43 Local infrastructure, tax cod

and availability of and access to information can also in

PUTTING CONCEPT INTO PRACTICE: CITIES FOR 

CLIMATE PROTECTION CAMPAIGN

Cities and municipalities worldwide are participating in the International Council on Local Environmental Initiatives

(ICLEI) Cities for Climate Protection Campaign. Participating cities agree to inventory their sources of greenhouse gas

emissions, set a target for emissions reductions, and develop and implement a plan to meet this.

Program participants choose an approach that works for their community. Actions taken by participating U.S. cities and

municipalities include:

 Mitigating road and traffic congestion,

 Planting trees to cool urban areas and sequester carbon,

 Switching to renewable energy,

 Using alternative-fueled vehicles in municipal fleets,

 Using better urban planning techniques,

 Recovering methane from landfills,

 Community recycling programs,

 Retrofitting buildings with more energy-efficient technologies, and

 Parking cash-out programs.

As a result of these policies, the participants have noted a number of tangible co-benefits to their efforts to reduce

greenhouse gas emissions:

 Increased energy efficiency lowers costs and keeps money in the community for more productive investments.

 Demand for energy-efficient products and services and for new technologies can create local jobs and boost the local

economy.

 Less fossil fuel consumption reduces air pollution that can cause adverse public health impacts.

 Communities are more livable because they have reduced traffic congestion, cleaner air, more efficient and comfortable homes and offices, and land use patterns that help build a sense of place.

 Energy efficient schools can spend their cost savings on better educational programs.

 Manufacturing processes are more efficient, and workplaces are more productive, because of better lighting and airflows.

Cumulative actions of the participating local governments can have a significant impact on the nations ability to meet

its climate protection goals. ICLEI has calculated that if all 55 U.S. cities and municipalities participating in the program

voluntarily reduce their greenhouse gas emissions 10 percent below 1990 levels, U.S. greenhouse gas emissions in total

would be reduced by 145 million tons  6.5 percent of the U.S. obligation under the Kyoto Protocol.

Source: ICLEI, U.S. Communities Acting to Protect the Climate: 1998 Achievements of ICLEIs Cities for Climate Protection  U.S. (Berkeley, CA, 1998).
32 CHAPTER 2

CLIMATE CHANGE

rectly influence greenhouse gas emissions.

REDUCING THE RISKS

OF CLIMATE CHANGE

WITH ADAPTATION

MEASURES THAT PROTECT AND INCREASE

THE PROSPERITY AND

VITALITY OF COMMUNITIES

If the climate changes as some scientists predict, communities will have to choose how to adapt to the adverse impacts

of this new climate and position themselves to take advantage of any benefits. Accelerated sea level rise, changing rainfall patterns, more intense and more frequent storms, and

changes in the natural resource base could have a detrimental impact on communities. Smaller communities that lack

resources to recover fully or find new sources of economic

sustenance may be particularly affected. Unless communities

plan ahead, they may be ill-prepared to respond to these

challenges.

Protecting the climate can be made an integral part of

sustainable community development. Because both the

potential impacts of climate change and strategies to reduce

greenhouse gas emissions will unfold over many decades,

policy choices made by communities today will have a lasting impact on future generations. Proactive efforts to reduce

greenhouse gases could help communities avoid some of

the risks of a changing climate. However, given the evidence

that climate has changed in the past and is likely to change

in the future even without human-induced change, it may

also be appropriate for communities to consider adaptive

responses by adjusting planning, engineering, and regulatory

strategies to take into account the vulnerability of different

areas.

Although this is an important issue, the Council did not

consider in detail how communities could prepare for a

changing climate. In general, we recognize that some climate

adaptation measures could help communities achieve other

sustainable development goals. Coastal and riverside communities could reduce their vulnerability to more intense and

frequent storms by reestablishing upstream wetlands and

forests, and improving the ability of soils to retain water.

Such action could have both economic and environmental

benefits. Urban communities could reduce peak summertime temperatures by pursuing more intensive urban reforestation, painting buildings and roofs lighter colors, and

using lightercolored paving materials. Lower summerti

temperatures could reduce the formation of air polluta

such as ground-level ozone. Early warning heat notificat

systems could help citydwellers plan appropriate activi

for very hot days, and thereby avoid some of the adve

health effects of high temperatures. Inoculation progra

and public education could reduce the rates of contract

and severity of illnesses, while simultaneously improv

public health. Because the efficacy and efficiency of th

adaptation steps likely will vary by region, actions taken 

prepare for a changing climate should complement effo

to reduce greenhouse gas emissions.44

Communities can start to meet these challenges 

addressing local problems such as traffic congestion, air p

lution, urban sprawl, and energy costs. By incorporating 

mate change into the fabric of these daily decisions, st

can be taken to reduce greenhouse gas emissions and, at 

same time, increase the prosperity, resilience, and vitality 

communities. In other words, communities can comb

steps to reduce greenhouse gas emissions with their plans 

achieve sustainable development.

Because of the diversity of sources of greenho

gases, local level climate mitigation strategies can 

designed to take local circumstances into accou

The solar car The Last Olympian was built by the Pirates from

Cinnaminson High School in New Jersey, for the Northeast Solar

Energy Associations 1998 American Tour de Sol Competition. The

Tour is sponsored by the U.S. Department of Energy and others.

The high school team that won the 1998 competition beat Ford,

Honda, Chrysler, and other large corporations to finish first in five

categories and second in one category to finish first place overall. Thi

accomplishment demonstrates the value of project-based education for

sustainability. 

Photo: Allan E. Baer, SolarQuest I-NetNews Team.
CHAPTER 

ENVIRONMENTA

MANAGEMEN
34 CHAPTER 3

ENVIRONMENTAL MANAGEMENT

Communities have selected a range of activities that help

them solve other quality-of-life concerns. Each project

selected by different communities can take advantage of the

unique opportunities afforded by the individual community

to integrate climate protection into efforts to improve the

economic, social, and environmental infrastructure that sustains them.

Innovative measures that reduce overall greenhouse

gas emissions and solve other quality-of-life concerns are an

essential part of a national climate protection strategy. Just

as the character of communities changes from place to

place, each community will present unique, local level solutions to the problem of global climate change that helps us

all pursue a sustainable future.

FOSTERING BROADBASED COMMUNITY

PARTICIPATION TO

REALIZE THE BENEFITS

OF CLIMATE PROTECTION

A number of systems changes could leverage existing

infrastructure, networks, and systems to catalyze community efforts to protect the climate. The Council identified

a number of efforts currently under way in communities

to encourage economic growth, environmental protection, and social justice that could be easily replicated or

adapted to include climate protection.45 These examples

illustrate some important lessons for encouraging other

innovative measures to protect the climate on a larger

scale.

1. Encourage and promote rapid learning that leads to

action. The United Way of Metropolitan Atlanta and

the Georgia Public Service Commission established

the 211 Atlanta project to use the telephone system

to connect individuals with common interests. By

dialing 211, an Atlanta resident is connected to a c

tral facility that maintains a database of participat

citizens interests. For example, a person interested 

improving the energy efficiency of their home co

dial 211 to be connected to people who know ab

the methods and technologies to reduce home en

gy consumption.

Goldman Sachs and the U.S. Department of Ene

worked together to help schools and hospitals rec

nize the benefits of energy efficiency. Together, th

developed a new underwriting method that rec

nizes the cost savings of energy-efficiency impro

ment. Schools and hospitals that agree to follow 

specific protocol to improve the energy efficiency 

their buildings can qualify for lower interest ra

under this initiative.

2. Make full use of economic and social capabilities t

are currently available to reduce emissions. The U

Environmental Protection Agencys Smart Grow

Network helps developers choose options that redu

sprawl and attendant traffic and air quality proble

The partnership program helps developers iden

and reuse land that is already served by water, sew

gas, telephone, and electric utility services. Reusing 

infrastructure in some of these places only co

$5,000 to $10,000 per unit compared to $50,000 

$60,000 per dwelling unit for building new infrastr

ture in some greenfield locations.

3. Encourage entrepreneurial interests to identify a

develop new markets for measures and products t

support climate protection objectives. Location-e

cient mortgages are a promising home mortg

product that can help prospective homeowners re

ize the reduced transportation expenses associa

with living near the places they work or living n

public transportation. A partnership has been b

with banks and the Federal National Mortg

Association to offer these mortgages in six U.S. cit

Chicago, Seattle, Los Angeles, San Francisco, Mia

and Milwaukee.

4. Reward achievements and innovations that furt

the realization of climate protection goals. Provid

opportunities for large numbers of small sources 

participate in market-based programs to reduce em

sions could provide a new set of options to achi

those reductions cost effectively. For example, 

Chicago and Pittsburgh Public School Districts 

Advise the President on the next 

steps in building the new 

environmental management 

system of the 21st century...

PCSD Charter, April 1997
CHAPTER 3

ENVIRONMENTAL MANAGEMENT

committed to forming a Great Lakes Energy

Network. By learning how to measure the emissions

from their facilities and incorporate energy-efficiency

metrics into their existing accounting systems, the

districts hope to participate in emissions trading

opportunities for air pollutants as well as greenhouse

gases.

TOWARDS SUSTAINABLE CLIMATE ACTION

Consensus building, outreach, and inclus

approaches are essential components of susta

able climate action. The Councils experience ill

trates the significance of these strategies, as well as 

efforts necessary to reach out to other stakeholders on 

climate issue.

An important benefit of the Councils work on clim

change was increased trust among the Council memb

and a better understanding of the diverse views th

brought to the Councils discussions. Continued dialog

helped them reach consensus on difficult issues, and, 

cases where they could not agree, gave them a better app

KEY FINDINGS  ENVIRONMENTAL MANAGEMENT

 Sustainable development requires rethinking the nature, source, and linkage of environmental problems. The current

definitions of environmental pollution, environmental management, and environmental protection are too narrow, in

some cases, to permit identification of the true nature of the problems (e.g., cultural, economic, institutional, political

and to recast their potential solutions.

 Developing and using information on environmental performance and conditions is critical to any environmental

management framework and must be incorporated at all levels of decisionmaking. There is a need to develop, agree

upon, and apply common metrics for measuring and reporting environmental performance of products, households,

services, firms, facilities, and the economy; and to further develop and use indicators to measure environmental outcomes and monitor ambient environmental conditions.

 Environmental conditions can and should be improved beyond existing requirements with an environmental management framework that is organized for performance and that differentiates among size, sectors, and performance levels

To do this, and to align the framework more closely with the economy, environmental managers should employ effective, certifiable environmental management systems, environmental accounting practices, and appropriate market

mechanisms that will improve environmental performance.

 Regional and systems approaches to environmental management and economic development that better align human

activity with natural cycles provide multiple benefits. An environmental management framework should strive to

understand the interdependencies between communities, nature, and the economy; implement strategies that respect

and use those interdependencies to improve the environment; and preserve and, when possible, restore biodiversity as

a necessary part of ecological vitality.

 An environmental management framework that fosters sustainable development needs to respect and incorporate the

value of community and place. Communities, like organizations, differ in size, ability, sophistication, and understanding of environmental issues; the framework should be sensitive to such differences.

 The framework should include both traditional tools and new approaches, and promote early action on emerging

issues by involving companies, interest groups, government stakeholders, and international partners in constructive

dialogues that lead to solutions. The framework should foster the application of goal-oriented strategies to existing

environmental problems that are inadequately addressed by traditional systems or programs (e.g., nonpoint source

water pollution and dispersed air sources).

The new environmental management

framework of the 21st century will drive

continuous environmental improvement

to accompany continuous economic and

social gains.
36 CHAPTER 3

ENVIRONMENTAL MANAGEMENT

ciation of each others concerns.

Outreach and participation by diverse stakeholders at

Council-sponsored events helped all meeting participants

better comprehend the complexities of the various issues

that emerge when considering climate change. For example,

the Council convened a forum to increase understanding

about the Clean Development Mechanism, the results of

which are described in chapter 5. As defined in the Kyoto

Protocol, the CDM is intended to provide a means to facilitate investment in projects that help developing nations

achieve a cleaner growth path, and, in turn, help investor

countries earn credits for subsequent greenhouse gas emissions reductions. By reaching out to diverse stakeholders 

including businesses that might invest in CDM projects,

developing countries that might want to attract these investments, and environmental groups and nongovernmental

organizations interested in the Kyoto Protocol  participants were able to discuss the opportunities and challenges

in establishing a viable CDM. In this respect, Council outreach helped further a broad understanding of the various

stakeholder perspectives.

The pursuit of climate protection is fundamentally

linked to any national agenda for sustainable development.

The Council is convinced that collaborative approaches

focused on defining and reconciling the needs and aspirations of individuals with community values and the requirements of future generations can help promote direct and

meaningful action to protect the climate. By working

together, we can reap the benefits of acting to protect the

climate as we strive to achieve economic growth, environmental protection, and social justice for ourselves and posterity.

Introduction

S

ixty years ago, the Worlds Fair of 19391 introduc

to its visitors The World of Tomorrow. The fa

Futurama exhibit presented a glimpse of life 

the year 1960. Millions of people visited the diora

depicting life in the city of the future, and millions m

saw the movie reel made about the exhibit and the vis

it presented. In some ways, the sustainable developm

issues we face today arose out of the nations pursuit o

modern world without limits, as reflected in that 19

vision.

A lesson from the 1939 Worlds Fair is that Amer

and the world can benefit from a concrete, positive vis

of a sustainable world. To have any effect, this vision m

be appealing and meaningful to people  it must rep

sent the kind of world people are willing to build. Tod

as we think about the promise of the future, we recogn

the need to make changes to the economic, social, a

environmental protection practices of today so that fut

generations will enjoy that promise.

The 1997 charter asks the Council to advise 

President on the next steps in building the new enviro

mental management system of the 21st century.2 T

environmental management system refers to the ove

framework of a broader set of institutional and individ

influences that effect the environment including, but n

limited to, environmental laws and regulations, corpor

stewardship, economic and financial systems, and ot

features of organized society.3 In the greatest sense, t

framework4 represents all human activities that directly 

indirectly affect the environment, extending the oppor

nities we have to address change while simultaneou

protecting the environment.

The 1996 report of the Presidents Council 

Sustainable Development (PCSD)5 made a number of r

ommendations regarding the nations environmental m

agement framework. These included: accelerating effo

to evaluate existing regulations and to create opportunit

Reinvented, the environmental management framework can emphasize

watershed protection, habitat restoration, community-based environmental

protection, or brownfields redevelopment.

There are, in fact, economic and 

social dimensions to almost every environmental issue  and these 

are frequently interrelated.
CHAPTER 3

ENVIRONMENTAL MANAGEMENT

for attaining environmental goals at lower economic costs;

creating an alternative performance-based management

system; using market incentives as a part of an overall

framework; and shifting tax policies and reforming subsidies that encourage environmentally damaging activities.6

Building on these recommendations and other recent

work (some of which is discussed Appendix B-3),7 here

we focus on integrating key concepts and recommending

next steps for organizing environmental management

toward sustainable development.

The next section of this chapter briefly discusses why

the system needs to advance and describes how that

process has begun. This is followed by a section on

Attributes which presents further observations on the

vision of a new environmental management framework

and its key attributes8 (e.g., Improve Performance, Ensure

Environmental Stewardship, Involve Communities).

Finally, we offer specific recommendations about the next

steps in building a new framework to foster sustainable

development. These recommendations suggest how and

where change can happen, although any new framework

would encompass a far greater number of issues, as well

as the imperative of the international context.

BUILDING A NEW 

ENVIRONMENTAL 

MANAGEMENT 

FRAMEWORK

The need to improve environmental quality will n

be eradicated once a certain threshold or level 

protection has been reached. Even as we contin

ously and persistently strive to enhance our economic w

being, our health, and the quality of our lives, so too m

we constantly pursue a goal of improved environmen

quality. To this end, we must build an environmental m

agement framework that will, now and in the future, p

mote clean air, clean water, less stress on fragile resour

and natural habitats, and greater resource productivity.

An environmental management framework that f

ters sustainable development has a clear and indisputa

goal: continuous9 environmental improvement t

respects the importance of social and economic w

being. If the new environmental management framewo

of the 21st century is to drive continuous environmen

improvement to accompany continuous economic a

social gains, the framework must optimize the posit

dynamic interplay between people, markets, informati

technology, and the natural world.

Over the past several years, numerous experime

have been undertaken that suggest the shape of a new en

ronmental management framework conducive to susta

able development.10 Conventionally, environmental prot

tion has focused on individual waste streams from facilit

Reinvented, the environmental management framew

can emphasize watershed protection, habitat restorati

community-based environmental protection, or brownfi

An environmental management framework that is organized for improving performance

includes, but is not limited to, the following characteristics:

 Focuses on performance results and progress towards goals;

 Measures, analyzes, and disseminates performance information and other indicators that can help organizations

improve environmental performance results;

 Uses environmental management and accounting systems that establish clear and effective performance-based goals

and encourage innovative means of achieving current and future environmental requirements; and 

 Increases resource productivity (i.e., doing much more with much less) and fosters simultaneous improvements in 

productivity and the efficient use of materials and energy.

Photo: Stephen Delaney, U.S. Environmental Protection Agency.
38 CHAPTER 3

ENVIRONMENTAL MANAGEMENT

redevelopment.11 These and many other initiatives point the

way to an environmental management framework for sustainable development. While none of them individually represents a complete model, they each suggest elements that

should characterize of the environmental management

framework of the future. Moreover, the combination of

these elements would undoubtedly have a multiplying

effect, increasing the performance level of each element.

A new environmental management framework will

include standard requirements for all regulated activities

with more flexible strategies for those demonstrating

strong environmental performance and improvement.

Such a framework will tap a combination of voluntary,

regulatory and market mechanisms that motiv

improved environmental performance, recognize 

value of community, and respect a sense of place. T

new framework will focus on and encourage more e

cient and effective performance levels for environmen

management and protection.

This chapter aims to accelerate implementation o

new environmental management framework. The next s

tion presents a vision of sustainable development; the s

sequent section presents recommendations that help al

and sensitize the current environmental protection syst

toward sustainability. Together they provide a compass 

charting the next steps in building the environmental m

agement framework of the 21st century.

The recommendations presented here are accom

nied by corresponding examples to indicate where interv

tion for sustainable development might occur.12 These re

ed environmental management activities are used to ill

trate the concepts being discussed and are not necessa

intended as an endorsement of any specific program. 

with most environmental management reforms, these a

other recent initiatives were not explicitly designed 

achieve sustainable development goals; many are achiev

success, but not always in the integrative way, or to 

degree, that sustainable development requires. Finally, 

making these recommendations, the Council has not iden

fied what the roles and responsibilities of each sector sho

be. Rather, these recommendations are presented so that 

groups and institutions can take the next step by making 

commitment to act, both individually and collaboratively

Through communication of the principles of environmental stewardship, it is hoped that the

following will be achieved:

 Wider understanding of the need to face the environmental, economic, and social demands of growing population

and greater prosperity together (that is, weighing economic development and growth against the carrying capacity of

local and global ecosystems).

 Redefinition of commercial activity to focus on the delivery of service and value instead of the delivery of material or

products.

 Increased adjustment of public works and institutions, private enterprise, and human activity to operate in ways that

understand and complement the natural cycles of the Earth.

 Integration of environmental management with core business strategies so that environmental stewardship has value

as a part of doing business.

 Integration of renewable (sustainable) forms of energy into mainstream production processes.

The Henrys Fork Watershed Initiative aims to improve water

management policies in the river basin. Here, the Henrys Fork

Watershed Council conducts a Web of Life exercise, intended to

demonstrate the interconnection of interests among watershed parties. Participants included representatives from the U.S. Bureau of

Reclamation, the Idaho Department of Fish and Game, the

Fremont Madison Irrigation District, the Department of

Environmental Quality, and members of the local agricultural

community. Photo: Center of Excellence for Sustainable Development.
CHAPTER 3

ENVIRONMENTAL MANAGEMENT

ATTRIBUTES OF NEW ENVIRONMENTAL 

MANAGEMENT 

FRAMEWORK

One of the most important revelations of the

Council in Sustainable America was that meaningful and long-term solutions for environmental,

economic and social equity problems will require new

strategies that redefine the source of problems, create

mutual benefit throughout society and the chain of commerce, and achieve multiple goals  environmental, economic, and social  simultaneously. Sustainable America

promotes the concept that no matter what environmental

issue we choose to address, our goal should be to understand the interrelated economic and social aspects of that

issue as well. Solutions must therefore address the environmental, economic, and social aspects of issues and problems as they relate to one another.

The seven characteristics of a new environmental

management framework described below, are among the

requisite, interrelated components that constitute the

Councils further vision of a sustainable development

approach to environmental management in the 21st century.13

IMPROVE PERFORMANCE

Improve environmental conditions beyond exist

requirements and measurably increase resource produc

ity with performance-focused environmental mana

ment.

Environmental management decisions should fo

on improving environmental performance, taking in

account social and economic impacts. To facilitate t

approach, incentives for continually improving perf

mance must be incorporated into environmental mana

ment in ways that encourage innovation for performan

beyond existing requirements. Equity and economic grow

should also be seen as performance-improving goals.

Sustainability requires all organizations to str

beyond existing requirements with innovative, improv

or enhanced processes or pollution prevention techniqu

Organizing for improved environmental performance c

accelerate progress towards sustainable development a

may encourage innovation and development of n

approaches for achieving environmental managem

goals. In pilot programs, this has been done by categor

ing regulated entities into separate tiers based on perf

mance. For instance, Greentrack describes programs 

initiatives designed to reward and support top enviro

mental performers, although incentives are needed 

motivate all organizations to perform beyond exist

requirements.14 The value of organizing environmen

management toward performance goals also applies 

public facilities or other entities that may not be regulat

monitored, or currently expected to create and man

performance goals. A framework that focuses on perf

mance will challenge all sectors to improve productiv

and the efficient use of materials and energy.

ENSURE ENVIRONMENTALSTEWARDSHIP

Producers and consumers share extended responsibility 

the environmental effects of making products, their use, a

waste streams through a life-cycle approach.

Economic growth, and therefore sustainable development, cannot occur without a

commensurate increase in employment

opportunities.

Increased levels of community stakeholder involvement influence decisions through:

 Inclusive collaboration for problem solving and planning to ensure that companies, agencies, and communities ca

achieve mutually beneficial results;

 Better reporting systems and planning processes that inform and involve the public; and

 Ensuring that environmental benefits are shared and burdens reduced across society without disproportionate impact
40 CHAPTER 3

ENVIRONMENTAL MANAGEMENT

Environmental stewardship is an ethic and practice

of responsibility toward the Earth and its natural processes for the life of products, materials, and energy. It suggests that this responsibility is shared variously by all those

in the flow of commerce. Environmental stewardship is

an essential element of an environmental management

framework.15 Indeed, a shared sense of responsibility

towards the natural environment is necessary to achieve

the objectives of sustainable development.

INVOLVE COMMUNITIES

Foster collaboration in problem solving and planning

among companies, agencies, and citizens to achieve mutually beneficial communitywide results.

Communities, governments, and businesses can form

a powerful degree of consensus, building a culture of inclusive engagement to support sustainable development. The

process of making decisions that affect the environment

and the community can often be enhanced by sharing information resources, clearly articulating objectives, and collaborating with stakeholders. Information from the community helps expand environmental management decisions to

include social and economic issues. Community partici

tion and multistakeholder collaboration processes at 

firm level and at all levels of government and public af

ation can also help optimize the efficacy and efficiency 

environmental management decisions.

Not all communities are alike or seek the same le

or type of involvement. Stakeholders know and c

describe problems, priorities, and concerns; but genera

they do not possess the resources to solve technical pro

lems, to help set complex standards, or to involve the

selves in time-consuming processes. Decision-mak

processes should be designed to ensure that they nev

theless have a meaningful role. Orienting and expand

collaboration to a regional scope may increase the lik

hood that, to the greatest extent possible, agreement o

sustainable design will be attained without diminish

individual community needs or voiding national goals.

ENGAGE EMPLOYEES

Advance employment opportunities in healthy, safe, a

ecologically benign work environments and offer hum

resource development that satisfies the talent, skill, a

desires of employees.

In Sustainable America, the Council said that jo

productivity, wages, capital and savings, profits, inform

tion, knowledge, and education must grow to achiev

vision of sustainable development.16 Sustainable develo

ment extends to employment both in terms of the level 

employment needed for a sustainable society and the qu

ity of employment desired by working people. No econ

my can survive long without addressing both of th

related issues.

Environmental education and training provided 

part of job responsibilities have been shown to enhan

employee involvement in environmental management a

to increase performance levels beyond compliance. 

Cornell University study determined that a serious a

organized effort to involve employees in pollution p

Waste streams 

can provide raw 

materials for 

new products.

Saprophyte, LLC

uses industrial 

wood waste as a 

novel source of 

materials for 

modular furniture.

Photo: Saprophyte, LLC,

Providence, Rhode Island.

One of the far-reaching aims of sustainable development is to better align human

activities with the natural cycles of the

earth...
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ENVIRONMENTAL MANAGEMENT

vention is more important to program effectiveness than

the occasional solicitation of their ideas. The employee

needs to believe that the organization is making a serious

effort to involve and empower him or her in matters of

pollution prevention.17 Similarly, energy efficiency and

materials management can be optimized when this same

level of engagement is reached.

The management framework that fosters sustainable

development is one that achieves environmental benefits

while simultaneously establishing a positive, rewarding

work environment. For this to happen, the future framework needs to recognize the asset and productivity value

of human capital, as well as the employment levels needed to promote prosperity for greater numbers of people.

Economic growth  and therefore sustainable development  cannot occur without a commensurate increase

in employment opportunities.

PROVIDE INFORMATION

Use standardized public reporting formats and comparable

data sets comprised of metrics, benchmarks, and/or common indicators of environmental performance geared

toward generally accepted accounting practices and for generating feedback systems for learning.

An information-rich system, one that generates and

disseminates accurate and useful information, has multiple

advantages. It motivates those who are being measured to

perform better. It allows analysis of past experience to

inform future practices.

Information rich does not mean, however, that

more is better. Information is relevant to the environmental management framework to the extent that it is

meaningfully incorporated into decision-making processes

and adds to the learning that leads to problem solving.

Open information policies and practices recognize that

disclosure, transparency, and active dissemination 

information should be the rule, not the exception, w

the goal of increasing access to public information for 

segments of society.18

A new environmental management framework ne

high-quality baseline data and metric measurements 

information that should be accessible and understanda

to the public  and methods for making sustainable de

sions. Performance should be monitored against th

baselines to measure and verify effectiveness of enviro

mental management and resource productivity. In ad

tion, benchmarks and indicators are needed to cond

comprehensive impact assessments; evaluate the effecti

ness of environmental management programs; and m

sure progress towards sustainable development at 

local, state, national, and global levels.

ADOPT INTEGRATED

APPROACHES

Employ a systems approach towards environmental m

agement and sustainable development that aligns and ma

tains a balance of economic and social influences that co

plement natural cycles or ecological systems.

The fates of the economy, social well-being, and 

natural environment are intertwined. For example, 

pursuit of eco-efficiency (improvements in environmen

performance) should benefit both the natural and so

environments. Although it is not possible to take ev

interdependence into account in every decision, think

about activities in terms of holistic systems with integr

ed economic, social, and environmental components c

eliminate costly mistakes, unintended consequenc

duplication, and gaps. The future framework needs 

encompass not only the traditional elements of enviro

mental protection, but also consider nontraditional fact

Climate Change Opportunities:

Market mechanisms are likely to play a significant role in any strategy to reduce greenhouse gas (GHG) emissions.

Some financial institutions are already beginning to reassess and project the value of energy efficiency, renewable energy, technology, and environmental management in future markets. This evaluation is based on the perception that foreign markets and governments are moving to provide incentives  both economic and political  for early reductions

in GHGs and other releases that may become marketable. Participation and formal credit for emissions reductions in

such market programs can be facilitated by the use of environmental management and accounting systems that include

measures to track energy efficiency and GHG reductions.
42 CHAPTER 3

ENVIRONMENTAL MANAGEMENT

that affect the environment, such as energy efficiency, the

dynamics of ever-increasing per capita demand for products and services (e.g., vehicle-miles traveled), and the

impacts that reductions in one media might have on

another (e.g., multimedia and crossboundary effects).

At the broad resource management level, systems

thinking means employing approaches that consider the

entire ecosystem. The concepts of biodiversity and bioregional or crossboundary effects instruct us that natural

systems play a crucial role in building the best environmental management and economic development

approaches. Energy use and natural resource consumption

are particularly vulnerable to waste. Management, logistics, and accounting systems should be used not merely for

efficiency, but to design better delivery and service patterns that lead to reduced energy and natural resource

demand.

At a community level, brownfields redevelopm

provides an example of an approach that is integrated a

holistic. Previously industrialized land is being redev

oped with a differentiated approach to environmen

cleanup costs, although each such brownfields site m

address acceptable levels of risk in accordance w

planned uses and any unaccounted for pollution. In gene

brownfields are a cost-effective option for managing urb

sprawl by reducing greenfields development.

At the facility level, systems thinking means treat

a facility as a holistic entity, or a closed loop.19 Integra

and holistic systems also address the entire life cycle 

materials and energy. Together, these concepts sugg

that manufacturing be treated not as a linear activity, b

as circular. . . in a closed loop, sustainable system...treat

products holistically from cradle-to-cradle. . . to establ

pollution prevention and product stewardship as stand

business practices.20 

At all levels, holistic environmental understanding 

be introduced to more closely complement or incorpor

natural biological cycles and systems. One of the far-reach

aims of sustainable development is to better align hum

activities with the natural cycles of the Earth by design

our systems to mimic the cyclical flow of energy and wa

within natural ecosystems.

USE ACCOUNTING SYSTEMS AND MARKET

MECHANISMS

Recognize the economic value of natural resources as ass

and, the business and financial value of environmen

management performance; create appropriate incenti

Future opportunities for measuring environmental performance include:

 Reporting relevant, comparable, standardized environmental performance information (both local and

global, public and private);

 Providing useful information about ambient environmental quality and conditions;

 Creating synergy with the evolution of international

environmental management standards;

 Developing decision-making tools for investors, customers, vendors, regulators, citizens, etc.;

 Tracking energy efficiency, increased resource productivity, land use, and other indices of sustainable

development; and

 Enhancing the ability of stakeholders and regulators

to assess environmental performance improvements.

The Florida Department of Environmental Protections Environmental Performance Measures program developed

sustainability plans that identify key issues and multi-agency strategies to improve environmental conditions within

regional ecosystems. This program uses a four-tier system to monitor agency performance. These tiers include

Environmental and Public Health Indicators, Behavioral and Cultural Measures, Outputs and Activities, and Resource

Efficiency Measures. These four categories are intended to work together, allowing environmental management to be

considered at different levels.

Accounting for Sustainable Development (ASD), developed in cooperation with the Society of Management

Accountants of Canada to measure sustainability in corporations, is an accounting approach that encompasses the

entire cycle of production, also known as full-cost accounting. Currently, the ASD framework is being utilized in the

development of some environmental management systems.
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ENVIRONMENTAL MANAGEMENT

that stimulate innovation and the use of market mechanisms in the pursuit of environmental goals.

Ecosystem functions and natural resources have

value. So long as these benefits  and the costs associated with externalities such as pollution  go uncounted,

environmental management will remain a cost-centered

phenomenon, unable to drive sustainable environmental

results. This evolution will occur only as the economic and

social value of biodiversity, watersheds, wildlife, and other

natural resources are finally realized, and environmental

accounting becomes a regular approach within businesses,

governments and other organizations.

In a framework that fosters sustainable development,

environmental quality and economic vitality can be

achieved together. A new environmental management

framework should employ economic means that will motivate businesses and individuals to improve environmental

quality. The key to linking market rewards with improved

environmental performance is the recognition of externalities, or releases into the natural environment, as waste

in the economic system.21 By contrast, reducing pollution

and increasing efficiency often produce financial gains to

the economy that are left out of the accounting system.

Managerial accounting practices can be an appropriate tool for integrated environmental management as

reflected in firm accounts. The use of managerial accounting systems to track the full costs and benefits related to

environmental performance is very important to the firms

identification and implementation of environmentally

preferable practices. Although some firms use managerial

accounting information in their approach to environmental management, they often fail to link such information to

their financial performance (e.g., shareholder value). The

reporting of environmental impacts and financial information to external interests, and the inclusion of environmental performance, liabilities, and expenditures in company financial statements, can be powerful drivers for

firms to improve their overall value as well as their environmental performance.

Financially related drivers in lending, investment, and

insurance increasingly anticipate, value, and reward

improved environmental performance. One way for firms

to take advantage of good environmental performance

internally is to link environmental management with their

business strategy and financial performance. For instance,

a particularly effective environmental management system

may lead to discounts in credit rates or insurance costs, or

may return market value to the firm. Understanding and

reporting the financial value of this environmental perf

mance allows organizations to better allocate public a

private resources.

Separate, but related, to the managerial and finan

accounting for environmental management is the em

gence of market-related mechanisms. Market-ba

mechanisms to reduce pollution that are linked directly 

an organizations profitability can motivate organizatio

to improve environmental performance. Market-rela

mechanisms are not a stand-alone solution. Rather, so

can be coupled with the existing regulatory system 

achieve the objectives of the new framework. Other typ

of market-related mechanisms need additional regulatio

in order to be implemented, or changes in the current r

ulatory system to function effectively and efficien

Ideally, good strategies will work with or enhance the c

rent system, or break down barriers to improvement.

RECOMMENDATIONS

MEASURING PROGRESS

AND ACCOUNTABILITY

Developing and using high-quality information on en

ronmental performance and conditions are critical to a

management framework and must be incorporated at 

levels of decisionmaking. Information by itself, howev

does not solve problems. Information-driven appl

learning leads to change. Ideal information syste

improve the collection, organization, and dissemination 

comprehensive, relevant data; reduce duplication a

streamline reporting requirements; and inform decisio

makers about economic, environmental, and equ

impacts to set better goals.22

The Global Reporting Initiative, a multiyear project

of the Coalition for Environmentally Responsible

Economies, aims to establish - through a global, voluntary, and multistakeholder process - the foundation for standardized corporate sustainability reporting worldwide. The effort is intended to elevate sustainability reporting practices to a level equivalent to

and as routine as, financial reporting in terms of

comparability and generally accepted practices. Draf

guidelines will be beta tested on roughly two dozen

organizations.
44 CHAPTER 3

ENVIRONMENTAL MANAGEMENT

Information needs to be sufficiently comprehensive

to enrich collaborative decisionmaking and measure real

progress. Insular anecdotes, dated reporting materials, and

periodic assessments must be replaced by a more comprehensive, credible, and standardized data collection and

reporting system that is relevant and valuable to managers,

the marketplace, and interested citizens or groups.

Environmental performance data should be shared with

the public in a timely manner to provide tangible accountability and to foster environmental awareness. Education

and information technologies such as the Internet can

increase public understanding and access to comprehensive, useful data. However, balanced against the publics

right to know and need to understand is the obligation to

protect valid confidential business information.

Assessing and reporting performance can improve

the overall quality of both private and public operations.

Better performance can facilitate participation in innovative management strategies that reduce overall costs while

providing improved environmental protection. In addition, measuring, accounting, valuing, and disclosing environmental performance to investors, customers, vendo

and the public may enhance the enterprise or busin

value of some corporations.23 Further development a

implementation of environmental assessment tools a

accounting criteria for economic, financial, and regulat

purposes are needed to realize these benefits more bro

ly.

Recommendation 1

Measure environmental progress.

The public must be confident that progress is be

made to achieve national, state, and local environmen

goals. To assess that progress, environmental performan

and conditions should be measured at many levels: natio

al, state, discernible regions, community, company, a

individual facility (whether industrial, agricultural, pub

or commercial). Collection and dissemination of go

National Metal Finishing Resource Center is comprehensive environmental compliance, technical assistance and pollution

prevention information source available to the metal finishing industry. The Center is an Internet Web Site that casts infor

mation in a way that makes it accessible to an entire range of users and establishes convenient and user-friendly delivery

mechanisms. It also serves as an information resource and distribution channel for technical assistance programs and has

many on-line conferences whereby users can talk to each other about specific compliance issues. Services and products

include: an EPA Regulatory Determinations collection pertaining to metal finishing; performance and cost comparisons

across technology options; pollution prevention case studies; and vendor information.

The Digital Earth concept, although not yet fully operational, is a characterization of the terrestrial natural and cultural

environment, referenced in space and time, along with the educational program needed to communicate the possibilitie

and procedures of using a fully developed imaging system of the Earth. Within the United States, the National Spatial

Data Infrastructure established by Executive Order in 1994 provides the basic mechanism for the coordination, access,

and distribution of the geospatial data needed to form the Digital Earth. These data can be used in geographic information system applications, which is of increasing interest at the local government level. International or global data

sets can extend the geospatial components beyond U.S. borders.

Strategies that provide incentives for performance improvement should be sensitive

to business size and sectoral 

differences, distinguish between strong and

weak performers, and leverage third-party

agents when their participation would be

feasible and effective.

The Chemical Industry Compliance Assistance Center

makes available a wealth of detailed information on

federal regulations and pollution prevention practices,

including plain-English guides, pertinent interpretative

memoranda, compliance checklists, fact sheets, and

links to technical assistance providers, state/local regulators, and professional and industry organizations.

The Center is sponsored by the National Center for

Clean Industrial Treatment Technologies, a research

consortium dedicated to advancing pollution prevention, along with the Pacific Northwest National

Laboratory, the University of Wisconsins Solid and

Hazardous Waste Education Center, and EPA.
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ENVIRONMENTAL MANAGEMENT

environmental information linked to established goals

may help drive performance improvement and better

planning, increase resource productivity, and alleviate

stresses on the environment.

Various stakeholders use environmental information

in different ways. For policymakers, this information can

be integrated into a larger set of indicators for sustainable

development.24 Regulators can use environmental performance data to better allocate resources for program management. For the private sector, environmental accounting

helps determine the strategic business value of environmental activities, which can be an important factor in business planning and the creation of new markets.

Information on pollution trading rates, ambient conditions, and environmental resources can be used by citizen

groups and others to set goals and determine priorities for

community development and restoration.

Action 1 

Develop and apply agreed-upon sustainable developm

indicators and collect the necessary data for measuring en

ronmental progress at the regional, state, and national lev

Action 2

Develop, apply, and report on specific indicators for fa

ities, firms, sectors, communities, and the economy 

track increased resource productivity (for services a

production, public and private).

Action 3 

Invest in information systems for monitoring environm

tal conditions to assess and report on local and regio

impacts and transboundary effects, and to establish prio

ties.

Action 4 

Use accounting practices in the management of enviro

mental performance at the firm level to derive strate

business value.

Action 5

Use financial performance information and analysis 

drive institutional decisionmaking toward the profitabi

of sustainable development.

Recommendation 2

Define common metrics for environmental performan

Performance metrics and indicators help ensure t

the right information is collected to support achievem

of environmental goals and to accelerate progress towa

them.25 A common set of metrics, measurements, a

indicators is needed to meaningfully inform communit

nongovernmental organizations, regulators, and finan

analysts interested in the environmental performance 

organizations. This set must be consistent, unbiased, a

understandable; relevant to the issues being addressed; a

to portray trends over long time periods; and capable 

communicating the relative risk and comparable progr

on various environmental matters (see appendix B-1).

EPAs Environmental Accounting Project works to encourage the modification of accounting practices to accept and

explicitly account for the environmental cost of all business decisions. This program focuses primarily on managerial

accounting practices and those costs internal to the firm, and encourages identification of environmental costs within a

facility by product or process. This information can be used by managers to develop more accurate costing and pricing

of products and services. It is anticipated that applying environmental management accounting principles will demonstrate the business benefits of environmental stewardship and better performance.

The inside of F-16 fuselages are cleaned with a spray of water

and liquid soap. Replacing a process that used five tons of ozonedepleting chlorofluorocarbons (CFCs) and volatile organic chemicals annually, the soapy water process is part of a CFC-elimination effort that has saved Lockheed Martin Tactical Aircraft

Systems $8 million in the last five years. Photo: Pat Corkery,

Lockheed Martin.
46 CHAPTER 3

ENVIRONMENTAL MANAGEMENT

Ideally, a new framework that incorporates metrics and

indicators for common performance elements shared by

most public and private organizations would be developed

first. This reporting system would reflect both site-specific

(e.g., facility) and organization-level (e.g, corporatewide)

performance. These systems must then evolve to account

for sectoral and regional differences, and incorporate similar measures of economic and social well-being.

Action 1 

Develop multiple stakeholder agreement on and implement common metrics for measuring environmental performance (using a model of generally accepted accounting

principles where appropriate) to:

 Assess progress towards protection of human health

and the environment;

 Gauge operational flexibility and performance standards in alternative performance-based management

strategies;

 Identify market mechanisms and business values that

help improve the regulatory approach and drive optimal performance; and

 Communicate relevant environmental performance

and improvements.

Action 2

Measure environmental performance and report relev

information in a standardized format to foster contin

improvement for products, facilities, and firms.

Recommendation 3

Link environmental, economic, and social information

To balance interests and optimize progress towa

sustainable outcomes, environmental performance inf

mation must be integrated with social and economic inf

mation. Greater strides in sustainable development w

occur when businesses are able to capitalize on the fin

cial value of good environmental performance, life-cy

issues are considered in process and product design, a

consumers are able to see beyond the material to the va

of products. The paramount goal for integrating dive

types and levels of information is to affect the decisio

making process in such a way that sustainable develo

ment opportunities become more obvious, and theref

logical and desirable.

Action 1

Develop incentives for collection, dissemination, and 

of information on the life-cycle of products that focu

The Environmental Results Program of the Massachusetts Department of Environmental Protection is a sector-specif

ic program targeting small businesses that replaces the current state permit system with a mandatory certifying program

intended to be a more effective method for improving environmental performance. The state provides all businesses in

a specific sector (e.g., drycleaners, photo processors, printers) with detailed workbooks explaining why and how they

need to protect the environment in their workplace, and identifying specific required activities. The program also

incorporates an aggressive outreach strategy that includes working with the trade associations and translating material

into other languages when needed to reach business owners; a requirement that senior business officials certify their

companys compliance with environmental requirements; a targeted enforcement effort to assure compliance; and a

program evaluation component to monitor the industry compliance rate.

EPAs Common Sense Initiative is a participatory, multistakeholder program that seeks innovative ways to achieve environmental goals for six industry sectors. Under this program, the metal finishing sector recently launched a National

Strategic Goals Program to improve the environmental performance of metal finishing facilities. At the national level,

the industry committed to achieve a set of specific environmental goals (e.g., by the year 2002, 98 percent metals utilization on products, 50 percent reduction in metals emissions to air and waste, 50 percent reduction in water use). To

promote achievement of the goals, a tiered program offers incentives appropriate to four levels of environmental performance, as follows: operational or regulatory flexibility for top firms; compliance assistance for mid-performers, tran

sition assistance for firms that might otherwise abandon contaminated operating sites, and enforcement against chronic

noncomplying firms. EPA provides guidance and support to the program, which is being implemented and tailored by

participating state and local agencies.
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ENVIRONMENTAL MANAGEMENT

on optimizing the use of natural resources (i.e., materials),

building energy efficiency, and reducing environmental

impacts.

Action 2

Foster extended product responsibility by assigning

appropriate levels of care to those who have the greatest

capacity for stewardship in the life-cycle of a product.

Action 3 

Create information resources to focus commercial activity

on the delivery of service and value instead of the delivery of material or products.

Action 4 

Educate the public about and encourage organizations to

operate in ways that recognize and reduce environmental

impacts and that complement natural cycles of the Earth.

Improving 

environmental 

management and 

performance. 

The current national environmental protection syst

has achieved a substantial degree of success by requir

manufacturers to control pollutants; however, it is time 

consider implementing new approaches. After decades 

evolving environmental regulation, there is growing va

tion in the way different organizations perform. So

firms have already internalized the need for environm

tal stewardship into their business; others are sim

focused on compliance. Still other firms need a great d

of assistance before they are able to meet environmen

requirements at all. If the nation is to move toward s

tainability, progress must come not only from the lead

but through improvements in the performance of 

actors.

Tools such as pollution prevention, design for 

environment, extended product stewardship, eco-effici

cy, and environmental management systems that includ

commitment to continuous improvement enhance en

ronmental performance.26 These prevention approach

improve industrial efficiency through better energy a

materials management; they can also provide safer pla

to work and reduce the impacts of pollution on comm

nities. Organizations that lead the way in research, dev

opment, and application of these approaches should 

supported and rewarded. In addition, industry leaders a

Project XL (Excellence and Leadership) attempts to test new ways of producing better environmental results, while

achieving greater efficiency for business and increased public participation through active stakeholder processes. The

key to Project XL is regulatory flexibility to tailor regulations, policies, guidance, or approaches in a way that benefits

project sponsors, while at the same time improving environmental performance. With these efforts, social and community benefits are increasing as the stakeholder process improves and matures. Project XL and other EPA reinvention

programs represent cross-cutting attempts to improve and differentiate performance, thus providing important lessons

for making systemwide changes in the framework.

Launched in 1995, the European Eco-Management & Audit Scheme (EMAS) is a government regulated voluntary environmental management system. EMAS distinguishes itself from ISO 14001, the international environmental management systems standard of the International Organization for Standardization, by virtue of its requirement for a site-spe

cific public environmental statement. This statement must provide information on raw material, water and energy use,

pollutant emissions and waste generation, and any other significant environmental effect. Using the financial auditing

model, EMAS also provides for third-party verification of both regular site audits and the public statement. These features may add to the schemes credibility, and can help participating sites focus on continuous improvement of environmental performance and external communication. They also reflect the roots of EMAS as a public policy instrument

rather than an internal management tool, which is the focus of ISO 14001. Almost 2,000 sites in Europe have registered to EMAS. The European Union is currently proposing revisions to help make the voluntary initiative a better

complement to existing requirements and increase its benefits to participating entities.
48 CHAPTER 3

ENVIRONMENTAL MANAGEMENT

government should encourage adoption of more sustainable practices by the large majority of firms that are not

currently high performers.

Regulatory systems need to recognize the different

environmental management capabilities, commitments,

and performance levels of both private and public entities.

Differentiation among regulated entities must be based on

their level of commitment to environmental stewardship,

environmental management, and actual performance in

achieving their environmental objectives. Ambitious

national standards must be maintained, along with strong

enforcement to ensure compliance with those standards.

At the same time, the emphasis of some environmental

managers on improving environmental quality and

resource productivity  not just complying with standard

requirements  needs to be affirmed. The environmental

management framework and regulatory system should

offer appropriate incentives to improve organizational

environmental performance at all levels. Strategies that

provide incentives for performance improvement should

be sensitive to business size and sectoral differences, distinguish between strong and weak performers, and leverage third-party agents when their participation would be

feasible and effective.

Recommendation 4

Differentiate by sector and size.

The management response of individual companies to

regulatory programs depends on factors such as their size,

information sources, the level of competition in their sector, and degree to which they sell directly to individual consumers. Regulatory programs should acknowledge these differences and address the various sectors in ways that

account for their unique aspects and that will increase environmental performance. For example, regulatory agencies

can help smaller businesses or specific sectors comply with

targeted rules by providing detailed information about environmentally protective technologies, and by communicating

with the businesses through trade associations and suppli

ers. Regulatory agencies can also help small businesses

explore ways to realize economies of scale in environmen

protection such as sharing (i.e., aggregating) the costs and

use of pollution control equipment or by sharing experts

through cooperative contracts with environmental consul

tants.

Action 1

Implement management programs using environmen

performance information to provide the flexibility need

to meet specific requirements of regulated activities in 

following ways:

 Tailor programs and provide technical assistance 

create an economy of scale among small busines

to improve environmental performance (e

agglomeration or clusters).

 Tailor programs to recognize the specific regulat

and environmental performance issues associated w

important industrial sectors (e.g., the U

Environmental Protection Agencys [EPAs] Comm

Sense Initiative for the Metal Finishing Sector).

Recommendation 5

Promote high performance.

Excellence will find its reward in public recognition a

the marketplace. Government programs, however, sho

aim both to help align market rewards with good envir

mental performance and design program or system chan

to reward that achievement. Environmental performan

programs should be designed to encourage and prov

incentives to companies and organizations that consisten

outperform existing environmental requirements and that 

committed to continued environmental excellence a

improvement. Top performers with the ability and comm

ment to ensure high levels of environmental protect

should be aided and benefited by market rewards, pub

recognition, and increased operational flexibility.

One way to help motivate companies to pursue exc

lence in environmental management is to establish p

grams for alternative regulatory strategies, sometim

referred to as a greentrack or alternative path

Participating companies could propose process-spec

operational changes and alternative strategies leading 

both high environmental performance and increased pr

itability.28 Businesses that outperform existing enviro

mental requirements and continually improve perf

In the future, public and private institutions will need to evolve together as economic activity continues to grow and the

environmental management framework

becomes more complex, flexible, and

diverse.
CHAPTER 3

ENVIRONMENTAL MANAGEMENT

mance over time would benefit from the economic and

administrative certainty of such a program. As a condition,

they would be expected to report verified performance

information to government and the public.

It is crucial that proposals by a firm under any alternative regulatory strategy result in an overall environmental

improvement over what the firm is required to do otherwise. Therefore, such approaches must employ quantifiable

environmental performance measures and effective

enforcement mechanisms specifically targeted at, among

other things, the areas in which the firm has been offered

regulatory flexibility to ensure that performance is improving.

Government must be able to verify and enforce this

performance at least as reliably as it can under the present

system. Similarly, in the case where a firm is receiving regulatory benefits different from those under existing programs, the proposed alternative should confer a recognizable net benefit to society.

Current alternative regulatory programs are in the

developmental and experimental stages. Such programs

must establish clear goals, guidelines, and performance

measures for their success to be replicated more broadly; to

maintain the fairness of the system; and to ensure public

confidence. These programs must also be designed to

address concerns that small businesses may not benefit

equally, and that program design and monitoring may

demand additional resources from government and stakeholders.29

Action 1

Develop a voluntary program that motivates and rewards

high environmental performance and confers a net be

fit to society.

Action 2 

Define characteristics of good and outstanding enviro

mental performers (e.g., compliance history, modern en

ronmental management systems, continual improveme

pollution prevention, reported results, etc.).

Action 3 

Develop incentives for voluntary participation (e.g., op

ational flexibility, system of rewards/recognition, f

track, preapproval, multimedia, etc.).

Environmental Management Systems (EMS) Incentives Project. In 1997, the Oregon state legislature passed green

permits legislation to encourage regulated facilities to achieve environmental results that are significantly better than

otherwise provided by law. The EMS Incentives Project is one approach that Oregon Department of Environmental

Quality believes will achieve the environmental results envisioned in the legislation. The project uses a tiered system in

which greater environmental performance is rewarded with increasing regulatory benefits. For participating companies,

compliance with standards is the baseline level of performance required under the program. Measurable environmental

performance goals are established, and public reporting and meaningful stakeholder involvement are expected. The

three-tiered system requires demonstrated reductions in targeted environmental impacts; the highest and second highes

tiers must demonstrate that the facility is in the top 10 percent and 25 percent, respectively, of industry environmental

performance. Incentives include public recognition as an environmental leader, regulatory and operational flexibility,

and technical assistance.
50 CHAPTER 3

ENVIRONMENTAL MANAGEMENT

Action 4 

Provide administrative tools and incentives to motivate

middle-tier performers to achieve the standard of excellence set by high performers.

Recommendation 6

Align with the economy.

All environmental management programs need

effective methods to assess environmental performance

and ensure public confidence in the system. However,

information technology allows far more rapid change in

production processes and products than was previously

possible. More than ever, companies need to be able to

change their processes rapidly to maintain economic competitiveness. Government can and should do its best to

reallocate, adapt, and adjust its environmental management capabilities to keep pace with expansion and change

in the economy - currently, it is a significant challenge to

align environmental protection efforts with the econom

In the future, public and private institutions will need 

evolve together as economic activity continues to gr

and the environmental management framework becom

more complex, flexible, and diverse.

The number and types of activities that affect 

environment change with the economy. By contr

changes in the environmental management framewo

(arising from both the public and private sectors) t

would improve efficiency and effectiveness are not alw

in sync with fluctuations in the economy; for examp

environmental agency and program resources often 

behind economic improvement. Consequently, the en

ronmental protection system can suffer in its effectiven

or become an unintentional bottleneck, and frustratio

grow on all sides.

A new environmental management framework m

EPAs New England regional office is piloting the StarTrack program as a means of achieving better environmental per

formance through the use of environmental management systems and third-party certification. Companies participatin

in StarTrack are required to have an established compliance auditing program and demonstrated commitments to compliance, pollution prevention, and continuous improvement of environmental performance. To meet program requirements, companies conduct comprehensive compliance audits and environmental management systems audits. Qualified

independent third parties review and certify the audits. Action plans must be developed to address any areas of noncompliance and any areas needing improvement in the environmental management system. Each company prepares an

makes publicly available an annual environmental performance report. If successful, this program has the potential to

produce improved environmental protection, improved public understanding of companies environmental performance, and improved efficiency in the use of public and private resources. Moreover, by monitoring and reducing the

environmental impacts of performance, flexible operational alternatives can be identified and adverse effects prevented

in a more verifiably routine manner.

The Licensed Site Professional (LSP) program of the Massachusetts Department of Environmental Protection is an

innovative bridging of government and private sector resources. It uses licensed nongovernment professionals to oversee contaminated site cleanups, thereby accomplishing more cleanups than if the state reviewed all sites on its own.

Although the state still maintains oversight responsibility at a small number of sites that have been identified as the

most serious and/or complex, private LSPs are responsible for approving the key response actions at all other sites,

using the redesigned remedial program as their guide. Responsible parties and their LSPs must follow the processes and

meet the standards specified by the state, document actions taken, and provide an opinion from the LSP stating that

the cleanup work complies with state requirements. Thus, those who wish to proceed rapidly with cleanups can do so

without delays occasioned by shortages of state staff time. This system has accelerated cleanups statewide without

reducing environmental standards.
CHAPTER 3

ENVIRONMENTAL MANAGEMENT

anticipate change and strive to evolve. Indeed, mechanisms

that act to ensure that environmental protection automatically matches changes in the economy are in various stages

of development. For some of those sytems, a significant

infrastructure and an assessment of performance is still

needed. Potential mechanisms include market-based programs and charges for some programs; the use of qualified

third parties (who are neither the regulated nor the regulator) to document and improve environmental performance;

and the adoption of environmental management systems

(EMSs), including firms growing use of the ISO 14001, the

international environmental management systems standard

of the International Organization for Standardization

(ISO). (For more information, see appendix B-2.)

Market Mechanisms. Market-based programs and charges

use regular market functions to protect the environment.

Under these systems, the cost of pollution is set by the

market, and costs to companies are linked directly to their

environmental performance. Companies thus have

increased incentives to reduce these costs through innovation. The government plays a very different role in this

sort of system than it does in most other environmental

protection programs. Its primary role is to maintain the

integrity of the market, ensuring that companies are actually buying and selling what they report. The government

also must ensure overall progress toward environmental

goals. Market mechanisms cannot be successfully appl

to all environmental problems; for example, where po

tants are not readily monitored and establishing a basel

for trading or validating reductions is difficult.

Environmental Management Systems. There is wi

spread and growing use of environmental managem

systems by organizations domestically and abroad as 

inherent benefits of these systems are recognized. T

Council believes there is potential in their use in prom

ing high environmental performance; however, the link 

performance improvement has not yet been made. 

environmental management system can be a signific

tool for sustainable development if the link to verifiab

credible reporting is made and performance impro

ments demonstrated. Alone, environmental managem

systems (including properly certified ISO 14001 system

do not necessarily ensure improved environmental co

pliance and performance (see appendix B-2). Rath

effective environmental management systems can prov

significant structural support for improving performan

if coupled with qualitative and quantitative performan

commitments and goals. To make such environmen

improvements, systems must be in place and produc

verifiable performance results.

Third-Party Certification and Auditing. Private sec

third-party certification and auditing company services 

used by firms to review corporate environmental mana

ment activity. These third parties can be used to revi

permits, certify environmental management systems, au

compliance, or verify environmental performance resu

and reporting. A commercial industry of highly qualif

and competent third-party certifiers and auditors (ana

gous to financial auditors who certify the accuracy of c

tain segments of the financial system) could be an imp

tant feature of a more diverse environmental managem

framework. These services could be used by high-p

forming organizations as part of their alternative regu

tory strategies; firms interested in partially outsourc

aspects of their environmental management functio

Environmental performance and environmental management apply to communities and geographic regions as well

as to businesses and industrial sectors.

The Bronx Community Paper Company, a 100% recycled paper

mill, was planned by the Natural Resources Defense Council and

designer Maya Lin in collaboration with south Bronx community

groups. Constructed on a brownfield, the mill will recycle wastepaper, clean up and reuse sewage water, and produce livable wage

jobs in the poorest census track in New York City. 

Photo: Maya Lin and Natural Resources Defense Council
52 CHAPTER 3

ENVIRONMENTAL MANAGEMENT

and, potentially, government agencies to augment their

oversight activities.

Currently, the field of third-party certification is in its

initial stages of development, and fundamental design and

oversight issues must be addressed. Private auditing

arrangements can supplement, but do not replace, governmental oversight. However, such an industry could augment 

government inspection efforts, adapt more quickly to

changes in the economy, and help ensure the publics confidence in the new environmental management framework.

Once developed, an effective third-party system would

need to maintain very high standards. That is, it is necessary

to ensure that what the recognized third-party certifiers

have approved should, in fact, have been approved. Any

auditing system (public or private) can fail: auditing standards may prove ambiguous; auditors can be lax, poorly

qualified, or incompetent, or may be deliberately misled.

Existing financial auditing and accounting systems occasionally fail; a similar failure in an environmental auditing

system could have disastrous effects on human health or

the environment. Safeguards need to be put in place to prevent such harms where auditing systems fail. For instance,

poor-performing auditors should be penalized through disqualification, civil liability, or criminal sanctions.

In systems of this kind, the governments ability to

establish and enforce environmental standards, and ensure

the veracity of a limited number of validated certifiers, is

essential to environmental protection. Equally essential

would be the maintenance of clearly defined auditor qualification standards, which may be based on voluntary co

sensus standards where practical. Comparable progra

should be available to both small and large busines

Properly designed, such programs should complement a

enhance community involvement.

All parties  government, business, and the public 

could potentially benefit from the services of a vibr

third-party certification and auditing industry where 

participants are qualified and competent. Governments 

serve as a catalyst for this by providing guidelines that 

be used for accrediting third-party certifiers and audit

under certain conditions; creating voluntary programs t

stimulate a demand for this new service; and in helping 

maintain strict standards for third-party certifiers a

auditors. As part of the activity relating to this area, g

ernments should evaluate whether any new programs re

ize the anticipated environmental protection, flexibi

and gains, and resource savings.

Action 1

Environmental management systems (EMSs) of high-p

forming organizations can and should include mec

nisms for successfully ensuring compliance accurat

measuring and reporting performance. Systems may v

by size and type of organization, but comprehens

EMSs used by high performing organizations would sh

the following characteristics:

 A plant-specific EMS, or corporate-level, system imp

mented at the plant level;

 Accepted corporate environmental principles, polic

and goals;

 Commitment to compliance baselines and continu

improved performance;

 Identification and prioritization of environmen

aspects and impacts;

 Environmental performance metrics/indicators;

 Sufficient public involvement and public reporting 

permit meaningful understanding of facility mana

ment, performance, and compliance status;

 Pollution prevention, design-for-the-environme

and life-cycle approaches;

 Supply chain and extended product responsibi

efforts;

 Environmental accounting;

 Periodic system evaluation or auditing;

 Provisions for corrective/preventive action w

regard to identified problems; and 

 Senior-level responsibility and interdepartmen

agreement.

The policy of the Cape Cod Commission is to create

diversified, sustainable development in the Cape Cod

region. A regional approach is used to address environmental resource issues that cross traditional

boundaries. The Commission encourages economic

activities that minimize harmful impacts on the environment and society, while avoiding the after-the-fact

regulatory battles and cleanup bills. The Commission

embraces attempts to balance the competing needs

for economic opportunity, social equity, and preservation of the historic and ecological legacy unique to

the region.

The 14 river communities designated by a federal

advisory committee under the American Heritage

Rivers Initiative are experiments in how to combine

economic development, environmental preservation,

and cultural identification in positive community initiatives. All of this initiatives ongoing efforts relate

to the federal Clean Water Action Plan.
CHAPTER 3

ENVIRONMENTAL MANAGEMENT

Action 2

Encourage federal and state agencies to develop and test

voluntary incentive-based programs involving the use of

accredited third-party certifiers and auditors to:

 Certify environmental management systems (including properly implemented ISO 14001s);

 Conduct periodic, verifiable auditing of environmental compliance and performance, and review findings

with appropriate agencies; and

 Create and provide public reports of environmental

management and performance to allow for meaningful public understanding.

Action 3

Develop performance goals and program incentives for

enrollment in the above-described programs. Companies

seeking performance review, certification, and audit

results in such administrative and regulatory programs

must have a history of good compliance and environmental management systems that measure environmental

performance and compliance.

Action 4 

Conduct a critical review of current programs and policies

for the accreditation of third-party certifiers and auditors by

a panel of experts from business, the financial community,

environmental organizations, federal and state regulators,

and community representatives to determine what, if any,

additional guidelines and institutional changes are necessary

or desirable.

LINKING PLACES AND

STRATEGIES

Connections to our community and a sense 

place have long contributed to the quality of o

lives. In many ways, these values are hard 

explain, and their existence is even harder to pro

Nevertheless, the strength and breadth of commun

bonds, as evidenced by support for local sports teams 

allegiance to schools and neighborhoods, demonstra

their importance. People value connecting with oth

and this affinity is the wellspring of community. A

when they do make these connections  through par

associations at school, churches, and synagogues, or blo

organizations  they are able to fix problems and m

progress in ways that they could not have done indivi

ally.

The Council believes that improving environmen

quality is everyones responsibility. Environmental perf

mance and environmental management apply to comm

nities and geographic regions as well as to businesses a

industrial sectors. The combined performance of bu

nesses, civic government, community organizations, a

public associations can greatly enhance the value and b

efits of local citizenship when organized to achieve en

ronmental outcomes that foster sustainable developme

Because the actions one group takes have an effect on 

others, identifying these linkages also allows commun

members to recognize that social, economic, and enviro

mental opportunities are often interdependent.

A new environmental management framework t

supports sustainability needs to respect and incorpor

the value of community and places, while at the same ti

ensuring that all communities have minimum basel

standards of environmental protection. It should a

extend expertness and assistance to places experienc

The Global Action Program in New York tries to empower individual households to change personal behavior and to

move consciously towards sustainable consumption. EcoTeams organize communities and households to analyze con

sumption patterns to reduce waste in the use of energy, transportation, and water resources. These EcoTeams wor

together and report their results to a national office, and their performance is compared to other teams. The impacts o

EcoTeams are felt in homes and communities.

The New Jersey Department of Environments Watershed Management Approach was developed to improve surface and

groundwater quality and quantity for all uses with a performance-driven environmental management framework. New

Jersey residents take on the responsibility of serving as stewards for their own watersheds. Information is acquired by th

stakeholders (including NJDEP) and then is developed into a watershed management plan, which drives activities and

investments in the geographic area. This approach allows stakeholders to determine the priority of problems and build

a better understanding of the environmental impacts of everyday activities.
54 CHAPTER 3

ENVIRONMENTAL MANAGEMENT

adverse environmental consequences to find and implement collaborative solutions that reduce those impacts.

Strategies that engage the community in monitoring environmental problems and crafting solutions have many

advantages. They create a forum for debating tradeoffs

that may be necessary; they tap the opinions and expertise

of people with diverse views and talents; and they can catalyze cooperative action.

Recommendation 7 

Foster a collaborative regional approach to environmental

protection.

Generally, environmental management is placedependent. Air emissions, however, can concentrate in a

relatively small area or cross jurisdictional boundaries,

depending on the characteristics and size of the airshed

and source of the pollution. Similarly, contaminants

released to water can be dispersed through a watershed or

can concentrate in sediments. Pollutants spilled on land

often make their way to the waters within a watershed, and

ultimately the ocean, as rains create soil erosion and

stormwater runoff, or as the pollutant seeps into groundwater. Since contaminants move from place to place, communities in one place cannot disregard the fact that co

aminants travel elsewhere.

Solutions to environmental problems therefore m

be place-sensitive, identifying specific problems affecting 

air- or watershed, the sources of the problems, and h

each source contributes to them. Solutions can be streng

ened by building on the regional nature of some enviro

mental concerns,30 and by tapping the resources and exp

tise of affected jurisdictions to devise and implement so

tions.

Regional, state, and local collaboration are essentia

achieving sustainable environmental management, espec

ly in natural resource and land use decisions. Regional- a

state-level collaboration can take multiple forms and oc

at different points in the same geographic area. For exa

ple, a collaboratively conducted sustainability invento

 an assessment of environmental impacts affecting 

area or region and of the availability of resources needed 

make progress  can provide a context for individual 

tiatives to enhance sustainable development. Target indi

tors for sustainable development include, for examp

water use, air and water quality, energy consumption, so

waste, education and business infrastructure, transpor

tion, natural resource assets, and overall economic progr

Regardless of the form, collaboration can embrace a vari

of community-based, intergovernmental, and market-ba

Minnesotas St. Paul Port Authoritys brownfields

redevelopment program is one of 16 showcase communities and has over 50 sites needing redevelopment. Due to scarce resources, the Port Authority

determines which sites to remediate based on the

extent of redevelopment costs, site configuration, and

a variety of social justice indicators such as the level

of unemployment, housing vacancies, and percentage

of rental property. The redeveloped land is given away

to businesses, which enter into an agreement with the

Port Authority to retain and attract businesses to St.

Paul. Agreements include design criteria relating to

energy efficiency, local hiring guarantees for St. Paul

residents, and livable working wages. The program is a

success: the Port Authority has three to four businesses competing for each available opening. This program has generated over $2 million a year in property

taxes, created over 1,500 job in distressed communities, and created 900,000 square feet of building space

in previously abandoned lots.

The environmental management framework needs to test and adopt new

approaches. . . The result will be a system

that is less uniform and more complex

but also more flexible.

Even in the face of scientific uncertainty, society should take reasonable actions

to avert risks where the potential harm to

human health or the environment is

thought to be serious or irreparable.

 Sustainable America, 199
CHAPTER 3

ENVIRONMENTAL MANAGEMENT

approaches.

Action 1 

Foster regional and multijurisdictional approaches to environmental protection (e.g., to address land use, transportation, etc.), while maintaining national standards.31

Action 2

Develop and use strategic assessments of regional economic

opportunities that support and are specific to watershed

management approaches (e.g., Clean Water Action Program).

Action 3 

Develop new mechanisms to attract capital to redevelop

brownfields (with the overall goal of increasing the ratio

of brownfields to greenfields use).

Action 4 

Implement and apply sustainable development inventories

to assess community environmental impacts, economic

opportunities, and natural resources in a comprehensive

manner.

Action 5

Encourage businesses and local governments to work with

communities in setting environmental priorities for sustainable economic development and land use planning. (e.g.,

smart growth, smart transportation, redevelopment, etc.).

Recommendation 8

Involve individuals and communities in improving environmental performance.

Perhaps one of the biggest hurdles in moving towards sustainability is overcoming the lack of awareness about the

environmental impacts of the lifestyle choices we make.

Individuals make decisions every day  where to live,

what form of transportation to use, what products to bu

 that, in the aggregate, can lead to large-scale environmental impacts that are difficult to manage. In most case

people make these decisions without adequate informati

and often without any idea of the potential environment

consequences. Similarly, communities make decisions abo

zoning, housing, schools, transportation, and other press

ing issues without accurate information on the relative

environmental costs of their choices.

Governments, educational institutions, and busines

need to build a more common understanding of how 

products we buy, the policies we adopt, and other eve

day choices we make affect sustainability. While 

Internet has made vast amounts of data widely availab

we still face enormous challenges in turning data into u

ful information that can help people make choices, rea

ing people at all levels of society, integrating environm

tal knowledge and problem-solving skills into our edu

tional system, and building a sense of individual respon

bility for the environment.

Action 1

Provide information to and educate consumers and in

viduals about environmentally responsible househo

For years, the San Francisco Bay has been subject to a

buildup of copper pollution. Even though point

source controls are fairly effective, copper in the Bay

remains a problem. Recent studies indicate that the

majority of copper pollution comes from nonpoint

source runoff, with automotive brake pads accounting

for 80 percent of the copper source. Copper from

brake pads emerged as a water quality problem after

regulation eliminated the use of asbestos in brake

pads, and copper was substituted to meet automotive

safety standards. In response, industry, government,

and environmental leaders promptly formed the Brake

Pad Partnership Project, a voluntary industry program

to reduce the use of copper. The project establishes

specific percentage reduction goals, and is proposing a

research program to develop a methodology to fully

evaluate the potential impacts of copper and other

ingredients proposed for use in brake pads.

Photo: Stephen Delaney, U.S. Environmental Protection Agency.
lifestyle, and product choices.

Action 2

Develop and provide information to citizens and elected

officials about the effects of proposed and existing government policies on sustainable development.

Recommendation 9

Identify risks and protect communities against disprop

tionate impacts.

It is argued that some low-income and minority co

munities have lacked equal environmental protection a

have borne disproportionate or cumulative environmen

burdens.32 Any future environmental framework must h

processes in place to identify risks and ensure that enviro
CHAPTER 

METROPOLITAN AND RURA

STRATEGIE
58 CHAPTER 4

METROPOLITAN AND RURAL

STRATEGIES

mental burdens are reduced, and that environmental protection is shared throughout and across all communities.

Therefore, organizational responses need to focus on

increased involvement of community representatives and

interest groups in projects with environmental impacts.

Although several mechanisms are available to redress

environmental impacts, it is more important to identify and

prevent the conditions that can create inequities between

communities. By taking steps to identify potentially

inequitable environmental impacts, communities can begin

to integrate sustainable development principles and practices

fully. One step to prevent such impacts is to incorporate

community issues early on in the decision-making processes

of industries, government, and other relevant entities.

Communities can increase their economic potential, quality

of life, and overall livability if mechanisms are established to

ensure that community representatives (not local government officials alone) are collaboratively involved in decisionmaking processes affecting the community.

Action 1

Develop and use sustainable development indicators 

identify possible disproportionate economic, environm

tal, and social impacts on urban and rural communities

Action 2

Collaboratively negotiate capital investment strategies 

developing local economic opportunities that simulta

ously address possible disproportionate impacts.

Action 3

Develop incentives that encourage organizations t

achieve high levels of environmental protection to inv

in economically distressed areas and hire employees fr

those distressed communities at unreduced wages.

Action 4

Adopt public and private sector approaches for enviro

mentally and economically distressed communities t

allow additional economic development while reduc

total environmental burdens.

NEW APPROACHES TO 

PERSISTENT PROBLEMS

AND EMERGING

ENVORONMENTAL

ISSUES. 

Although the United States has made great strides 

addressing environmental problems, the nation and 

world still face significant environmental challeng

Environmental professionals, lawmakers, nongovernmen

Encourage people to work together to

create healthy communities where natural

and historic resources are preserved, jobs

are available, sprawl is contained, neighborhoods are secure, education is lifelong,

transportation and health care are accessible, and all citizens have opportunities to

improve the quality of their lives.

 Sustainable America, 1996

Whether individuals and institutions

restore their watersheds, champion more

efficient use of land, create accessible

transportation alternatives, make housing

more affordable, link people with quality

jobs, preserve their cultural and ecologica

resources, or create new environmentally

sensitive businesses, they can improve the

lives of todays citizens while safeguarding their communities for future generations.
CHAPTER 4

METROPOLITAN AND RURAL

STRATEGIES

organizations (NGOs), businesses, and others are struggling

to understand and devise solutions to persistent and complex environmental problems as well as to new environmental challenges. Some of the persistent and complex environmental problems facing us today include pollution from

myriad small, dispersed sources that are not easily reached

through conventional regulatory approaches, but that cumulatively contribute significantly to pollutant loadings. Other

challenges include land-based activities that create local problems  such as inadequately controlled land development

(i.e., urban sprawl) and agricultural runoff  that are best

addressed in the context of local community decisionmaking.

New issues doubtless will emerge in the next century

that will also demand attention. These environmental

challenges include global issues  such as climate chan

and long-range transport of persistent pollutants  t

involve complex interactions between human activity a

natural systems.

Recommendation 10

Develop new approaches to persistent problems and eme

ing issues.

To address both currently recognized environmen

problems and those yet to be identified while mov

towards sustainability, the environmental managem

framework needs to test and adopt new approaches. 

need to enhance our ability to rethink the nature, source, a

linkages of environmental problems by continuously lea

KEY FINDINGS - METROPOLITAN AND RURAL

STRATEGIES

 The imperatives of sustainable community development are gaining momentum. There are hundreds of initiatives

around the country that are finding sustainable solutions to pressing local and regional challenges. In the process, the

initiatives are finding or rediscovering new economic, ecological, and social assets that can strengthen and enhance th

communities.

 The Council identified five strategic opportunity areas for sustainable community development  green infrastructur

land use and development, community revitalization and reinvestment, rural enterprise and community development,

and materials reuse and resource efficiency. Sustainable community development does not constitute a single fix or

solution. Instead, communities need multifaceted solutions. By undertaking sustainable strategies that address each of

these five areas, communities can realize significant and synergistic benefits. When invested in collectively, the five are

comprise a comprehensive approach to sustainable community development.

 Successful initiatives share seven common characteristics that should inform and guide the development of policies

and projects. Successful initiatives: (1) serve, invest in, and respect people; (2) invest in and respect places; (3) align wi

or create new market forces for sustainable development; (4) leverage their ecological and social, as well as economic,

assets; (5) constructively address issues of race and class; (6) build regional and multijurisdictional alliances; and (7) ar

locally driven. In particular, successful initiatives understand the intrinsic value of place. They recognize that challenges extend beyond artificial jurisdictional lines and attempt to create regional solutions. They also recognize that

challenges and opportunities can be best addressed by networks of people with diverse backgrounds, views, and expe

ences working together in inclusive planning and decision-making processes.

 To overcome major implementation obstacles, communities need three types of tools and resources: information and

technical assistance, economic incentives and financial assistance, and local capacity and partnerships. Numerous stak

holders  including federal, state, local, and tribal governments; community-based and environmental organizations;

and the private sector  must work together to empower communities with the tools they need to develop sustainab

 To accelerate the pace of sustainable community development, we must make the most of existing authority and

resources to empower communities. By immediately undertaking new initiatives and building on initiatives already

under way, we can significantly enhance local capacity, leverage markets, and strengthen multijurisdictional and region

partnerships within the next three years.
60 CHAPTER 4

METROPOLITAN AND RURAL

STRATEGIES

ing from and using past experience to improve current performance. In the environmental field, that requires trying to

understand who pollutes and why, and how their decisions

are affected by those of others.

To deal with this broadening set of problems, the

framework will, in the next century, include both traditional

tools (national standards, permits, reporting, enforcement,

etc.) and new approaches (market- and information-based

approaches, stakeholder participation in decisionmaking,

performance-based standards, etc.). Only those tools that

best address a given problem in the most effective, efficient,

and just manner will be applied to that problem. The result

will be a framework that is less uniform and more complex

but also more flexible. Such a framework will facilitate the

development and tailoring of strategies that allow specific

problems and opportunities to be identified and addressed.

Within the new framework, too, more research,

sophisticated databases, and analysis are needed to identify systemic problems and major sources or causes of

problems. For example, endocrine-disrupting chemicals

are emerging as a potential global issue, but the sources

and effects of these chemicals are still not well understood.

Foresight is a crucial element of sustainable development, and essential in a new environmental management

framework. For example, the Swedish government has

established goals for the phaseout of certain persistent

substances in products. A reverse engineering process

to determine how to reach the goals is being implemented in the hope of fostering innovation without creating

new risks. By focusing on alternatives, goals, and severity

of effects, the debate is shifted from causality to solutions.

A process that weighs evidence about harm, but considers

it in the context of available technologies and methods

that eliminate or reduce the severity of the impacts, is critical to good decisionmaking.

Action 1

Promote early action on emerging issues by involv

companies, NGOs, government stakeholders, and inter

tional partners in constructive dialogues on issues that w

lead to solutions.

Action 2

Improve information strategies for emerging issues 

securing commitments to support anticipatory resear

and develop databases and analyze information to inve

gate unknown risks and understand the magnitude 

their environmental and health impacts (e.g., endocri

disrupting chemicals).

Action 3

Apply focused strategies to existing environmental pro

lems that are inadequately addressed by traditional syste

or programs (e.g., nonpoint source water pollution a

dispersed air sources).

As we attempt to solve global issues in the 21st c

tury, we need to strengthen our international partnershi

We have much to share with other nations that are striv

Place-based strategies, which acknowledge the unique qualities and concerns of

different places, are essential to building

more healthful, enduring, and livable

communities.

Savings calculated for a four-person household earning $40,000

annually in the Chicagoland area depends on the households

location near transit and places to work and shop. High values

for households located near amenities such as rail lines suggests

that these households save more money because they are location

efficient. 

Image: Center for Neighborhood Technology, Natural Resources Defense

Council, and the Surface Transportation Policy Project.
CHAPTER 4

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for sustainability, and also much to learn from 

them. Organisation for Economic Co-operation and

Development countries with parallel economic and environmental histories, such as the United Kingdom, the

Netherlands, Denmark, Germany, and Canada, offer valuable lessons that should be shared with U.S. communities

and regulatory agencies. Such sharing is evident in New

Jerseys recent inclusion of Dutch pollution prevention

policies, Chattanoogas and Cape Charless use of Danish

ecological industrial parks, and Wisconsins adoption of

German acid rain programs.

The Council urges national and international governments, businesses, and NGOs to advance the dialogue

about emerging environmental issues wherever possible.

In the 1980s, the discovery of the ozone hole over

Antarctica galvanized international action, resulting in the

Montreal Protocol agreement to phase out the production

of ozone-depleting chlorofluorocarbons (CFCs). Key to

the protocols success was the general acceptance of the

need for action, and consensus on what that action should

be, by the various national governments, NGOs, and

CFC-producing and -using businesses. We need to produce more of this kind of progress in concerted international efforts as we face the challenges of the future.
62 CHAPTER 4

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INTRODUCTION

This chapter addresses a fundamental questi

How can we, as a nation, help sustainable co

munity initiatives move from vision to action? 

In Sustainable America, the Presidents Council 

Sustainable Development (PCSD) presented a vision 

community development that encompassed economic, en

ronmental, and equity concerns  a vision inspired a

informed by the collective aspirations and experiences 

communities around the nation.1 It presented an urgent c

for communities to confront specific challenges a

embrace new opportunities to enhance their current a

future well-being. Most importantly, Sustainable Ame

affirmed the national importance of building vibra

healthy, and livable communities. Since its publication, 

imperatives of sustainable community development 

increasingly taking hold, gaining momentum, and produc

benefits. As aptly summarized in a September 1998 spe

by Vice President Gore, While the blight of poor devel

ment and its social consequences have many names, 

solutions, pioneered by local citizens, are starting to coale

into a movement. In the future, livable communities will 

the basis of our competitiveness and economic strength

Over the past five years of the Councils work, we h

People say their new communities have

become too dependent on the automobile, too removed from nature, too close

to the clutter of box retail stores.

Timothy Egan, The New Politics of Urban Sprawl,

New York Times, November 15, 1998, p. 44.

As part of the growth management plan for Portland, the state

of Oregon coordinates a program designed to encourage builders

to construct transit-friendly developments. 

Photo: Center of Excellence for Sustainable Development.
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observed considerable innovation in how people with different interests can act collectively to build enduring and livable communities. In hundreds of communities and regions

across America, community leaders representing citizen

groups, elected officials, businesses, and other stakeholders

are rolling up their sleeves to engage each other and work

together. In particular, these leaders are recognizing the

intrinsic value of the places in which people live, work, and

visit. And they are taking bold and creative actions to preserve and enhance the economic, ecological, and social

assets of their communities.

Sustainable community development embraces a vast

range of opportunities and options. Based on our review of

initiatives and activities from around the country, we have

found that five broad areas of sustainable community

development hold particular promise and potential: green

infrastructure, land use and development, community revitalization and reinvestment, rural enterprise and community

development, and materials reuse and resource efficiency.

These areas are not discrete; rather, they overlap and complement one another. By undertaking sustainable strategies

within each of these five areas, communities can realize significant and synergistic benefits. When invested in collectively, the five areas comprise a comprehensive approach to

sustainable community development. Whether individuals

and institutions restore their watersheds, champion more

efficient use of land, create accessible transportation alternatives, make housing more affordable, link people with

quality jobs, preserve their cultural and ecological resources,

or create new environmentally sensitive businesses, they can

improve the lives of todays citizens while safeguarding their

communities for future generations.

The Council has also found that successful initiatives

share several common characteristics that should inform

and guide policies and programs. There is no denying the

power of example these efforts provide. But although we

are witnessing more successes, most sustainable community

development initiatives face daunting technical, financial,

and institutional obstacles. In order to fulfill the promise of

sustainable communities affirmed in Sustainable America, we

must find ways to overcome obstacles and replicate those

strategies that are working.

In this chapter, the Council recommends policies and

actions that advance three types of tools and resources to

enable metropolitan and rural communities to overcome

obstacles and move forward: (1) information and technical

assistance, (2) economic incentives and financial assistance,

and (3) local capacity and partnerships. Our specific reco

mendations identify how the federal government; st

local, and tribal governments; the private sector; and co

munity-based and environmental organizations can w

together to empower metropolitan and rural communi

with the tools they need to develop sustainably.

To accelerate the pace of sustainable community dev

opment, the Council also believes we must make the m

of existing authority and resources. By immediately und

taking new initiatives and building on initiatives alre

under way, we can significantly enhance the knowled

skills, and capabilities of all stakeholders by building lo

capacity, leveraging markets and financial intermediaries, a

strengthening multijurisdictional and regional partnersh

within the next three years.
64 CHAPTER 4

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STRATEGIC 

OPPORTUNITIES FOR 

SUSTAINABLE 

COMMUNITY 

DEVELOPMENT

FIVE STRATEGIC AREAS OF SUSTAINABLE 

COMMUNITY DEVELOPMENT

Five areas of sustainable community development hold particular promise and potential. If

addressed collectively, these five areas also provide a comprehensive approach to 

sustainable community development:

 Green Infrastructure. The pace, extent, and intensity of human activities place great burdens on ecosystems and natural

resources across the country. Green infrastructure is the network of open space, airsheds, watersheds, woodlands,

wildlife habitat, parks, and other natural areas that provides many vital services that sustain life and enrich the quality of

life.A To obtain these benefits, many communities are increasingly promoting place-based approaches to conserve, protect, and restore local and regional systems of natural resources and amenities. The objectives of these green infrastructure strategies are somewhat different from those of traditional conservation efforts. While traditional conservation

focuses on environmental restoration and preservation, it often neglects the pace, shape, and location of development in

relationship to important natural resources and amenities. Green infrastructure strategies actively seek to understand,

leverage, and value the different ecological, social, and economic functions provided by natural systems in order to guide

more efficient and sustainable land use and development patterns as well as protect ecosystems.B

 Land Use and Development. Over the last several decades, sprawled development  characterized by low-density, single-purpose land use; ad hoc, disjointed planning; discontinuous leapfrog development patterns; and excessive consumption of greenfields  has exacerbated economic, environmental, and social problems.C Sprawl is inefficient land

development that fails to value the overall design of a community or region, or its intrinsic ecology. Its estimated that,

on average, each person uses four to five times more land for roads, homes, and shopping now than 40 years ago.D

Recognizing the problems of sprawl, communities are increasingly adopting what is being called smart growth, a term

that describes the design and management of the physical expansion of existing communities and the creation of new

ones so as to decrease sprawl, conserve open space, reverse disinvestment in existing communities, respect natures carry

ing capacity, increase social interaction, and provide protection from natural hazards  in short, to make communities

more livable. Smart growth is not anti-growth. Rather, it addresses inefficient and haphazard growth. Smart growth links

development decisions with quality of life, while monitoring and understanding market factors. It recognizes that where

structures are built and how land is used affect lifestyles, the environment, local economies, and social interaction, determining whether land use and development is a community asset or liability.

The Mooser Creek watershed in southwest Tulsa, Oklahoma, is

among the last remaining natural corridors in the metropolitan

area. A citizens committee brought together stakeholders to discuss

issues and concerns before setting goals for and planning development in the Mooser Creek greenway in ways that preserve priority areas. Here, Remington Elementary School fifth-graders build

a nature trail on school grounds. 

Photo: City of Tulsa, Oklahoma.
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Marcel Proust wrote that the real voyage of discovery consists not in seeking new landscapes,but in having new eyes. Individuals and institutions are increasingly viewing their communities through

the lens of sustainability, and, by doing so, are finding or

rediscovering new economic, ecological, and social assets.

With these new perspectives, community members are discovering new opportunities to strengthen their communities. And they are becoming more involved in local government, community affairs, and entrepreneurial endeavors to

implement these opportunities.

Place-based strategies, which acknowledge the

unique qualities and concerns of different places, are

essential to building more healthful, enduring, and livable

communities. Technically, place is the geographic union

of natural landscapes, ecosystems, and human settlements

and structures. Behavioral, social, and environmental scientists, in such books as The Power of Place3 and The

Geography of Nowhere,

4 emphasize that place matters a

underscore what we all intuitively know: that our physi

surroundings shape our thoughts and emotions, def

our identity, and anchor our sense of community. A

unnoticed by most of us, place also predetermines 

limits on our carrying capacity - the degree to which n

ural systems can sustain life and successfully accomm

date human needs and activities.

By investing in place, community leaders can prov

a measure of security and stability in our rapidly chang

society. As economic networks and markets beco

increasingly globalized, people and businesses increasin

mobile, and America older and more diverse, communit

are challenged with developing adaptive and flexi

strategies that build on unique assets and create a sense 

why here.

Concurrently, community leaders are recogniz

 Community Revitalization and Reinvestment. Historical disinvestment within older, central cities, inner ring suburb

and rural areas has generated an intricate array of interlocking economic, social, and environmental challenges. These

challenges concern housing, job and business opportunities, education, health care, and public safety, among others.E

To create a nation of sustainable communities, every community must be encouraged to use its local economic, ecological, and social resources and assets. These assets often include undercounted purchasing power, housing stock,

transportation access, vacant and underutilized land, and biodiversity which can be found in even the most distressed

and impoverished communities.F Yet external resources and reinvestment are needed to help distressed communities

leverage their assets more effectively. Entrenched poverty in central cities, older suburbs, and rural areas requires that

investment and attention be redirected inward and the social costs of addressing poverty be shared by society at large

Community reinvestment is also a natural complement to smart growth. To manage future growth more effectively,

we must make existing communities desirable places to live.

 Rural Enterprise and Community Development. The structure and assets of rural America are fundamentally different from those of the nations metropolitan areas. Rural communities are particularly vulnerable to economic and land

development pressures, including loss of key land and natural resources due to overharvesting and sprawl, declining

opportunities in traditional rural industries, and water quality concerns.G Still, rural, suburban, and urban areas are

mutually dependent; and much information and analysis is needed regarding their connections, such as those betwee

food production, food dependence, and ecosystem management. A number of new strategies, such as communitysupported agriculture, organic farming, forest conservation, eco-tourism, and other sustainable enterprises, are being

developed and implemented that appreciate the fragility and vulnerability of rural economies and social structures.H

 Materials Reuse and Resource Efficiency. Strategies that conserve resources and minimize waste by retaining, recycling, reusing, and remanufacturing materials are taking hold in many metro and rural communities.I The growth in

post-consumer recycling has justified the cancellation of incinerators and landfills from coast to coast in favor of

materials reuse, collection, and upgrading.J Remanufacturing previously used appliances and other products has grown

into a $73 billion industry employing 486,000 personsK and has helped reduce the consumption of virgin materials.

Often called construction in reverse, deconstruction systematically takes buildings apart and salvages materials often a

the same or less cost than traditional demolition. Several cities are viewing deconstruction as a way to address abandoned buildings while also creating jobs and job training for local people.L Dozens of new eco-industrial parks,

where networked firms improve resource and energy efficiency by symbiotically exchanging wastes, are being developed across the country.M
66 CHAPTER 4

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that place is defined by more than artificial jurisdictional

lines. Many of the issues facing communities  air and

water quality, transportation, land and natural resource

conservation, affordable housing, and economic development  extend beyond the arbitrary lines of political

jurisdiction. As such, regions are becoming an increasing

focus of interest due to shared ecosystems, the spillover

effects of actions by individual jurisdictions, and the significance of regional economies whose gross national

products sometimes match or exceed those of entire

countries.5 Because of the complexity of problems and

challenges, effective initiatives involve networks of peop

places, and markets acting to achieve mutual benefits, tr

scending sectoral and jurisdictional divides. The creativ

and dynamism of these partnership initiatives contr

starkly with stand-alone initiatives structured by gove

ment, community, or business acting in isolation.

THE MOMENTUM IS

BUILDING FOR SUSTAINABLE 

COMMUNITY DEVELOPMENT

There are hundreds of sustainable community initiati

around the country. Although sustainable commun

development is a locally driven process, there are actio

that multiple stakeholders can take to support it at ev

scale, including neighborhood, village, city, region, sta

and nation. A sample of these efforts is highlighted 

appendix C-1 of this report. In addition, several initiativ

listed below, have grown out of the Councils earlier r

ommendations in Sustainable America and its subsequ

report, Building on Consensus:

6

 The U.S. Conference of Mayors and the Natio

Association of Counties created the Joint Center 

Sustainable Communities, with the support of seve

federal partners, to implement the recommendatio

of Sustainable America. The creation of the Jo

Center marks the first formal working partners

between city and county elected representatives at 

national level.7

 The Pacific Northwest Regional Council, a coalit

of more than two dozen regional leaders from dive

constituencies and cultures, is helping to prom

inclusive collaboration on sustainable development 

a region that has experienced significant populat

growth, rapid economic changes, escalating pressu

on key natural resources, and increasing globaliz

influences from the Pacific Rim and Canada.8 

 The Bay Area Alliance for Sustainable Developm

Knowledge creation through information

and technical assistance is an indispensable element of sustainable community

development.

SYSTEMATIC ACTIONS 

TO BUILD AND SUPPORT 

SUSTAINABLE 

COMMUNITIES

There are three types of cross-cutting actions that,

collectively, can support many different types of sustainable community efforts:

 Provide information and technical assistance.

Information is an indispensable tool for making

a credible case for action to decisionmakers and

the public, selecting sustainable strategies, and

evaluating progress. Information alone is not

enough, however. Networks connecting individuals and institutions must exist to enable them

to share that information.

 Provide economic incentives and financial assistance. Economic incentives and financial assistance can create standing for communities in

the marketplace, significantly increasing their

strength and potential for sustainability. In particular, market-based strategies and public sector

incentives can be used to build on and strengthen local and regional assets. Individual initiatives

and enterprises also need start-up and long-term

financing and access to capital.

 Build local capacity and partnerships. The ability

of local individuals and organizations to lead

and implement initiatives is an indispensable element of success. They must be able to find

common ground and build trust and partnerships among people of diverse economic, cultural, and racial backgrounds. Community

groups, governments, and the private sector

must also form regional and multijurisdictional

partnerships in order to address sustainability
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grew out of Sustainable Americas recommendation to

encourage regional alliances and collaborative

processes. The Bay Area Alliance is a multistakeholder coalition representing business, environmental,

governmental, and community sectors to advance

sustainability in the greater San Francisco-Oakland

metropolitan area.

 The Sustainable Racine initiative, supported by the

Johnson Foundation of S.C. Johnson Wax, has convened hundreds of Racine, Wisconsin, residents to

craft a long-range plan and goals addressing education,

health, safety, economic development, and environmental stewardship.9 

 The Smart Growth Network, a nationwide effort of

several partner organizations coordinated by the U.S.

Environmental Protection Agency (EPA) and the

International City/County Management Association,

provides information and technical assistance on sustainable land use and development.10 This effort was

motivated in part by Sustainable Americas recommendations to manage the geographic growth of existing

communities and siting of new ones to decrease in

ficient land development, conserve open space, a

revitalize communities.

 The Center for Neighborhood Technology, with su

port from the MacArthur Foundation, held regio

forums in 12 metropolitan areas to advance seve

PCSD recommendations to foster regional collabo

tion on sustainable community development. In p

ticular, these Metropolitan Initiative forums iden

fied how the federal government could be m

responsive to regional needs through better inform

tion access, policies, and coordinated investment.1

 The Cape Charles Sustainable Technology Park, o

of four PCSD demonstrations of eco-indust

development, completed the construction of its f

phase in fall 1998. Its tenants include solar ener

food processing, and environmental consulting a

technology firms; these will take up residence in ea

1999. The Cape Charles development, located in o

of the poorest counties in Virginia, hopes to demo

strate that business profitability, community vital

and environmental responsibility can coexist.12

These activities are but a handful of efforts that reflect 

growing interest and concern exhibited by numero

stakeholders for issues involving livability and sustaina

ity. In the November 1998 elections, for example, vote

decisions on a total of 240 ballot measures approved m

than $7.5 billion in new state and local funds for an ar

of land conservation, quality of life, farmland and for

protection, and growth management programs and act

ties.13 In 1998, in their inaugural or state of the sta

addresses, 32 governors identified smarter land use a

development, preservation of open space, and reinve

ment in urban centers as crucial to their states future

Articles in mainstream journals such as The Economist a

U.S. News and World Report are heralding the sustainabi

agendas of rural and metropolitan places, such 

Chattanooga and Portland, that have greatly enhanced 

economic competitiveness of and breathed new life i

their communities.15 And environmental industries rang

from manufacturers of energy-efficient products 

cleanup services to environmentally conscious build

construction are growing more quickly than the economy 

large and already represent a significant part of the econ

my.16

The imperatives of sustainability also resonate in 

nations capital. During the past several years, we have w

The Center for Agroecology and Sustainable Food Systems at the

University of California-Santa Cruz, researches, develops, and

advances sustainable food and agricultural systems that are environmentally sound, economically viable, socially responsible, nonexploitative, and which serve as a foundation for future generations. Here, center staff calibrate weather monitoring equipment in

the canopy of an organic apple orchard in Corralitos, California.

Photo: Jon Kersey, University of California-Santa Cruz.
68 CHAPTER 4

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nessed increased engagement by the White House and

federal agencies in sustainable community development.

There are an increasing number of interagency partnerships such as the Brownfields Revitalization Initiative

which, led by EPA and the U.S. Department of Housing

and Urban Development (HUD), brings together the

resources of more than 15 agencies to clean up and develop vacant, abandoned, and underutilized properties. And

the Transportation Equity Act for the 21st Century, enacted in 1998, will continue the innovations begun under the

Intermodal Surface Transportation Efficiency Act of

1991 to promote inclusive planning and flexible investment in transportation alternatives that can preserve and

enhance the sustainability of communities.

These efforts, among many others, are coalescing

into a concentrated national focus. In early 1999, the

White House launched the Clinton-Gore Livability

Agenda, which includes a billion-dollar initiative to provide new tools and resources to preserve green space,

enhance transit systems, and pursue regional collaboration, among other goals. The Administration also proposed a $1 billion Lands Legacy Initiative, the largest oneyear investment ever in the protection of Americas land

resources, including wilderness, farmland, natural parks

and monuments, as well as local green spaces.17 Other federal efforts include the U.S. House of Representatives

Livable Communities Task Force which considers how the

federal government can support community livability.18 In

early 1999, self-selected members of the Senate developed

a Smart Growth Caucus to address how the federal government can support efforts by localities and regions to

develop and use land more efficiently.

The growing sustainability movement in the United

States is part of a global phenomena. In his review of the

development patterns of 42 cities in the United States,

Canada, Australia, Europe, and Asia, Peter Newman and

Jeffrey Kenworthy, authors of Sustainability and Cities,

found that nearly all of these metropolitan areas are

increasingly revitalizing their central and inner areas,

increasing their investment in transit, and preserving ecological resources and amenities.19

FIVE STRATEGIC AREAS

OF SUSTAINABLE COMMUNITY DEVELOPMENT

From our review of these many inspiring efforts and act

ties, we have identified five strategic areas of sustainable co

munity development that are producing benefits: green in

structure, land use and development, community revitali

tion and reinvestment, rural enterprise and community dev

opment, and materials reuse and resource efficienc

Collectively, communities and regions are investing e

greater amounts of resources and time in these five areas 

they work to resolve pressing local and regional econom

ecological, and social challenges:

 Depletion and destruction of ecosystems and natu

resources;

 Detrimental land use and development;

 Disinvestment and entrenched poverty in central cit

older inner ring suburbs, and rural communities;

 Unique economic and social pressures in rural areas; a

 Inefficient use of materials and resources.

Although the five areas weve identified encompass s

cific challenges, they also represent new opportunities 

enhance local and regional economic, ecological, and so

assets. Within each of these areas, metropolitan and ru

communities are implementing many different types 

strategies that best suit their local conditions, challenges, a

needs.

COMMON CHARACTERISTICS OF SUCCESSFUL

INITIATIVES

Despite the wide range of strategies and diversity 

actors operating within these five broad areas of susta

able community development, we have found that s

cessful initiatives share several characteristics. By adopt

these elements of success, policies and programs co

ceived and implemented by all stakeholders can incre

their effectiveness and potency. In particular, success

sustainable community development initiatives poss

these seven characteristics:

 They serve, invest in, and respect people. Individ

initiative is often the key motivating force for acti

Empowered individuals make a difference in th

communities. Successful strategies also strength

interactions and learning among individuals a

organizations. Through these connections, indivi
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als discover ideas, better understand issues, and link

to resources within and outside the community.

 They invest in and respect places. Successful initiatives recognize the intrinsic value of the places in

which people live, work, and visit. They also understand that a sense of place is an important economic

and social asset.21 As Lamont Hempel and Tom

Horan argue, communities need both roots and

wings to succeed at complex goals.22

 They align with or create new market forces. A healthy

market is one in which the systems and incentives exist

to deliver a high quality of life for all community members continuously over the long term. Successful initiatives attempt to create new or redirect existing market forces to improve the environment, counter sprawl

and disinvestment, and benefit individuals and families.

They find and then build on the local assets of their

communities. Successful initiatives recognize the

need to manage, protect, and build upon a communitys unique social, ecological, and economic assets.

In particular, the concept of asset-building is gaining recognition as an essential strategy for helping

low-income families move out of poverty.23 Citizens

are also recognizing natural resources as community

assets, natural capital, and ecological wealth.

 They constructively address issues of race and class.

America is becoming more culturally and racially

diverse. Many communities are discovering the economic and social value of cultural diversity and are

consciously embracing it as a community asset. They

are actively building inclusive partnerships between

people of different backgrounds, classes, and cultures to identify and achieve shared goals. And they

are addressing the sustainability concerns of all people, not just of those who can afford it.

 They build regional alliances and multistakeholder

coalitions. Successful innovations recognize that multiple stakeholders, working in inclusive partnerships, are

needed to solve the complex challenges facing communities. These partnerships are even more critical

given shared ecosystems, transportation, sprawl, and

highly networked regional and global economies.

 They are locally driven. Successful innovations are

locally driven and build on local assets while

acknowledging global issues and opportunities. A

top-down approach cannot unleash the local leadership needed to sustain local initiatives. At the sa

time, the federal government can facilitate dialog

among varied interests to arrive at mutually worka

solutions while protecting the national interest.

Although the duties of local and regional commu

ties are increasing, particularly in the context of rec

devolutions of responsibilities to states and localities, so

traditional federal roles must be preserved. Sustaina

community development does not call for diminish

existing economic and environmental laws, policies, a

programs. Rather, it requires a philosophical shift in 

approach we use to meet environmental, social, and e

nomic objectives. In the development and implementat

of place-based strategies, federal agencies must continue 

represent and protect national interests that may not be r

resented by local interests in all cases, such as controll

pollution, protecting biodiversity, and safeguarding c

rights.24 

OVERCOMING OBSTACLES 

ON THE PATH TO 

SUSTAINABILITY

Although momentum is building for sustainability in m

ropolitan and rural areas, individual initiatives still f

many technical, financial, and institutional hurd

Collectively, communities must confront three major typ

of obstacles that not only impede the progress of in

vidual initiatives but make it more difficult to replic

successful strategies:

 Information, technical skills, and learning netwo

are inaccessible or inadequate to communicate pro

lems and benefits to the public, conceive effect

solutions, and effectively guide planning and de

sionmaking.

 The market often fails to value social, cultural, a

environmental assets or to reward positive action 

protect and conserve them. In addition, because 

their relative newness, many initiatives have difficu

accessing adequate financing.

 Multiple jurisdictional boundaries and sectoral fr

mentation make it difficult to solve shared challeng

Communities can seize new opportunities and ov

come obstacles to implementation, but only if they h

essential tools and resources.25 Based on what already is wo

ing in communities, the Council has compiled a set of r
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ommendations that will promote flexibility, remove obstacles, and empower local initiative. The recommendations fall

within three broad categories: (1) information and technical

assistance, (2) economic incentives and financial assistance,

and (3) building local capacity and partnerships. If acted

upon, we believe these policies and initiatives would provide

the needed tools to expedite and replicate successes.

Numerous stakeholders have already taken these

actions to empower communities. Our recommendations

of specific policies and actions, presented later in this

chapter, acknowledge these efforts. But much more can be

done. Key to rapid implementation of sustainable community development will be to make the most of existing

authority and resources. The federal government can continue to play a key role by coordinating and focusing its

vast resources to foster regional solutions. State and local

governments, community-based and environmental nonprofits, businesses, universities, foundations, and individuals also have important roles to play. In particular, by forging vital partnerships that transcend political boundaries

and sectoral divides, these stakeholders can provide the

necessary information, economic incentives, and financial

assistance to enable communities to implement sustainable development strategies.

RECOMMENDATIONS 

INFORMATION AND 

TECHNICAL ASSISTANCE: SUPPORTING

CONTINUOUS COMMUNITY LEARNING

In a constantly changing world, a communitys ability to

learn will, in part, determine the degree to which it will

flourish or languish. Knowledge creation through information and technical assistance is an indispensable element of

sustainable community development. However, many in

viduals and institutions embarking on sustainable comm

nity activities lack information on how to implement s

tainable community strategies more effectively. Thus, 

advocated by Sustainable America, building a knowledge 

the interdependence among economic prosperity, enviro

mental protection, and social equity will help citizens und

stand, communicate, and participate in the decisions t

affect their lives.26 Much as high-performance compan

invest in knowledge creation to maintain long-term co

petitiveness, investment in the systems that enable conti

ous learning for sustainability can secure a comparat

advantage for communities. Our recommendations to s

port continuous community learning address four areas

 Public education on sustainability is needed to make 

public and decisionmakers aware of the challenges of a

opportunities for sustainable community developm

and to make a persuasive and credible case for action.

 Learning networks and technical assistance can insti

tionalize knowledge and build local capacity for rec

nizing and solving problems, and for identifying a

refining sustainable strategies.

 Communities need accessible and user-friendly inform

tion and data that are relevant to sustainable commun

concerns and can demonstrate the connections betwe

the economy, the environment, and equity. In additi

improved analytical tools and methods are needed 

enable better problem solving, planning, and decisio

making.

 Indicators and performance measures are needed t

can track performance towards desired goals.

Recommendation 1

Reinvigorate and advance public education on sustaina

community development.

Action 1

The Administration, in partnership with leaders in all r

evant sectors and the Smart Growth Network, sho

launch a public action campaign on smart growth. Th

partners should sponsor a five-year national campaign a

dialogue addressing land use and growth issues throu

community and business action. The campaign should 

launched at the National Town Meeting for a Sustaina

America, which will take place May 2-5, 1999. The ca

paign should ask communities throughout America 

identify natural assets and local and regional land use a

Transforming current models of development to ones that are more sustainable

depends on defining the relationship

between healthy communities and economic factors.
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growth issues; assess the impacts of sprawl-related problems; identify possible solutions and their benefits; identify ways to measure progress (i.e., establish indicators of

progress); and make commitments to form or strengthen

partnerships to implement solutions.

The campaign would link to three other efforts: (1)

national incentive programs for Smart Growth and

Regional Cooperation; (2) Growing Smart, a five-year project funded by the federal government which provides a

compendium of useful tools for states, regional entities,

and local jurisdictions to consider, adopt, adapt, and use;

and (3) Land-Based Classification Standards (LBCS), a

project funded by several federal agencies and the

American Planning Association. LBCS standardizes a

broad variety of land use and development data collected

and stored at the local, regional, state, and national levels,

enabling jurisdictions, agencies, and institutions to share

data more easily.27

Following the National Town Meeting for a

Sustainable America, the Administration should work

with leaders in all sectors and prominent civic journalists

and media specialists to develop a communications strategy that can continue to promote, explain, and popularize

sustainability and livability goals and concerns.

Action 2

The Administration, in partnership with others, should

reinvigorate the Education for Sustainability program.

Federal agencies should increase their activities to prom

lifelong learning about sustainable development, includ

the Sustainable Development Extension Network, as p

posed in Sustainable America and Education 

Sustainability.

28 The federal government should also enco

age partnerships among businesses, localities, and regio

organizations to develop and implement educational p

grams and curricula on sustainability for children and you

adults. For example, corporate leaders from forest-produ

company Louisiana-Pacific sponsor the Portland, Oreg

crew of the Salmon Corps, a program that engages you

Native Americans and other at-risk youth in the restorat

of salmon habitats in the Columbia River Basin. While e

cating young people about their heritage and traditions, 

program provides useful skills and helps restore crit

salmon and wildlife habitats throughout the region. In 

South Bronx, the Phipps Community Developm

Corporation, based at an innovative, city-funded Beac

School, which combines gang intervention and workfo

programs with organizing around community environm

and livability issues.

Recommendation 2

Institutionalize knowledge through learning networks a

technical assistance.

Action 1

The U.S. Department of Agriculture (USDA) and its la

grant system, responding to the mandate of the PC

and as a part of the Sustainable Development Extens

Network, should create a learning infrastructure for s

tainable communities. The infrastructure will prov

information on how to accomplish specific commun

development tasks, connect with potential regional pa

ners, and access potential funding sources. It will do t

through a high-tech/high-touch approach comp

mised of electronic, paper, and direct contact comp

nents.

As part of this effort, the Council for Excellence 

Government should convene a group of partners wit

USDA to work with the Joint Center for Sustaina

Communities in order to bring together the various te

nical assistance services now available within the la

grant system. This group would work with the Council 

Environmental Quality, leaders from all sectors, as wel

USDAs four regional Rural Development Centers, 

Resource, Conservation and Development Councils, a

Photo: Center of Excellence for Sustainable Development.
72 CHAPTER 4

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STRATEGIES

its Appropriate Technology Transfer for Rural Areas program. It would also link to HUDs Office of Rural

Housing and Economic Development, which is creating

an information clearinghouse on innovative housing and

economic development strategies, as well as funding for

direct grants for development projects.

Action 2

As part of a larger community-based conservation education strategy, organizations serving local government

should partner with natural resource agencies to help local

government mangers include and value green infrastructure in community plans. Local government managers are

in a key position to facilitate community involvement and

spur activities that protect and sustain natural resources.

The objectives here should be to increase awareness of

the economic and social values associated with green

infrastructure and natural resource stewardship, prov

inclusive community-driven strategic planning on fut

growth and development, and demonstrate improv

decisionmaking through the use of environmental d

and geographic information system (GIS) planning too

Action 3

Federal, state, and local agencies should coordinate th

technical assistance programs to overcome program fr

mentation and duplication. For example, the state 

Maryland has created the Revitalization Center 

Baltimore, which co-locates representatives from all ag

cies involved in revitalization and smart growth activities 

facilitate greater interaction and ease of access by the co

munities they serve. The Multi-Agency Service Team, joi

ly sponsored by the Maine State Planning Office and 

Maine Rural Development Council, brings together pub

and quasi-public sector service providers to resolve pr

lems facing small and medium-sized secondary wood pr

ucts manufacturers in the state.29 Such coordinated tech

cal assistance efforts should target underserved groups.

Recommendation 3

Disseminate and improve accessibility to user-frien

information and improved analytical methods and to

relevant to sustainable community development.

Action 1

The Administration should partner with leaders from r

evant sectors to design a central, user-friendly informat

clearinghouse on sustainability. The federal governme

community-based organizations, and national associatio

have already accomplished a great deal in linking susta

ability information available on the World Wide W

These partners should develop an information supp

system that can address questions stimulated by 

National Town Meeting and facilitate informati

exchange among sustainable community development i

tiatives. This clearinghouse should also address how 

reach low-income and rural communities that may n

have access to Internet resources.30

Action 2

Federal agencies and foundations should improve 

capability of communities to use GIS information in su

port of place-based ecosystem management, sustaina

land use, and community reinvestment. In particular, th

stakeholders should support a community/federal inf

CHARACTERISTICS OF 

SUSTAINABLE MARKETS

Research and pilots can support sustainable community development by identifying mechanisms that can

endow markets with the ability to:

 Recognize that community, cultural, economic,

and ecological concerns are equally important.

 Support strategies that take the long view

instead of short-term profit maximization.

 Appropriately value scarce natural resources and

the services provided by ecosystems.

 Internalize the applicable real environmental

and social costs of doing business.

 Ensure that all sectors benefit equitably from the

wealth garnered from economic development.

 Encourage open flows of information and data

to foster continuous learning, performance

tracking, and accountability.

 Make appropriate capital and funding available

to improve the communitys quality of life.

 Encourage private sector leadership in sustainable community initiatives.

 Catalyze entrepreneurial energy that can develop and cultivate new sustainable opportunities.

 Encourage resource efficiency in the government, industry and business, and nonprofit sectors.

 Encourage mutually supportive connections
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mation partnership in which the Secretary of the Interior

would lead a four-year interagency initiative to advance the

capacity of communities and regions to create and use

geospatial data, and improve federal agencies capabilities

to provide community information. These agencies

should provide incentives in the form of demonstration

grants, training and technical assistance, or subsidies for

software upgrades where needed.

Action 3

The U.S. Department of Transportation, in cooperat

with EPA, the U.S. Department of Energy, HUD, and 

Joint Center for Sustainable Communities, should est

lish a comprehensive program to develop new a

improved analytical tools for land use, transportation, a

environmental planning. States and localities need use

tools for analyzing and modernizing their planning la

and techniques, and for guiding public and private dev

opment in a sustainable manner. This effort should rec

WHAT IS RURAL AMERICA 

AND WHAT MAKES IT UNIQUE?

According to USDA, rural America contains 83 percent of the nations land and is home to 21 percent of its people

(Understanding Rural America, Washington, DC, 1995). As the vast majority of Americans have come to live in urban or

suburban areas, peoples notions of rural communities have become vague and probably tinged with the golden glow o

commercials that glorify small town living. In reality, rural communities are based on social structures that are quite

complex. Many different ways of categorizing rural communities are possible, but the most useful may be based on

location relative to urban areas or special resources:

 Communities on the urban fringe are confronted with advancing suburban development. Local government officials increasingly find themselves dealing with the impacts of highway and other infrastructure decisions made by

other jurisdictions. The rapid physical, economic, and social changes associated with development and population

growth cause such rural communities to lose their distinct identities.

 Communities beyond the urban influence most likely retain their agricultural or other rural character. In many, however, changes in agricultural policy have had severe impacts on the small farmers who were traditionally at the heart

of the communities. Their populations are declining and aging, as young people leave to seek employment elsewhere.

 Communities adjacent to special resources or landscapes fall into two very different subcategories: communities

with natural resource-based economies (forestry, agriculture, fishing, and mining) and gateway communities located

adjacent to special landscapes.

 Communities with resource-based economies are vulnerable to changes in national environmental policy and to inadequate management and/or depletion of their key resources. In either event, the community may confront the same

problems of out-migration and declining economy that characterize other rural communities that are beyond urban

influence.

 Gateway communities are those bordering public lands, including national and state parks, national forests, wildlife

refuges, and heritage areas. These communities, with their scenic settings, environmental quality, and easy access to

recreational activity, have been experiencing rapid change as a result of increased tourism and second (or retirement) home development. The jobs resulting from the tourism economy may be seasonal and pay only minimum

wages. But these communities are also attracting the lone eagles  the consultants and executives who can live

anywhere  and the small high-tech companies that provide well-compensated jobs. Thus, these communities

face new demands on their infrastructure and rapid change in their economic base and social composition.

Building rural and urban/suburban linkages will depend on better understanding the diverse qualities of rural areas.
74 CHAPTER 4

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nize ongoing work by professional associations that have

developed planning tools on smart growth with the support of federal funding, such as the American Planning

Associations Growing Smart Legislative Guidebook and

Clearinghouse.

Action 4

The federal government, foundations, and technical assistance providers should design and disseminate tools and

methods that can assess the benefits of investments in

sustainable community strategies. In particular, tools are

needed that will capture the cross-benefits of investments.

For example, PLACE3

S (Planning for Community Energy,

Economic, and Environmental Sustainability) software, a

land use and urban design model sponsored by the

Department of Energy, identifies the energy impacts of

land use decisions. Other tools are needed to estimate

more precisely the benefits of investments in green infrastructure, materials reuse and resource efficiency strategies, and sustainable rural strategies.

Recommendation 4

Promote technical assistance on the use of indicators and

evaluation methods.

Action 1

Civic organizations, foundations, and other nongovernmental organizations, together with the Administration, leaders

from other sectors, and the Interagency Working Group on

Sustainable Development Indicators, should sponsor a

series of workshops to help citizens use to existing or new

tools to track progress on sustainable community development. As part of this effort, the Council on Environmental

Quality should chair a working group of representatives of

the National Partnership to Reinvent Government, the

Interagency Working Group on Sustainable Development

Indicators, and the Federal Geographic Data Committee.

The working group would provide technical assistance to

communities and regions that wish to develop indicators,

benchmarks, or other performance measures to assist local

decision-making processes.

The working group should work with the Joint Center for

Sustainable Communities, which has launched a sustainable

community indicators project, profiling city and country

experiences with indicators. Federal agencies, organized by

USDA, are working cooperatively with the Joint Center to

better understand how community indicator efforts connect

to regional and national indicator efforts.

Action 2

The Administration should develop new economic sta

tics to measure reinvestment. As part of this effort, HU

and the U.S. Department of Commerce should deve

statistical barometers to capture reinvestment in 

renovation of commercial and residential projects a

brownfields redevelopment. Presently, government sta

tics track the economy and economic development ba

almost exclusively on new commercial and residen

activities (such as housing starts); this practice discoura

the financial and business sector from recognizing opp

tunities for sustainable community reinvestment.

ECONOMIC INCENTIVES AND

FINANCIAL 

ASSISTANCE: PUTTING

“PLACE” IN the Marketplace

S

ustainable America advocated economic developm

strategies that capitalize on unique local attributes a

on technological advances in energy and resource e

ciency, to create jobs and build strong, diversified lo

economies.31 Transforming current models of developm

to ones that are more sustainable depends on defining 

relationship between healthy communities and economic f

tors.

Unfortunately, many sustainable community dev

opment efforts struggle to make markets work for the

Green Communities, Green Jobs, a recent study by Al

Shabecoff and colleagues for the Joyce Foundation 

emerging initiatives to couple environmental protect

and economic development found that (1) the syste

that have successfully built the current community dev

opment industry are insufficiently market-oriented to t

advantage of current forces supportive of region

scaled sustainable development opportunities, (2) exp

mentation and demonstration of innovative market-ba

community development strategies are underway, and 

new kinds of support systems would enable these opp

tunities to proliferate more readily.32

As these initiatives evolve, they are addressing ma

quality of life issues including housing, land use, a
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transportation.

Federal, state, and local government and communitybased organizations should seek innovative and strategic

partnerships with formal financial institutions such as banks,

credit unions, and insurance companies to create new products and services that can help metropolitan and rural communities achieve sustainability goals. These partnerships

should conduct and evaluate pilots to demonstrate feasibility

and performance.

Our recommendations target seven activities that can

begin to harness the power of the marketplace for sustainable community development:

 Identify and institutionalize new market-based incentives that can advance sustainable community development goals and opportunities through research

and demonstration pilots.

 Broker regional alliances that link urban and rural markets. Communities can organize regional alliances that

emphasize market research, technology development

and transfer, collaborative approaches to ecosystem

management, and other opportunities that can benefit

regions.

 Enhance the capabilities and diversity of public and

private financial intermediaries in order to increase

access to capital. Basic community redevelopment

and reinvestment requires finance. Consumers need

financing to pay for greater water and energy efficiency or for more fuel-efficient automobiles. A community needs finance to promote ecologically sound

industrial parks or to build training centers for ecologically minded entrepreneurs. Gaps in finance,

therefore, greatly impede progress towards sustainable community development.

 Promote a shift in tax policies and subsidy reform. In

Sustainable America, the PCSD advocated both a shift in

tax policies and subsidy reform to encourage employment and economic opportunity, while discouraging

environmentally damaging production and consumption decisions.

 Promote holistic economic development planning that

embraces sustainability objectives. Development

focused on short-term economic goals has created

multiple challenges for communities in metropolitan

and rural areas. Merely generating revenue and jobs,

though essential, does not necessarily move a community closer to meeting its long-term needs. As a result,

more communities are asking essential, fundamen

questions: Do regional and local economic develo

ment plans truly integrate quality of life and jobs p

grams? Do they benefit all people and pay for the

selves? Do they emphasize attracting, growing, a

nurturing businesses that really make sense in light 

social, economic, and environmental consideration

 Engage private sector business and industry in s

tainable community development. Although ma

people hold strong environmental and social ide

the primary motivation of private industries and 

public at large is still the economic bottom li

Businesses must recognize that sustainable busin

practices are profitable. Each firm has an import

role to play in moving communities towards susta

ability by the way it conducts its business. Sustaina

community development efforts must demonstr

that firms can improve the bottom line and h

achieve larger economic, environmental, and so

goals at the same time.

 Promote workforce development that links to susta

ability principles. Workforce development relies up

a vast network of systems operating throughout 

levels of society. It is subject to complex econom

and environmental influences. Identifying, accessi

and coordinating the tremendous resources and exp

tise devoted to this network, in order to more fu

nurture human potential to fulfill workforce needs

one of the greatest challenges in creating sustaina

communities. A key component of this challenge is 

link employment and training systems to sustaina

community goals and objectives. Historically, servi

provided to those seeking work have been fragment

This has resulted in training and work readiness p

grams that are not linked to job placement activities 

other support services such as transportation. B

each of these services is a vital link in the chain to s

cessful employment and retention.

Recommendation 5

Research and experiment with new market mechanis

that promote sustainable community development goals

Action 1

Through already existing pilots, public-private partn

ships should evaluate how individual developm

accounts (IDAs) can achieve sustainable commun

objectives. IDAs provide a means to build wealth for 
76 CHAPTER 4

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STRATEGIES

poor and low-income by matching savings with funds

from external sources such as foundations, corporations,

religious institutions, and government.33 Building personal

assets and facilitating connections to mainstream banks

can be vital in building sustainable communities in distressed metropolitan and rural areas. Over 20 states have

changed their policies to enable IDA experiments, many

of which are being coordinated by the Corporation for

Enterprise Development, a nonprofit organization based

in Washington, D.C.34 A 1999 initiative of the U.S.

Treasury Department that mandates electronic funds

transfer for federal distributions provides a unique opportunity to link welfare and welfare-to-work recipients with

mainstream financial institutions.

Action 2

The federal government should work with lenders to

expand research on location-efficient mortgages. The

location-efficient mortgage (LEM) is intended to enable

homebuyers to shift money saved on transportation costs

to housing. The LEM Partnership, begun in 1996, includes

the Center for Neighborhood Technology, the Natural

Resources Defense Council, the Surface Transportation

Policy Project, and Fannie Mae. It is conducting pilots in

Chicago, San Francisco, Los Angeles, and Seattle in which

first-time homeowners can qualify for up to $35,000 more

house for the same family income because they live near

public transit.35 Analyses of urban access are also under

way in Miami, St. Louis, and Milwaukee. In support of

proposed White House actions on smart growth and

regional collaboration, leaders from relevant sectors

should help EPA, HUD, and the U.S. Departments of

Energy and Transportation track, evaluate, and enhance

the use of location efficiency as an incentive for smart

growth and sustainable development. These agencies,

along with foundations, financial institutions, and community-based organizations, should also identify ways that

better information can help the marketplace value location-efficiency.

Action 3

The federal government, working with state and local governments and the private sector, should provide incentives

to capture the air quality benefits of compact development. A recent EPA study demonstrates that developing

infill sites rather than greenfield sites on the fringe of

developed areas results in lower vehicle-miles traveled

because people live closer to work, schools, shopping, and

other services.36 This translates into lower emissions

increases. Cities and states should be able to capture th

benefits where possible and apply them to requireme

under the Clean Air Act. EPA, working with other fed

and state agencies, should coordinate and expand exist

pilot projects such as the Clean Air Brownfie

Partnership Pilot and the Urban Heat Island Reduct

Initiative. Also, methodologies for capturing the bene

of urban redevelopment under the Clean Air Act sho

be identified and ways to replicate those methodolog

determined.

Action 4

Government, finance, business, foundation, and comm

nity-based organizations should periodically convene m

tisector design teams to assess the effectiveness of m

ket-based strategies and pilots and identify new inno

tions. These teams would (1) inventory the capability 

existing market systems and instruments; (2) excha

knowledge about potential market incentives that 

meet sustainable community goals and objectives; (3) ev

uate the benefits of market incentives; and (4) specify n

market-based scenarios, mechanisms, and incentives t

would advance sustainable community development 

metropolitan and rural areas.

Recommendation 6

Broker strategic alliances between urban and rural m

kets.

Action 1

The Administration, working through the Council 

Environmental Quality, should work together with lead

from the private sector, nongovernment organizatio

USDA, other federal agencies, and state and local gove

ments to develop strategic alliances to link urban and ru

markets and foster joint development opportunities

memorandum of understanding should be used to or

nize regional alliances and pilots emphasizing mar

research and expansion, technology development 

transfer, collaborative approaches to ecosystem mana

ment, and other strategic ventures that support region

In particular, federal and state agencies should p

ner with regional entrepreneurs to link urban consum

and rural producers through direct marketing channels 

locally grown food. Such links would offer opportuni

to protect farmland located in or near metropolitan ar

while maintaining economically viable small farm prod

tion. These direct marketing opportunities can be prom
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STRATEGIES

ed and enhanced by a variety of federal and state programs

and activities, including community food security programs,

community-supported agriculture, development of valueadded processing and marketing enterprises, cooperatives,

procurement policies, school meal programs and other

institutional food systems, and farmers markets. Success

stories, lessons learned, and elements of success should be

identified and evaluated for future replication.

Action 2 

Natural resource agencies, including the Forest Service,

Bureau of Land Management, and Natural Resources

Conservation Service, should work together to bolster

natural resource-based opportunities as part of regional

sustainable community development efforts. Greater federal interagency cooperation is needed to help communities understand and incorporate opportunities to conserve

and protect natural resources and ecosystems which are

often decoupled from community and economic development strategies. These efforts should encompass both

rural and urban areas. Although natural resources and the

land base are viewed as rural, many jobs and processes

that use these resources as raw materials are located in

urban areas.

Agencies should organize their collective enterprise

development efforts; they should especially help expand

the work of the Joint Center for Sustainable Communities

with cities and counties nationwide on natural resour

based enterprise development. This work can h

strengthen the linkages between rural and urban Amer

and reinforce the connections between the environm

and economic development.

Action 3

USDA should take the lead in supporting efforts to p

tect farm, ranch, and forest lands through regio

alliance. An alliance of organizations and agencies co

cerned with protecting historically rural lands threaten

by conversion to other uses is forming around ecologi

and productivity concerns. Agencies could supp

research and analyses to more holistically characterize 

issue from the perspectives of protecting farm, ranch, a

forest lands. Agencies and other organizations could id

tify needed policy and program responses includ

expanded incentives to conserve working lands 

urbanizing areas as well as at the edges of metropoli

areas. In particular, agencies and other organizatio

should evaluate the effectiveness of Forest Banks37 a

their adaptation to promote better management of ot

ecosystems and other natural resources.

In addition, federal agencies will help sponsor a

organize a national conference on Working Lands a

Development in June 1999 as a follow-up to the Natio

Town Meeting for a Sustainable America. This conferen

will aim to provide participants with abetter understand

of problems, considerations, and opportunities from 

perspectives of professionals and public officials involv

in land use issues or related transportation, rural develo

ment, or urban development issues that influence la

use. The federal government can help regions build m

livable communities through the productive use of ex

ing infrastructure and the conservation of critical natu

resources on farm, ranch, and forest lands.

Recommendation 7

Federal, state, and local government, working with pub

and private financial intermediaries, should increase acc

to capital for sustainable community initiatives.

Action 1

Using the power of the National Performance Revi

Act, the Administration should continue to consolid

and coordinate federal programs and allow flexibility 

enable states and local governments to consolidate sm

Once dilapidated, Warehouse Row in Chattanooga, Tennessee,

now houses a designer outlet that draws shoppers from across the

region. 

Photo: Center of Excellence for Sustainable Development.
78 CHAPTER 4

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STRATEGIES

er separate grant programs. Many sustainable community

initiatives are spearheaded by community groups that lack

the experience, fiscal resources, and time to work within

the complex administrative structure of government.

Other organizations have expertise, time, and money, but

could be even more productive if their resources were targeted elsewhere. Although federal, state, and local governments have taken action to reduce obstacles, continuous

attention should be given to encouraging flexibility for

funding eligibility and one-stop shopping for grants and

other funding opportunities.

Action 2 

The Administration should create a commission comprising banks, governments, and community developm

corporations to evaluate how recent restructurings 

financial institutions can provide opportunities for s

tainable community development. Corporate and le

restructurings incur a variety of public obligations. Ea

new merger in the banking and financial services indus

particularly on the scale evidenced in the past two ye

(such as the recent Citicorp-Travelers Insurance merger 

create a $700 billion institution), creates new kinds 

reinvestment obligations under the Commun

Reinvestment Act (CRA). As regulatory practices mo

from command-and-control to more flexible perf

mance-based systems, increased public disclosure requi

ments increase the opportunities for public intervent

and negotiation to guarantee that CRA obligations w

SUSTAINABLE APPROACHES TO WORKFORCE 

DEVELOPMENT

Systems

 Training systems should link to current employment systems, anticipate and plan for future jobs, and integrate and

leverage current training resources across government, the private sector, and nongovernmental organizations (e.g.

school-to-work, welfare-to-work).

 Employment systems should link to current training systems to inform, steer, bolster, and nurture their efforts.

 All economic development efforts should have explicit links to job training and continuous learning programs to

ensure that all sectors of society benefit from development.

 Local development that benefits from public investments should be required to train and hire locally.

 Local programs should maximize the value of federal and state workforce development funding through such

methods as one-stop career centers and school-to-work programs.

People

 Workforce development efforts should recognize personal potential and dignity.

 Those in need should be afforded the opportunity to receive training or other employment support.

 Job training should focus on those fields and skills for which reasonable employment opportunities exist.

 People should be informed about what worker training is available and what a career in that field may be like.

 Support systems  e.g., life skills training, transportation, daycare, substance abuse counseling  are crucial to th

success of individuals endeavoring to break the poverty cycle.

 People should be provided with role models and mentors, and case management care from providers.

Commitment

 Communities should know what workforce development opportunities may (or may not) be available to them, and

should be part of the decision-making process to determine whether particular types of jobs and industries fit

their identity and goals.

 Local champions are crucial in initiating and maintaining local workforce development. All other aspects of workforce development must come together at the local level via partnerships and alliances that put aside turf and politics for the greater good.

 Local industry, business, government, and nongovernmental organizations should be united and committed to

making workforce development support local people.
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STRATEGIES

produce tangible community and consumer benefits.

The proposed commission may also evaluate if it is

necessary to increase CRA obligations, applying these

obligations to all financial institutions, and expanding the

federal pool of funds (currently about $350 million) for

seeding new community development financial institutions. Despite the incentives provided by CRA, poor communities still lack banks or other institutions in which to

place their savings, and the poor, in general, remain unable

to access affordable credit. This significantly affects

progress towards sustainability in inner city and rural communities.

Action 3

Working with financial institutions and rural community

development corporations, USDA should develop strategies that address rural credit concerns. The range of financial institutions involved in rural communities is often

small. Some sectors of rural America are well served, such

as large farms and housing. Less well served are sustainable agriculture; small farmers, ranchers, and woodlot

owners; small municipalities interested in rural development projects; and entrepreneurs interested in new innovative businesses (such as information and knowledgebased industries and services); these are precisely the types

of entities that could serve as the foundation of rural sustainable communities.

Action 4

The Administration should strengthen and support community-owned banks. In pursuit of this goal, it should

support full funding of the U.S. Treasurys Community

Development Financial Institutions program. Local ow

ership is an important way for a community to inoculate 

banks against unwanted shutdowns, mergers, or departu

and ensure a high level of community reinvestment of s

ings. The argument for local ownership applies with ev

greater force to nondepository financial institutions wh

have no CRA obligations for community reinvestme

Leaders from all sectors, the Administration, commun

development corporations, and foundations should hi

light the efforts of various kinds of local depository in

tutions  commercial banks like South Shore, thrifts l

the Union Savings Bank of Albuquerque, and commun

development credit unions like Raleigh-Durham Self-H

 that are helping low-income members and small bu

nesses finance myriad sustainability initiatives.

Action 5

The appropriate federal agencies, in collaboration with 

private sector, should actively promote initiatives aimed 

creating a secondary market for financing sustaina

community development. HUD, for example, h

launched a pilot for creating such a secondary market a

has developed a budget proposal to take the concept t

larger scale. The Minneapolis, Minnesota, nonpro

Community Reinvestment Fund, which serves 15 sta

operates a secondary market for development loans. T

Fund purchases loans, at market values, from the revo

ing loan funds of local nonprofits and municipal e

nomic development and affordable housing program

The Fund then sells bonds, backed by pools of th

development loans, to investors. This secondary mar

enables local organizations to raise cash to fund proje

Bridges to Friendship Clean Up Day sponsored by the

Washington Navy Yard and local District of Columbia grass

roots organizations. 

Photo: Global Environment and Technology Foundation.

The search is on to discover a new civic

DNA, the biochemistry of leadership

that fits the demands and opportunities

of the 21st century. Regional and local

leadership  shared across the civic,

business, and government sectors by people willing to cross the old and familiar

boundaries  is more critical than ever.

 Neal Peirce and Curtis Johnson, Boundary Crossers:

Community Leadership for a Global Age (New York, NY: The

Academy of Leadership Press, 1997).
80 CHAPTER 4

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STRATEGIES

and it helps them become less reliant on foundations and

government to fund their ongoing development lending

programs.38

Action 6

Federal, state, and local governments should strengthen

relationships with the philanthropic sector to leverage

their respective funds as a source of capital for sustainable

community development. There are more than 400 U.S.

foundations with combined total assets of $10 billion.

These foundations play a critical role in supporting development for the general community well-being. The public

sector should work with foundations on place-based community development initiatives to better leverage public

and private funds.

Recommendation 8

Promote shift in tax policies and subsidy reform.

Action 1

The Administration should assess the impacts of 

Taxpayer Relief Act of 1997 on land use and developm

patterns and community reinvestment. There are two fac

to this assessment. First, this tax law virtually repeals 

capital gains tax on the sale of personal homes. T

Environmental Law Institute estimates that the law co

affect nearly $4 million in sales of existing homes e

year.39 At the same time, the 1997 act creates new oppor

nities for urban revitalization by making housing rehabil

tion by owner-occupants an opportunity to generate t

free income. It is unclear, however, whether this rehabil

tion will occur in urban areas in need of revitalization.

Second, the law includes the first new tax incentive 

land conservation in over a decade which makes cert

CREATING EFFECTIVE MULTISTAKEHOLDER 

PARTNERSHIPS

The Bay Area Alliance for Sustainable Development (BAASD) includes representatives from businesses; foundations;

the religious community; the environmental sector; social equity organizations involved in such areas as housing, homelessness, and multiculturalism; regional, state, and federal agencies; and local officials from a nine-county area of the

San Francisco-Oakland metropolitan area. BAASD compiled lessons learned about its regional and multijurisdictional

process to determine how similar partnerships can be more effective:

 The process should help advance a recognized need already within the interests and/or workplans of stakeholder

groups. Critical, controversial issues, such as the environment, may not get the attention they need through a consensus process because of the difficulty in finding common ground and agreement on solutions to specific problems. Also, too broad an agenda may discourage participation by groups focused on single issues.

 The process needs to be fair and to involve all stakeholders. Many stakeholders cannot afford to be involved

because collaborative processes are time-consuming; thus the more well-funded constituencies (usually the busines

sector) may control the agenda.

 The process needs to identify key leadership, workplans, timelines, and funding support; there should be agreedupon procedures for raising and resolving issues.

 The process should move beyond just instilling good feelings and enthusiasm in participants to actually producing

solutions.

 The people representing key constituencies and/or organizations must have parity in terms of their experience,

expertise, and negotiating skills. These stakeholders must represent their respective organizations and/or constituencies well.

 An adequate and publicly available database/inventory of stakeholders ongoing sustainable development projects

and best practices can enhance the work of stakeholder groups by providing a ready source of information about

the kinds of innovative efforts that are underway.

 Participants must be available for what can be a time-consuming, long-term process. If the more distant stakehold

ers cannot participate due to time and travel constraints, their interests may not be fully represented.

 Sometimes, agency fears of being undermined, or a lack of trust regarding other agencies, may make it difficult to

reach goals. A multistakeholder process can help build trust and find common interests among these participants.

 A public education program can enhance success.
CHAPTER 4

METROPOLITAN AND RURAL

STRATEGIES

land in or near a metropolitan area, national park, wilderness area, or urban national forest eligible for favorable

estate tax treatment through the donation of a qualified

perpetual conservation easement. USDA, working with the

U.S. Department of the Treasury and other appropriate

agencies, should identify how the conservation incentive

provisions should work.

Recommendation 9

Promote holistic economic development planning.

Action 1

The Economic Development Administration should take

the lead in developing and delivering educational forums

for state, local, and tribal economic development planners

on how economic planning and sustainability community

goals can be aligned and on how to attract and promote

sustainable business development. Already, Economic

Development Administration (EDA) planning supports

320 economic development districts and 65 Indian tribes,

staffed and operated locally, to help communities build

capacity to focus on long-term economic challenges. Since

economic development districts are often coordinating

entities for various federal programs, the agency also supports and encourages interdisciplinary regional planning

that encompasses economic, social, and environmental

factors. Current EDA efforts should continue to meet the

need for increased sustainable business development.

Action 2 

Elected, community, and business leaders; labor repres

tatives; and local government agencies should wo

together with residents to develop a consensus about w

types of business investment would succeed in their co

munity and which are desired, and communicate this co

sensus to brokers, trade associations, and poten

investors. Community groups should also create, wh

possible, a partnership that can represent commun

interests to new and existing businesses considering 

investment in the community. National community dev

opment organizations, industry associations, and econo

ic development agencies should work together to iden

and promote industry-specific strategies that incre

community investment and promote sustainability. In p

ticular, building on experience from the Empowerm

Zones and Enterprise Communities, these groups sho

look at how to promote new economic opportunities 

sustainable small businesses in low-income communiti

Recommendation 10

Promote business and industry investment and invol

ment in sustainable community development.

Action 1

The Administration, working with leaders from finan

institutions, business, and community-based organi

tions, should convene a series of national forums 

engage the financial community and private sector in s

tainable community revitalization. These forums wo

identify opportunities for the private sector to engage a

invest in sustainable community alternatives.40 They wo

open a dialogue to obtain high-level commitments fr

private sector leaders to partner with government, no

governmental, and community development organi

tions on sustainable community initiatives and to h

remove barriers and obstacles to sustainable commun

revitalization in metropolitan and rural areas.

Action 2

Key stakeholders should continue to modify existing p

grams and jointly develop and implement new policies 

make infill properties desirable to investors and better a

to compete with greenfields. Developing infill property 

often more costly and complicated than developing gre

fields. Federal and state policies have been enacted t
82 CHAPTER 4

METROPOLITAN AND RURAL

STRATEGIES

attempt to level the playing field between urban and exurban locations, but federal, state, and local governments

should continue to review existing policies and develop

new ones to provide the same level and quality of investment and services to the inner city and older suburbs as

are provided to exurban locations. For example, the federal government should continue to review existing policies

and develop new ones to fully implement brownfields legislation and its National Brownfields Partnership. States

should investigate whether they can replicate the growth

management initiatives of the city of Portland, Oregon,

and the states of Maryland, Florida, and New Jersey.41 City

governments should also work with business associations

to reduce or eliminate regulations that impose costly and

unreasonable barriers to business development in distressed communities.

Action 3 

Federal, state, and local governments and community nonprofits should develop networks to match green businesses

with the needs of municipalities, communities, and each

other. This initiative could be particularly relevant for facilitating outsourcing in ways that strengthen local economies

and help fledgling green businesses find green suppliers and

potential customers. For example, the Triangle J Council of

Governments Industrial Ecosystem Development Proj

 a partnership between EPA, the North Carolina Divis

of Pollution Prevention and Environmental Assistan

regional development agencies, and local universities  

surveying companies in the Raleigh-Durham region to id

tify ways to turn the waste of one company into a raw ma

rial for another company. The Interagency Working Gro

on Environmental Technology is developing a database w

Public Technology, Inc., to match the specific needs of st

and local municipalities to appropriate environmental te

nology providers. Citizens in Appalachia are electronic

tying their communities into the new world econo

through the Appalachian Community Economic Netwo

With the Networks help, more than 20 entrepreneurs h

found customers through the Public WebMarket, a proj

tapping the resources of the World Wide Web and orch

trated by the Center for Civic Networking.

Action 4

Federal and state governments, community developm

corporations, and nonprofits should determine how ex

ing programs for small businesses and microenterpri

can be tailored for green and sustainable start-u

Microbusinesses in the United States comprise an inv

ble economy that goes largely unnoticed in econom

STRATEGIES CONCERNING PEOPLE AND 

LOCAL CAPACITY 

Sustainable community development initiatives must serve and invest in people. Strategies can build local capacity in the

following ways:

 Unleash the potential that resides within individuals  human capital  through education, occupation, health

care, and other human services.

 Increase social capital  the relationships among people  so as to allow human capital to move towards its potential.

 Enable people to have sufficient ownership of resources to implement projects and programs. People will invest in

their neighborhoods and work hard to make them better if they, and not exclusively government, can steward public funds.

 Incorporate leadership training in sustainable development strategies.

 Build informal networks that can link innovative entrepreneurs to mobilize resources and formulate alternative

strategies to build local capacity.

 Work with people to help them use their skills, knowledge, and abilities, so they can utilize, rather than depend on,

experts.

 Strengthen relationships and communication among people and institutions to improve community initiative,

responsibility, and adaptability.
CHAPTER 4

METROPOLITAN AND RURAL

STRATEGIES

development debates. Recent research, however, reveals

that microbusinesses with four or fewer employees generated 43 percent of the net new jobs created from 1990 to

1994.42 Multiple stakeholders should promote new economic opportunities for small businesses in low-income

communities and address the difficulty of financing small

commercial loans in rich and poor communities alike.

Research to determine best practices, successful

strategies, and the profitability of existing and potential

sustainable investments in metropolitan and rural communities should be disseminated through trade associations, business groups, business schools, financing sectors,

and the electronic and print media.

Recommendation 11

Promote sustainable strategies to workforce development.

Action 1

Federal, state, and local agencies; the private sector; and

community organizations engaged in workforce development and welfare-to-work should integrate their programs

so that those most in need of help can access a seaml

system of support services. The box on Sustaina

Approaches to Workforce Development (following) l

ideas for thinking about the requisite systems, people, a

commitments to accomplish this objective.

Action 2 

The U.S. Department of Transportation, in cooperat

with other federal agencies, should continue aggress

implementation of the Job Access and Reverse Comm

Grant program to address gaps in the transportation s

tem that hamper welfare recipients and other low-inco

people from getting to jobs and other support servic

Transportation has been identified as a key element of 

placement and retention. Those who seek work cann

work if they cant get to work.43 At the local level, agenc

nonprofits, community organizations, and other pub

and private sector entities should coordinate efforts 

ensure that employment transportation needs are iden

fied, prioritized, and integrated with the existing tra

portation system. Employers should take a lead role 

identifying and meeting the transportation needs of th

COMMON ELEMENTS OF REGIONAL COLLABORA

TION 

There is not one driver, champion, or model of regional collaboration. Attempts at collaboration face three significant

types of obstacles. First, the rules and regulations at the state and federal levels place unrealistic and cumbersome

requirements on collaboration. Second, collaborations have to overcome a long history of distrust and fragmentation

among groups within regions. Third, both the structure of the political process and financial markets tend to foster

short attention spans, whereas collaborations require a long-term focus. A survey of case studies reveals that collaborations are effective if they build relationships across diverse and disparate interests, including government agencies,

foundations, public interest coalitions, business leaders, civic leaders, and elected officials. These initiatives also recognize the importance of building the process from within the community. Thus, they have the ability to develop commu

nity capacity and to create truly inclusive processes. Successful models of regional collaboration include the following:

 Informal Structures. Civic organizations, citizen assemblies, areawide task forces, and alternative planning organizations tend to be less threatening to citizens and elected representatives who wish to retain local control of decisions that affect their community.

 Single Issues. Most successful cases form around one issue, usually addressing business development, transportation access, land use, environmental quality, welfare reform, housing, and so forth. In many cases, single issue projects evolve into broader initiatives.

 Communication Networks. Strong civic organizations and other forms of cross-community organization often

provide a preexisting infrastructure for a conversation about the need to collaborate and stay committed to collaboration.

 Lending Leaders. Sustained funding is essential to provide the opportunities for collaborations to emerge and take

form. It takes time for communities to develop the internal capacity to trust, participate, and join partnerships.

 Inclusive Processes. As noted by a researcher in a paper prepared for the Center for Neighborhood Technology,

to change a system, you need the whole system in the room (Julia Parzen, Innovations in Metropolitan

Cooperation, Chicago: The Metropolitan Initiative, 1997). Of particular importance is including people who bring
84 CHAPTER 4

METROPOLITAN AND RURAL

STRATEGIES

workforce, both by directly providing services and working with other employers and transportation providers to

ensure effective and timely access.

Action 3 

HUD should be able to provide funding to managers 

affordable housing projects to enable them to implem

and provide services to help residents of HUD-assis

housing developments find and retain jobs. These fun

will enable HUD to complement the efforts of the U
CHAPTER 

INTERNATIONAL LEADE

SH
86 CHAPTER 5

INTERNATIONAL LEADERSHIP

Department of Labor and its Temporary Assistance to

Needy Families program. The funds will also expand the

agencys current efforts to link residents of poor neighborhoods with support services and jobs outside of their

neighborhoods.

Action 4

Local elected, community, and business leaders; labor representatives; and local government agencies should establish strong linkages between economic planning/development activities and education and training systems.

Business development and recruitment efforts frequently

are not firmly linked with education and job training programs. All too often, this means that even though businesses decide to locate in a particular community, the residents of that community who have the greatest need for

jobs do not have the skills to acquire and/or retain jobs in

these businesses. Firmer linkages will establish feedback

mechanisms whereby education and training programs

can better prepare participants for future jobs that are

expected to be located in an area.

LOCAL CAPACITY AND 

PARTNERSHIPS: CREAT

ING 

CIVIC DNA

Recognizing that the challenges facing communit

extend beyond sectoral and jurisdictional boundar

Sustainable America and the PCSDs subsequent repo

Building on Consensus, advocated collaborative regio

planning and cooperation.44 This collaboration co

address regional challenges that include preparing a

linking people with high-quality jobs that are disper

throughout a region and increasingly concentrated in su

urbs; competing economically through the developm

of world-class communications, information, and tra

portation systems; providing an array of affordable ho

ing opportunities throughout a region; creating and ma

taining high-quality, equitable school systems; preserv

quality of life by protecting the environment; controll

traffic congestion; and revitalizing central cities, ru

towns, and older suburbs.45 

There is a serious gap between the complexity of th

challenges and the types of leadership and capacity that 

needed at the local and regional levels to resolve them. 

advance sustainable community development, we n

policies and leadership that build the capacity of indivi

als and institutions to recognize challenges, forge innovat

solutions, and track performance. Success is contingent 

investing in people, particularly by developing those ess

tial champions who can mobilize local support for proje

Advise the President on the promotion

of sustainable development internationally, and gather and disseminate information about U.S. and international sustainable development policies. Promote the

creation and continuation of national sustainable development councils around the

world.

Additionally, given the increasing flow of

financial capital from developed to developing countries, the Council shall recommend policies that encourage foreign

investment by theU.S. Government, businesses, investors, and, as appropriate,

multilateral institutions that are consistent

with the principles of sustainable development.

 PCSD Charter, April 1997

As the worlds largest economy and a

nation that many look to for models and

guidance, we have a responsibility to

demonstrate that it is possible to have

both a strong economy and a clean environment. However, we should not just

view international leadership as an obliga

tion. It is also in our own self-interest to

maintain an international perspective in

an increasingly globalized world.
CHAPTER 5

INTERNATIONAL LEADERSHIP

We also need policies that try to build relationships among

diverse individuals, institutions, and jurisdictions. The recommendations in this section address three areas of activity concerning local capacity and partnerships:

 Building a Multicultural Society. As we move forward

into the 21st century, America will become more

diverse, making it imperative that we rapidly dismantle the barriers that separate Americans from each

other. According to the designations used by the U.S.

Census, America is today 72.7 percent white, 12.1

percent black, 11.0 percent Hispanic, 3.6 percent

Asian/Pacific Islander, and 0.7 percent American

Indian. By 2050, the population in the United States

will be approximately 53 percent white, 25 percent

Hispanic, 14 percent black, 8 percent Asian/Pacific

Islander, and 1 percent American Indian.46 There is

much work to be done in building a thriving multicultural society in America that is unified and not

fragmented. Unless multiple stakeholders foster

greater cultural tolerance and acceptance, current

KEY FINDINGS  INTERNATIONAL LEADERSHIP

 The United States must use its leadership role to help chart a path towards sustainable development both at hom

and abroad. In doing so, the United States should be open to learning from other nations experiences; it should als

foster sustainable development internationally in a spirit of partnership.

 Multilateral agreements should recognize and address economic, environmental, and equity considerations

Sustainable development is inherently an integrative effort. Economic agreements must consider environmental an

social effects, and environmental agreements must address economic viability and social equity in order to be trul

sustainable.

 New coalitions of interests are needed, both domestically and internationally, to build support for the changes nec

essary for sustainable development to be achieved. Without champions from all sectors, change will not occur.

 The Administration should support the continuation of a sustainable development council or another body as 

forum for thoughtful consideration of sustainable development issues by high-level leaders in all sectors. By havin

such a body, the United States sends a strong signal to the world that multistakeholder dialogue and consensus-build

ing are important forms of policy advice and development. Such a Council strengthens the commitment of all sec

tors to a more sustainable future.

 Foreign investment, assistance, and all government activities should be progressively and consistently conducted in

ways that promote recipient countries efforts to achieve sustainable development. This includes technical and finan

cial assistance, bilateral assistance, and support of multilateral assistance. It also encompasses activities not usuall

thought of as aid but which can serve as a means for promoting sustainable development, such as Food an

Agricultural Organization funds, export promotion, and the like.

 The forum that continues for consideration of sustainable development issues can benefit from information exchang

with the international community. Efforts should be made to disseminate the Councils work internationally as well a

to learn from other countries experiments and experiences in working to achieve sustainable development.

Figure 1. Net resources flows to developing countries, 1990-97

Source: World Bank.
88 CHAPTER 5

INTERNATIONAL LEADERSHIP

trends may point to greater segregation in the future.

In the last decade, for example, major metropolitan

cities such as New York, Miami, and Los Angeles

experienced significant outmigrations of middleclass whites as new immigrants arrived.47

Sustainability initiatives will be challenged to address

race and culture in ways that promote economic and

social well-being for all residents. Partnerships cannot take unless individuals cross the boundaries that

separate them and keep them from recognizing their

common interests.

 Building Local Capacity. A community must be able to

create its own vision of the future, develop and implement it in conjunction with the public and private sectors, and assess progress towards that vision. This

capability is vested in an array of formal and informal

networks of individuals and institutions. When a community is rich in this capability, there is a strong community spirit manifested in myriad ways: strong local

philanthropy, volunteerism, worker commitment to

business, and business support of community initiatives. As much of the social and cultural landscape in

the United States undergoes profound change, communities are challenged to re-create the webs of local

interaction that nurture local capacity and community

spirit.

 Building Regional and Multijurisdictional Partnerships.

Successful initiatives often recognize that a region is

greater than the sum of its parts in order to create

more realistic, holistic, and useful policies and plans.

Regional collaboration can take multiple forms and

occur at different points of entry in the same geographic area. Regardless of the form, regional collaboration must embrace community-based, intergovernmental, and market-informed processes. Communitybased regionalism attempts to represent the concerns

of all community interests fairly (nongovernmental

organizations, private sector, and government) in finding mutual solutions to pressing community challenges. Intergovernmental regionalism attempts to

coordinate public sector investment and resources

efficiently and expediently to address challenges that

cross jurisdictional boundaries. Market-informed

regionalism attempts to ensure that public sector

incentives can be used to leverage private sector

resources and commitments. Community, government, and market actors should form a powerful consensus, building a culture of inclusive engagement to

support sustainable communities.

Recommendation 12

Develop initiatives to support and strengthen multicult

al relationships in the context of sustainable developme

Action 1

Leaders from all sectors should work with 

Administration to identify how national initiatives on s

Figure 2. U.S. exports and imports indexed to 1992 levels.

Source: U.S. Department of Commerce, Bureau of Economic Analysis.

Employees harvest and classify roses for export to the USA at

San Sebastian Farm where owners have found roses to be a prof

itable nontraditional export commodity. 

Photo: C. Watson, U.S. Agency for International Development.

Index: 1992 = 100
CHAPTER 5

INTERNATIONAL LEADERSHIP

tainable development can complement national and regional initiatives on building multicultural relationships. The

Administration should, for example, continue to promote

dialogue on cultural ethics and values through initiatives

such as One America. The One America initiative has identified promising practices for racial reconciliation across the

country in several areas: the arts, business, community and

economic development, community building, education,

government, health, religion, and youth.48 Leaders from all

sectors and the Administration should determine which of

these practices also address economic prosperity, ecological,

and social equity objectives so that best practices for building multicultural relationships in the context of building

sustainable communities can be identified.

Based on this review, the Administration, working in partnership with federal agencies; businesses; state, local and

tribal governments; and community-based organizations

should convene a series of regional meetings addressing

how sustainable community initiatives can leverage community racial, cultural, and religious diversity as important

assets. The workshops should specifically address collaborative, inclusive participation of diverse racial, cultural, and

religious groups and communities in regional initiatives.

Action 2

Foundations, the private sector, and community-based

groups  working with federal, state, local, and tribal

offices addressing environmental justice, community revitalization, and health and human services  should dev

op a series of workshops on how sustainability initiati

can provide opportunities for poor and minority individ

als, persons with disabilities, and communit

Discussions on race, class, and the environment have t

ditionally focused on redressing inequities in dispar

impacts of environmental problems on low-income 

minority groups. Sustainable development can both de

en and broaden the context of environmental equity 

identifying how low-income or minority groups can bu

on their economic, ecological, and social assets 

strengthen and revitalize communities.

A series of workshops should be convened that id

tify investment opportunities in sustainable commun

development that can directly benefit minority and lo

income communities. The workshops should address h

policies and procedures can better recognize and build 

indigenous knowledge; they should also provide best pr

tices as well as investment and policy guidance for pub

and private sector agencies. Special attention should 

dedicated to involving poor and low-income people in 

design and implementation of these workshops.

Recommendation 13

Build local capacity for sustainable community develo

ment.

Action 1

Federal agencies, local government, the private sector, co

munity groups, and foundations should develop and supp

a series of working sessions to build local capacity for s

tainable community development. These working sessio

would bring together community leaders and key agencies 

build local capacity for decisionmaking and collaboration 

(1) ensuring access to good information, (2) providing 

range of technical assistance, (3) helping communi

acquire analytical tools, and (4) training local individuals a

organizations on best practices. Such working sessions co

also provide a mechanism for regional collaboration. As o

inally proposed by the National Academy of Pub

Administration, such workshops could lay the foundatio

for a permanent forum between regions and the many d

ferent federal agencies that have an interest in regional pro

lem-solving.49 Working sessions could be tied to existing o

reach programs at universities or newly created, like HU

Community Builders Fellows program; these could be sp

sored by regional, statewide, or community foundations.

The U.S. Agency for International Development Commercial

Agribusiness Promotion project helped the owner of this dairy

farm in Finaransoa, Madagascar, obtain a $6,000 bank loan to

buy a truck and expand his business. 

Photo: Millie Morton, U.S. Agency for International Development.
90 CHAPTER 5

INTERNATIONAL LEADERSHIP

Action 2

The Interagency Working Group on Sustainable

Development Indicators, working with human service

providers and community-based indicator projects, should

develop indicators that can better measure social capital and

local capacity. There are several measures of social capital.

One is the type and frequency of interactions within and outside the community. Examples are inventories of civic associations that provide information on members including

numbers and characteristics such as age, gender, race, and

disabilities. Such inventories can show frequency of meetings, decision-making processes, finances, and services provided to members and nonmembers. Another measurement

is the impact of various types of social capital on the ability

to reach sustainable development goals. This effort should, at

a minimum, examine each of these measures of social capital.

Recommendation 14

Encourage regional and multijurisdictional partnerships.

Action 1 

The federal government should provide incentives for collaboration and use more flexible and regional approaches

to align its information and its investments. These incentives could include financing for metropolitan collaborative pilot projects, as well as promoting innovative strategies for regional land use planning. The federal government should work with localities to determine how best to

coordinate its vast array of information, technical as

tance, and funding to meet local and regional goals.

Zivinice, Bosnia, Womens Association distributing the Dayton

Agreement. The U.S. government supports independent media

and politically active civil society organizations by providing direct

grants of assistance. 

Photo: Nick Cox, U.S. Agency for International Development.
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INTERNATIONAL LEADERSHIP

Action 2

HUD, in conjunction with other federal agencies, should

be given the authority and resources to provide new flexible funding to multijurisdictional, multisectoral partnerships to use in designing and implementing regional

approaches to community, economic, and affordable

housing development. Funding would be provided to

cooperative partnerships of government, business, community, and institutional representatives from multiple

jurisdictions within a region that can and have agreed to

take quick action in adopting regional approaches. The

funding should (1) overcome the hesitancy of localities to

sacrifice their limited, piecemeal resources to interjurisdictional work; (2) enable cities and counties to respond to

their sustainable development needs in the manner they

see best; (3) enable regional partnerships to secure the

capacity  with staff, technology, technical assistance,

and more  needed to accelerate concrete collaborations;

(4) partially cover the costs of implementing regional initiatives; and (5) create lessons that can be shared with

other regions facing similar challenges, such as in providing affordable housing. This initiative would make a solid

statement to the nation that the federal government views

bottom-up, cooperative, interjurisdictional, and intersectoral partnerships as a critical tool for addressing existing

development and embracing the sustainable development

opportunities of the next millennium.

Action 3

States, regional councils, and local governments should

incorporate sustainability mission and goals into regional

planning guidelines, such as on smart growth and ecosystem management. Local governments, individually and

regionally, operate within the legislative and administrative

frameworks set by their state governments. State governments can help shape the course of their regions by

embracing sustainability approaches and ways of thinking.

Action 4

State, local government, and regional organizations should

support the use of indicators to show interdependence of

jurisdictions within regions. The National Association of

Regional Councils, for example, is currently developing a

State of the Regions Report to help benchmark the performance of regions on a number of economic, environmental, and social factors. In metropolitan areas such as

Baltimore, Cleveland, Portland, Seattle, and Chattanooga,

local civic, business, and community groups have compiled indicators that show the interrelationships of regio

al concerns and the effectiveness of regional cooperati

CONCLUSION

S

ustainable development requires coordination a

partnerships to harness the disparate energies 

numerous actors into a focused and cohesive mo

ment. Key to rapid implementation of sustainable comm

nity development will be to make the most out of exist

authority and resources. We believe that our recommen

tions can begin to bear fruit within the next three years.

 By Year 1: Learning Through Information a

Networks. In one year, multiple stakeholders c

enhance existing capacity by deploying new inform

tion toolkits and creating learning networks to fac

tate swift cross-regional innovation and partnershi

We can also begin to make a persuasive and credi

case for action to the public and key decisionmak

through education and communication.

 By Year 2: Leveraging Markets and Financ

Intermediaries. By Year 2, stakeholders can be rea

to leverage financial and technical intermediaries 

create the crucial financial support needed by co

munities seeking to create sustainable projects. 

can also create the economic incentives needed 

encourage everybody to act in ways that enhance s

tainability.

 By Year 3: Linking Institutions to Build Lo

Capacity and Partnerships. By Year 3, stakehold

can build strong regional and multijurisdictional pa

nerships and the local capacity needed to institutio

alize sustainable community development.

Ultimately, the transition to sustainability will co

down to actions taken at the community level all acr

the nation. It will require the integration of many inno

tions that concern people, ecology, buildings, utilities, el

tronic media, open space, natural resources, and econo

ic and social arrangements. The authority and resour

that exist at the community level today will be needed 

achieve as many of these goals as possible. However, 

will also need to put in place even stronger systems 

enable continuous learning and continuous resource sh

ing.

By learning, leveraging, and linking, various stakeho

ers can work together to create the synergy needed to re

cate successes and help move sustainable community dev
92 CHAPTER 5

INTERNATIONAL LEADERSHIP

opment initiatives from inspiration to implementation.

And, by forging vital partnerships that transcend arbitrary

political jurisdictions and sectoral divides, these stakeholders can empower communities to leverage their ecological,

economic, and social assets to secure a high quality of life

both for todays population and for future generations.

INTRODUCTION

The United States is blessed with significant endowments of capital  natural, human, social, andfinancial. These riches enable the country to be a

global leader, exerting substantial economic, political, and

cultural influence around the world. With one of the highest living standards on Earth, the United States is the

largest producer and consumer in all history, accounting

for nearly 25 percent of the worlds resources.1 It is thus

incumbent upon the nation to show stewardship as well as

leadership and to put itself, and to help set the world, on

a path towards sustainable development.

The United States international leadership is wide

ranging, and both formal and informal in nature. Formally,

for example, the United States is an important member of

the United Nations, serving as one of the five permanent

members of the Security Council. Other nations often

hesitate to act to address international issues of secur

development, or the environment unless the United Sta

takes the lead. Informally, Americas popular cult

exports have for decades shown people around the glo

a high standard of living (although not necessarily a bet

quality of life), with an accompanying high use 

resources. While this American Dream has been 

inspiration for much of this century to people around 

world who hope for a better future for themselves a

their families, it is critical that, as we move into the 2

century, the images we project of an American dream 

indeed sustainable.

As the worlds largest economy and a nation that ma

look to for models and guidance, we have a responsibility 

demonstrate that it is possible to have both a strong ec

omy and a clean environment.2 However, we should not j

view international leadership as an obligation. It is also 

our own self-interest to maintain an international persp

tive in an increasingly globalized world. With the rec

growth in communications  where news is provid

worldwide around the clock, and where the Internet d

seminates masses of information continuously and inst

taneously around the globe  problems and situations t

previously were only local or national in scope now t

place on an international stage. This can be a double-edg

FORUM ON THE MULTILATERAL AGREEMENT ON

INVESTMENT 

The following highlights some of the key issues regarding the MAI raised during the February 10 forum. These point

do not reflect a consensus among forum participants; rather, they are included to provide a sense of the major concern

and potential benefits posed by the MAI.

 International capital flows contribute greatly to the growth of the United States as well as to the global economy

Investment and sustainable development need not be in conflict.

 Appropriate provisions must be made in the agreement to protect all nations ability to enact and enforce their own

environmental protection measures.

 Environmental and economic global institutions should be on an equal footing.

 From the NGO perspective, the MAI has the potential to link environmental and economic goals; however, thi

linkage must be strengthened in the existing text of the agreement.

 From the international business perspective, the MAI does not prevent sustainable development; given the appro

priate conditions of national treatment, efficient operation, legal assurances, and dispute settlement, the agreemen

could enhance prospects for sustainable development.

 The MAI should set forth a framework for investors that includes standards for environmental protection, access to

information, and access to justice.

 International investments will continue, regardless of MAI structure or codification. The agreement reflects th

increased globalization of the worlds economy and communication capabilities, as well as the desire to attain equi
CHAPTER 5

INTERNATIONAL LEADERSHIP

sword: while we are exposed to international events and are

able to acquire more information, the information can be

overwhelming and outpace our ability to respond.

Despite the stature of the American economy, our

way of life is not self-sufficient. American imports and

exports have grown dramatically in the latter half of this

century. We depend on other countries for goods that we

do not produce ourselves as well as for inputs to production. Exports have contributed to 30 percent of U.S. economic growth, supporting about 12 million high-paying

American jobs.3 The flow of money, as well as of goods,

has also increased. Although the United States is not highly integrated into the global economy due to its large

domestic economy, in 1996 gross private capital flows

(inflows and outflows) amounted to 12.5 percent of the

U.S. gross domestic product (GDP), up from 8 percent 10

years earlier.4 In 1996, the United States spent about $56

billion in developing countries  $11 billion, or 0.02 percent of GDP, in official development assistance (ODA);

and $45 billion in private outflows.

Worldwide, at the beginning of the decade, private

capital flows to developing countries were approximately

commensurate with official development assistance ($42

billion and $56 billion, respectively). According to 1997

estimates, however, private capital flows were six times

greater than ODA that year, reaching $256 billion5 (see figure 1). The dramatic growth in international private capital flows to developing countries in the 1990s was the

result of changes in both the developing and industrial

worlds. Developing countries began welcoming foreign

capital through regulatory and policy changes and opened

the sale of many state-owned companies to private bidders. On the part of industrial countries, computerized

financial networks facilitated global investments, while

economic growth and low interest rates encouraged a

search for higher returns in emerging markets.6

Given the enormous increase in international private

capital flows, consequent economic growth, and uncertain

net environmental and social consequences, the Presidents

on Sustainable Development (PCSD) examined the impacts

of these capital flows on sustainable development, particularly in developing countries. To broaden our understanding

of these complex issues, the Council convened high-level

forums relating to two timely and critical mechanisms that

would, if instituted, influence foreign investment: the thenprospective Multilateral Agreement on Investment (MAI)

and the Clean Development Mechanism (CDM). Both

forums were well attended and drew a diverse range of p

ticipants, bringing new clarity to these issues. The Coun

also provided input to the United Nations reexaminat

of development finance,7 emphasizing sustainability and 

recognition of social and environmental concerns as v

components of economic growth.

INTERNATIONAL 

CONNECTIONS OF 

PCSD ACTIVITIES

As globalization has brought many issues from 

domestic realm to the international and ba

every one of the Councils topics of attent

have international connections. The term globalizatio

often refers to the trend towards decreased importance 

national borders in the face of increased contacts amo

people, companies, and institutions, and rapid advances 

technology. For instance, environmental and social just

organizations around the world have used technology 

unite in advocacy of various issues, in effect increasing 

transparency of governmental and business activit

International transactions by American businesses cont

ue to grow. Figure 2 shows the dramatic rise in bo

exports and imports throughout the latter part of t

century. American and international business h

become increasingly interconnected through plants, jo

and capital. In recent developments, for example, inform

tion technology has made it possible to employ subco

tractors through the Internet, creating co-workers on p

jects without their ever meeting face to face. These tren

have meant a de facto increase in the relative degree 

influence over international relations by entities outs

Sustainable development is inherently an

integrative effort. For nations to achieve

sustainable development,

multilateral agreements or processes that

affect the economy, the environment, or

social equity should be undertaken from 

perspective of sustainability and reflect al

three areas of concern.
94 CHAPTER 5

INTERNATIONAL LEADERSHIP

government.

The majority of cross-border investments to developing countries takes the form of foreign direct investment

(FDI), such as joint ventures or building facilities in other

countries. (See figure 1.) These investments have a longer

time horizon than portfolio investment or debt financing,

and are most directly affected by environmental considerations. FDI has the demonstrated potential to promote basic

social and environmental goals: such as increased awareness

of environmental factors, increased efficiency of resource

use, worker skill development, and new resources to

address existing environmental problems.8 One way to use

these investments to help facilitate countries sustainable

development efforts is to work with companies and their 

international operations. For instance, the Councils

Environmental Management Task Force has proposed next

steps in building a new environmental management framework for the next century that would help move the system

towards sustainable development (see chapter 3). While

these recommendations are tailored to the American system

of environmental management, much can be gained by

sharing this new vision of relationships internationally

among businesses, governmental regulatory structures, and

people. And for our part, the United States is also learning

from international efforts, such as the International

Organization for Standards ISO 14000 and the European

Unions Eco Management and Audit Scheme.

American leadership and international engagement

are especially important in addressing the array of global

issues that can only be solved through cooperation.

Solutions to global environmental problems such as the

destruction of the ozone layer, the loss of biological

diversity, and human interference with the climate depend

on the participation and leadership of the United States.

The country is currently engaged in a significant global

effort to assess and monitor trends in the state of 

worlds forests and to promote sustainable forest mana

ment. Since the United States is the worlds largest emit

of greenhouse gases, American leadership on slowing 

mate change is vital. The Councils Climate Change T

Force highlighted the importance of early action to prot

the climate. The Councils work on this issue (see chapter 

has stressed the importance of improved technologies a

their dissemination both domestically and globally, as w

as the broader benefits that can be realized when comm

nities take action motivated by other objectiv

Technologies and other technical assistance from industr

ized countries can help developing countries grow th

economies while improving environmental protection a

opportunities for all. The Clean Development Mechani

in the Kyoto Protocol is one means of institutionaliz

cooperative approaches for achieving sustainable devel

ment while reducing greenhouse gas emissions. Under 

CDM, investments can be made in cleaner sources of en

gy or cleaner industrial processes in developing countrie

exchange for credit against greenhouse gas reduction t

gets.

Economic development, deterioration of cities

variety of transportation issues, and the inability to d

effectively with rising populations in metropolitan ar

are issues that communities face around the world. T

Councils Metropolitan and Rural Strategies Task Fo

has developed tools to assist communities to deve

more sustainably; to find ways to invest in people, plac

and markets; and to assess and track progress at the co

munity level (see chapter 4). These tools may also be he

ful for communities around the world. In the same w

American communities seeking ways to develop brow

fields have learned from European communities succe

ful brownfields redevelopment and eco-industrial p

projects. Sister city, county, and state affiliations betwe

the United States and other nations began shortly af

World War II. They developed into a national initiat

when President Dwight D. Eisenhower proposed the p

ple-to-people program at a White House conference 

1956.9 His intention was to involve people and organiz

groups at all levels of society in personal citizen diplom

cy. These existing relationships provide a venue 

increased learning as cities exchange strategies for meet

common challenges. For almost 40 years, the Peace Co

has served as an example of a successful approach 

providing hands-on assistance directly to communities 

need around the world. One Peace Corps volunteer 

Our company makes a significant

impact on the planets commerce and

energy...our goal is to be a zero waste

company. We define waste as any cost

that does not produce value to our customers...Since 1994, cumulatively weve

taken $40 million out of our costs on our

way to a projected savings of $76 million

by the end of 1998.

 Interface Sustainability Report, 1997
CHAPTER 5

INTERNATIONAL LEADERSHIP

Poland is working with a Polish nongovernmental organization (NGO) to propose that the Polish government

adopt a multistakeholder national council on sustainable

development.

The Presidents Council on Sustainable Development

along with the Global Environment and Technology

Foundation are convening a National Town Meeting for a

Sustainable America to showcase examples of sustainable

development at all levels across the country. This is an

opportunity for others around the world to learn what we

are doing, as well as for Americans to learn from other

countries successes. The meetings theme of crossing

boundaries demonstrates that it is necessary to learn from

each other, not just person to person but also community

to community, and nation to nation. We are enriched

through discovering others successful approaches to

implementing sustainable development.

In sum, we can better overcome the challenges of

moving towards a more sustainable society when we learn

how others have successfully faced similar issues. We have

much to gain by sharing our experiences in advancing sustainable development in America; we have just as much to

gain in learning from the experience of other nations in

their efforts to achieve sustainable development.

THE IMPORTANCE OF 

COLLABORATIVE APPROACH

ES

Although at times challenging, the Council 

learned that multistakeholder dialogue provi

important input for efforts to achieve sustaina

development. New coalitions of interests are needed 

build support for change as we move from traditional m

els of economic development and environmental protect

to integrated, sustainable systems. Many controversial iss

are tackled without sufficient understanding of poten

areas for common ground. Thoughtful dialogue among r

resentatives from traditionally adversarial stakeholder grou

can help promote mutual understanding, allowing a be

appreciation of each others priorities and concerns, a

building a foundation for collaborative problem solving.

The Council adopted this approach of assembl

different viewpoints in two activities it conducted to h

inform its consideration of international private cap

flows and sustainable development. Although the t

forums were designed for different purposes, they ea

included participants with a variety of perspectives on 

topics discussed. In both cases, this format served to i

minate a broader array of concerns by all in attendan

and fostered a greater understanding of the different p

orities held by the various participants.

In addition to providing a place for various sectors 

come together and discuss policy options, the Presiden

Council on Sustainable Development serves as a sym

of the importance and utility of a multistakeholder ad

sory body in building and maintaining a democratic tra

tion of governance. National governments should cont

ue to have a focal point for sustainable developm

which provides opportunities for thoughtful discuss

Our business policies express what we

believe is right and wrong in business.

They describe what BP expects of its

people and what society can expect of

BP. We believe that wherever we operate,

our activities should generate economic

benefits and opportunities and our conduct should be a source of positive influence; that our relationships should be

honest and open; that we should be held

accountable for our actions.

 British Petroleum Annual Report, 1997

The Clean Development Mechanism is

intended to encourage investments in

projects that help put developing nations

on a more sustainable path and, in turn,

help investor countries earn credits for

subsequent greenhouse gas emissions

reductions.
96 CHAPTER 5

INTERNATIONAL LEADERSHIP

and a collaborative approach to policy development. In

recent years, several countries have expressed interest in

forming their own multistakeholder advisory body on sustainable development similar to this Council and have

contacted PCSD for advice and information on its work.

Sharing information with other national councils on sustainable development and attempting to learn from the

experience of others should continue to be a staple activity of the Council.

The Council intends to invite representatives of

other national councils from all corners of the globe to

come to the National Town Meeting in May of this year

and to bring with them their best examples and experiences in promoting sustainable development, as the

United States shares its experience with them. There will

also be an opportunity to compare experiences about

what has been effective  and what has been most challenging  in creating and continuing national councils, as

well as in implementing sustainable development.

SUSTAINABILITY IN 

INTERNATIONAL PRIVATE

CAPITAL FLOWS

CDM FORUM RESULTS

Suggestions for a More Effective CDM

 Encourage flexible mechanisms that allow the benefits of cost-effective decisionmaking to be realized.

 Create profiles of clear winner model projects as prototypes for each sector - industry, energy, buildings and trans

portation. These examples can help decrease transaction costs and risk for other firms applying these models.

 Improve competitiveness of CDM projects using traditional investment criteria (i.e., decrease costs and risks, improv

return).

 Examine both existing and new capital flows. Look at mainstream or incremental investments and assess possibl

incentives for meeting CDM criteria.

 Reduce risk to early participants. Governments and other public institutions should initially serve as market mak

ers, with a graduate transition over time to a private sector mechanism.

 Address methodological concerns over certification and the establishment of baselines.

Suggestions for a More Sustainable CDM

 Encourage projects on poverty eradication and industrial development through the incentives in the CDM.

 Address the specific equity concerns of small island states and low-lying coastal communities.

 Examine the existing incentives in financing domestic infrastructure and energy projects for their effects on th

CDM and carbon emissions.

 Use discounting or a full-cost analysis to differentiate between the net benefits of various energy sources; this woul

facilitate more meaningful comparisons between renewable and nonrenewable energy sources.

 Allow for weighting the value of credits based on the degree of environmental and sustainable development bene

fits. This would offer greater incentives for projects with secondary environmental and social benefits.

Al-Kaabneh, Palestine, is a small community which has no conventional electricity. The Greenstar Foundation and local villagers, with the assistance of the U.S. Department of Energy,

installed a solar array at the local school where it 

powers, among other things, a multimedia computer system. 

A planned high-speed wireless Internet connection will allow

video conferences and electronic commerce to be introduced to the

settlement. 

Photo: Michael North, Greenstar Foundation.
CHAPTER 5

INTERNATIONAL LEADERSHIP

A LOOK AT THE PROPOSED MULTILATERAL

AGREEMENT ON

INVESTMENT

Private investment now dwarfs official development assistance in funds flowing into developing countries. As such,

private investment, including foreign direct investment,

has become the major engine of economic growth in

these countries. (See figure 1.)

Growth, if not occurring within a framework of sustainability, can become a net negative force in a society.

Conversely, growth that is aimed at social, environmental,

and economic sustainability will have a positive long-term

influence on the lives of people in the society. For example, as nations consider the issues surrounding multilateral agreements on investment, it is important that any such

rules for private investment flows be compatible with sustainable development.

In December 1998, the Organisation for Economic

Cooperation and Development (OECD) announced that

negotiations on the MAI were no longer taking place, citing

a number of important issues requiring further analysis and

deliberation.10 The OECD officials agreed that further work

should be carried out in a transparent manner and should

involve all interested countries. While the MAI is no longer

being negotiated, it is likely that bilateral and multilateral

investment agreements will continue to be negotiated in the

future, and analytical and conceptual work done in the contex of MAI discussions should inform future work in these

areas. In particular, the parties to the Free Trade Agreement

of the Americas are negotiating an investment chapter to an

overall trade agreement  thus these concepts are still

quite relevant. Undoubtedly, the issues that remain will be

difficult to resolve in the short term. Environmental and

social criteria in investment decisions is increasingly being

incorporated by financial professionals. It will be a continuing challenge to bring their consideration into investment

negotiation discussions.

With this challenge in mind, the Council convened a

Forum on the MAI and Sustainable Development in

February 1998. The MAI sought, among other things, to

protect international investors by ensuring that their

investments abroad would be treated no differently than

investments made by nationals of the recipient country.

By affording such protections, costs and risks are reduced

for investment, thereby creating a policy climate co

ducive to increased investment. Such investment has 

potential to increase standards of living and distrib

prosperity more widely. However, some groups are co

cerned that national sovereignty and the ability of sma

units of government to act would be threatened by su

an agreement, and that broader effects on the enviro

ment, labor, and social justice could result.

The forum highlighted some of the key issues po

by the MAI. The Council decided not to take a position 

the MAI itself, but to increase understanding of the v

ous concerns and benefits of such an agreement amo

the interested parties. (A summary of the forums p

ceedings can be found in appendix D.)

Several questions were raised that indicate the ne

for further analysis and consideration of the merits 

concluding a multilateral agreement on investment. Th

queries stressed the need for better information about f

eign investment, particularly its effects on develop

nations economies, environment, and quality of life. T

speaks to the issue of whether transparency  gener

agreed upon as desirable and necessary  is sufficient 

provoke good environmental and social performan

Given the dramatic rise in foreign private investment a

periodic financial crises in developing economies,11 th

Kia village, Arnavon Islands, Solomon Islands, is the site of a

community-managed marine conservation area funded by the

U.S. Agency for International Development.

Photo: Hank Cauley.
have been a number of efforts to analyze the relationship

between private capital flows and the impacts on environment and society.12 Research of this nature is vital to our

attempts to understand the effects of globalization and

should continue to be pursued.

MAI advocates asserted that the motivation for co

cluding a multilateral agreement on investment is, amo

other benefits to grow markets abroad. A climate 

growth is encouraged when international agents ens

sufficient rules on property rights, investment protecti
APPENDICE
APPENDICES

and dispute settlement mechanisms to guide this growth.

The purpose of the MAI was to promote foreign investment by reducing risks and distortions. One such risk the agr

ment sought to address is that of a government nationalization or expropriation of investor property by guaranteeing tha

such an event occurs, the foreign investor will be fairly compensated. Without such guarantees of property rights, investm

will remain scarce or demand a higher return. On the other hand, many citizens have expressed their concern in letters to 

U.S. government that this so-called takings provision would place corporate profits above all other concerns. These fe

are probably due in part to a recent case brought by an American company against the Canadian government under 

investor/state arbitral provisions of the investment chapter of the North American Free Trade Agreement (NAFTA). T

case involved an environmental law banning the import and interprovincial transport of the companys product. The com

ny contended that they should be compensated for losses incurred because of the law and that they were denied equal natio

al treatment. After receiving an adverse ruling on non-environmental grounds in a domestic case related to the same ban, 

Canadian government settled the case privately. Moreover, there have been a number of additional investor/state dispu

brought under NAFTA against Canada and Mexico on environmental grounds since then, though none have gone throu

arbitration or award as of yet. These events have people worried over the potential for free trade and investment goals to t

priority over environmental, health, or sovereignty concerns. While there is cause for concern regarding the sanctity of en

ronmental laws, there is also reason for concern over clear and blatant use of environmental laws solely for the purpose 

protecting domestic firms.

Representatives from NGOs have raised questions about whether the MAI would allow communities and localities 

act in their own interest. The concern arises from the provision of nondiscrimination, which may preclude local governme

from enacting preferences for local businesses, for example. In the quest for increased free trade and investment, new and c

ative local sustainability efforts should not be prohibited. Both local and global interests in sustainable development must 

considered. Others have expressed concern that in setting environmental standards within investment and trade agreemen

localities will not have the discretion to determine the overall balance of environmental laws or regulation that is suited 

their particular circumstances.

Several forum participants advocated making adequate information available while reducing barriers to investme

Markets and democratic governance both rely on information to function properly. A related concern is over access to j

tice. Multilateral investment agreements offer both government-government and investor-government recourse in disp

resolution mechanisms. Several NGOs are concerned, however, that communities and individuals would have to rely 

national governments to protect their interests, when not all governments can be relied upon to do so, particularly when h

stakes are involved. One panelist suggested that, at a minimum, dispute settlement mechanisms should allow people to 

amicus briefs in international arbitration cases to make their opinions known on the issue. This would ensure broader acc

and input to the arbitral process.

It is incumbent upon a multilateral agreement on investment to ensure that environmental standards are not lowered 

order to gain investment. Indeed to promote sustainable development, consideration should be given to raising standards 

some cases. Good environmental policies are good economic policies. Proponents of the MAI emphasized that increa

trade and investment expand standards of living and wealth, and often, in the case of foreign direct investment, bring the 

est technology. Some potential parties to a MAI argue that codifying the rules for encouraging international investment

place of the many bilateral investment treaties that currently exist, will result in an opportunity to motivate more countries 

have high standards for investment and for environmental and worker protection.

One of the principal issues that surfaced during the forum discussion was whether it was possible, and desirable, to link e

nomic goals with environmental and social concerns. Many environmental groups are convinced that these must be linked. M

in the business community, however, maintain that they should remain separate, a view shared by many developing countries. T

wide disparity in views stems partly from a failure to understand each others perspectives and concerns: the business commun

often fails to take into account the ecological effects or sociocultural ramifications of a given economic activity; and environm

tal groups often fail to acknowledge the financial issues, pressures, and cost calculations that affect business decisions.

The forum discussion revealed that the need to address economic, environmental, and social considerations together is 
APPENDICES

a universally accepted concept. Yet sustainable development is inherently an integrative effort. For nations to achieve sustaina

development, multilateral agreements or processes that affect the economy, the environment, or social equity should be und

taken from a perspective of sustainability and reflect all three areas of concern. International forums should support sustaina

development goals, whether these are in the area of finance, trade, or environmental protection. Sustainable development 

process that involves everyone, at all levels of governance. Multilateral agreements must allow for actions taken towards s

tainable development at the community or regional level.

It may be useful to reframe the debate on whether it is desirable to put environmental agreements on an equal footing w

economic agreements. It is more productive to ask how we can more fully incorporate environmental and social consideratio

into everyday economic decisions, and incorporate economic concerns into social and environmental issues. More needs to 

done, both in research and in practice, to decrease the gulf between social, environmental, and economic values and und

standing.

A growing number of individual businesses see the benefits and opportunities of incorporating social and environm

tal considerations in their core operations.13 They are finding that paying greater attention to these issues can help them m

age risks and costs in a way that confers competitive advantages. For example, The Dow Chemical Company instituted 

WRAP (Waste Reduction Always Pays) program, and announced extensive environmental, health, and safety goals for 20

The goals involve an environmental code of ethical practices, incident reductions, and resource productivity with an emp

sis on pollution prevention. Between 1994 and 1997 Dows waste-to-production ratio decreased by 11 percent. The compa

also established a Responsible Care Award to recognize employee efforts worldwide in moving towards the 2005 goals. 

1997, nine teams of finalists in locales ranging from Canada to the Netherlands and from Japan to Brazil each received $5,0

to give to a nonprofit organization in their community that shares the companys concern for protecting people and the en

ronment.

Some multinational corporations go beyond internal measures to provide training and capacity building for local fir

in the countries in which they operate. For example, several member companies of the World Business Council on Sustaina

Development are working with the UN Development Program to provide training and mentoring programs for small a

medium-sized businesses in developing countries.14 Multinational companies are increasingly sending environmental train

to work with their facilities around the world. These companies feel that it is not much additional trouble or expense to h

those trainers stay an extra day or two and provide technical assistance in environmental management to interested local co

panies, technical institutes, and government agencies. Actions like these provide dual benefits: the developing country recei

additional expertise, and the company achieves a more certain, and higher quality, environmental regulatory infrastructure

Companies around the world are making great strides in the name of social commitment. British Petroleum (BP), for exa

ple, is committed to making a distinctive and constructive contribution in the communities in which they operate. This pled

is perhaps most visible in the companys community programs, such as the popular teaching forum Science Across the Wo

in which students in one country share views and information with those in other countries  and by doing so each lea

more.15

As one of the largest employers in Mexico, General Motors (GM) has initiated a number of housing, education, health, a

environmental initiatives to promote community development and improve worker quality of life. In a joint agreement with 

Mexican government and two builders, GM is helping over 5,000 employees buy homes. Additionally, GM partnered w

Habitat for Humanity Mexico to establish a new affiliate in Matamoros and has committed to funding the first two years 

administrative costs and the first 50 homes constructed.16

INTERNATIONAL CAPITAL FLOWS, CLIMATE

CHANGE, AND THE CLEAN 

DEVELOPMENT 

MECHANISM

Climate change is a critical issue of sustainable development. The effects of predicted sea level rise, changes in weather p
APPENDICES

terns, and increases in extreme weather events will all directly affect a large proportion of the worlds population, includ

many of the most vulnerable developing nations. Those populations presently least able to increase their standard of liv

will often be the hardest hit. Low-lying coastal areas such as Bangladesh and small island developing states will experien

severe damage if sea level rises by a meter or more due to a high concentration of coastal communities and economic ac

ities.

Article 12 of the Kyoto Protocol establishes the Clean Development Mechanism (CDM) to help developing countr

achieve sustainable development while simultaneously reducing greenhouse gas emissions.17 As the details of the CDM h

yet to be formalized, and the Protocol has yet to be ratified, the Council sees the mechanism as providing a timely exam

through which to examine the relationship between sustainable development and international private capital flows.

The CDM is intended to encourage investments in projects that help put developing nations on a more sustainable p

and, in turn, help investor countries earn credits for subsequent greenhouse gas emissions reductions. For example, a co

pany may invest in solar panels to bring electricity to a rural village or install an industrial cogeneration system. The CD

encourages partnerships between North and South, and between private and public entities, to facilitate technology tra

fer that contributes to greenhouse gas mitigation. Most agree that the CDM offers great potential for win-win investme

which help both investors and host countries reach their respective goals, though important issues remain to be resolv

These issues include the role of forest-related and other potential methods for sequestering carbon, and the verifiability 

reductions. For a project to qualify under the Clean Development Mechanism, it would have to fulfill the CDM objectives 

assisting in achieving sustainable development and reducing global greenhouse gas emissions in ways that ensure reductio

are additional and provide real, measurable and long-term benefits to the mitigation of climate change.

To help illuminate some of these issues, the Council, along with six other organizations, convened a Forum on the Cle

Development Mechanism and Sustainable Development in July 1998.18 (See appendix D for a summary of the forums p

ceedings.) The dialogue was designed to increase understanding and develop interest in the mechanism as well as to exam

the conditions needed to accomplish the mutually interdependent objectives of sustainable development and greenhouse 

reductions. Like the MAI forum, the gathering was not designed to achieve consensus, but rather to further understand v

ous stakeholder perspectives on the CDM. It was also an opportunity for the Council to hear from those who may be involv

in future CDM projects and to identify key aspects to include so that the mechanism would be successful in attracting inve

ment to help developing countries in their pursuit of a more sustainable path.

Close to 100 people from the federal government, private industry, and the NGO community participated in the d

logue. They heard presentations on opportunities and key issues in the CDM and spent two hours in small group discussi

sharing their perspectives on specific questions. Participant suggestions on ways to make the CDM a more effective inst

ment in promoting sustainable development can be found in the box on the next page. These suggestions are presented h

for information purposes only and do not reflect a consensus among the participants nor endorsement by the Council.

In general, the presenters had a similar perception of the opportunities presented in the concept behind the CDM 

that the mechanism can provide benefits to all participants. Investors would gain by the opportunity to earn credits for red

ing emissions where it is less expensive; host country recipients would benefit by gaining technology or other investm

which would help them develop more sustainably. Most agreed that it is important to include transparency, efficiency, a

accountability in developing the rules and modalities of the CDM, and that the process of figuring out how to implement 

CDM effectively should include all stakeholders. Many noted that all stakeholders in both developed and developing countr

need a greater awareness and understanding of both the opportunities to be exploited, and the pitfalls to be avoided, in 

CDM.

The Activities Implemented Jointly (AIJ) pilot phase provides an opportunity to learn from projects in which partn

ships are undertaken between two countries to jointly reduce greenhouse gas emissions. Most of the projects in the AIJ p

fall under the categories of energy efficiency, renewable energy, and forestry management. Although no credit is awarded 

these projects, as a pilot program it afforded the opportunity to learn how to make these projects work effectively, how 

measure and count reductions, and how to ensure the longevity of reductions as well as the satisfaction of all participan

During the breakout discussion period, several participants suggested that it would be helpful to (1) do a thorough analysis 
APPENDICES

the pilot phase and apply those lessons learned, and (2) create profiles of model projects to provide a template for proje

to be instituted under the CDM. This would help reduce risks for developers and promote more rapid participation, th

resulting in more timely emissions reduction investments. On the other hand, some participants expressed the concern t

the AIJ phase not be viewed as a clear CDM roadmap, but rather as a source of learning to contribute to the development 

the CDM.

The representative from the Marshall Islands, a small island developing state, echoed the concerns of many enviro

mental groups: overall, these innovative flexibility mechanisms should not be a substitute for greenhouse gas emissions red

tions in industrialized countries nor result in a reliance on forestry projects, which are less expensive and on which m

research is needed.19 Developing countries want to ensure that the CDM helps in meeting their most pressing needs  pov

ty alleviation and sustainable development  as well as in preparing to combat the threats posed by climate change.20

The CDM has the potential to help achieve global climate objectives by encouraging cooperative action to reduce gre

house gas emissions as developing nations grow. It is also a vehicle for attracting capital towards sustainable developm

objectives while protecting the climate. As one speaker noted, the mechanism can help promote technology transfer in th

principal ways: by improving the value of the overall investment; by allowing shorter contracts or riskier projects to move f

ward; and by encouraging multinational corporations and others to look at emissions reduction opportunities globally rat

than in only the industrialized nations.21

Given the CDMs stated purpose of helping countries achieve sustainable development while reducing global greenho

gas emissions, it is easy to be optimistic about its potential ability to accomplish these objectives simultaneously. In actuality, ho

ever, facilitating the realization of these twin objectives while developing rules to make the CDM operational is not easy  a

so often the case, the devil is in the details. The CDM must be transparent, and provide for accountable and verifiable em

sions reductions; yet it must also be efficient in order for it to be used. The CDM offers the potential for some reductions to 

made at lower cost in areas that do not have an extensive infrastructure already in place. It is vital, however, that inexpens

reductions be meaningful and lasting. Potential recipients want to ensure that they gain the technology and technical assistan

that help them develop in an economically, environmentally, and socially beneficial manner.

The process of implementing a CDM that explicitly encompasses sustainable development objectives is a timely exa

ple of the challenge of addressing and connecting sustainable development within international agreements. Nonetheless, 

difficulty of this challenge should not dissuade the international community from trying to accomplish the integration of s

tainable development goals with practical and specific measures.

FUTURE OPPORTUNITIES IN INTEGRATING SUSTAINABLE 

DEVELOPMENT WITH ISSUES OF INVESTMENT

National councils on sustainable development and financial policymakers and institutions, among other participants in bo

industrialized and developing countries, should continue the ongoing process of information exchange, stakeholder dialog

and further study at the international level to sort out the complex issues involved in integrating sustainable development in

international economic agreements. The interest and intellectual capacity of a broad array of stakeholders contribute a wea

of knowledge and experience upon which to draw in striving to achieve sustainable development through international agr

ments.

The global need for green development strategies creates new investment opportunities. Domestic policies sho

enhance Americas ability to take advantage of these trends and support the creation and expansion of businesses, organizatio

and techniques that help improve the environment and well-being of citizens around the world. Assistance to other count

should not just be given financially, but should provide the technical expertise, small business development potential, microc

dit, information exchange, and other promising activities that build capacity to advance sustainable development more succe

fully.
APPENDICES

Appendix A 

Endnotes

CHAPTER 1

1. Council publications may be ordered by calling 1-800-363-3732 or logging onto the Councils Website at

<<http://www.whitehouse.gov/PCSD>>.

2. Education for Sustainability: An Agenda for Action (1997), Washington, DC.; Materials: A Report by the

Interagency Workgroup on Industrial Ecology, Energy and Material Flows, Washington, DC, September, 1998 (available on the Web at <<http://www.oit.doe.gov/mining/materials/>>; A more detailed version of this report,

Industrial Ecology, Material and Energy Flow in the United States, A Report Prepared by the U.S. Interagency

Working Group on Industrial Ecology, Material and Energy Flow Washington, DC, is forthcoming; Sustainable

Development in the United States, An Experimental Set of Indicators, A Progress Report Prepared by the U.S.

Interagency Working Group on Sustainable Development Indicators, Washington, DC. (forthcoming, 1999) (availab

on the Web at <<http://www.sdi.gov>>.

3. Presidents Council on Sustainable Development (PCSD), Building on Consensus: A Progress Report on Sustainable Amer

(Washington, DC: U.S. Government Printing Office,1997) can be ordered from PCSD by calling 1-800-363-3732 or a

<<http://www.whitehouse.gov/PCSD>>.

4. <<http://www.whitehouse.gov/PCSD>>.

5. Presidents Council on Sustainable Development, Sustainable America: A New Consensus for Prosperity Opportunity, and a

Healthy Environment (Washington, DC: U.S. Government Printing Office, 1996), chapter 2.

6. PCSD, Sustainable America, p. 8

7. PCSD, Sustainable America, p. 9.

8. The 12 areas were Miami, Los Angeles, the San Francisco Bay Area, St. Louis, Chicago, Detroit, Atlanta, the New

Jersey-New York-Connecticut tristate area, Cleveland, Boston, Pittsburgh, and Minneapolis-St. Paul.

9. The Councils co-sponsor of the event is the not-for-profit organization, the Global Environment Technology

Foundation.

CHAPTER 2

1. Intergovernmental Panel on Climate Change (IPCC), Climate Change 1995, The Science of Climate Change, Summary for

Policymakers (Cambridge, UK: Cambridge University Press, 1996), p. 10.

2. IPCC, Climate Change 1995, p. 8.

3. IPCC, Climate Change 1995, p. 11.

4. IPCC, The Regional Impacts of Climate Change: An Assessment of Vulnerability (Cambridge, UK: Cambridge University

Press, 1998).

5. IPCC, Climate Change 1995, p. 13.

6. UN Framework Convention on Climate Change (UNFCCC), article 2, adopted in New York on May 9, 1992. The co

vention can be accessed at <<http://www.unfccc.de>>.

7. UNFCCC, article 3.1.

8. UNFCCC, article 4.2.

9. The six greenhouse gases include carbon dioxide, methane, nitrous oxide, and three manufactured gases (sulfur hexafluoride, perfluorocarbons, and hydrofluorocarbons).

10. Kyoto Protocol to the UN Framework Convention on Climate Change, article 3.1 and annex B. The protocol can be

accessed at <<http://www.unfccc.de>>.

11. For a discussion of the Clean Development Mechanism, see chapter 5 and appendix D of this report.

12. The protocol will enter into force if 55 nations ratify the agreement. This set of nations must include enough developed countries to account for at least 55 percent of the total 1990 carbon dioxide emissions from developed countri

Current information on the status of nations that have signed and ratified the Framework Convention on Climate

Change and the Kyoto Protocol can be obtained at <<http://www.unfccc.de/fccc/conv/file01.htm>> and

<<http://www.unfccc.de/fccc/conv/signdate.htm>>, respectively.

13. Data on carbon dioxide emissions can be found in Carbon Dioxide Information Analysis Center, Environmental

Sciences Division, Oak Ridge National Laboratory, 1995 Estimates of CO2 Emissions From Fossil Fuel Burning and Cemen
APPENDICES

Manufacturing Based on the United Nations Energy Statistics and the U.S. Bureau of Mines Cement Manufacturing Data,

ORNL/CDIAC-25, NDP-030 (Oak Ridge, TN, 1997). Per capita emissions data are presented in World Resources

Institute, United Nations Environment Programme, United Nations Development Programme, and World Bank, Wo

Resources 1998-99 (Oxford, UK: Oxford University Press, 1998), p. 176, figure GC.6.

14. International Energy Agency, World Energy Outlook 1995 (Paris: Organisation for Economic Co-operation and

Development/International Energy Agency, 1995), pp. 48-49.

15. Announcement by President William J. Clinton on April 21, 1993, cited in President William J. Clinton and Vice

President Albert Gore, Jr., The Climate Change Action Plan (Washington, DC: U.S. Government Printing Office, 1993)

p. i.

16. For an overview of federal government initiatives to secure voluntary greenhouse gas emissions reductions, see Clint

and Gore, The Climate Change Action Plan.

17. U.S. Department of Energy, Energy Information Agency (DOE), Annual Energy Outlook, 1998, DOE/EIA-0383(98)

(Washington, DC: U.S. Government Printing Office, 1998), p. 27 and figure 17.

18. Interlaboratory Working Group on Energy-Efficient and Low-Carbon Technologies, Scenarios of U.S. Carbon Reduction

Potential Impacts of Energy Technologies by 2010 and Beyond (Washington, DC: U.S. Department of Energy, 1997), p. 3.1

table 3.4.

19. The status and prospects for the environmental industry as a whole are discussed in Office of Technology Policy,

Meeting the Challenge: U.S. Industry Faces the 21st Century, The Environmental Industry (Washington, DC: U.S. Departmen

of Commerce, October 1998).

20. This evaluation is based on the perception that foreign markets and governments are moving to provide incentives,

both economic and political, for early reductions in greenhouse gases and other releases that may become marketable

See also comments made by Steve Percy, BP America, Inc., at the Councils June 4, 1998, public meeting; and by

Kenneth Locklin, Energy Investors Fund, at the Councils September 29, 1998, public meeting.

21. See for example, Robert R. Nordhaus and Stephen C. Fotis, Analysis of Early Action Crediting Proposals (Washington,

DC: Pew Center on Global Climate Change, 1998); and U.S. General Accounting Office, Climate Change: Basic Issues i

Considering a Credit for Early Action Program, GAO/RCED-99-23 (Washington, DC: U.S. Government Printing Office

1999).

22. Several analyses of the potential of technology to reduce emissions cost effectively have been published. See, for exa

ple, Interlaboratory Working Group, Scenarios of U.S. Carbon Reductions; and National Academy of Sciences, Policy

Implications of Greenhouse Warming (Washington, DC: National Academy Press, 1992).

23. A number of studies on impediments to the introduction and deployment of technology have been published. See, f

example, the following publications by the National Science and Technology Council: Technology for a Sustainable Futu

A Framework For Action (Washington, DC: U.S. Government Printing Office, 1993); Bridge to a Sustainable Future:

National Environmental Technology Strategy (Washington, DC: U.S. Government Printing Office, 1995); and National

Environmental Technology Strategy: Status and Action (Washington, DC: U.S. Government Printing Office, 1995). Also s

A.K.N. Reddy, Barriers to Improvements in Energy Efficiency, Energy Policy (1991): 953-61. The impediments iden

fied by the Council in this chapter are those that it considers to be the most significant.

24. Models that do not assume accelerated deployment of existing technologies and rapid development of new technolo

gies generally predict higher costs for reducing greenhouse gas emissions. See, for example, S. DeCanio, Barriers

Within Firms to Energy Efficiency Investments, Energy Policy Vol. 21, No. 9 (1993): 901-14; and D.W. Gaskins and J

Weyant, Model Comparisons of the Costs of Reducing CO2 Emissions, American Economic Review Vol. 83, No. 2

(1993): 318-23.

25. Paul Ehrlich and Anne Ehrlich popularized a theoretical framework for considering the impact of human activity on

the environment as: I = P x A x T Impact (I) is a function of population (P) times affluence (A, a measure of the sc

of resource use and convenience) times technology (T, a measure of the resource, energy, or environmental intensity 

the methods that are used to produce and consume goods and services). For a discussion of the basis for the I = PA

formulation, see Paul Ehrlich and Anne Ehrlich, Population Explosion (New York: Simon and Schuster, 1990), pp. 58-

26. The potential of each greenhouse gas to warm the atmosphere is different. For example, methane is 21 times more

powerful a greenhouse gas than is carbon dioxide. Reporting emissions in MMTCE provides a way to compare the

ability of each greenhouse gas to trap heat in the atmosphere relative to carbon dioxide. Consequently, 1 million met

tons of methane emissions are equivalent to 21 MMTCE. For more information, see Office of Policy, Planning and

Evaluation, Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990-1996 (Washington, DC: U.S. Environmental

Protection Agency, 1998), pp. 1-6 to 1-7 and table 1-1.
APPENDICES

27. Office of Policy, Planning and Evaluation, Inventory of U.S. Greenhouse Gas Emissions and Sinks, p. ES-2.

28. Contributions of carbon dioxide, methane, and nitrous oxide calculated from data in Office of Policy, Planning and

Evaluation, Inventory of U.S. Greenhouse Gas Emissions and Sinks.

29. DOE, Annual Energy Outlook, p. 75, figure 109.

30. DOE, Annual Energy Outlook, pp. 102-103, table A2, and p. 122, table A17.

31. DOE, Annual Energy Outlook, p. 111, table A7.

32. Interlaboratory Working Group, Scenarios of U.S. Carbon Reductions, p. 4.4, figure 4.1.

33. DOE, Annual Energy Outlook, pp. 106-109, tables A4 and A5.

34. The EnergyStar label helps consumers easily identify energy-efficient products. To be eligible for the label, manufactu

ers must demonstrate that products meets high standards for energy efficiency. Rebuild America is a DOE program

that helps people save money by helping them identify options to cut energy use in their buildings.

35. Greenhouse gas emissions from food and wood processing are counted in the industry sector. Emissions from vehic

used for farming, ranching, and timbering are counted in the transportation sector.

36. Office of Policy, Planning and Evaluation, Inventory of U.S. Greenhouse Gas Emissions and Sinks, p. 5-2, tables 5-1 and 5

2.

37. R. Lal, J.M. Kimble, R.F. Follett, and C.V. Cole, The Potential of U.S. Cropland to Sequester Carbon and Mitigate the

Greenhouse Effect (Chelsea, MI: Sleeping Bear Press, 1998), p. 9.

38. Office of Policy, Planning and Evaluation, Inventory of U.S. Greenhouse Gas Emissions and Sinks, pp. 6-3 to 6-4 and tabl

6-3.

39. Lal et al., Potential of U.S. Cropland, p. 81, table 40.

40. Eco-efficient means a practice that is both economically efficient and environmentally effective.

41. Presidents Council on Sustainable Development, Sustainable America: A New Consensus for Prosperity, Opportunity, and 

Healthy Environment for the Future (Washington, DC: U.S. Government Printing Office, 1996), pp. 45-47.

42. DOE, Annual Energy Outlook, pp. 106-09, tables A4 and A5.

43. W.P. Anderson, P.S. Kanaroglou, and E.J. Miller, Urban Form, Energy and the Environment: A Review of Issues,

Evidence and Policy, Urban Studies Vol. 33 (1996).

44. For more detailed information on the sensitivity and adaptation of systems to climate change, see IPCC, ScientificTechnical Analyses of Impacts, Adaptations and Mitigation of Climate Change, Summary for Policymakers in Clima

Change 1995, pp. 28-36; and IPCC, The Regional Impacts of Climate Change, pp. 7-8.

45. These examples were presented to the Council by PCSD member Scott Bernstein at the June 1998 public meeting. (Fac

checking was the responsibility of the presenter.) The 211 Atlanta project was described in a personal communication t

Mr. Bernstein by Mark OConnell, President, United Way of Metropolitan Atlanta. Additional information on the DOE

Goldman Sachs partnership can be found on the DOE Website <<http://www.eren.doe.gov>> under the subject

International Performance Measurement and Verification Protocol. The concept of location efficiency is discussed in

PCSD, Sustainable America, pp. 92-93. Further detail on the cost of sprawl can be found in Kevin Kasowski, Costs of

Sprawl Revisited, Developments, September 1992; and Robert W. Burchell and David Listokin, Land, Infrastructure, Housi

Costs and Fiscal Impacts Associated With Growth: The Literature on the Impacts of Sprawl Versus Managed Growth (Washington

DC: Urban Land Institute, 1995). The Great Lakes Energy Network is a project of the High-Performance School

Partnership between the Center for Neighborhood Technology and the Chicago and Pittsburgh Public School Districts

CHAPTER 3

1. More information on the 1939 New York Worlds Fair can be found at

<<http://amsterdam.park.org:8888/Pavilions/WorldExpositions>>.

2. 1997 Council Charter Language: Advise the President on the next steps in building the new environmental management system of the 21st century by reviewing current environmental management reforms (including Project XL and

other innovations), further developing a vision of innovative environmental management that fosters sustainable dev

opment (environment, economy and equity), and recommending policy improvements and additional opportunities t

advance sustainable development. The Council shall report its initial recommendations on environmental managemen

reform to the President no later than Spring 1998 and its broader recommendations on the role of environmental

management in sustainable development by December 1998. Revised Charter, Presidents Council on Sustainable

Development, April 25, 1997; and Executive Order No. 12852, July 19, 1993; Further Amendment to Executive Ord

No. 12852, as amended June 30, 1997.

3. The workplan consisted of three steps. The first step was to conduct a vision exercise to peer forward into the futur
APPENDICES

The second and third steps involved reviewing current environmental management reforms and recommending how 

build a new environmental management framework to foster sustainable development.

4. To avoid confusion with environmental management systems (EMSs) we chose the term framework to refer to the

larger system of environmental management and protection influences.

5. Presidents Council on Sustainable Development, Sustainable America: A New Consensus for Prosperity, Opportunity, and 

Healthy Environment for the Future (Washington, DC: Government Printing Office, 1996).

6. PCSD, Sustainable America, pp. 31-51.

7. See appendix B-3: Next Generation Reports.

8. This section and the next present the major concepts that emerged from the Environmental Management Task Forc

visioning exercise. In this exercise, the task force held two meetings to develop an outline of a new environmental

management framework that could serve as a reference point in reviewing current environmental management reform

and making further policy recommendations. The task force surveyed a number of economic, technological, environ

mental, and societal trends providing the context for discussing a new environmental management framework. We

heard opinions from diverse experts on directions these major drivers might take us; this information enabled the tas

force to form some plausible assumptions about the condition of world in the near future. The exercise then procee

ed towards describing a desired state of the world based on the principles and goals of sustainable development. A k

objective this exercise was to determine which trends and conditions will need to be modified to achieve more sustai

able development and identify the implications for environmental management.

9. Note that here we have drawn a distinction between continuous and continual in talking about the framework in gen

al, since the collective effect of many continual (repeated process) improvements will be a continuous improvement

overall.

10. Environmental Management Task Force Workplan; Step 2 - Review Process: From the Council charter and as

described in the task force workplan, it was agreed to identify and assess a range of current environmental management reforms in light of the developing vision of a sustainable environmental management framework. Due to limit

tions on time and resources, the initial task force write-ups on current reforms (based on publicly available documen

tion) were not intended to be technically comprehensive or conclusive. The summaries were also used to conduct a

benchmarking evaluation to assist the task force in identifying reforms and their relationship to the attributes and

objectives of a new environmental management framework. These attributes, referred to as framework attributes in t

materials (see, July 23 Task Force Reference and Meeting Materials), also acted as the basis for benchmarking criteria 

the task force review of current environmental management reforms. The review (and the benchmarking) was not

intended to measure the general success or failure of the programs involved, the task force was interested to know

what reforms were likely to help foster sustainable development.

11. Dozens of communities are experimenting with Brownfields Redevelopment projects to rejuvenate formerly used

industrial properties (called brownfields to distinguish them from greenfields, agricultural and other virgin prope

ties sought for new plant locations).

12. The Council does not endorse any particular set of environmental management reforms. Current environmental man

agement reforms are referenced in this section for the purpose of illustrating a related activity or concept, and to sug

gest where progress might be enhanced.

13. The attributes of a new environmental management framework for fostering sustainable development also served as

the basic criteria for the task forces review of current environmental management reforms (see endnote 8 and 9

supra).

14. As the task force understands the concept of a greentrack, it complements, rather than replaces, the existing regula

tory system. Shelley Metzenbaum points out the important difference between opting out of the command-and-con

trol model and being allowed to opt into the alternative track in, Making Measurement Matter: The Challenge and

Promise of Building a Performance-Focused Environmental Protection System, (Brookings Institution Center for Public

Management, October 1998), pp. 71-73. Ira Feldman discusses, inter alia, the idea of utilizing demonstrated environmental performance, including a properly implemented environmental management systems and core performance

measures, as the basis for a more flexible system in, ISO 14000 Can Underpin a New Dual-Track Regulatory Syste

Greentracking as an Alternative to Command and Control, Environmental Business Journal (January 1997), pp.11-15.

15. The Aspen Institute, The Stewardship Path to Sustainability of Natural Resources (Washington, D.C.: The Aspen Institute

forthcoming 1999).

16. PCSD, Sustainable America, p. v.
APPENDICES

17. Edward Cohen-Rosenthal, John Bunge, Antonio Ruiz-Quintanilla, Employee Participation in Pollution Reduction:

Preliminary Analysis of the Toxics Release Inventory, Journal for Cleaner Production (1996).

18. PCSD, Sustainable America, p. 64.

19. Closed-loop systems are those in which resources and energy flow into production processes, and excess materials a

put back into the loop so that little or no waste is generated. Ideally, the loops are closed within a factory, among ind

tries in a region, and within national and global economies(PCSD, Sustainable America, pp. 38-39).

20. PCSD, Eco-Efficiency Task Force Report (Washington, DC, 1996) pp. 11-13.

21. In Sustainable America, the Council identified the use of market incentives as a part of an overall environmental man

agement system to achieve environmental and natural resource management objectives, whenever feasible(p. 50).

22. PCSD, Sustainable America, p. 60.

23. A survey of the available literature on the financial performance of investment products that screen or select compa

stocks according to environmental management performance provides some basis for the assertion that it is possible 

analyze publicly traded companies for environmental performance without diminishing a risk-adjusted return. That is

screened stocks can have comparable shareholder return, for instance, with the Standard & Poors 500 Index). Wheth

environmentally screened investment products (e.g., socially responsible investment products or mutual funds, etc.)

outperform the S&P 500 Index or other investment tools is debatable and does not need to be determined for the

purposes of measuring and valuing environmental performance. The implication for the overall environmental management framework is that it is possible to measure and assign financial or firm value to the environmental management performance of companies, including energy efficiency and greenhouse gas emissions reductions. See Laura

Gottsman and Jon Kessler, Smart Screened Investments: Environmental-Screened Equity Funds that Perform Like

Conventional Funds, Journal of Investing Vol. 7, No. 4 (Fall 1998); John Ganzi et al., Corporate Environmental Performa

as a Factor in Industry Decisions: Status Report (Washington, DC: U.S. Environmental Protection Agency, March 1998);

and The Aspen Institute, Uncovering Value: Integrating Environmental Performance with Financial Performance (Washingto

DC, 1999).

24. U.S. Interagency Working Group on Sustainable Development Indicators, Sustainable Development in the United States 

An Experimental Set of Indicators (Washington, DC: forthcoming).

25. As used here, an environmental performance metric may include measures of energy use and efficiency, air emission

and toxic releases, water use and discharge quality, waste treatment, etc. Indicators, as defined by the U.S. Interagency

Working Group on Sustainable Development Indicators, are one of many tools for simplifying, quantifying, and com

municating vast amounts of information in ways that are more easily understood. They are also useful for alerting us 

what areas need more attention, as well as areas that see improvement (Sustainable Development in the United States, p.

v). Note that the terms metric and indicator are sometimes used interchangeably.

26. Pollution Prevention, see Sustainable America, p. 30, and National Academy of Engineering, The Greening of Industrial

Ecosystems (Washington, DC: National Academy Press 1994) p. 98 - 107. Design for the Environment, T.E. Graedel a

B.R. Allenby, Industrial Ecology (Englewood Cliffs, NJ: Prentice Hall 1995) p. 14. Extended Product Responsibility, see

Sustainable America, pp. 38-43.

27. As noted earlier, we here consider any greentrack to be supplemental to the current system; however, alternative strat

gies for administrative efficiency and process-specific requirements that lead directly to demonstrable high environme

tal performance should be pursued. Any greentrack or alternative performance-based system must address multiple

aims as set forth in this section.

28. The Aspen Institute, The Alternative Path: A Cleaner, Cheaper Way to Protect and Enhance the Environment (Washington,

DC, 1996) outlines particular policy issues that must be addressed in offering operational flexibility in exchange for

superior environmental performance and stakeholder involvement. Also see appendix B-3, Next Generation Reports

the convergence of ideas on how to modernize the current system of environmental protection is summarized here 

Karl Hausker, former project director of the Enterprise for the Environment at the Center for Strategic and

International Studies.

29. Although the results have not yet been fully calculated, the upfront resources and expenses used in new initiatives su

as the Environmental Protection Agencys reinvention initiative, Project XL, or other programs with alternative perfo

mance goals may be averaged over time and thus ultimately reduce costs. The resources expended to discover how p

formance options that differ from current practices work, necessarily entails upfront investment. These costs should

be expected to create increased efficiency and effectiveness, and thus diminish, if applied on a wider scale over time.

Allen Blackman and Janice Mazurek, in discussing Project XL note that a significant percentage of the costs that...X
APPENDICES

participants have incurred are likely to have been transitory rather than permanent, and we can expect the costs of 

program to fall in the future. (The Cost of Developing Facility-Specific Environmental Regulations: Evidence from EPAs

Project XL, (Washington, DC: Resources for the Future, March 16 1999) p. 25. Some argue that a portion of these

anticipated savings should be invested in facilitating public participation in project development  for instance,

through technical assistance grants to citizen groups. As Jody Freeman puts it, agencies must view building the capa

ty of communities  that is, their technical and financial ability to participate in the regulatory process  as part of

their missions (Collaborative Governance in the Administrative State, 45 UCLA L. Rev. 1, 81 (1997)). Michael

McCloskey identifies the confounding or deleterious effects that local decisionmaking can sometimes have on nation

environmental goals in Limits to Collaboration, Harpers Magazine (November 1996), pp. 24-36.

30. As used here, the term regional refers to discernible areas that may encompass a broader locale than may be define

by governing districts, communities, or states. It also suggests the possibility of organizing activity with respect to bio

logical ecosystems or bio-regions where feasible.

31. Multijurisdictional means the collaboration or coordination of multiple jurisdictions such as municipalities, counties,

districts, states, regulated sectors, or other such levels of organization.

32. Bullard, Robert D., Unequal Protection - Environmental Justice and Communities of Color (Sierra Club, San Francisco 1994

CHAPTER 4

1. The Councils previous work on sustainable communities is documented in chapter 4 of Sustainable America: A New

Consensus for Prosperity Opportunity, and a Healthy Environment (Washington, DC: U.S. Government Printing Office, 19

and in the associated Sustainable Communities Task Force Report (Washington, DC: PCSD, 1997).

2. Vice President Al Gore, September 1998 speech, Brookings Institution, Washington, DC.

3. Winifred Gallagher, The Power of Place: How Our Surroundings Shape Our Thoughts, Emotions, and Actions (New York, N

Poseidon Press, 1993).

4. James Howard Kunstler, The Geography of Nowhere: The Rise and Decline of Americas Manmade Landscapes (New York,

NY: Touchstone, 1993).

5. The Joint Center for Sustainable Communities, The Role of Metropolitan Areas in the U.S. Economy (Washington, DC,

1998). The report, prepared for the Joint Center by Standard and Poors DRI, compiles gross metropolitan product

data for the largest 314 metropolitan areas that are analogous and can be compared to gross domestic product for

countries and gross state product for states. The report shows that if metropolitan economies were ranked as nation

47 of the worlds largest 100 economies would be U.S. metro areas.

6. PCSD, Building on Consensus: A Progress Report on Sustainable America (Washington, DC, January 1997).

7. For more information about the Joint Center for Sustainable Communities, see its Website at

<<http://www.naco.org/programs/special/center>>.

8. For a copy of a videotape describing the activities of the Pacific Northwest Regional Council, contact the Columbia

River Inter-Tribal Fish Commission, 729 Northeast Oregon Street #200, Portland, Oregon 97232; phone (503) 238-

0667.

9. S.C. Johnson Wax, The S.C. Johnson Public Report (Racine, WI, 1998), p. 4.

10. For more information about the Smart Growth Network, see its Website at <<http://www.smartgrowth.org>>.

11. For more information about The Metropolitan Initiative and the results from the 12 forums, see

<<http://www.cnt.org>>. Also see Carl Vogel et al., Forums Bring Together Diverse Regional Voices, The

Neighborhood Works, Vol. 20, No. 6 (November/December 1997), pp. 22-36.

12. For more information about the Cape Charles eco-industrial development, see the Website at <<http://www.cfe.co

nell.edu/wei/capecharles.html>>.

13. Phyllis Myers, Livability at the Ballot Box: State and Local Referenda on Parks, Conservation, and Smarter Growth, Election

Day 1998 (Washington, DC: Brookings Institution Center on Urban and Metropolitan Policy, 1999).

14. Smart Growth Network Website, 1999 Governors for Smart Growth, Smart Growth Library, <<http://www.smartgrowth.org/library/governor99.html>>. The library summarizes and quotes the smart growth and livability initiative

and goals found in two dozen gubernatorial state of the state or inaugural addresses.

15. Brendan L. Koerner, Cities That Work, U.S. News and World Report, June 8, 1998.

16. Benjamin Goldman, Sustainable America: New Public Policy for the 21st Century (Washington, DC: U.S. Department of

Commerce, Economic Development Administration, 1995). Environmental Business International Inc. (EBI) compil

the information about the size of the environmental industry published in, International Trade Administration,

Environmental Industry of the United States: Overview by State and Metropolitan Statistical Area, (Washington, DC: U.S.

Department of Commerce, September 1997). The environmental industry is defined as those goods and services use
APPENDICES

in regulatory compliance plus the sale of clean water, energy efficiency, and resources recovered from post-consumer

waste or industrial byproducts. By this definition, the U.S. environmental industry comprises 115,400 companies,

according to EBI. In 1996, these companies employed 1,286,500 persons and had $178.3 billion in revenues and $15

billion in exports.

17. For details on the Clinton-Gore Livability Agenda, see the Website,

<<http://www.whitehouse.gov/WH/SOTU99/lcom.html>>.

18. For information about the Livable Communities Task Force, see <<http://www.house.gov/blumenauer/lctf.htm>>

The task force was created by Congressman Earl Blumenauer of Oregon during the 105th Congress; at the time of

this reports publication, it was co-chaired by Reps. Tom Allen (Maine), Elija Cummings (Maryland), and Chakah Fat

(Pennsylvania).

19. Peter Newman and Jeffrey Kenworthy, Sustainability and Cities: Overcoming Automobile Dependence (Washington, DC:

Island Press, 1999).

20. The Metropolitan and Rural Strategies Task Force convened 60 people to identify promising strategies for four of

these areas (green infrastructure was added at a subsequent meeting). The findings for advancing progress in each of

these areas are documented in PCSD, People, Places, and Markets: Comprehensive Strategies for Building Sustainable

Communities, Workshop Proceedings, June 28-30, 1998, Warrenton, Virginia (Washington, DC, 1998).

21. Roger Bolton, An Economic Interpretation of a Sense of Place. Paper no. RP130. (Williamstown, MA: Williams

College, Department of Economics, January 1989). See also his review of the 30-year history of arguments for and

against place-based policies, Place Prosperity Versus People Policy Revisited: An Old Issue with a New Angle, Urba

Studies Vol. 29, pp. 185-203.

22. Lamont Hempel and Tom Horan, Roots and Wings (Claremont, CA: Claremont Graduate School, 1996).

23. For theoretical and practical applications of asset-building, see Michael Sherraden, Assets and the Poor: A New America

Welfare Policy (Armonk, NY: M.E. Sharpe, 1991); and John McKnight and John Kretzmann, Building Communities Fro

the Inside Out (Evanston, IL: Northwestern University, 1995).

24. PCSD, Sustainable America, p. 52.

25. Appendix C-2 provides tables that show how the tools of information and technical assistance, economic incentives

and financial assistance, and local capacity and partnerships can be tailored to advance progress in the five issue areas

26. PCSD, Sustainable America, p. 58.

27. American Planning Association, Research Department, Land-Based Classification Standards,

<<http://www.planning.org/lbcs>>, November 21, 1998.

28. PCSD, Education for Sustainability: An Agenda for Action (Washington, DC: U.S. Government Printing Office, 1996).

29. Maine Rural Development Council, Evaluation of the Multi-Agency Service Team Approach to the Delivery of Business and

Technical Assistance in Support of the Maine Secondary Wood Products Industry (1997). Report is available at

<<http://mrdc.umext.maine.edu/mast/intro.htm#P1>>.

30. The majority of American communities are not yet wired for wide-spectrum telecommunications, and there is as yet 

plan to guarantee that the last mile of high-capacity hookup will reach older and lower income communities (which

will nonetheless help pay for system upgrade and modernization). The Federal Communications Commission (FCC) 

working to implement the Snowe-Rockefeller provision of the Telecommunications Act, which requires the FCC to

ensure that public libraries, as well as schools and rural health care providers, can obtain telecommunications services 

affordable rates. Libraries, in particular, could provide the means of access to electronic information for those house

holds that lack an Internet connection. See U.S. Office of Technology Assessment, Technological Reshaping of Urban

America. (Washington, DC: U.S. Congress, 1995); and Nicholas Negroponte, in Information for the 21st Century,

Scientific American, January 1995.

31. PCSD, Sustainable America, pp. 101-107.

32. Alice Shabecoff et al., Green Jobs, Green Communities, prepared for the Joyce Foundation (Washington, DC: Communi

Information Exchange, 1998).

33. For more information on IDAs, see the Website for the Corporation for Enterprise Development,

<<http://www.cfed.org/idasusas.htm>>.

34. Peter Barnes, Who Owns the Sky?, 1997 Entrepreneurial Economy Review, 1997.

35. For more information on LEMs, see Kim Hoeveler, Accessibility vs. Mobility: The Location Efficient Mortgage,

Public Investment, September 1997 (Washington, DC: American Planning Association). Also see the Center for

Neighborhood Technology Website at <<http://www.cnt.org>>.

36. EPA, The Transportation and Environmental Impacts of Infill Versus Greenfield Development: A Comparative Case Study
APPENDICES

Analysis (Washington, DC, 1998).

37. The Forest Bank concept is under development by The Nature Conservancy in several sites, including southwest

Virginia. Through the Bank a forest landowner can deposit timber rights and receive immediately an annual annuity a

fixed percentage of the timbers value. The Nature Conservancy will take over responsibility for the management and

eventual harvest of the timber using sustainable forestry principles that will not degrade the land or impair the habita

of endangered species, and the local economy will benefit as higher quality timber is moved to the marketplace

38. PCSD, People, Places, and Markets.

39. Environmental Law Institute, Linking Tax Law and Sustainable Urban Development: The Taxpayer Relief Act of 1997

(Washington, DC, 1998).

40. For examples of similar forums engaging the private sector in community reinvestment, see American Assembly,

Community Capitalism: Rediscovering Markets of Americas Urban Neighborhoods, proceedings of the 91st American

Assembly, April 17-20, 1997, Harriman, New York, (New York, 1997).

41. The Portland, Oregon, growth management initiative is described in PCSD, Sustainable Community Task Force Report

(Washington, DC, 1996), p. 27. The states initiatives are described in Appendix C-2.

42. U.S. Small Business Administration, The Facts About Small Business (Washington, DC, May 1996).

43. See Margaret Pugh, Barriers to Work: The Spatial Divide Between Jobs and Welfare Recipients in Metropolitan Areas

(Washington, DC: Brookings Institution, Center on Urban and Metropolitan Policy, September 1998); and U.S.

Department of Transportation, Access to Jobs: Job Access and the Metropolitan Transportation Planning Process in Hartford,

St. Louis, and Detroit (Washington, DC, August 1997).

44. PCSD, Building on Consensus.

45. National Academy of Public Administration, Building Stronger Communities and Regions: Can the Federal Government

Help? (Washington, DC, March 1998).

46. Council on Economic Advisors, Fact Book, Changing America, CEA Fact Book (Washington, DC, 1998). The racial clas

fications are those used by the U.S. Census Bureau, as determined by the Standards for the Classification of Federal Data

on Race

and

Ethnicity

47.

William

Booth, 

White

Migratio

North

From

Miami,

The

In recent years, there has been a remarkable convergence of ideas on how the nation should improve

its environmental protection system. The ideas have emerged from reports by Presidential and

Congressional commissions, consensus-building forums, expert panels, and individual authors. All of

these reports call for evolutionary change in the nations environmental protection system. Without

such change, the reports argue, the U.S. will be unable to meet the environmental challenges of today,

nor those looming in the next century.

Various authors have described this evolutionary change as regulatory reinvention or innovation

or reform. Other authors have described it as the next generation or second generation of environmental policy Unlike reports or policy dialogues that focus on a particular environmental statute

or problem,2 next generation reports addressed systemic issues concerning how the nation protects the

environment...

Environmental progress requires more of the evolutionary change that is already underway as the next

generation of environmental protection takes shape. The current system, consisting mainly of end-ofpipe, technology-based regulations, is inadequate for the challenges ahead, despite its many accomplishments over the past three decades. The challenge for the U.S. and for all nations is to protect and

restore the natural environment while providing for the economics needs of a population that will

grow by at least several billion more people. This will require, among other things: that pollution be

limited not by the best available technology or some variant thereof, but by limits determined by

human and ecological health; that industry undergo a green revolution resulting in products and

processes that generate dramatically less waste and that channel remaining wastes back into production rather than into the environment; and that society find far more effective means of reducing the

environmental impact of the day-to-day decisions of billions of people in their roles as consumers,

workers, drivers, farmers, etc. We will fail in these tasks unless the environmental protection system

evolves in the directions outlined by next generation reports: toward a more performance-based, information-rich, technology-spurring, flexible, accountable regulatory system; toward a broader array of

policy tools that promote continuous environmental improvement, including environmental taxes,

subsidy reform, emissions trading, and information disclosure; and toward stronger private sector

management systems that internalize the same stewardship ethics embodied in environmental statutes.
APPENDICES

Washington Post, November 9, 1998, pp. A1 and A12. See also Joel Kotkin, White Flight to the Fringes, The

Washington Post, March 10, 1996, pp. C1 and C2.

48. The Presidents Initiative on Race, Pathways to One America in the 21st Century: Promising Practices for Racial Reconciliation

(Washington, DC, 1998); see the Website at <<http://www.whitehouse.gov/Initiatives/One America/face.html>>.

49. National Academy of Public Administration, Building Stronger Communities and Regions, p. 47.

A. In a May 1997 article in the journal Nature, several ecologists and economists identified 17 services provided by ecos

tems, noting that "the services of ecological systems and the natural capital stocks that produce them are critical to th

function of the Earths life support system. They contribute to human welfare, both directly and indirectly, and there

fore represent part of the total economic value of the planet." These services include replenishing nutrients and soil

for agriculture, sustaining biodiversity which furnishes herbs and medications, naturally filtering air and water, and pr

viding habitat for wildlife and amenities for people. Robert Constanza et al., "The Value of the Worlds Ecosystem

Services and Natural Capital," Nature, May 15, 1997.

B. Green infrastructure strategies range from the simple to the complex. They include tree planting to reduce summerti

temperatures in urban areas, conversion of abandoned railroad tracks to develop green corridors for pedestrians and

cyclists, and creation of rooftop garden. More complex strategies include stormwater management, erosion preventio

sediment control for construction sites, wetlands creation and stewardship, and urban design for watershed protectio

In an example of a more sophisticated green infrastructure approach, New York Citys Jamaica Bay Watershed

Management Plan combined reliance on natural processes and engineering solutions, to reduce the cost of clean wa

compliance  from $2.3 billion to $1.2 billion  and protect open space. Albert F. Appleton, "The Challenge of

Providing Future Infrastructure in an Environment of Limited Resources, New Technologies, and Changing Social

Paradigms," paper presented to the National Research Council Board on Infrastructure and the Constructed

Environment, Washington, DC, March 24, 1995.

C. See Robert Burchell et al., Costs of Sprawl Revisited (Washington, DC: National Academy of Sciences, National Resear

Council, 1998); and James Frank, The Costs of Alternative Development Patterns: A Review of the Literature (Washington,

DC: Urban Land Institute, 1989). Although sprawled development provides immediate and direct benefits to the peo

ple who move to outer areas, the costs are longer term and are borne by society at large. Due in part to dispersed set

tlement patterns, Americans drive 2.5 trillion miles annually, exacerbating congestion, air pollution, and the carbon

dioxide that contributes to global climate change. Moreover, since 1970, nearly 6 million middle-income and affluent

households have left central cities, exacerbating class and racial segregation within regions.

Despite the short-term benefits of moving outward, research shows that, over time, economic and social problems a

well as the pattern of disinvestment migrate from cities to suburbs. See Thomas E. Bier, "Public Policy Against Itself

Investments that Help Bring Cleveland (and Eventually Suburbs) Down," in Cleveland Development: A Dissenting View

Alvin Schorr, ed. (Cleveland: David Press, 1991); David Rusk, Cities Without Suburbs (Washington, DC: Woodrow

Wilson Center Press, 1993); and Myron Orfield, Metropolitics: A Regional Agenda for Community and Stability

The PCSD expressed the need for change as follows: 3

For the last 25 years, government has relied on command-and-control regulation as its primary tool

for environmental management. In looking to the future, society needs to adopt a wider range of

strategic environmental protection approaches that embrace the essential components of sustainable

development We, as a Council, have concluded that this will require the nation to a develop a new

framework for a new century

Learning to use new approaches to achieve interrelated goals simultaneously will be an evolutionary

process. It needs to build on the strengths and overcome the limitations of current economic and

regulatory systems and recognize the interrelationships between economic and environmental policies. This will require pursuing change concurrently on two paths: making the existing regulatory

system more efficient and more effective, and developing an alternative system of environmental

management that uses innovative approaches.
APPENDICES

(Washington, DC: Brookings Institution Press, 1997).

D. The Sierra Club, "The National Sprawl Fact Sheet," <<http://www.sierraclub.org>>. The reasons for sprawl vary fo

each place, but are compounded by subsidization of new exurban infrastructure (for example, transportation, sewer,

and water service); population pressures; and migration of people and businesses from cities to suburbs. See Scott

Bernstein, "Imagining Equity," Environment and Planning, December 1993; and David Bollier, How Smart Growth Can

Stop Sprawl (Washington, DC: Essential Books, 1998).

E. For a comprehensive overview of community development challenges, including racial and geographic dimensions, s

U.S. Department of Housing and Urban Development, The State of the Nations Cities reports (Washington, DC, 1998)

See also Robert H. McNulty and Clinton A. Page, eds., The State of the American Community: Empowerment for Local

Action (Washington, DC: Partners for Livable Communities, 1994).

F. Various studies demonstrate that significant retail purchasing power is "leaking" out of poor communities in metropo

tan and rural areas and that this aggregated market demand could be cost-effectively served by new retail facilities wi

in the communities themselves. In Chicago, Michael Porter, an economist at Harvard Business School, estimated that 

the inner city core communities of Chicagos West and South Sides alone, the market was overlooking $2 billion per

year in purchasing power. A joint analysis by Chicago United and the Center for Neighborhood Technology estimate

that the total purchasing power within a 2-mile radius of a single rail transit stop in West Garfield Park is $2 billion p

year. See Michael Porter, "The Competitive Advantage of the Inner City," Harvard Business Review, May/June 1995; a

Robert Weissbourd et al., The Market Potential of Innercity Neighborhoods (Washington, DC: Brookings Institution, Cen

for Urban and Metropolitan Policy, 1999).

G. Since the end of World War II, America has shifted 1 million acres of land per year from natural resource-based use

to urban/suburban uses. Agricultural and forestry efforts have also increased pressures on environmental and natural

resources, particularly water contamination from pesticides, soil erosion, and organic waste. Although about 25 perce

of the nations poor live in rural areas, rural America is home to about 30 percent of the working poor because of th

prevalence of low-skill, low-wage jobs. Work in traditional rural industries, such as farming, livestock, and fishing, do

not guarantee that a family will be lifted out of poverty. Nearly 98 percent of those working on farms, for example,

require off-farm income to support their families. All figures cited are from U.S. Department of Agriculture, Econom

Research Service, Rural Conditions and Trends, Vol. 8, No. 2, 1998.

H. For strategies on sustainable rural enterprise and community development, see Michael Kinsley, Economic Renewal: A

Guide for Sustainable Community Development (Snowmass, CO: Rocky Mountain Institute, 1997); PCSD, Sustainable

Agriculture Task Force Report; and PCSD, Natural Resources Task Force Report (Washington, DC, forthcoming).

I. A good source of case studies on resource efficiency in the context of community development is the U.S. Departm

of Energy (DOE) Tool Box, which includes the PLACE3S Guidebook, Smart places software, and Green

Development CD-ROM. Case studies are also documented on DOEs Website on sustainable community developme

at <<http://www.sustainable.doe.gov>>.

J. For example, the number of U.S. curbside pickup programs for recyclables grew from 1,042 in 1988 to 6,678 in 1993

See John E. Young and Aaron Sachs, The Next Efficiency Revolution: Creating a Sustainable Materials Economy, Worldwa

Paper No. 121 (Washington, DC: Worldwatch Institute, 1994). In 10 Northeastern states alone, more than 103,000 p

ple are employed in firms that process or manufacture recycled materials, adding more than $7.2 billion in value to

recovered materials. See Institute of Scrap Recycling Industries fact sheet, <<http://www.isri.org>>, 1998. Also see

Neal Peirce, "Recycling the Urban Junkyard," The Washington Post, April 5, 1998.

K. Robert Lund and William Hauser, The Remanufacturing Industry in the United States (Boston: Boston University, 1997).

L. This information is from preliminary findings of the Institute for Local Self-Reliance, Washington, DC, 1998, which

further estimates that deconstruction requires significantly more labor than traditional demolition, creating 10 to 15

times as many jobs.

M. PCSD, Eco-Industrial Park Workshop Proceedings, October 17-18, 1996, Cape Charles, Virginia (Washington, DC, 1997)

The Cornell Work and Environment Initiative coordinates an Eco-Industrial Development Roundtable and tracks th

status of several eco-industrial park developments around the country; see <<http://www.cfe.cornell.edu/wei>>.

CHAPTER 5

1. PCSD, Sustainable America: A New Consensus for Prosperity, Opportunity, and a Healthy Environment for the Future

(Washington, DC: U.S. Government Printing Office, 1996), p. 156; and World Resources Institute, United Nations
APPENDICES

Environment Programme, United Nations Development Programme, and World Bank, World Resources 1998-99

(Oxford: Oxford University Press, 1998), pp. 236-37.

2. This theme of international leadership in an environmental context was presented in chapter 7 of Sustainable America

3. Remarks by U.S. Secretary of Commerce William M. Daley at the Presidents Export Council Virtual Trade Mission,

November 10, 1998.

4. World Bank, 1998 World Development Indicators (Washington, DC: International Bank for Reconstruction and

Development, 1998), p. 312. Gross private capital flows are calculated in table 6.1 as the sum of the absolute values o

direct, portfolio, and other investment inflows and outflows recorded in the balance of payments.

5. World Bank, Global Development Finance 1998 (Washington, DC: International Bank for Reconstruction and

Development, 1998), p. 3.

6. Hillary French, Investing in the Future: Harnessing Private Capital Flows for Environmentally Sustainable Development

(Washington, DC: Worldwatch Institute, 1998), p. 9.

7. For more information, see the UN Financing for Development Website, <<http://www.un.org/esa/analysis/ffd/ffd.htm>>

8. Environmental aspects of FDI are discussed by Bradford S. Gentry, Foreign Direct Investment and the Environment: Boo

or Bane?, background paper for the OECD Conference on Foreign Direct Investment and the Environment, The

Hague, January 28-29, 1999 (New Haven: Yale Center for Environmental Law and Policy, 1999).

9. For more information, see the Sister Cities International Website at <<http://www.sister-cities.org>>.

10. Excerpt from the MAI Website, <<http://www.oecd.org/daf/cmis/mai/maindex.htm#top>>: Negotiations on th

MAI are no longer taking place. However, the officials agreed on the importance of multidisciplinary work on invest

ment at OECD. There are a number of important issues on which further analytical work and inter-governmental co

operation are needed. The officials agreed that this work should be carried out in a transparent manner and should

involve all OECD members as well as interested non-member countries, including those that participated as observe

in the negotiations.

11. The late 1970s and early 1980s were marked by a debt crisis, mainly affecting Latin America, when an abundance of

foreign investment was available due to the surplus of oil revenues. See, e.g., Robert Gilpin, The Political Economy of

International Relations (Princeton, NJ: Princeton University Press, 1987). The 1990s have seen periodic financial crises 

one country expand to other emerging markets: the Mexican peso crisis produced the so-called Tequila effect and, 

the past year, financial crises in Asia, Russia, and now Brazil. See, e.g., the CNN Financial Network report Devaluati

Deja-Vu: Brazils Crisis Is Like Episodes in Mexico, Asia and Russia - Except Its Different, January 14, 1999,

<<http://cnnfn.com/worldbiz/9901/14/brazil_russia>>.

12. For analyses of the relationship between financing and the environment, see, e.g., French, Investing in the Future, or

Bradford Gentry, ed. Private Capital Flows and the Environment: Lessons From Latin America (Cheltenham, UK: Edward

Elgar, 1999). For a primer on how the financial services industry operates and areas of potential environmental leverage

see John Ganzi, Frances Seymour, and Sandy Buffet, Leverage for the Environment: A Guide to the Private Financial Services

Industry (Washington, DC: World Resources Institute 1998). For analyses of the emerging market financial crises and

effects on society and development, see, e.g., World Bank, Global Economic Prospects and the Developing Countries 1998/99:

Beyond Financial Crisis (Washington, DC: World Bank, 1998).

13. Arnst, Catherine et al. When Green Begets Green, Business Week, November 10, 1997, pp. 98-106.

14. Gentry, Foreign Direct Investment and the Environment.

15. See the Science Across the World program Website, <<http://www.bp.com/saw/english/core.html>>.

16. Personal communication, General Motors Corporation liaisons to the PCSD, February 1999.

17. The Clean Development Mechanism is defined in Article 12 of the Kyoto Protocol to the United Nations Framework

Convention on Climate Change. Its purpose is stated in Article 12.2: The purpose of the clean development mechanis

shall be to assist Parties not included in Annex I in achieving sustainable development and in contributing to the ultima

objective of the Convention, and to assist Parties included in Annex I in achieving compliance with their qualified emis

sion limitation and reduction commitments under Article 3. (Annex I countries are the industrialized countries.)

18. The co-convening organizations were: the Alliance to Save Energy, the Business Council for Sustainable Energy,

Edison Electric Institute, International Climate Change Partnership, and the United States Council for International

Business.

19. The CDM does not specify whether forestry projects, so-called carbon sinks, are included, leading to a debate over
APPENDICES

whether the omission means that sinks projects should be included in the CDM. The Intergovernmental Panel on

Climate Change is currently studying the issue of carbon sequestration, and the Conference of the Parties (the signat

ries to the United Nations Framework Convention on Climate Change) has deferred further action until this report i

released.

20. The CDM does call for a share of the proceeds from certified project activities [to be] used...to assist developing

country Parties that are particularly vulnerable to the adverse effects of climate change to meet the costs of adaptation (Article 12.8).

21. Presentation by Mark Hall, Director of Government Affairs, Trigen Energy Corporation, Forum on the Clean

Development Mechanism and Sustainable Development, July 27, 1998 (see apppendix D).
APPENDICES

APPENDIX B

ENVIRONMENTAL MANAGEMENT

B-1.

ENVIRONMENTAL PERFORMANCE INDICATORS: TH

NEED FOR COMMON MEASURES

The value of environmental performance information is under threat of being diminished by the proliferation of differin

approaches. It is often difficult to develop sufficiently comparable information on environmental performance across a si

gle company, let alone a whole sector or nation. The problems are further compounded by differing definitions from one

country to another  not to mention the difficulty created when locally developed metrics are too insular or do not refle

accepted national standards or goals.

Thus, one of the most important challenges ahead is to devise metrics that serve the specific needs of users while

simultaneously contributing to greater comparability across firms, communities, industries, states, and nations. There is no

single simple answer to this. For example, compliance with regulations is often predicated on definitions of how perfor

mance is measured (e.g., pollutant concentrations in wastewater discharge, total rates of pollutant releases, or effects on

ambient levels. Thus, overhauling the U.S. Environmental Protection Agencys (EPAs) information management systems 

to build in some core metrics across air, water, and waste programs, for instance  could help focus corporate and publi

attention on the most significant elements of performance.

Essentially, who will build  and how  the necessary architecture to collect, manage, analyze, and disseminate info

mation will depend on the specific type of information under consideration:

 Environmental performance metrics/indicators that measure potential human stresses on the environment (e.g., pollu

tant releases, transportation, natural resource depletion, etc.);

 Environmental management indicators that measure efforts to reduce or mitigate environmental effects (e.g., regulato

programs, corporate environmental performance, and community, state, or national levels of performance);

 Environmental condition indicators that measure environmental quality (e.g., ambient air or water quality  these can

again be at the local, state, or national level); and

 National accounting information that tracks natural resources and natural assets at the state and national levels (e.g., t

equivalent of the green gross domestic product  GDP); and internally, managerial accounting practices that track

environmental management performance and value within facilities, organizations, and firms.

Various reporting initiatives are presently under development. Although these are moving in different directions both

domestically and worldwide, most begin with voluntary corporate environmental performance reporting or a specific set 

indicators: ISO 14032 (the International Organization for Standardizations ISOs Environmental Performance Evaluation

the Environmental Defense Funds Scorecard, and the Global Reporting Initiative (Coalition for Environmental

Responsible Economies), to name a few.

Responding to the question of whether a standardized reporting framework can be achieved, the Global Reporting

Initiative  spearheaded by a multistakeholder coalition which includes nongovernmental organizations (NGOs), accoun

ing associations, the United Nations Environmental Programme, and various businesses  is initially aiming to develop a

set of common performance metrics for voluntary corporate environmental reporting (approximately 1,500 companies n

report worldwide). The projects design goal is to develop a standardized reporting guideline reflecting the three dimensio

Society requires a novel kind of regulation to make a true industrial ecology possible. Frustrations with regulation frequently arise because we have fostered and developed environmental laws that attempt to deal

with one problem at a time...Well-meant environmental regulation can have the bizarre effect of increasing

both the amount of waste created and the amount to be disposed, because it puts up high barriers to reuse.

. . A priority for the future will be a cleanup of that aspect of the nations regulatory machinery.37
APPENDICES

of sustainability. Indicators for economic and social aspects would be added as agreement for such indicators is reached.

Examples of international opportunities to standardize metrics include the Organisation for Economic Co-operation

and Developments Pollutant Release and Transfer Registers (essentially the development of Toxics Release Inventory-l

reporting systems in other countries); the Montreal Protocol on ozone-depleting substances); the newly signed Rotterdam

Convention on prior informed consent for trade in chemicals and pesticides; the Kyoto agreements on climate protection

and the biodiversity convention. These processes are among the opportunities for developing consistent metrics for keep

score on environmental performance worldwide.

In September 1998, the Presidents Council on Sustainable Developments Environmental Management Task Force c

hosted a roundtable discussion with EPA Region IXs Merit Partnership for Pollution Prevention on the financial and env

ronmental performance aspects of environmental management systems (EMSs). Approximately 60 companies participate

in this one-day meeting directed toward discussing how companies approach environmental management as a business an

financial matter with particular attention to the emergence and adoption of EMSs, including ISO 14001. The meeting,

which emphasized sustainable development goals, identified general recommendations about the need to work with the

financial industry to further develop material environmental management indicators, the potential relevance of EMSs to

performance-based regulatory programs, and the need to distinguish between the adoption of EMSs and the developmen

of environmental performance evaluating criteria.

B-2. ENVIRONMENTAL MANAGEMENT SYSTEMS AN

ISO 14001

A diverse group of organizations, associations, private corporations, and governments have been developing and implementing EMS frameworks for the past 30 years. For example, the Chemical Manufacturers Association created its own st

dard called Responsible Care. Similarly, the English, French, Irish, Dutch, and Spanish governments have developed thei

own voluntary EMS standards.

The possibility that these diverse EMS frameworks could result in barriers to international trade led to a heightened

interest in formulating an international consensus standard for EMSs. To that end, the ISO, which is comprised of representatives from industry, government, NGOs, and other entities, finalized the ISO 14001 EMS standard in September 19

The intent of this standard is to provide organizations with the elements of an effective environmental management sys

tem which can be integrated with other management requirements to assist organizations to achieve environmental and

economic goals.

A product of this standards development effort is a single format for EMSs which can accommodate varied applications all over the world. ISO 14001 is unique among the ISO 14000 standards because it can be used to audit internal ma

agement systems objectively for the purposes of self-declaration or third-party certification of the systems conformity w

an organizations stated environmental policy and goals.

Many organizations recognize the inherent business advantages of EMSs and are implementing them. In a future en

ronmental management framework, some high-performing firms may want to make their EMSs a component of alternat

regulatory strategies. In these instances, the use of EMSs  including properly implemented ISO 14001  could have th

potential to affect our shared environment; implementation would then be of concern to public policymakers. Efforts are

under way to gather credible and compatible information to address key public policy issues adequately. The following ca

gories are areas of interest and concern to public policymakers.

1. Environmental Performance. The impact a facility has on the environment is of paramount importance to a regulato

assessment of EMSs. Thus, it is critical to measure any change in a facilitys environmental performance that might b

attributable to implementation of an EMS.

2. Compliance. Implementation of an EMS has the potential to improve an organizations environmental compliance

with regulatory requirements. The goal of collecting compliance information is to be able to measure the relationshi

between an EMS and compliance with local, state, and federal environmental regulations and standards.

3. Pollution Prevention. Pollution prevention is a significant public policy goal. The reduction, elimination, reuse, recycl
APPENDICES

and treatment of waste can have an impact on an organization by reducing costs and risks. These actions also enhan

the quality of the work environment and ecosystem. Therefore, better understanding the relationship between an org

nizations overall performance and the role of pollution prevention in the organizations EMS has social, economic,

and environmental implications.

4. Environmental Conditions. To understand the impact of an EMS on the environment, it is necessary to know some

thing about the status of the ambient environment surrounding the facility prior to EMS implementation. Such an

analysis not only helps evaluate the effectiveness of the EMS, it also provides a basis for facility managers to shape a

prioritize their environmental policies and objectives. Data on environmental conditions will help all parties determin

the sustainability of certain human activities from environmental, economic, and social perspectives.

5. Costs/Benefits to Implementing Facilities. There has been much speculation about the relative costs and benefits ass

ciated with the implementation of an EMS. More organizations that are implementing EMSs need to collect cost dat

which should answer questions concerning possible net financial benefits that might accompany improved complian

and increased environmental performance, and whether higher levels of environmental performance are cost prohib

tive. This information could encourage firms to adopt EMSs and strive to become high performers.

6. Stakeholder Confidence. The perceived success or failure of an EMS when used as part of a firms overall environmental strategy is based in part on external stakeholder evaluation of the effort. It is important to look at the amoun

and degree of stakeholder participation in both the development and implementation of an organizations EMS.

7. Third-Party Audits and Certification. The assessment of the EMS can be conducted by third-party auditors and cert

fiers; in many cases, this is already being done. Agreement needs to be reached by and among the auditing/certifying

professionals, the companies being assessed, and the relevant regulatory bodies as to whether certification is adequat

to ensure consistency in the knowledge, skills, and competency of those conducting audits.

B-3. NEXT GENERATION REPORTS

Ideas on how to modernize the current system of environmental protection are summarized in a recent manuscript by K

Hausker, former project director of the Enterprise for the Environment at the Center for Strategic and International

Studies. The following is excerpted from this paper, with the authors permission:1
APPENDICES

Report Summaries

The next generation reports listed below by no means present identical recommendations. Each is unique in its scope a

emphasis, and each has a certain flavor reflecting the composition of its authorship, and whether the report was the outp

of an expert panel or a stakeholder process:4

 Setting Priorities, Getting Results: A New Direction for EPA, National Academy of Public Administration (NAPA).5

This report stemmed from EPAs FY 1994 appropriations bill which directed the agency to engage NAPA to review

EPAs processes for priority setting and resource allocation, organizational structure, and relationships with states and

communities.

 Sustainable America: A New Consensus for Prosperity, Opportunity, and a Healthy Environment for the Future,

Presidents Council on Sustainable Development. President Clinton created the PCSD in 1993 and charged it with pr

ducing consensus recommendations on how to pursue sustainable development. The original Council had 25 membe

made up of cabinet heads and leaders from business, environmental, civil rights, labor, and Native American organiz

tions. A wide range of issues is ddressed in Sustainable America, and many are relevant to the environmental protectio

framework. The PCSDs report is notable particularly for the fact that it is a consensus document endorsed by four

major national environmental NGOs.6

.

 The Alternative Path: A Cleaner, Cheaper Way to Protect and Enhance the Environment.7 This report reflected a tw

year-long stakeholder process, but not a formal consensus-building effort. The report sets forth broad principles con

stituting a foundation for a new system of environmental protection, and also a number of more focused recommen

dations on an alternative path of regulation intended to experiment with more performance-based, flexible

approaches to reducing pollution.

 Resolving the Paradox: EPA and the States Focus on Results. NAPA.8 Like the earlier volume, this report resulted fro

a directive by Congress; in this case, to review key initiatives in federal, state, and local environmental protection, and

examine the responses by EPA and the Congress to the 1995 NAPA report.

 Thinking Ecologically. Next Generation Project at the Yale Center for Environmental Law and Policy.9 This project

brought together a number of experts writing on the common theme of charting a new course for environmental p

cy; the project took input and comment from some 250 people over two years in a series of workshops and conferences.

 The Environmental Protection System in Transition: Toward a More Desirable Future,10 the Enterprise for the

Environment. Its final report, entitled E4E, was an explicit, consensus-building project involving over 80 participant

including: a bi-partisan group of members of Congress, state and local government officials, and former EPA admin

trators; the current deputy administrator of EPA; and leaders from business, the environmental community, and acad

mic and research institutions. As a consensus process, E4E was notable particularly in its bipartisan composition and

its involvement of all levels of government, though several participants chose not to endorse the final report.11

There are many convergent themes in the reports, as discussed in the sections below.

The Environmental Protection System, Past and Future

 All of the reports recognize that the current system has brought about a much cleaner environment over the past th

decades, largely through application of technology-based regulations12 on large point sources of pollution and throug

national standards applicable to various products, processes, and substances.

 At the same time, the reports argue that the current system is not well-equipped to address the environmental challenges that remain or that loom on the horizon.

 Several of the reports describe the current system as likely being in a zone of diminishing returns, where further

tightening of technology-based regulations will produce modest environmental improvement at very high cost.13

 The reports call for evolution, not revolution. None of the reports call for a dismantling of the current regulatory sy

tem; they recommend building on it. The reports recommend modifying and supplementing the existing system, exp

imenting with new approaches, and carefully evaluating the results. In E4E, the metaphor for this evolution was the

use of stepping stones to cross a river. The E4E report stated that this evolution would require experimentation,

prudent risk taking, mistakes, learning, adaptation, and a rebuilding of trust.14 In a similar vein, The Aspen Institute
APPENDICES

concluded, The Alternative Path supplements the current regulatory system rather than replacing it. The current sys

tem is needed to serve as a benchmark for performance as new methods are tested.15

Goals

 Most next generation reports emphasize the need for the nation to set clear, measurable environmental goals to guid

the environmental protection system.16 The PCSD set forth 10 interrelated goals that it felt were essential in guiding

the nation toward sustainable development, and it offered suggestions of indicators to measure progress toward each

goal.17 One of the Aspen Institutes 11 broad, underlying principles developed in The Alternative Path is:

Environmental protection goals should underlie a new system and be clear and measurable.18 E4Es vision for the

future recommended that an improved environmental protection system set and pursue clear environmental goals a

milestones for the nation, states, localities, and tribes, and use understandable indicators to measure progress.19

 None of the next generation reports suggest that environmental goals (or milestones) obviate the need for regulation

or nonregulatory policy tools to bring about reductions in pollution or other changes necessary to protect the enviro

ment.

Information and Data

 Next generation reports stress the need for greatly improved information and data systems.20 Information and data r

evant to the environmental protection system encompass those related to ambient conditions, emission sources, and

risks to human health and ecosystems, as well as measures of Agency resource use and impacts, and broader social a

economic impacts.

 The improved environmental protection system called for in next generation reports requires better information and

data than does the current system. A system focusing on environmental goals as described above requires better mon

toring and tracking of environmental conditions and more sophisticated information systems than traditional techno

gy-based regulations.

 The PCSD, E4E, and NAPA reports contain recommendations to strengthen the base of scientific knowledge;

increase its use by decision-makers and the general public; and improve the quality, collection, management, and acce

sibility of environmental information.21

Evolution of the Regulatory System

 Next generation reports call for evolutionary change in the regulatory system, with an emphasis on performance-bas

standards (rather than technology-based standards) and with regulated entities having more flexibility in meeting the

standards while maintaining high standards of accountability.22

 This evolution would also include a more integrated, multimedia regulatory structure; more encouragement of pollu

tion prevention; and more streamlined reporting requirements.

 The PCSDs conclusion in this area represented a breakthrough: for the first time, a prominent group of national en

ronmental organizations and business leaders jointly endorsed the

...growing consensus that the existing regulatory system may be greatly improved by moving toward performan

based policies that encourage pollution prevention. Regulations that specify performance standards based on

strong protection of health and environment  but without mandating the means of compliance  give comp

nies and communities flexibility to find the most cost-effective way to achieve environmental goals. In return fo

this flexibility, companies can pursue technological innovation that will result in superior environmental protecti

at far lower costs. But this flexibility must be coupled with accountability and enforcement to ensure that public

health and the environment are safeguarded.23

 Several next generation reports address the thorny issue of superior environmental performance, i.e., whether regu

lators should offer more flexible, cost-saving approaches only if regulated entities provide greater environmental pro

tection than that achieved by current regulations. The conclusions are very similar: superior environmental performance should not be required of each and every improvement to the regulatory system. The PCSD distinguished

between general streamlining and improvement of the regulatory system (expected to produce cost savings and/or
APPENDICES

incremental environmental improvement), and bold experiments in alternatives to the current system that would

require superior environmental performance as a condition for a far greater range of flexibility for the regulated enti

ty.24 This distinction is echoed in The Alternative Path and the E4E report.25

 Many next generation reports cited the desirability of regulatory approaches that encouraged pollution prevention

across all media.26

 Many reports emphasize the desirability of improving the collection, organization, and dissemination of information

to reduce duplication and streamline reporting requirements while enhancing access to relevant information by regul

tors and the public at large.27

Expanded Set of Policy Tools

Next generation reports call on government to expand the set of policy tools it uses to protect the environment.28 Examples include greate

use of:

 Pollution taxes, often discussed in the context of a revenue-neutral tax shift in which taxes on labor and/or capital

would be reduced.

 Pricing of various services that reflects their environmental impacts, e.g., transportation and waste disposal.

 Reform of subsidies that encourage environmental degradation.

 Tradable permits, such as the Clean Air Acts sulphur dioxide allowance trading system, the RECLAIM program for

controlling air pollution in the Los Angeles air basin, various water effluent trading programs, and land-oriented trad

able permits (e.g., wetlands mitigation banking).

 Information disclosure requirements, such as the Toxics Release Inventory and Californias Proposition 65.

 Systems of extended product responsibility in which designers, producers, suppliers, users, and disposers accept

responsibility for environmental effects through all phases of a products life.

Federal-State Partnerships

 Several next generation reports address the nature of the federal-state partnership in protecting the environment.

 Next generation reports generally embrace the principle that EPA should differentiate its oversight responsibilities

based on a states environmental performance.29 The PCSD recommended differentiated oversight based on performance: Federal agencies should develop effective partnerships with state governments to administer environmental

regulatory programs. These partnerships should eliminate duplicative activities and greatly reduce federal oversight o

state programs that have a proven track record.30

Federal Policy Integration

 Next generation reports emphasize the need for better policy integration at the federal level. The policies of many fe

eral departments and agencies have a significant impact on the environment through their influence on the activities 

various sectors of the economy. Consistent with this theme, the PCSD report contains sections addressing many of

these sectors.31

 Several next generation reports recommend environmental concerns be better integrated into federal agencies throug

revitalization of the National Environmental Policy Act.32 E4E also cited the need for stronger coordination among

agencies in dealing with problems ranging from water quality to endangered species to climate change, and argued th

responsibility for this ultimately lies with the President who can choose to empower the Council on Environmental

Quality or another White House office to perform the leadership and coordination function.33

 Several reports call on Congress to better integrate its fragmented committee structure to improve both its legislative

and oversight functions in the area of environmental protection.34

Other Themes in Next Generation Reports

Several next generation reports emphasize the key role of private sector stewardship in protecting the environment. The
APPENDICES

Council recommends adoption of a voluntary system that ensures responsibility for a products environmental effects by 

firms involved in the products life-cycle.35 The E4E report contains recommendations including: development and bette

metrics and indicators for stewardship; more extensive private networks of information sharing on pollution prevention

and environmental stewardship; and industry adoption of a set of environmental best practices that promote both enviro

mental protection and improved profitably.36
APPENDICES

CONCLUSION

Industrial ecologists recognize that environmental protection in the coming century will require systemic changes in mate

als use, production processes, product formulation, product use, and disposal practices:

Environmental regulatory processes and regulations have defined and expanded the demand for technology-based

products and services related to the environment. Nevertheless, most critical barriers to environmentally beneficial

technology innovation and diffusion arise within the U.S. environmental management system.

NOTES 

1. Karl Hausker, The Convergence of Ideas on Improving the Environmental Protection System (Washington, DC: Center for

Strategic and International Studies, 1999).

2. See, e.g., Final Consensus Report of the National Commission on Superfund (1994) or Ozone Transport Assessment Group

Executive Report (1997).

3. President's Council on Sustainable Development (PCSD), Sustainable America: A New Consensus for Prosperity,

Opportunity, and a Healthy Environment for the Future (Washington, DC: U.S. Government Printing Office, 1996), pp. 

27.

4. Typically, and not surprisingly, expert panel reports were able to make more specific and controversial recommendations, while consensus reports are less specific and controversial.

5. NAPA, Setting Priorities, Getting Results: A New Direction for EPA (Washington, DC, 1995). Hereinafter, this report is

cited as NAPA I.

6. These were: John Adams (Natural Resources Defense Council), Jay Hair (National Wildlife Federation), Fred Krupp

(Environmental Defense Fund), and Michele Perrault (Sierra Club).

7. The Aspen Institute, The Alternative Path: A Cleaner, Cheaper Way to Protect and Enhance the Environment, Aspen Serie

on the Environment in the 21st Century (Washington, DC, 1996).

8. NAPA, Resolving the Paradox: EPA and the States Focus on Results (Washington, DC, 1997). Hereinafter, this report is

cited as NAPA II.

9. Next Generation Project, Thinking Ecologically (New Haven: Yale Center for Environmental Law and Policy, 1997).

10. E4E, The Environmental Protection System in Transition: Toward a More Desirable Future, 1998,

<<http://www.csis.org/e4e/>>. E4E was convened and chaired by William D. Ruckelshaus, who twice served as th

administrator of EPA. The Center for Strategic and International Studies provided an institutional home for the pro

ject and analytic support, and The Keystone Center provided process design and facilitation services. At the direction

of Congress, NAPA provided additional analytic support to E4E and developed its own report on the U.S. environmental protection system (NAPA II).

11. These several participants, and their reasons for not signing, are described in David Clarke, What Went Right, Envt

F., March/April 1998. See also Linda Greer, Why We Didn't Sign, Envtl. F., March/April 1998, pp. 37-38.

12. This dialogue uses technology-based regulation interchangeably with command-and-control regulation (as do m

authors), and distinguishes it from performance-based regulation and other policy tools in the pages that follow.

13. See, e.g., The Presidential/Congressional Commission on Risk Assessment and Risk Management (the Risk

Commission) Washington, DC: U.S. Government Printing Office, 1997) p. 31; and Daniel C. Esty and Marian R.

Chertow, Thinking Ecologically: An Introduction, in Next Generation Project, Thinking Ecologically, p. 6.

14. E4E, Environmental Protection System in Transition, p. 5. ¶15. Aspen, Alternative Path, p. 10. ¶16. See, e.g., Risk

Commission Report, pp. 4 and 14; and NAPA II, pp. 39-46.

17. PCSD, Sustainable America, pp. 12-23.

18. Aspen, Alternative Path, p. 5.

19. E4E, Environmental Protection System in Transition, p. 4.
APPENDICES

20. See, e.g., Aspen, Alternative Path, pp. 5-7 and 16; Risk Commission Report, pp. 23-28 and 45-48. Also, in Next

Generation Project, Thinking Ecologically, see Jane Coppock and John Gordon, Ecosystem Management and Economic

Development, p. 40; Jason Rylander and John Turner, Land Use: The Forgotten Agenda, p. 69; E. Donald Elliott,

Towards Ecological Law and Policy, p. 176; and Emil Frankel, Coexisting With the Car, p. 193.

21. PCSD, Sustainable America, pp. 57-68; E4E, Environmental Protection System in Transition, pp. 19-24; and NAPA II, pp

53-56 and 68.

22. The degree to which current regulations are performance-based versus technology-based is subject to endless debate

For one of most lucid discussions of this issue concluding that, in practice, technology-based standards do predomi

nate, see NAPA I, pp. 91-92.

23. PCSD, Sustainable America, p. 28.

24. Compare policy recommendations in PCSD, Sustainable America, pp. 31 and 34, with those at p. 35, the latter of whi

involve superior environmental performance.

25. Aspen, Alternative Path, pp. 10 and 13; and E4E, Environmental Protection System in Transition, pp. 29-30.

26. See, e.g., PCSD, Sustainable America, pp. 26-27; E4E, Environmental Protection System in Transition, p.27; and Marian R

Chertow and Charles W. Powers, Industrial Ecology: Overcoming Policy Fragmentation, in Next Generation Project

Thinking Ecologically, pp. 19-36.

27. PCSD, Sustainable America, p. 60; NAPA II, p. 68; E4E, Environmental Protection System in Transition, pp. 21-23;

National Environmental Policy Institue (NEPI), Integrating Environmental Policy: A Blue Print for the 21st Century

(Washington, DC: NEPI, 1996). Integrating Environmental Policy: A Blueprint for 21st Century.

28. See, e.g., NAPA I, pp.103-04; PCSD, Sustainable America, p. 27; Aspen, Alternative Path, p. 5; Risk Commission Repo

pp. 29-31; NAPA II, p. 37; Robert Stavins and Bradley Whitehead, Market-Based Environmental Policies, in Next

Generation Project, Thinking Ecologically, pp. 105-17; E. Donald Elliott, Towards Ecological Law and Policy, in Next

Generation Project, Thinking Ecologically, pp. 179-86; E4E, Environmental Protection System in Transition, pp. 23-24 and

34-40; and NEPI, NEPI, Reinventing the Vehicle for Environmental Management (Washington, DC: NEPI, 1995), pp 45

48.

29. See, e.g., E4E, Environmental Protection System in Transition, pp. 41-44; and NEPI, Building Partnerships for Accountable

Devolution (Washington, DC: NEPI, 1997)

30. PCSD, Sustainable America, p. 53.

31. See, e.g., PCSD, Sustainable America, pp. 33, 37, 49, 54, and 125-29.

32. See, e.g., Risk Commission Report, p. 52; Marian R. Chertow and Charles W. Powers, Industrial Ecology: Overcomin

Policy Fragmentation, in Next Generation Project, Thinking Ecologically, p. 33, footnote 3; and E4E, Environmental

Protection System in Transition, pp. 45-47.

33. E4E, Environmental Protection System in Transition, p. 47.

34. NAPA I, p. 132; NAPA II, p. 74; and E4E, Environmental Protection System in Transition, pp. 48-49.

35. PCSD, Sustainable America, pp. 38-44.

36. E4E, Environmental Protection System in Transition, pp. 51-60.

37. Robert A. Frosch, The Industrial Ecology of the 21st Century, Scientific American, September 1995: 178, 181.

38. David R. Berg and Grant Ferrier, The U.S. Environmental Industry (Washington, DC: U.S. Department of Commerce,

1998) p. 73.
APPENDICES

APPENDIX C

METROPOLITAN AND RURAL STRATEGIES

C-1. EXAMPLES OF SUSTAINABLE COMMUNITY INI

TIATIVES

Several hundred community efforts around the country are working on important fronts in sustainable community development. Through sheer initiative and fortitude, many communities are already realizing the benefits of sustainable community

development. Although this is a locally driven process, the goals and objectives of communities in metropolitan and rural ar

can be enabled and supported at many different scales  neighborhood, local city, regional, state, national, and global. We

include these examples here to demonstrate some of the many different elements of sustainable community development.

Neighborhood

 Austins Casa Verde Builders. Located in Austin, Texas, Casa Verde Builders is a program organized by the American

Institute for Learning, the U.S. Department of Housing and Urban Development (HUD), YouthBuild, AmeriCorps,

the city of Austin, the U.S. Department of Energy (DOE), and the State Energy Conservation Office. In this progra

at-risk youth learn hands-on construction skills and applied academics by building energy-efficient, sustainable, and

affordable housing in low-income neighborhoods. Casa Verde homes are at least 35 percent more energy efficient th

traditionally built affordable housing. Casa Verde Builders also perform other community service activities, such as

weatherization and disability access remodeling. The proceeds from home sales and remodeling go back into the pro

gram to ensure that other young people and families can benefit. As of 1995, the programs 64 members have built 1

1,400-square-foot homes.

 Savannahs Grants for Blocks. After noticing a falling off in local citizen participation in city-run neighborhood

improvement programs, the city of Savannah decided to surrender control of improvement money to residents. The

citys Grants to Blocks program gives residents money  up to $500  to improve their neighborhoods. From 1993

to 1997, residents completed more than 700 beautification projects, and over 1,500 local individuals attended training

workshops on community building or leadership development. Resident and city staff together conducted visioning

sessions. City government supported the process by targeting services and improving the infrastructure. Citizens

increased their citizenship responsibilities. Financial institutions increased their investments in inner city neighborhoo

once they perceived that risks were reduced.

Local City, Town, or Village

 Youngs Bay, Washington. Salmon are a bellwether of ecological health in the Pacific Northwest. Shorebank Pacific, a

nonprofit affiliate of a bank holding company, has lent $5 million to 50 high-risk projects, 70 percent of them in the

lower Columbia and Willapa watersheds to help preserve and recover the salmon runs in these rivers. Each of these

projects is designed to change the interactions among natural systems, markets, and communities. For example, the

bank has worked with a group of individual gill-net salmon fishers in Youngs Bay at the mouth of the Columbia Riv

These fishers are also taking steps to protect the salmon habitat. Through one of its client companies, Shorebank pu

chased about 50 percent of the catch in Youngs Bay and brought it to high-end markets in Seattle, Portland, and San

Francisco, serving as a critical intermediary for the gill-netters to ensure that their efforts to protect salmon habitat a

recognized in the market price paid for the fish.

 Philadelphia. For more than 50 years, Cardone Industries has pioneered the automotive parts remanufacturing indust

in Philadelphia. Cardone employs 3,500 people in Philadelphia, many of whom come from the inner city and can wa

to work. As a remanufacturer, Cardone Industries is not only making a major contribution in terms of materials, ene

gy, labor, and capital equipment conservation, but also, by restoring worn or nonfunctioning products to like-new co

dition, it prolongs the lifetime of automotive components. It preserves the value embodied in products during their
APPENDICES

manufacture, making it possible for automobile owners to acquire replacement parts at reasonable prices and to keep

their vehicles in better condition over longer lifetimes.

Regional

 Florida Eastward Ho! Initiative. As part of a major effort to save the Everglades ecosystem, the Eastward Ho!

Initiative created a joint state-local effort to revitalize an 85-mile-long urban corridor stretching from West Palm Bea

to Miami by encouraging infill and redevelopment of lands not adjacent to the Everglades watershed. The effort has

been successful in large part because of the collaboration of federal, state, and local natural resource agencies. The u

mate goal is to create sustainable communities in Southeast Florida by accommodating new residents, maintaining

unique local character, revitalizing the urban core, protecting the water supply, ecosystems, and quality of life, and m

ing increasing cultural diversity a strength, according to researcher Julia Parzen.

 New York Watershed. Faced with investing $7 billion in conventional water treatment technology to correct for the

agricultural contamination of its upstate watershed, New York City instead formed a partnership with the watershed

farmers to improve their agricultural practices and to purchase upstate farmland at a cost of $1 billion. In this win-w

solution facilitated by a smart rules set of regulatory incentives through a network of federal and state agencies, N

York City avoided $6 billion in unnecessary capital investment, and upstate farming communities gained access to ne

capital.

 Information and Technical Assistance in Montana. Prior to 1994, residents in eastern rural Montana travelled 225 mi

to the nearest metropolitan area of Billings, Montana, to get specialized health care. Thanks to interactive television,

fiber optics, and some federal assistance to the Eastern Montana Telemedicine Network (EMTN), five rural medicin

facilities are connected to physicians in Billings. EMTN also is connecting rural high schools to provide advanced an

continuing education courses to nurses and others through distance learning.

State

 Maryland Smart Growth Program. This program reflects the state of Marylands determination that public development dollars are most wisely spent when they are targeted to priority funding areas. These are locally defined and

state-certified areas where growth is planned, infrastructure is already in place, and criteria established by the Smart

Growth and Neighborhood Conservation Act are met. By investing funds only in these areas, the state expects to sav

taxpayer dollars, protect open space from sprawl development, preserve its heritage, and encourage reinvestment in

older communities. The Maryland Office of Planning provides analytical tools and technical assistance to help count

define their priority funding areas. The program does not prohibit development in nonpriority areas, but does prohib

the use of state development dollars for such projects. In addition to this geographic targeting of state funds,

Maryland has adopted several programs specifically designed to support projects that implement smart growth.

Examples include the Rural Legacy Program, the Neighborhood Business Development Program, Live Near Your

Work, the Neighborhood Partnership Program, and the establishment of the Revitalization Center in Baltimore City.

 New Jersey State Development and Redevelopment Plan. The New Jersey State Development Commission works to

integrate state and local planning to conserve natural resources, revitalize urban centers, protect the environment, an

provide affordable housing and services to communities. New Jersey voters in 43 cities and six counties decided to

raise their taxes to buy and preserve open space in the November 1998 election. Statewide, by a two-to-one margin,

voters also approved spending nearly $1 billion over 10 years to buy half of New Jerseys remaining open space.

 Oregon Statewide Planning Program. Oregon has a program dating from 1973 to save farm and forest lands, manag

urban growth, and protect natural resources. Most recently, the governor established quality development objectives

to guide state agency programs and investments. The objectives include reducing urban sprawl, producing mixed dev

opment, encouraging choices of energy-efficient transportation, providing cost-effective public services, protecting t

environment, and creating a balance of jobs and affordable housing.

National

 Brownfields Initiative. The Brownfields Initiative supports local efforts to clean up and redevelop brownfields  pro
APPENDICES

erties where reuse is complicated by real or perceived environmental contamination. The Brownfields Initiative has

provided grants to more than 200 communities and technical support to hundreds more. Through the Brownfields

National Partnership, created in 1997, more than 20 federal agencies work together to provide financial and technica

support for brownfields revitalization activities. The partnerships centerpieces are 16 Brownfields Showcase

Communities, models of multi-agency collaboration including both major metropolitan areas and small towns. In 19

the President signed into law a $1.5 billion brownfields tax incentive for the cleanup and redevelopment of brownfields.

 Transportation Equity Act for the 21st Century (TEA-21). TEA-21 guarantees $198 billion to support intermodal

transportation. The act builds on the Intermodal Surface Transportation and Efficiency Act (ISTEA) of 1991, which

emphasized inclusive planning and decisionmaking, flexible funding, and integration of transportation with land use

and environmental concerns. Communities all over the country have taken advantage of this flexibility. Over the life 

ISTEA (Fiscal Years 1992-97), more than $2.4 billion in what used to be highway money was reprogrammed and obl

ated for public transportation projects.

 National Associations and Networks. Many associations have begun to educate their members on the options and be

efits of sustainable development. The Joint Center for Sustainable Communities, a partnership between the U.S.

Conference of Mayors and the National Association of Counties, with the funding support of several federal agenci

provides education and technical assistance and information about the nations best sustainable practices to city and

county officials. Most importantly, the center identifies ways that cities and counties can work together. The Smart

Growth Network, supported by the U.S. Environmental Protection Agency, the International City/County

Management Association and others, serves as an invaluable resource on smart growth to counter the negative impac

of sprawl and community disinvestment. The Sustainable Communities Network, formed by a coalition of nonprofi

is a vast, growing resource of Website links, topical gateways, case studies, bibliographies, and appendices for use by

local communities.

 The National Coastal Zone Management (CZM) Program. The CZM Program is a model voluntary partnership

between the federal government and U.S. coastal states with federal funding levels for 1997 through 1999 of $50 mi

lion annually. It is designed to: (1) encourage the participation, cooperation, and coordination of the public and fede

state, local, interstate, and regional agencies and governments affecting the coastal zone; (2) preserve, protect, develo

and  where possible  restore and enhance the resources of the nations coastal zone for this and succeeding gen

ations; and (3) help states promote wise use of land and water resources of the coastal zone, giving full consideration

to ecological, cultural, historic, and aesthetic values as well as the needs for compatible economic development. Since

1974, a total of 27 coastal states and five island territories have developed CZM programs. Together, these programs

protect more than 99 percent of the nations 95,000 miles of coastline.

Global

 The International Council for Local Environmental Initiatives (ICLEI) Cities for Climate Protection Campaign. ICL

was instrumental in the adoption of Local Agenda 21 at the Earth Summit. Agenda 21 identifies specific objectives

that can be used to guide sustainable development efforts. Since then, the U.S. branch of ICLEI has helped local gov

ernments assume a major role in sustainability efforts and has developed one-stop guides on technical assistance a

funding sources, and other references. ICLEI has calculated that if all 55 cities and municipalities participating in its

Cities for Climate Protection Campaign meet their voluntary goals, their emissions reductions will be equivalent to 10

percent of the U.S. obligation under the Kyoto Protocol.

C-2. TAILORING THE TOOLS TO ADVANCE STRATE

GIC AREAS OF SUSTAINABLE COMMUNITY DEVEL

OPMENT

From our review of many inspiring efforts and activities, the Council identified five strategic opportunity areas of sustainabl
APPENDICES

community development and three tools to overcome obstacles on the path to local sustainability. The following tables show

how the tools of information and technical assistance, economic incentives and financial assistance, and local capacity and

partnerships can be used to support the five strategic areas: green infrastructure, land use and development, community revi

ization and reinvestment, rural community and enterprise development, and materials reuse and resource efficiency. They als

identify a preliminary list of financial and technical intermediaries that can advance progress in each of these five areas.
APPENDICES

Green Infrastructure

Goal: Promote place-based approaches to conserve, protect, restore, and manage local and regional networks of natural,

living, and environmental resources and amenities.

Objectives: To establish a long-term strategy to plan for, conserve, protect, and restore a network of natural and environmental resources and amenities (open space, farms, timberlands, green corridors, wildlife habitat, parks, brownfield restor

tions, landscaping of development parcels, backyards, etc.) that will provide an attractive and functionally useful setting fo

future development; to encourage win-win approaches for conservation and development; and to promote communityinitiated place-based approaches to land use and growth that combine the concepts of ecosystem management with new

economic and community dynamics (e.g., human ecology).

Tools Actions

Information  Link green infrastructure into national public marketing campaigns on quality of life, sustainable com

munities, and smart growth issues

 Use geographic information system to demonstrate how green infrastructure planning can be used w

buildout analysis to determine how to avoid growth conflicts, regenerate vacant inner city areas, an

promote voluntary conservation and revitalization actions 

 Convene a green infrastructure forum to bring practitioners together to gain a deeper and more com

plete understanding of successful community approaches to green infrastructure 

 Use partnerships between practitioners to identify collaborative opportunities

 Develop and make available a learning toolkit which community leaders can use for implementing su

tainable community opportunities for green infrastructure 

Economic  Encourage localities to integrate land conservation, resource management, and green urbanism into 

Mechanisms and  economic and community development planning and local jobs and small business creation.

Incentives  Develop small business opportunities tied to resource use, conservation, restoration and waste reuse,

pollution prevention and environmental protection (possible instruments include conservation easements, farmland rental agreements, stream restorations, climate protection zones, rooftop gardens, an

urban forests)

 Support tradable development rights and other ways to protect farm, forest, and rangeland and encou

age stormwater treatment, habitat creation, stream restoration, and landscaping

 Target federal, state, and local programs, such as the Conservation Research Program, Forest Legacy

Program, the State Revolving Fund, and state open space funds, to leverage additional funding to pro

vide awards, tax breaks, and other incentives to identify, plan, and act

Financial and  Smart Growth Network 

Technical  American Planning Associations Growing Smart Clearinghouse

Intermediaries  Federal, state, and local government, including the Joint Center for Sustainable Communities

 Economic development and small business organizations

 Research institutes

 NGOs (i.e., American Farmland Trust, The Conservation Fund, Land Trust Alliance, American Fore

etc.) and foundations

 Urban forestry, agriculture, architectural, engineering, and landscape architecture organizations

Partnerships and  Use existing sustainable development leadership organizations to develop a learning toolkit and train 

Local Capacity  local and regional leaders on how to design green infrastructure in a larger community-based green

urbanism education strategy in order to foster local job creation and small businesses, provide natural

amenities and nonvehicular travel routes (examples include green gardens which train minority com

munities in ecological gardening, The Conservation Funds Sustainable Careers Internship Program fo

young adult training and employment, and the Roedale Institutes Farm Link program to help new
APPENDICES

farmers get started)

 Reinforce efforts of pro-green infrastructure financial and technical intermediaries

 Link conservation and environmental interests with development interests to foster sustainable comm

nity initiatives

Land Use and Development

Goal: Promote smart growth strategies to enhance the livability and sustainability of metropolitan and rural communities

Objectives: To promote sustainable development patterns to prevent ecological degradation and promote a sense of

place; to protect farm, forest, and rangelands and open spaces; to reverse abandonment of older, central cities and inne

ring suburban areas; and to appropriately value vacant and underutilized land and create small businesses and local jobs.

Tools Actions

Information  Launch national public marketing campaign on smart growth issues

 Promote use of geographic information systems to identify most appropriate places for future develo

ment, revitalization, or restoration as well as the impacts of growth; GIS mapping efforts could make

use of HUDs Community 2020 software, the National Center for Resource Innovations Green, Mo

or Less approach, and the American Planning Associations current Land-Based Classification System

which documents data on land cover, land use, and property rights

 Create or bolster mechanisms for people to gain better information and share successes

 Use buildout analysis to determine where and how much development will be in the future and to

target areas for community conservation and revitalization action and assistance

 Develop and encourage the use of analytical methods that regions can use to assess the relationship

between investments in growth and investments in poverty reduction

 Promote wide distribution of findings from HUDs Partnership for Advanced Technology in Housin

 Promote the adoption of model state legislation developed through HUDs Growing Smart initiative

Economic  Implement demonstrations and pilots of location-efficient mortgages

Mechanisms and  Support tradable development rights and conservation easements to protect farm, forest, and rangelands

Incentives  Support local and regional food systems in ways to protect farmland surrounding urban areas to crea

local jobs and provide quality food for urban and suburban residents

 Support air quality credits for sustainable communities

 Implement conservation incentives of the 1997 Taxpayer Relief Act

 Implement a location policy for federal facilities that supports smart growth

 Leverage federal, state, and local programs to provide awards, tax breaks, and other incentives to ident

plan, and act

 Support implementation of second round of Empowerment Zones  15 urban and 5 rural

 Strengthen the Farmland Protection Policy Act

Financial and  Smart Growth Network

Technical  Joint Center for Sustainable Communities

Intermediaries  APAs Growing Smart Clearinghouse

 Federal, state, and local government

 Developer associations, such as National Homebuilders Association

 Urban Land Institute and other such institutes

Partnerships and  Use civic leadership organizations and programs to help train local and regional leaders on a whole

array Local Capacity of techniques relating to sustainability, including smart growth

 Reinforce efforts of pro-smart growth financial and technical intermediaries

 Provide federal support for local public and private farmland and open space protection initiatives
APPENDICES

Community Revitalization and Reinvestment

Goal: Promote methods that build on local and regional economic, ecological, and social assets to reinvigorate and revital

metropolitan and rural communities.

Objectives: To attract sustainable investment in metropolitan and rural communities; to integrate sustainable concepts int

economic and community development activities; and to build strong and diversified local economies while linking them 

regional and global markets.

Tools Actions

Information  Develop and promote methodologies to map local social, environmental, and economic assets (such a

local purchasing power, infrastructure) that can recognize local resources and attract reinvestment and

revitalization

Economic  Implement demonstrations and pilots to assess the impacts of location-efficient mortgages

Mechanisms and  Identify and promote new market tools for financing reuse of assembled and serviced land (such as

Incentives financial incentives to clean up and economically develop brownfields)

 Develop programs that promote investment in areas with existing rights of way and serviceable trans

portation and communications infrastructure and outside of green infrastructure

 Allow the premature write-off of nonproductive assets to avoid creating stranded investments

 Create incentives for businesses that hire and train local people for new sustainable jobs

 Support the creation and implementation of individual development accounts in conjunction with th

Treasurys EFT-99 initiative 

 Support the creation of secondary financial markets for community and economic development loan

 Ensure that transportation and training programs associated with welfare-to-work are linked to addre

the spatial mismatch between jobs and housing

 Provide incentives to encourage energy efficiency in housing and other community building program

 Provide incentives for public and private partnerships that achieve environmental protection, social

equity, and economic prosperity

 Implement sustainable communities provisions of TEA-21

 Focus federal financial and technical assistance on new market opportunities and small business creation in distressed urban and rural communities

Financial and  Community reinvestment loan funds

Technical  Private sector  firms and finance

Intermediaries  Chambers of commerce

 Federal, state, and local government agencies

 Community development corporations

 Foundations

Partnerships and  Convene forums to link private sector with community development agencies on community reinvest

Local Capacity ment needs and opportunities

 Use civic leadership organizations and programs to help train local and regional leaders on a whole

array of techniques relating to sustainable community development

 Link job training and workforce development to sustainability initiatives

 Develop partnership matrices that link federal resources to community initiatives

 Promote green building and equity programs that teach young people how to build and maintain ene

gy-efficient and affordable homes
APPENDICES

Rural Community and Enterprise Development

Goal: Promote innovative economic enterprises and opportunities that can strengthen and diversify rural economies and

promote sustainable community development.

Objectives: To improve rural communities access to markets, build assets, and facilitate networking opportunities; to develop

strategic alliances between rural and urban markets; to promote diversified mixed-income strategies that can supplement tr

ditional economic activities, such as farming or resource extraction; and to create nonfarm jobs to support family farms.

Tools Actions

Information  Develop an information and communication infrastructure to encourage electronic and person-to-pe

son communication, mentoring between outside experts and local leaders, and learning about success

 Advance strategic research on the microeconomics of rural enterprise development, particularly in

identifying how to overcome barriers to credit

 Advance timely research and development of potential markets for rural goods

 Deliver education campaigns aimed at urban consumers on rural concerns

 Develop more sophisticated technical analyses of sustainable alternatives

Economic  Identify creative financing to support innovative technologies and techniques

Mechanisms and  Incorporate planning and diversity requirements in to rural development funding

Incentives  Enable flexible funding to support sustainable economic alternatives

 Integrate or coordinate federal, state, and local programs to enable regional approaches

 Implement the recommendations made by the Commission on Small Farms

 Promote regional and local food systems as a way for consumers to support local farmers and keep foodbuying dollars in their community (such as developing incentives to support community-supported agricul

ture)

Financial and  Regional centers for rural development and regional community and development councils

Technical  NGOs and private foundations

Intermediaries  Federal agencies (such as Department of Agriculture, Department of Commerce, Small Business

Administration)

 State and county agencies

 Joint Center for Sustainable Communities

 Private sector brokers and retailers

 National Cooperative Association

 Watershed alliances

 Natural Rural Partnership

 Land-grant universities and other academics

Partnerships and  Use civic leadership academies and programs to help train local and regional leaders on rural sustainabil

Local Capacity  Build the capacity of rural-based NGOs through leadership training

 Broker strategic alliances to link rural and urban markets

 Convene a workshop to identify elements of success of local and regional food systems

 Move farm clubs beyond just farmer-to-farmer to involve the entire community

 Use local eco-system alliances to highlight urban-rural interdependencies

 Support sustainable resource-based industries which support small businesses and coordinate the

efforts of federal, state, and county natural resource agencies with community development agencies

 Link natural resource-based efforts to community and economic development strategies
APPENDICES

Materials Use and Reuse

Goal: Promote strategies that conserve resources and minimize waste by retaining, recycling, reusing, and remanufacturin

the embedded material assets found in metropolitan and rural communities.

Objectives: To enable job creation as a result of materials reuse and recycling, particularly in communities that need work

to integrate materials conservation and remanufacturing into federal, state, and local economic and community development; and to promote eco-industrial development to promote resource efficiency and minimize pollution and waste.

Tools Actions

Information  Support feasibility studies of the market for salvaged materials

 Develop methodologies that can inventory the nature and value of the built and manufactured assets 

a community

 Fund marketing efforts to increase public acceptance of reused building materials and remanufacture

goods

 Fund education efforts to teach architects and contractors about the quality and adaptability of reuse

materials 

 Evaluate potential feasibility of deconstruction 

 Conduct and support research on how costs of disposal of construction and demolition waste affect

materials reuse 

 Conduct and support research on setting aside funding for federally funded demolition projects to pr

mote better materials reuse

Economic  Support the implementation of deconstruction pilots initiated by public housing agencies

Mechanisms and  Identify incentives that can enable eco-industrial development to be integrated into regional and local

Incentives economic planning

 Review how the Resource Conservation and Recovery Act can overcome barriers to waste exchange

between firms

 Review federal, state, and local tax and procurement policies as they relate to encouraging materials

reuse or remanufacturing

Financial and  Local economic development agencies

Technical  Federal, state, and local government

Intermediaries  Interagency Working Group on Environmental Technology

 DOEs Industries of the Future Initiative

 Associations aimed at architects and building contractors

 USDAs Forest Products Laboratory

Partnerships and  Develop a network of centers of excellence for materials reuse, remanufacturing, recycling, and eco

Local capacity industrial development

 Train architects and contractors on how to use reused materials

 Link job training to materials reuse and remanufacturing programs
APPENDICES

APPENDIX D 

INTERNATIONAL CAPITAL FLOWS

FORUM ON THE MULTILATERAL AGREEMENT ON

INVESTMENTSUMMARY OF PROCEEDINGS

The Forum on the Multilateral Agreement on Investment (MAI) was convened on February 10, 1998, by the International Task Forc

of the Presidents Council on Sustainable Development. Additional personnel associated with the forum are listed in appendix H of thi

report. 

Dianne Dillon-Ridgley, International Task Force Co-Chair

Why Convene an MAI Idea Forum?

The Presidents Council on Sustainable Development, like other national councils on sustainable development, is paying

attention to the Multilateral Agreement on Investment MAI negotiations, as the members have always acknowledged and

understood the global nature of sustainability. However, given the enormous challenge of charting a path towards sustain

ability for our country, our government, and our communities, the Council has primarily focused on domestic issues durin

its first four years. With the new Executive Order of April 1997, the Council was given an opportunity and a responsibili

to make the connection between international issues and their domestic ramifications. The MAI embodies this challenge;

moreover, it is precisely in this kind of forum that the Council can be of greatest assistance in convening all stakeholder

The task force is not taking a position on the MAI deliberations, but rather is interested in the potential impact of the M

on promoting sustainable development.

Jeffrey Hunker, U.S. Department of Commerce

Key Issues

 The MAI brings an important link to the forefront: the investment and environmental agenda.

 There has been a large and growing amount of private capital flows into developing countries in the last 10 years, m

nifying the importance of the private sector.

 There has been large domestic economic growth partially due to export growth.

 There is a strong link between overseas investment and U.S. exports.

The two latter points are especially significant due to the magnitude of investment in energy infrastructure at present and 

the future  90 percent of the energy structure in India and China has yet to be built. This can be seen as a blessing or 

curse, but certainly renders the MAI important to climate change considerations.

Ambassador Al Larsen, U.S. Department of State

The mandate by Congress to strengthen the rules on international investment carries two concerns:

 Market access is complete and successful, and

 Agreement includes investment protection and provisions for the environment and labor.

These have become a controversial part of the MAI, and the right balance must be sought.

The goals of the environmental provisions are to protect the U.S. ability to enact and enforce its own environmental protection laws, and to foster solid environmental standards in developing countries that balance economic and environment

goals. The negotiated text contains a provision, similar to an article in NAFTA, that countries cannot lower standards to

promote investment. There is a need for binding provisions, not just guidelines. European delegations want commitment

to be binding.
APPENDICES

Specific Provisions to Address the Environment are Similar to NAFTA

 Recognition that countries have the ability to improve environmental laws and existing standards;

 Language in like circumstances  look into cases to determine like circumstances to prevent discrimination (e.g.,

zoning issues are case specific); and

 Language should underscore countries ability to speak with private entities about their environmental regulations an

management systems.

Other Important Provisions 

The Organization for Economic Cooperation and Development (OECD) has done a lot of environmental work in recen

years, creating provisions on hazardous waste and principles of environmental decisionmaking. All countries that sign the

MAI should be obligated to the same principles and laws agreed to by OECD countries. The MAI should include nonOECD countries in the OECD Environmental Policy Committee Review of principles. Regarding labor concerns, we

should create investment incentives to impose discipline on governments at the local, state, and national levels to lure

investment that is too costly or that lowers worker standards. The federal government is not in a position to impose limit

on states. However, there is a need to gather data on how state governments currently subsidize foreign investment.

Conclusion

OECD provides interesting venues and should continue to solicit advice for integrating sustainable development principl

into the private sector.

John Audley, National Wildlife Federation

Three Main Reasons that the National Wildlife Federation (NWF) is Involved in the MAI Discussion 

1. The desire to balance economic and environmental rules of law.

2. The relationship to the democratic decision-making process.

3. The implications for its partners in the developing nations of Latin America.

Three Points of Contention With the MAI

1. Direct and indirect expropriations run contrary to U.S. takings laws.

2. Dispute proceedings provisions do not embody a democratic process of negotiations, the text targets non-OECD

nations, preventing decisions being made at the state or local level.

3. Doesnt meet the OECD test to balance environmental and economic goals:

 The MAI permits disputes over just compensation for government takings of private property.

 The dispute process occurs in front of a panel, not in the state or country where the dispute occurred.

 There is no recourse for citizens affected by an investment dispute.

 State and local land rights are shifted to federal rights, which threatens the common homeowner in conflict with

the wealthy landowner.

 It imposes unfair financial burdens on municipal entities.

Other Issues

Much of the agreement is viewed as being negotiated in secret. Contentious elements were decided prior to public pres

sure to engage nongovernmental organizations in negotiations.

Conclusion

NWF opposes the MAI and will make its opposition public through letters and demonstrations. International rules are vi

for what NWF is trying to achieve  a direct connection between rules of law and environmental protection.
APPENDICES

Stephen Canner, United States Council for International Business

Presentation Goal

To give an international business community perspective and to clear up misinformation. The key question: Can the MAI

and rules for environmental protection coexist?

Some statistics:

 $300 billion in annual investment flows: The United States is the largest exporter and importer of capital.

 Ninety percent of international investment is in industrialized countries: there has been a slowdown of investment in

lesser-developed countries.

 Ninety percent of goods and services that are produced abroad, stay abroad (they are not imported back into the

United States).

 Twenty-five percent of U.S. exports occur between U.S. businesses and their counterparts abroad.

What Is MAI All About?

From an economists perspective, the purpose of the MAI is to grow the economy by growing markets for U.S. goods an

services abroad. In the past, growth occurred mostly through trade. Now growth is largely through investment in affiliate

and joint ventures. The MAI is about growing markets abroad and making rules to guide this growth.

What Should the Rules Be?

1. Business wants to invest abroad with no barriers to action or discrimination. Investors want to operate under nationa

treatment provisions in trade rules.

2. Business wants to establish an enterprise in an environment that is free from government regulations and standards, 

conditions, and to avoid host government mandates or regulations that prevent an investor from operating most effi

ciently.

3. An investor wants legal assurance of transfer, implying that a host government will be bound to international standards of expropriation with appropriate compensation.

4. An investor should have the right to dispute settlement in cases argued between governments, investors, and governments and investors. This provision is embodied in existing bilateral investment treaties.

How Do Rules to Protect the environment Fit In?

Agenda 21 recognizes that the free flow of capital and trade liberalization are essential for growth and development. The

MAI is likely to produce this result.

Addressing Environmental and Labor Arguments Made Against the MAI

 The MAI imposes on state sovereignty.

Response: State laws are grandfathered in.

 The MAI will limit the ability of state/local governments to protect the environment and health.

Response: As long as standards are set in a nondiscriminatory way, there is nothing in the MAI that precludes a state

ability to protect itself. The MAI only applies to monetary damages.

 Countries that impose regulation that reduces corporate profits can be seen as a takings.

Response: The MAI will not give foreign government more rights.

Antonio Parra, World Bank

The International Center for Settlement of Investment Disputes (ICSID) arbitrates settlements among parties of the ICSID

Convention. Existing bilateral investment treaties and multilateral treaties include agreements over disputes similar to the MA

Arbitration of investor-state settlements will take precedence over state-state settlements. The MAI implies several metho

of arbitration and recourse to local courts, and allows aggrieved investors to specify form of arbitration. The treaty shoul

offer access to less specialized forms of arbitration, institutional forms of arbitration, and fewer jurisdictional constraints

Different forms of arbitration have different procedural rules. Disputes over similar issues have diverse outcomes with di

ferent forms of arbitration. The MAI seeks to bring together arbitration and common provisions on remedies that arbitr

tors can grant in order to prevent this problem.
APPENDICES

David Schorr, World Wildlife Fund

The MAI deals with investor rights and obligations  the importance of this issue is how capital flows have a significant

impact on the environment. The World Wildlife Fund poses these key questions: What is appropriate and possible under

the MAI, from the standpoint of environmental inclusion in investor protection treaties? Are these issues separate? Can

one protect both the environment and investors?

 Good environmental policies are good economic policies.

 Mission: to alleviate bad environmental management in the context of investment.

 Obligations of investors: There is a fine line between private actors and public, as private actors make policy through

their actions. How does voluntary compliance as another method of protection besides command and control fit i

 There are three pillars of good environmental governance:

1. Good standards.

2. Access to environmental information.

3. Access to justice  people can apply information to language and enforce standards.

Information Issues: General Principles

 Private entities providing information: Classic tools applied to the government, such as environmental impact statements, should also be applied to private actors. The MAI could include this.

 Toxic release inventories: U.S. laws require corporations to release this information.

 Quality of information: Ensure that information is in a useful and accessible form.

 There should be corporate transparencies across boundaries to see who shareholders are, ensure FCC compliance,

apply ISO 14000 (an environmental management certification system), move beyond compliance.

Access to Justice Issues

 The MAI creates access to justice and addresses the need for ICSID to save dispute settlement from developing cou

tries local lack of government. However, it must equally ensure individuals right to relief and citizens ability to hav

access to justice.

 Relevance of NAFTA: It is important to set up international environmental justice so that citizens have a right to br

complaints to an international body, and corporations are held accountable.

 One way to create citizens rights is to give citizens of one country standing rights in another country where the corporation is based, in effect extending jurisdictional limits.

 Adherence to corporation codes and OECD guidelines should be reviewed and a certification system added, so that if 

company doesnt meet a beyond compliance standard, the company will not participate in dispute settlement.

RESPONSE BY AMBASSADOR LARSEN 

TO PANEL PRESENTATIONS

 Takings: This is unnecessary in a U.S. context because of our strong constitutional tradition, but could be issue for o

country in other countries. The State Department wants to ensure that governmental action affecting corporate prof

is not considered to be a taking.

 Relationship between dispute settlement and state and local governments: The corporation, having the same rights a

domestic corporations, challenges state law as incompatible with treaty obligations. A state cannot deal with those

cases, the federal government would become the defendant in such cases.

 Interest from other countries that want to be a part of the agreement: This is a good opportunity to get more countries to have high standards for investment, the environment, and worker protection.

 Access to justice: The State Department is open to additional approaches on provision of information and access.

There is a good case to be made to allow consideration of amicus briefs, and a role for private parties to voice their

agreement.

 Good ideas: Getting countries to sign on to OECD environmental standards and an environmental impact statemen

approach.

Conclusion

There is a need to discuss the balance of concerns that brings a consensus. The State Department negotiators have receiv
APPENDICES

a lot of mail criticizing the MAI and requesting an immediate end to negotiations. All sides were negligent in not opening 

dialogue at an earlier stage. Public response, labor attacks, provide impetus for the PCSD to turn the discussion to how to

move globalization forward, incorporating the aspects currently missing. Thanked the International Task Force for conve

ing a dialogue focusing on the democratic process and how to set up a global process for responsible international invest

ing.

FORUM ON THE CLEAN DEVELOPMENT 

MECHANISM AND SUSTAINABLE 

DEVELOPMENT—SUMMARY OF PROCEEDINGS

The Forum on the Clean Development Mechanism was convened on July 27, 1998, by the International Task Force of the Presidents

Council on Sustainable Development in cooperation with the Alliance to Save Energy, Business Council for Sustainable Energy, Edison

Electric Institute, International Climate Change Partnership, and the United States Council for International Business. Additional per

sonnel associated with the forum are listed in appendix H of this report.

Martin Spitzer, PCSD, provided an overview of Councils work and challenged the participants at the forum to identify

policies that mitigate greenhouse gas emissions while simultaneously promoting sustainable development.

Dianne Dillon-Ridgley, PCSD International Task Force co-chair, mentioned current areas of task force work: to support

and interact with other national councils on sustainable development, to examine international capital flows in light of su

tainable development, and to recommend policies that encourage investment abroad consistent with the principles of sus

tainable development. She noted that the purpose of the forum was to further dialogue and understanding, not to try to

reach consensus. The Clean Development Mechanism (CDM) has the potential to contribute to the achievement of susta

able development goals while meeting climate objectives and creating partnerships between developing countries, industri

ized countries, and private entities.

Introduction

Melinda Kimble, U.S. Department of State, emphasized to participants that in light of the somewhat difficult history of t

climate change regime, focusing on one aspect of the Kyoto Protocol, the CDM, is important. The CDM will be seminal 

implemented because it would frame a clearinghouse structure to promote private participation in technology transfer, an

because it promotes sustainable development and leapfrog technologies in less developed countries while reducing atm

pheric levels of greenhouse gases.

Activities that sequester carbon as well as those that reduce emissions must be part of the package. The process of devel

oping mechanisms for sinks projects is taking longer than projected. Getting the CDM right is very important, since it

will provide the key to domestic and international efforts to mitigate the negative impacts of climate change. In the comi

years, policy-makers must work towards:

 Ensuring that benefits of mitigating greenhouse gas emissions are real and lasting;

 Ensuring transparency, efficiency, and accountability;

 Identifying organizations to work on certification, marketing reductions, and finding project funding;

 Administering adaptation funds; and

 Determining the CDM Executive Board membership.

David Sandalow, White House Council on Environmental Quality and National Security Council, spoke on the potential 

the CDM to promote sustainable development, reduce greenhouse gas emissions, help developing countries adapt to climate change, and promote U.S. business opportunities abroad. He pointed out two key issues with the CDM thus far: lac

of agreement regarding operational entities, and the problem of additionality.

Panel 1: Opportunities and Benefits
APPENDICES

Robert Dixon, Director of U.S. Initiative on Joint Implementation (USIJI), presented USIJIs goal: to encourage the deve

opment of international voluntary joint implementation projects that reduce or sequester greenhouse gas emissions unde

the UN Framework Convention on Climate Change (FCCC) Activities Implemented Jointly pilot. USIJI has established

operational modalities and nine primary criteria for these projects, including acceptance by the host country and the longterm reduction of greenhouse gas emissions. These projects are primarily energy-efficiency, renewable energy, and forest

management activities; and open the door for U.S. businesses to help meet the financial and technological needs of devel

oping countries while protecting the global environment. Additional financial assistance will be catalyzed by emissions

reduction credits, but no crediting is allowed under the FCCC pilot. Lessons learned from the USIJI experience could be 

useful tool in the development of the CDM.

Mark Hall, Trigen Energy Corporation, gave one industrys perspective of the CDM. Some projects that may qualify as

CDM projects are: utility infrastructure, manufacturing process modifications, transportation infrastructure and carbon

sequestration. He promoted combined heat and power as a more efficient means of providing power, but warned that all

technologies are not suited to every area due to fuel availability and resource constraints. He cited some opportunities and

benefits of the CDM:

 It improves the value of the overall investment.

 It may allow for shorter contracts or riskier projects to move forward.

 It encourages multinational corporations and others to look at emissions reduction opportunities globally rather than

only in industrialized nations.

Espen Rønneberg, Marshall Islands Delegation and the Association of Small Island States (AOSIS), gave a perspective

from a developing country vulnerable to climate change and clearly set out AOSISs priorities. AOSIS believes that small

island developing states will benefit from adaptation fees and cleaner development resulting from the CDM. However, th

focus must remain on mitigation from industrialized states rather than on forestry or sinks projects of questionable eff

tiveness in developing states.

A discussion of actions and efforts reasonably expected from developing countries must occur in the context of the prio

ties of poverty eradication and sustainable development as well as of the threats posed by climate change. The CDM mu

first tackle industrial sectors and other large sectors of greenhouse gas emissions from developing countries. It is in the

interest of AOSIS and other developing countries to use the avenues created by the FCCC to promote sustainable develo

ment through efforts such as renewable energy. Other issues of importance are compliance, verification, financial and env

ronmental additionality, and reporting.

Margo Burnham, The Nature Conservancy, outlined The Conservancys Noel Kempff Climate Action Project in Eastern

Bolivias Noel Kempff Mercado National Park. Project objectives include ensuring the integrity of biodiversity and carbo

offsets, investing in long-term funding mechanisms, and conducting rigorous carbon monitoring and verification. Benefit

from the project include:

 Investor participation in policy development to stimulate learning from their experience;

 National priorities and government offset sharing,

 Working with communities to improve the standard of living, and 

 Access to parkland for sustainable economic enterprises.

Although not a complete solution to climate change, forestry projects such as the Noel Kempff effort can be an importa

component of the response.

Nancy Kete, World Resources Institute, pointed out the wide agreement in evidence among the other presentations excep

with regard to sinks. The main dilemma with the CDM is that no one knows how big the opportunities are; there is no

even an order of magnitude estimate of how much money is involved. The magnitude of demand for carbon offsets

depends upon how much trading there is and what less-developed countries do. The CDM is not a substitute for foreign

direct investment, though it would redirect some of that investment. Systemic changes in economic policies and infrastru

ture investment are needed. Local benefits exist on a community level, while global benefits can be seen in reduced green

house gas levels in the atmosphere.

Discussion focused on questions of benchmarks, baselines, details of the Noel Kempff Climate Action Project, discount

ing, and sinks.
APPENDICES

Panel 2: Key Issues

Jeff Seabright, U.S. Agency for International Development, outlined the key issues, including methodological issues (i.e.,

baselines, additionality, liability, and transaction costs) and operational issues involving new and existing organizations.

Christiana Figueres, Center for Sustainable Development in the Americas, addressed the inherent tension in the CDM

between an emphasis on national priorities and a reduction of emissions at low cost to, and with little interference from,

institutions. She cited gaps between priorities of sustainable development and cost, climate change mitigation and econom

growth, innovation and experience, credibility and efficiency, and less-developed countries and the industrialized world. T

bridge these gaps, participation of the private sector and clearly established national policies are needed. Host national

authorities must:

 Ensure convergence with national priorities, sustainable development, technology transfer, and requirements as defin

by host countries; and 

 Design and implement systems for approval of projects within a country before referral.

Michael Marvin, Business Council for Sustainable Energy, presented goals for Buenos Aires:

 Increase understanding in the South,

 Reduce the mistrust of the North,

 Ensure an aggressive workplan for the FCCC work groups; and

 Guarantee ex post facto credit for eligible post-2000 projects.

The CDM must be transparent (without excessive bureaucracy), developed in cooperation with all stakeholders, usable by

all, and allow for profit making for the host country and cost reduction for the donor. It should rely on the private and

nongovernmental organization sectors as much as possible to reduce the governmental role, develop incrementally to bu

a knowledge base, establish clear rules on documentation, and create a clear audit trail.

He suggested that the Executive Board advocate for the CDM rather than merely administer it, and the CDM should sup

plement, rather than supplant, other development assistance.

John Novak, Edison Electric Institute, presented several suggestions to get the CDM operational in 2000. He outlined th

ways the CDM can be used: a non-Annex I party does project and sells emission reductions; a private party partners with 

host country to share credits; or CDM investors give funds that the CDM invests and for which they receive credits.

Suggestions included drawing on USIJI experience; breaking out projects by sector; using a baseline/reference case for

greenhouse gas benefits, monitoring, and verification; learning by doing; and adopting a bottom-up approach. Industry

should get more involved in the process and help developing countries improve their understanding of the CDM.

Norine Kennedy, United States Council for International Business, presented another business perspective on the CDM.

The CDM will meet its goals only if it is widely used. Hence, businesses have to be willing to propose projects that satisf

the concerns of non-Annex I countries, and non-Annex I countries have to be willing to approve those projects. It is

important to investigate the impacts of the CDM on competitiveness, trade, investment, and its consistency with open m

kets and free trade. The four outstanding issues for business are:

 The definition of additionality,

 Share of the proceeds,

 Operating entities and the Executive Board, and 

 Limits on the use of certified emissions reduction credits.

Discussion centered on the possible contention between inclusiveness and transparency, negotiations between host countries and Annex I countries, and the CDMs relation to ISO 14000.

Breakout Group Discussion Summary

The following questions were distributed to each breakout group. A summary of the groups comments follow each questio
APPENDICES

1. In General, How Do We Harness or Create Incentives for Participation in Sustainable Energy Development in

Developing Countries and Ensure Good Results for Lenders, Investors, and Host Country Stakeholders?

This question proved troublesome from the start due to varying definitions of sustainable energy development. Still,

some suggestions were:

 Get prices right: global multilateral institutions could use different discount rates for different energy types, thus givi

a boost to renewable sources in cost calculations.

 Cost, risk, and return, the basic criteria when deciding upon any given investment, are undoubtedly the same criter

a business would use to determine whether to invest in a CDM project. Other factors in this decision would include

the enthusiasm of host countries; certainty of receiving a good return (e.g., credits); assignment of responsibility for

emissions reductions; and the price of carbon.

 Companies given greenhouse gas emissions reduction targets would likely make a diverse set of investments to reduc

their emissions: some plant, process, or equipment investments; some engagement in emissions trading; and investment in a CDM project.

 Governments or institutions could play the role of market maker by initially taking on more risk to entice entities to

participate. When enough rules and examples are in place, financial intermediaries will take over the markets.

 Monitoring and verification must be able to ensure desired results but not be so stringent as to increase transaction

costs and thereby inhibit participation.

2. To Accommodate Complexities and Not Retard the Development of the CDM, Should a CDM Program Be Develope

Incrementally or at Once?

Almost all groups agreed that a CDM program should be developed incrementally; otherwise, the process of working ou

the fine details of the CDM would take too long. The following suggestions were made:

 Business representatives in particular were interested in learning by doing and arriving at the best solutions throug

experience.

 Creating a list of characteristics could help in judging certain projects as win-win.

 A mechanism could be created for automatic approval of certain types of projects (e.g., clear win-win projects)

before the year 2000.

 Some sectors are further along in terms of having projects that are compatible with CDM goals. Those should be pe

mitted before all details are ironed out in all sectors.

 Using provisional rules for early starter projects, and tightening rules later as knowledge is accumulated, is one way t

get the CDM operational.

 The private sector would benefit from a compendium of different models to quantify reduction credits so it can find

the most suitable model for the sector or project.

 Many participants from the private sector stated that focusing on directing mainstream capital flows in a more sustainable direction would be more effective than focusing exclusively on new capital flows.

Varying priorities were evident when trying to determine the most important details to settle within an incremental

approach. These different priorities are indicative of differing fundamental approaches. Some said that monitoring and ve

fication were most important to get right initially, while others said that these would come as projects evolve. Verificatio

could follow an International Organization for Standardization (ISO) model of standards, and private auditors could rece

a license to conduct audits in a predictable and standard manner. The important factors are consistency and predictability 

the setting of standards and avoidance of increased transaction costs.

3. Sharing Proceeds What is Fair?

Again, interpretations of this question varied. Most participants viewed sharing proceeds as negotiations between proje

sponsors and host countries over splitting the project proceeds. It was unclear whether proceeds referred to some so

of emissions reduction credits, a portion of the project value, or the value of emissions reduced. If sharing proceeds wer
APPENDICES

part of the negotiation between investor and host, there may be a need for capacity building on the part of certain host

countries to ensure their ability to negotiate a fair outcome.

Another group took sharing proceeds to mean sharing the funds for the adaptation provision in Article 12 of the Kyoto

Protocol. This interpretation also brought up the questions of what the proceeds were and how these adaptation funds

would be shared. The group thought adaptation funds should probably go to the most vulnerable (non-Annex I) countrie

(e.g., AOSIS rather than the Netherlands or OPEC nations). The group also considered the question of how much of th

proceeds should go to adaptation, and whether that amount should be a flat fee or a percentage. A percentage could repr

sent a small proportion from a large amount (to generate more projects) or a large proportion from a small amount. The

was concern that if this tax is too large, opportunities to use energy-efficient or cleaner technologies will be squandered

since energy infrastructure investments will be made regardless. One suggestion was to make the tax very low initially i

order to spur early action on the CDM.

Finally, one group discussed sharing proceeds as a means of funding administration of the mechanism and adaptation, an

what percentage share should be allocated for those purposes.

4. How Should Additionality Be Defined?

This question engendered the greatest amount of discussion. Some participants suggested a list of qualitative factors by

sector in each country in order to encourage environmentally friendly development; this need not be the best available

technology, as that criterion might be too restrictive. Participants raised the question of whether the assessment of additionality should change over time as technology continually improves. One group mentioned that it was important to kee

financial additionality and environmental additionality separate.

Most groups recognized that defining additionality depends on how baselines are calculated, a fact that brought up a seco

set of questions:

 Should baselines be uniformly determined by sector? By region? By country?

 Should each project have some sort of baseline, determined by average or historical technology?

 Would baselines be fixed or raised over time?

5. Are There Different Classes of CDM Projects That are to be Treated Differently?

The idea of having different classes of CDM projects seemed a reasonable concept to many, but no clear method of deli

eating the classes and their distinctions emerged. Some suggested that clear-cut win-win projects (e.g., energy-efficiency

or renewable energy projects where no power existed) would get the most credit with the least amount of bureaucracy.

Another suggestion was to use discounting through which a certain percentage of the emissions reduction credits would 

discounted according to environmental risk. In this way, the crediting process would be more uniform and streamlined, y

it would be possible to account for differences in the environmental or sustainable development value of the project.

In further discussions of crediting, the question of when credits would be issued surfaced. If issuance of credits would b

uniform among different types of projects, would credits be issued on an annual basis or at the end of the project when

the emissions reductions were proven? These questions were of particular concern for land use change and forestry projects.

6. What Types of Projects Might Qualify? What Sort of Project Would Be a Clear Winner?

Criteria for clear winners included:

 Not planned before the Kyoto Protocol was signed,

 Little to no greenhouse gas emissions from the project,

 Has the imprimatur of the host country and a wide group of stakeholders,

 No secondary environmental impacts, and 

 Rapid accrual and verification of reductions.

Other groups mentioned examples of clear winner projects including renewable and energy-efficiency projects; fuel
APPENDICES

switching (e.g., coal to combined cycle gas turbines or wind); replanting of damaged farmland or burnt forests; material

reuse; and fugitive methane recapture.

7. What Should Be the Role of the Sustainable Development Community In the Development of the CDM? What is t

Role of Industry? How Should These Roles Be Made Manifest? 

Few groups had time to answer this last question. One comment was that these constituencies should be as involved as th

can, but that ultimately governments do the negotiating. Groups with an interest should make their interests known to th

respective governments.

Some Suggestions for Next Steps to Move the CDM Forward

 Use USIJI projects to gain an understanding of how guidelines for the CDM would be set. The questions raised by

this include: Would all USIJI projects prove eligible under the CDM? Why would they qualify?

 Find projects that are clear winners in the eyes of leaders of developing countries to raise their interest and expert

and to move the CDM forward.

 Encourage industry to come forward with case studies as a basis for examining methodologies.

 Discuss intra-company projects and how those would work under the CDM to gain incremental value from the main

stream of investment.

 Conduct outreach to developing countries to make issues and terms understandable.
APPENDICES

APPENDIX E

COUNCIL MEMBER PROFILES

CO-CHAIRS

Ray C. Anderson, Chairman and Chief Executive Officer, Interface, Inc. Since founding Interface in 1973, Mr. Anderson

has revolutionized the carpet and floor covering industry. Mr. Anderson learned the carpet trade through 14-plus years at

various positions at Deering-Milliken and Callaway Mills. Inspired by Paul Hawkens treatise, The Ecology of Commerce, Mr.

Anderson is changing Interfaces technologies and investing in processes that will make the company completely sustainab

Mr. Anderson received the inaugural Millennium Award from Global Green in September 1996. Mr. Anderson was award

a bachelor of science degree in industrial engineering by the Georgia Institute of Technology.

Jonathan Lash, President, World Resources Institute. Mr. Lash leads the World Resources Institute, a Washington-based

center for policy research that provides objective information and practical proposals for policy change that will foster en

ronmentally sound development. Mr. Lash also serves on various national and international committees, including the

Organisation for Economic Co-operation and Developments Round Table on Sustainable Development, the Tata Energy

and Resources Institute, the Keidanren Committee on Nature Conservation, the China Council for International

Cooperation on Environment and Development, and the Dow Chemical Companys Corporate Environmental Advisory

Committee. Mr. Lash is also a board member of the Institute for Sustainable Communities and the Wallace Global Fund.

He formerly chaired the National Commission on Superfund, directed the Environmental Law Center and Vermont Law

School, and served as Vermonts Commissioner of Environmental Conservation and as head of the Vermont Agency of

Natural Resources. He was also senior staff attorney at the Natural Resources Defense Council, and served as a Peace

Corps volunteer. He has a bachelors degree in government from Harvard University and a law degree from Catholic

University.

EXECUTIVE DIRECTOR

Martin A. Spitzer, Executive Director, Presidents Council on Sustainable Development. Mr. Spitzer became the Councils

executive director in January 1997. Previously, he served as the coordinator of the Councils New National Opportunities

Task Force. Before joining the Council, he worked in the office of the U.S. Environmental Protection Agency

Administrator on pollution prevention policy. Prior to joining the agency in 1990, Mr. Spitzer worked for the New York

State Department of Environmental Conservation. He has also worked for an engineering firm, as an attorney, and for a

variety of nonprofit organizations. Mr. Spitzer received his undergraduate degree in economics and history from the State

University of New York-Binghamton, a doctorate in policy studies from the School of Management at the State Universi

of New York-Buffalo, and a law degree from the same institution.

MEMBERS

John H. Adams, President, Natural Resources Defense Council (NRDC). Since 1970, Mr. Adams had been executive dire

tor of the NRDC, an environmental advocacy group with more than 400,000 members and a budget of over $33 million

he was named president in 1998. He is chairman of the Open Space Institute and serves on the board of the American

Conservation Association, the Catskill Center for Conservation, the League of Conservation Voters, the Winston

Foundation for World Peace, the Woods Hole Research Center, the U.S. Committee for the United Nations Development

Programme, the Alliance to Save Energy, and the Earth Day Network. He is a graduate of Michigan State University and

Duke University School of Law.

Aida Alvarez, Administrator, U.S. Small Business Administration. Ms. Alvarez directs the delivery of a comprehensive set 

financial and business development programs for Americas entrepreneurs. Before leading the Small Business

Administration, Ms. Alvarez was the first director of the U.S. Office of Federal Housing Enterprise Oversight. Earlier, M

Alvarez worked as an investment banker and was an award-winning newspaper and television journalist in New York City

for 11 years. Her public service background includes two years as vice president at the New York City Health and Hospit
APPENDICES

Corporation. She also served as a commissioner on the New York City Charter Revision Commission. Administrator

Alvarez is a cum laude graduate of Harvard College.

Bruce Babbitt, Secretary, U.S. Department of the Interior. During his tenure at the Department of the Interior, Secretary

Babbitt has initiated the development of large-scale, consensus-based environmental restoration projects. Before heading 

the Interior Department, Mr. Babbitt was governor of Arizona from 1978 to 1987. Previously, he spent three years as the

states attorney general. In 1988, he was a Democratic candidate for president. In addition, Mr. Babbitt was national presi

dent of the League of Conservation Voters and a founding board member of the Grand Canyon Trust. He graduated fro

the University of Notre Dame, and has a masters degree in geophysics from the University of Newcastle, England, and a

law degree from Harvard University.

Scott Bernstein, President, Center for Neighborhood Technology. Mr. Bernstein and the Center for Neighborhood

Technology have been recognized by Renew America, the Enterprise Foundation, the U.S. Department of Energy, and ot

ers for innovative approaches used to promote sustainable communities. Before founding the center, he served on the sta

of Northwestern Universitys Center for Urban Affairs and Policy Research. He has been a visiting lecturer at the Univer

of California-Los Angeles, an environmental fellow of the Institute for Transportation Studies at the University of

California-Davis, a trustee of the Institute for the Regional Community, and a board member of the Brookings Institutio

Center for Urban and Metropolitan Policy. Mr. Bernstein studied political science and engineering at Northwestern

University.

Carol M. Browner, Administrator, U.S. Environmental Protection Agency (EPA). Administrator Browner is the longest

serving administrator in the history of EPA. Over the past six years, Ms. Browner has made protecting public health and

the environment while growing the economy a top priority. She has speeded the cleanup of the nations toxic waste sites.

She also led the efforts to clean up and redevelop brownfields and to develop and implement President Clintons Clean

Water Action Plan. She has taken action to update air quality standards for particulate matter and ozone, and is working t

reinvent her agency to achieve the best public health and environmental protection for the least cost. From 1991 to 1993,

she was secretary of Floridas Department of Environmental Regulation. Earlier, she served as legislative director to then

Senator Albert Gore, Jr., and served on the staff of then-Senator Lawton Chiles. Administrator Browner received her

undergraduate and law degrees from the University of Florida-Gainesville.

David T. Buzzelli, Director and Senior Consultant, The Dow Chemical Company. Mr. Buzzelli joined the Dow Chemical

Company in 1965 and held a number of positions in research and manufacturing before being appointed director of gov

ernment and public affairs and a vice president of Dow Chemical U.S.A. In 1986, he was named chairman, president, and

chief executive officer of Dow Chemical Canada. He is the past vice president and corporate director of environment,

health and safety, public affairs, and information systems. He is also a member of the Dow Corning Corporation Board o

Directors. He is a former co-chair of the Presidents Council on Sustainable Development. Mr. Buzzelli is a member of t

World Resources Institute Board and Executive Committee, the International Institute for Sustainable Development Boar

and the China Council for International Cooperation on Environment and Development. Mr. Buzzelli has a bachelors

degree from the University of Minnesota in chemical engineering and a masters degree in the same subject from the

University of Delaware.

Andrew M. Cuomo, Secretary, U.S. Department of Housing and Urban Development. Since assuming his present positio

Secretary Cuomo has focused on more efficient and effective programs, along with an aggressive campaign against waste,

fraud, and abuse. Before becoming secretary, he served for four years as the assistant secretary for community planning a

development at the U.S. Department of Housing and Urban Development. Before entering federal service, Secretary

Cuomo led the New York City Commission on the Homeless. In 1986, he founded both the Housing Enterprise for the

Less Privileged and the Genesis Project. Secretary Cuomo served as campaign manager for Mario Cuomo in 1982 and as 

special assistant to the governor in 1983. He practiced law from 1983 to 1986. Mr. Cuomo holds an undergraduate degre

from Fordham University and a law degree from Albany Law School.

William M. Daley, Secretary, U.S. Department of Commerce. Since becoming secretary in 1997, Mr. Daley has aggressivel

monitored other nations trade practices to protect American companies and workers. Secretary Daley served as Special

Counsel to the President in 1993, where he coordinated the successful campaign to pass the North American Free Trade

Agreement. Previously he practiced law in Chicago and was president and chief operating officer of Amalgamated Bank 

Chicago. He has served on corporate boards, and was active in many Chicago-area community projects. Secretary Daley

holds a law degree from the John Marshall Law School and an undergraduate degree from Loyola University.
APPENDICES

Dianne Dillon-Ridgley, Executive Director, Womens Environment & Development Organization (WEDO). Ms. DillonRidgley has over 20 years of leadership in sustainable development and womens issues domestically and internationally.

Prior to heading WEDO, Ms. Dillon-Ridgley was national president of Zero Population Growth from 1994 to 1997. In

1993, she was the first director of the Women, Cancer, and the Environment campaign and has been a senior policy advi

for WEDO since 1994. She represented the World Young Womens Christian Association (YWCA) at the United Nations

and as a member of the national board, she chaired racial justice for the U.S. YWCA. She is the U.S. member of the Glob

Water Partnership, a trustee of the Wallace Global Fund and, since 1987, chair of the Iowa Department of Economic

Developments Targeted Small Business Board. She served as co-chair of the PCSD Population and Consumption Task

Force, is a director at Interface, Inc., and vice chair of the National Summit on Africa Board of Directors. Ms. DillonRidgley is a founding member of the Institute of Sustainable Design at the University of Virginia School of Architecture

She is a state-certified mediator in Iowa and did her undergraduate work in philosophy at Howard University.

E. Linn Draper, Jr., Chairman, President, and Chief Executive Officer, American Electric Power (AEP). Mr. Draper is als

president of Ohio Valley Electric Corporation and its subsidiary, Indiana-Kentucky Electric Corporation. He became cha

man, president, and chief executive officer of AEP in 1993. He joined the company in 1992, following 13 years with Gul

States AEP Company, where he served as chairman, president, and chief executive officer. He joined Gulf States Utilities 

1979. Earlier, he served on the faculty and administration at the University of Texas. Mr. Draper holds a bachelor of arts

degree from Rice University, a bachelor of science in chemical engineering from the same institution, and a doctorate in

nuclear science and engineering from Cornell University. He is a registered professional engineer in the state of Texas.

Randall Franke, Commissioner, Marion County, Oregon. Mr. Franke has served as Marion County Commissioner since

1979. He has been elected chairman of the county board eight times. He has served, often as chair, on many state and

regional commissions dealing with prison overcrowding, community development, job training, road finance, health systems, solid waste reduction, youth services, emergency services, mass transit, low-income housing, and senior services. He

chairs the EPAs Local Government Advisory Committee, and is a member of the Northwest Council on Sustainable

Development. He is a past president of the National Association of Counties. Mr. Franke earned his undergraduate degr

from the University of Oregon and holds a masters degree in corrections from the Oregon College of Education.

Dan Glickman, Secretary, U.S. Department of Agriculture. Secretary Glickman brings over two decades of legislative and

legal experience to his position. Prior to his confirmation, he represented Kansass 4th District in the U.S. House of

Representatives for 18 years. His committee assignments included the House Agriculture Committee; he chaired the

Subcommittee on General Farm Commodities and its predecessor, the Subcommittee on Wheat, Soybeans, and Feed

Grains, for six years. He worked on farm bills in 1977, 1981, and 1990; he also was the original author of legislation to

streamline and reorganize the Agriculture Department. Additionally, Secretary Glickman chaired the House Permanent

Select Committee on Intelligence. Before being elected to Congress in 1976, he was president of the Wichita, Kansas,

School Board, and a partner in the law firm of Sargent, Klenda, and Glickman. He has a bachelors degree in history from

the University of Michigan and a law degree from The George Washington University.

Samuel C. Johnson, Chairman, S.C. Johnson & Son, Inc. Since 1967, Mr. Johnson has chaired his 113-year-old familyowned, multinational household products company, which received the 1994 World Environment Center Gold Medal. Mr

Johnson is the recipient of a Lifetime Environmental Achievement Award from the United Nations Environment

Programme and of the Charles A. Lindbergh Award. He sits on the boards of the Mobil Corporation, Deere and

Company, and H.J. Heinz Company, among others. He is a member of the Sustainable Racine, Inc., Advisory Board and

the World Business Council for Sustainable Development. He also serves as chairman of the National Board of Governo

of the Nature Conservancy and is regent emeritus of the Smithsonian Institution. Mr. Johnson holds a bachelors degree 

economics from Cornell University and a masters degree in business administration from Harvard University.

Fred D. Krupp, Executive Director, Environmental Defense Fund. Mr. Krupp has been with the Environmental Defense

Fund, a national environmental organization that links science, economics, and law to find innovative, economically viabl

solutions to environmental problems, since 1984. Mr. Krupp serves on the boards of the H. John Heinz III Center for

Science, Economics, and the Environment, and the National Environmental Education and Training Foundation. He was

also a member of the Presidents Commission on Environmental Quality and the National Commission on Superfund.
APPENDICES

Previously, he spent several years in private law practice, during which time he helped found the Connecticut Fund for th

Environment. Mr. Krupp is a graduate of Yale University and holds a law degree from the University of Michigan.

Kenneth L. Lay, Chairman and Chief Executive Officer, Enron Corp. Enron is one of the worlds leading integrated elec

tricity and natural gas companies. Mr. Lay was elected as its chief executive officer in 1985 and its chairman in 1986. Befo

joining Enron, he held top management positions with Houston Natural Gas, Transco Energy Company, and Continenta

Resources Company. Earlier, he served as a corporate economist for Exxon Company, U.S.A., and deputy undersecretary

for energy for the U.S. Department of the Interior. Mr. Lay serves on the boards of several companies. He holds bachelo

and masters degrees in economics from the University of Missouri, and a doctorate in the same subject from the Univer

of Houston.

Harry J. Pearce, Vice Chairman, General Motors (GM) Corporation. Mr. Pearce joined GM as associate general counsel in

1985 after serving as a senior partner in the firm of Pearce and Durick. Prior to his appointment as vice chairman in 199

he served as an executive vice president, executive vice president and general counsel, and vice president and general coun

sel. In addition to serving on GMs board of directors, he is also a member of the boards of General Motors Acceptance

Corporation, Delphi Automotive Systems Corporation, Hughes Electronics Corporation, Marriott International, Inc., and

MDU Resources Group, Inc. He is also a member of the World Business Council for Sustainable Development and the

World Economic Forums Council of Innovative Leaders in Globalization. He received a bachelors degree in engineering

sciences from the United States Air Force Academy and a law degree from Northwestern University.

Steve Percy, Chairman and CEO, BP America, Inc. Prior to assuming his duties at the helm of BP America, Mr. Percy wa

president of BP Oil in the United States, group treasurer of the BP Company and chief executive of BP Finance

International. He began his career with Standard Oil Company in 1976 and joined BP after the two companies merged in

1987. He is a member of the board of directors of GenCorp, Inc., the Greater Cleveland Growth Association, Resource

for the Future, and the American Petroleum Institute. Mr. Percy earned a bachelor of science degree in mechanical engineering from Rensselaer Polytechnic Institute, a masters in business administration from the University of Michigan, and 

law degree from the Cleveland Marshall College of Law.

Michele A. Perrault, International Vice President, Sierra Club. Ms. Perrault is a member of the Sierra Club board and was

its national president from 1984 to 1986 and again in 1993. For the past 13 years, she also has directed the Sierra Clubs

environmental education workshop for teachers. She is a co-founder and steering committee member for the Bay Area

Alliance on Sustainable Development, a member of the board of Greenseal, and chairman of the advisory board for Gre

Teams. She has served on the National Advisory Council on Coastal Zone Management and on the U.S. Environmental

Protection Agencys Environmental Education Advisory Council. Ms. Perrault has worked with the League of Women

Voters, New York Zoological Society, and Bank Street College of Education. She has held a number of leadership positio

at local, state, national, and international levels helping to build sustainable communities and fostering education for ecolo

ically sustainable development. Ms. Perrault received a bachelors degree from Hunter College.

Bill Richardson, Secretary, U.S. Department of Energy. Prior to his current position, Secretary Richardson served as the

U.S. Ambassador to the United Nations. Earlier, he was elected eight times to represent New Mexicos 3rd Congressional

District. In addition to his democratic leadership role in Congress, he was an active member of the Commerce, Resource

and Intelligence Committees. Secretary Richardson has served as President Clintons special envoy on many sensitive dipl

matic missions. He has won freedom for hostages in many difficult places, including Iraq, North Korea, and Sudan. His

efforts have earned him two Nobel Peace Prize nominations. Mr. Richardson received a bachelors degree from Tufts

University and a masters degree from The Fletcher School of Law and Diplomacy.

Richard W. Riley, Secretary, U.S. Department of Education. President Clinton chose Richard Riley to be Secretary of

Education after Mr. Riley won national recognition for his highly successful effort to improve education in South Carolin

Prior to his current appointment, Secretary Riley served as a state representative and a state senator and was twice elected

governor of South Carolina. Secretary Riley is a cum laude graduate of Furman University and holds a law degree from th

University of South Carolina.
APPENDICES

Susan Savage, Mayor, City of Tulsa, Oklahoma. Ms. Savage has served as mayor of her native city since 1992. As the chie

executive officer of the third largest employer in Tulsa, Mayor Savage oversees services and capital projects annually budgeted at $400 million. Mayor Savage is the vice president of the Oklahoma Municipal League and has chaired the U.S.

Conference of Mayors Energy and Environment Committee. She is also a member of statewide panels on emergency se

vices and infrastructure development. Previously, she was the executive director of the Metropolitan Tulsa Citizens Crime

Commission for 10 years. Mayor Savage holds an undergraduate degree in criminal justice and economics.

John C. Sawhill, President and Chief Executive Officer, The Nature Conservancy. Before joining The Nature Conservanc

Mr. Sawhill headed the energy practice of McKinsey and Company. He was president of the U.S. Synthetic Fuels

Corporation and served as deputy secretary of the U.S. Energy Department in the Carter Administration. Earlier, he was

administrator of the Federal Energy Administration; associate director for natural resources, energy, science, and environment of the Office of Management and Budget; and president of New York University. He has served on the boards of

several companies, including Consolidated Edison Company, Crane Corporation, and the American International Group.

Mr. Sawhill graduated from Princeton University and holds a doctorate in economics from New York University.

Rodney Slater, Secretary, U.S. Department of Transportation. Secretary Slater has worked to ensure that our national tran

portation system helps to improve safety and quality of life for all users and to enhance communities and the natural env

ronment. Before becoming secretary, Mr. Slater served as the administrator of the Federal Highway Administration. From

1987 to 1992, he was a member of the Arkansas State Highway Commission, serving as its chairman in 1992. He held se

eral other positions in Arkansas, including director of governmental relations at Arkansas State University; executive assis

tant for economic and community programs for then-Governor Bill Clinton; the governors special assistant for commun

and minority affairs; and assistant attorney general in the litigation division of the Arkansas state attorney generals office

Secretary Slater graduated from Eastern Michigan University and earned a law degree at the University of Arkansas.

Theodore Strong, Executive Director, Columbia River Inter-Tribal Fish Commission. As the commissions executive direc

tor, Mr. Strong represents, and is an advocate for, the Warm Springs, Yakima, Umatilla, and Nez Perce tribes ecosystem

management philosophies and goals, which combine science and business acumen with traditional Native American value

Previously, Mr. Strong managed his own international trade and consulting company. Mr. Strong is a board member of

American Rivers, the Earth Conservation Corporation, Sustainable Northwest, and the Pacific Rivers Council. He was

comptroller, budget director, and enterprise director of the Yakima Indian Nation in Washington state, and has also work

for the Bureau of Indian Affairs and the Navajo Tribal Utility Authority. Mr. Strong is a member of the Yakima tribe. He

has studied at Draughtons Business College, Tacoma Technical Institute, and Eastern Montana University.

EX OFFICIO MEMBERS

D. James Baker, Under Secretary for Oceans and Atmosphere of the National Oceanic and Atmospheric Administration,

U.S. Department of Commerce. Under Secretary Baker is also co-chair of the National Science and Technology Councils

Committee on Environment and Natural Resources, co-chair of the Environmental Working Group and vice-chair of the

Space Committee of the U.S.-Russian Joint Commission on Economic and Technological Cooperation, and vice-chair of t

Science and Technology Committee of the U.S.-South Africa Binational Commission. He was acting chair of the Council o

Environmental Quality from 1993 to 1994. Earlier, he served as president of Joint Oceanographic Institutions, Inc. He wa

co-founder and first dean of the College of Oceanography and Fishery Sciences at the University of Washington and a fac

ulty member at Harvard University. He was elected a fellow of the American Association for the Advancement of Science 

1998. He holds a bachelors degree in physics from Stanford University and a doctorate in physics from Cornell University.

Sherri Goodman, Deputy Under Secretary of Defense, U.S. Department of Defense (DOD). Ms. Goodman is responsib

for DODs worldwide environmental, safety, and occupational health policies and programs including cleanup at active an

closing bases, compliance with environmental laws, conservation of natural and cultural resources, pollution prevention,

environmental technology, fire protection, explosive safety, and pest management. In 1996, Ms. Goodman received the

DOD Medal for Distinguished Public Service from the Secretary of Defense. Ms. Goodman was a professional staff me

ber and counsel with the Senate Armed Services Committee working for the chairman, Senator Sam Nunn. She has work

as a consultant for the Rand Corporation and as a defense analyst for Science Applications, Inc. Ms. Goodman received h

undergraduate degree summa cum laude from Amherst College. She received a law degree cum laude from Harvard Law
APPENDICES

School and a masters degree in public policy from the John F. Kennedy School of Government.

Richard Rominger, Deputy Secretary, U.S. Department of Agriculture. Since 1993, Mr. Rominger has helped the Secretary

direct the activities of the U.S. Department of Agriculture, a large, diverse department whose mission includes conservatio

domestic food assistance, marketing, international trade, meat and poultry inspection, forestry, rural development, research

and education. He is a farmer who has raised a variety of crops with his family near Winters, California. Prior to his servic

as deputy secretary, Mr. Rominger led Californias Department of Food and Agriculture from 1977 to 1982 and was president of the Western Association of State Departments of Agriculture and the Western U.S. Agricultural Trade Association

Mr. Rominger received the California State Fair Agriculturalist of the Year Award in 1992 and the California Farm Bureau

Federation 1991 Distinguished Service Award. Mr. Rominger received a bachelors degree in plant science summa cum laude

from the University of California-Davis and is a member of the agricultural honorary society of Alpha Zeta. 

EMERITUS MEMBERS

Richard Barth, Retired Chairman, President, and Chief Executive Officer, Ciba-Geigy Corporation. Mr. Barth joined Cib

Corporation in 1965 as a legal assistant. Following its merger with Geigy, he became the firms general counsel. He next

served as chief financial officer and as senior vice president from 1980 to 1986, when he became president and chief exe

utive officer of the corporation. He currently serves on the board of the Novartis Corporation. Mr. Barth is a graduate o

Wesleyan University and Columbia Law School.

Richard Clarke, Retired Chairman and Chief Executive Officer, Pacific Gas and Electric Company (PG&E). Mr. Clarke

began his career as an attorney for PG&E, subsequently holding a number of legal and executive management positions

with the firm. He presently serves on the advisory board for the Walter A. Haas School of Business at the University of

California-Berkeley, and on the board of trustees for the universitys school of law. He also serves on the board of the

Nature Conservancy of California, PG&E, Potlatch Corporation, and CNF Transportation Company. Mr. Clarke is a cochair of the Bay Area Alliance for Sustainable Development. He received both a bachelors degree in political science and 

law degree from the University of California-Berkeley.

Jay D. Hair, President, World Conservation Union. Before his retirement in 1995, Mr. Hair served for 14 years as presiden

of the National Wildlife Federation, the worlds largest conservation organization. In 1991, he was appointed to the

Investment Policy Advisory Committee as a U.S. trade representative; in 1994, he was reappointed to the Investment and

Services Policy Advisory Committee. Mr. Hair serves on the board of directors of several organizations, including Clean

Sites, Inc., and the Windstar Foundation. He received a bachelors degree in biology and a masters degree in zoology from

Clemson University; he also holds a doctorate in zoology from the University of Alberta, Canada.

LIAISON TO THE PRESIDENT

George T. Frampton, Jr., Acting Chair, Council on Environmental Quality. Before assuming his duties at the Council on

Environmental Quality, Mr. Frampton was the assistant secretary for fish and wildlife and parks at the U.S. Department o

the Interior. Prior to his government service, he was president of The Wilderness Society from 1986 to 1993. From 1976 

1985, he was a partner in the law firm of Rogovin, Stern & Huge. Also during this period, from 1979 to 1980, he was

deputy director and chief of staff for the Nuclear Regulatory Commissions investigation into the Three Mile Island nucl

accident. Mr. Frampton served as assistant special prosecutor, Watergate special prosecution force, from 1973 to 1975. M

Frampton was a fellow at the Center for Law and Social Policy from 1972 to 1973. He received his undergraduate degree 

physics and philosophy cum laude from Yale College, his masters, with distinction, from the London School of Economic

and his law degree magna cum laude from Harvard Law School.
APPENDICES

APPENDIX F

COUNCIL STAFF AND TASK FORCE MEMBERS

COUNCIL STAFF 

Martin A. Spitzer, Executive Director

Jack Bowles, Deputy Executive Director

Evangeline Deshields, Office Manager

Christine Ervin, Former Advisor, Climate Change Task Force

Cheryl Little, Metropolitan and Rural Strategies Task Force Coordinator

Catherine McKalip-Thompson, International Task Force Coordinator

David Monsma, Environmental Management Task Force Coordinator

Tamara Nameroff, Climate Task Force Coordinator

Angela Park, Former Director, Communications and Constituency Development

Ken Patterson, Director, National Town Meeting

Patricia Sinicropi, Deputy Director, National Town Meeting

David Slutzky, Former Coordinator, International Task Force

Cynthia Wade, Executive Assistant

PRINCIPAL LIAISONS

Marcia Aronoff, Environmental Defense Fund

Adela Backiel, U.S. Department of Agriculture

Frances Beinecke, Natural Resources Defense Council

Kenneth Blower, BP America, Inc.

Joseph Canny, U.S. Department of Transportation

Roan Conrad, National Oceanic and Atmospheric Administration, U.S. Department of Commerce

Maggie Coon, The Nature Conservancy

Wilma Delaney, The Dow Chemical Company

David Festa, U.S. Department of Commerce

David Gatton, U.S. Conference of Mayors

Wendy Gerlitz, Columbia River Inter-Tribal Fish Commission

Jim E. Hartzfeld, Interface Research Corporation

Dale Heydlauff, American Electric Power

Jane Hutterly, S.C. Johnson & Son, Inc.

Holly J. Kaufman, U.S. Department of Defense

Nick Keller, Joint Center for Sustainable Communities, National Association of Counties

Keith Laughlin, Council on Environmental Quality

Linda Lawson, U.S. Department of Transportation

Ronald Matzner, U.S. Small Business Administration

Michael McCloskey, Sierra Club

Judith M. Mullins, General Motors Corporation

Terry Hitchins Nicolosi, U.S. Department of Housing and Urban Development

John Palmisano, Enron Corporation

Jim Pipkin, U.S. Department of the Interior

Claude Poncelet, Pacific Gas and Electric Company

Dan Reicher, U.S. Department of Energy

Lynn Richards, ICF Consulting Group

Carole Wacey, U.S. Department of Education

Donna Wise, World Resources Institute

Rob Wolcott, U.S. Environmental Protection Agency
APPENDICES

CLIMATE CHANGE TASK FORCE

Co-chairs

D. James Baker, National Oceanic and Atmospheric Administration, U.S. Department of Commerce

Jonathan Lash, World Resources Institute

Steve Percy, BP America, Inc.

Task Force Coordinator

Tamara Nameroff

Council Members and Liaisons

The Climate Change Task Force was a Task Force of the whole Council. Please see the lists of Council members and principal liaisons 

these names.

Additional Members

Margot Anderson, U.S. Department of Agriculture

John Atcheson, U.S. Department of Energy

Mike Bennett, Interface, Inc.

Ellen Brown, U.S. Environmental Protection Agency 

Michael Campilongo, U.S. Small Business Administration

Ann Carey, U.S. Department of Agriculture

Krishna Chivukula, U.S. Environmental Protection Agency

Kirk Fauver, Federal Highway Administration

Ted Heintz, U.S. Department of the Interior

Bracken Hendricks, National Oceanic and Atmospheric Administration, U.S. Department of Commerce

Dennis Heydanek, The Dow Chemical Company

Jackie Krieger, U.S. Environmental Protection Agency

Dan Lashof, Natural Resources Defense Council

Linda Lawson, U.S. Department of Transportation

Ronald Matzner, U.S. Small Business Administration

Ben Mieremet, National Oceanic and Atmospheric Administration, U.S. Department of Commerce

Rebecca G. Moser, National Oceanic and Atmospheric Administration, U.S. Department of Commerce

Tia Nelson, The Nature Conservancy

Art Rosenfeld, U.S. Department of Energy

Tim Stuart, U.S. Environmental Protection Agency

Donald Trilling, U.S. Department of Transportation

James Turnure, U.S. Environmental Protection Agency

Rob Watson, Natural Resources Defense Council

John Williams, General Motors Corporation

Kurt Zwally, U.S. Department of Energy

ENVIRONMENTAL MANAGEMENT TASK FORCE

Co-chairs

Carol M. Browner, U.S. Environmental Protection Agency

Michael McCloskey, Sierra Club

Harry J. Pearce, General Motors Corporation

Task Force Coordinator

David Monsma

Council Members

D. James Baker, National Oceanic and Atmospheric Administration, U.S. Department of Commerce

David Buzzelli, The Dow Chemical Company
APPENDICES

Dianne Dillon-Ridgley, Womens Environment and Development Organization

Sherri Goodman, U.S. Department of Defense

Samuel C. Johnson, S.C. Johnson & Son, Inc.

Steve Percy, BP America, Inc.

Richard E. Rominger, U.S. Department of Agriculture

Council Member Liaisons

Arden Ahnell, BP America, Inc.

Jay Benforado, U.S. Environmental Protection Agency

F.H. Chip Brewer, S.C. Johnson & Son, Inc.

Ann Carey, U.S. Department of Agriculture

Wilma Delaney, The Dow Chemical Company

Dean Drake, General Motors Corporation

Chuck Fox, U.S. Environmental Protection Agency

Nancy Levenson, S.C. Johnson & Son, Inc.

Rebecca G. Moser, National Oceanic and Atmospheric Administration, U.S. Department of Commerce

Robert Phillips, General Motors Corporation

Lynn Richards, ICF Consulting Group

Margaret Rogers, The Dow Chemical Company

Maureen Sullivan, U.S. Department of Defense 

Additional Members

John Bridges, U.S. Postal Service

Nevin Cohen, Inform, Inc.

Tom Davis, Tom Davis Associates

Ira Feldman, United Nations Association 

Anne Kelly, U.S. Environmental Protection Agency, Region I

Alison Kinn, U.S. Environmental Protection Agency

Clair Krizov, AT&T

Bob Massie, Coalition for Environmentally Responsible Economies

Mildred McClain, Citizens for Environmental Justice

Shelley Metzenbaum, University of Maryland

Judy Odoulamy, U.S. Department of Energy

William Panos, Massachusetts Department of Environmental Protection

David Pellow, University of California-Berkeley

Claude Poncelet, Pacific Gas and Electric Company

Janet Ranganathan, World Resources Institute

Gail Robarge, U.S. Environmental Protection Agency

Robert Shinn, New Jersey Department of Environmental Protection 

John Spinello, New Jersey Department of Environmental Protection

Tim Stuart, U.S. Environmental Protection Agency

Ethan Tim Smith, U.S. Geological Survey
APPENDICES

METROPOLITAN AND RURAL STRATEGIES TAS

FORCE

Co-chairs

Scott Bernstein, Center for Neighborhood Technology

Andrew Cuomo, U.S. Department of Housing and Urban Development

Susan Savage, City of Tulsa, Oklahoma

Task Force Coordinator

Cheryl Little

Council Members

John H. Adams, Natural Resources Defense Council

Aida Alvarez, U.S. Small Business Administration

Bruce Babbitt, U.S. Department of the Interior

D. James Baker, National Oceanic and Atmospheric Administration, U.S. Department of Commerce 

Richard Barth, Ciba-Geigy Corp.

Carol M. Browner, U.S. Environmental Protection Agency

Richard Clarke, Pacific Gas and Electric Company

William Daley, U.S. Department of Commerce

Dianne Dillon-Ridgley, Womens Environment and Development Organization

Randall Franks, Marion County, Oregon

Sherri Goodman, U.S. Department of Defense

Jay D. Hair, World Conservation Union

Samuel C. Johnson, S.C. Johnson & Son, Inc.

Bill Richardson, U.S. Department of Energy

Michele Perrault, Sierra Club

Richard W. Riley, U.S. Department of Education

Richard E. Rominger, U.S. Department of Agriculture

John C. Sawbill, The Nature Conservancy

Rodney Slater, U.S. Department of Transportation

Theodore Strong, Columbia River Inter-Tribal Fish Commission

Council Member Liaisons

Adela Backiel, U.S. Department of Agriculture

John Bullard, National Oceanic and Atmospheric Administration, U.S. Department of Commerce

Roan Conrad, National Oceanic and Atmospheric Administration, U.S. Department of Commerce

Hank Dittmar, Surface Transportation Policy Project

Jim East, City of Tulsa, Oklahoma

Greg Entourage, S.C. Johnson & Son, Inc.

Glenn Eugster, U.S. Environmental Protection Agency

Wendy Gerlitz, Columbia River Inter-Tribal Fish Commission

Noel Gerson, U.S. Department of Defense

Ted Heintz, U.S. Department of the Interior

Robert Hickmott, U.S. Department of Housing and Urban Development

Nick Keller, National Association of Counties

Linda Lawson, U.S. Department of Transportation

Pat LeDonne, U.S. Department of Energy

Ronald Matzner, U.S. Small Business Administration

Jerry McNeil, National Association of Counties

Peter Melhus, Pacific Gas and Electric Company

Terry Hitchins Nicolosi, U.S. Department of Housing and Urban Development
APPENDICES

Angela Nugent, U.S. Environmental Protection Agency

Additional Members

Thomas Bier, Cleveland State University

Carl Bouchard, U.S. Department of Agriculture

Kendra Briechle, International City/County Management Association

Evert Byington, U.S. Interagency Working Group on Sustainable Development Indicators

Michael Campilongo, U.S. Small Business Administration

Kate Clancy, Wallace Institute

Smith Covey, U.S. Department of Agriculture

Brian Dabson, Corporation for Enterprise Development

Peter Dreyfuss, U.S. Department of Energy

Fred Ducca, U.S. Department of Transportation

Andrew Euston, U.S. Department of Housing and Urban Development

Carol Everett, U.S. Conference of Mayors

Otto Gutenson, U.S. Environmental Protection Agency

Michalann Harthill, U.S. Geographic Services

Peter Hawley, American Planning Association

Eliot Hurtwitz, National Association of Counties

John Irby, National Association of Counties

Jill Kruse, Surface Transportation Policy Project

Judith LaBelle, Glynwood Center

Ruth McWilliams, U.S. Department of Agriculture

Michael Myers, U.S. Department of Energy

Brand Niemann, U.S. Environmental Protection Agency

David Ouderkirk, U.S. Environmental Protection Agency

Bill Painter, U.S. Environmental Protection Agency

Carol Parker, U.S. Department of Defense

Linda Rimer, U.S. Environmental Protection Agency

Rachel Sandals, U.S. Small Business Administration

Kelly Shulman, National Association of Counties

Michael Shuman, Institute for Policy Studies

Michael Springer, U.S. Department of Treasury

Joshua Stearns, National Oceanic and Atmospheric Administration, U.S. Department of Commerce

Dale Thomson, U.S. Department of Housing and Urban Development

Harriet Tregoning, U.S. Environmental Protection Agency

Mark Tumeo, Cleveland State University

Gary Valen, Humane Society of the United States

Tim Warman, American Farmland Trust

Helen Payne Watt, Corporation for Enterprise Development 

Adam Weinberg, Colgate University

Ed Weiner, U.S. Department of Transportation

Marc Weiss, Center for National Policy

David Williams, U.S. Department of the Interior

INTERNATIONAL TASK FORCE

Co-chairs

Dianne Dillon-Ridgley, Womens Environment and Development Organization

William Daley, U.S. Department of Commerce

Kenneth Lay, Enron Corporation
APPENDICES

Task Force Coordinator

Catherine McKalip-Thompson

Council Members

John H. Adams, Natural Resources Defense Council

D. James Baker, National Oceanic and Atmospheric Administration, U.S. Department of Commerce

Carol M. Browner, U.S. Environmental Protection Agency

Jay D. Hair, World Conservation Union

Jonathan Lash, World Resources Institute

Michele Perrault, Sierra Club

Harry J. Pearce, General Motors Corporation

Steve Percy, BP America, Inc.

Richard E. Rominger, U.S. Department of Agriculture

John C. Sawhill, The Nature Conservancy

Rodney Slater, U.S. Department of Transportation

Council Member Liaisons

Adela Backiel, U.S. Department of Agriculture

Kenneth Blower, BP America, Inc.

Roan Conrad, National Oceanic and Atmospheric Administration, U.S. Department of Commerce

Maggie Coon, The Nature Conservancy

David Festa, U.S. Department of Commerce

Jeffrey Hunker, U.S. Department of Commerce

G. Mustafa Mohatarem, General Motors Corporation

John Palmisano, Enron Corporation

Jacob Scherr, Natural Resources Defense Council

Tim Stuart, U.S. Environmental Protection Agency

Donna Wise, World Resources Institute

Rob Wolcott, U.S. Environmental Protection Agency

Additional Members

Dan Bilello, U.S. Environmental Protection Agency

Barbara Bramble, National Wildlife Federation

Linda Descano, Salomon Smith Barney

Susan Fletcher, Congressional Research Service

John Ganzi, Environment & Finance Enterprise

Bradford Gentry, Yale Center for Law and Environment

David Hales, U.S. Agency for International Development

Bracken Hendricks, National Oceanic and Atmospheric Administration, U.S. Department of Commerce

Chris Herman, U.S. Environmental Protection Agency

Melinda Kimble, U.S. Department of State

Dan MaGraw, U.S. Environmental Protection Agency

Bert Schacknies, U.S. Department of Transportation

Kathy Sessions, United Nations Association

Frances Seymour, World Resources Institute

Sandra Smithey, U.S. Agency for International Development
APPENDICES

APPENDIX G

FOR FURTHER READING 

AND ADDITIONAL INFORMATION

Presidents Council on Sustainable Development. Sustainable America: A New Consensus for Prosperity, Opportunity, and a

Healthy Environment for the Future. Washington, DC: U.S. Government Printing Office, 1996.

World Commission on Environment and Development (the Bruntland Commission). Our Common Future. Oxford: Oxfor

University Press, 1987.

CLIMATE CHANGE

Crowley, Thomas J. Remembrance of Things Past: Greenhouse Lessons From the Geologic Record. Consequences No. 2

(1996): 2-12.

Intergovernmental Panel on Climate Change. IPCC Second Assessment Report: Climate Change 1995. Cambridge: Cambridge

University Press, 1995.

United Nations. Framework Convention on Climate Change and the Kyoto Protocol. <<http://www.unfccc.de>>.

U.S. Office of Technology Assessment. Preparing for an Uncertain Climate. Washington, DC: U.S. Government Printing

Office, 1993.

Watson, Robert T., Marufu C. Zinyowera, and Richard H. Moss, eds. The Regional Impacts of Climate Change: An Assessmen

Vulnerability. Cambridge: Cambridge University Press, 1998.

ENVIRONMENTAL MANAGEMENT

Anderson, Walter T. Theres No Going Back to Nature. Mother Jones, September-October 1996: 34-79.

The Aspen Institute. Uncovering Value: Integrating Environmental Performance With Financial Performance.

Washington, DC, 1999.

The Stewardship Path to Sustainability of Natural Resources. Washington, DC, 1999, forthcoming.

Gottsman, Laura, and Jon Kessler. Smart Screened Investments: Environmental-Screened Equity Funds That Perform

Like Conventional Funds. The Journal of Investing Vol. 7, No. 4 (Fall 1998).

Hawken, Paul. Natural Capitalism. Mother Jones, March-April 1997: 40-62.

Leslie, Jacques. Dawn of the Hydrogen Age. Wired, October 1997: 138-91.

McKibben, Bill. A Special Moment in History. Atlantic Monthly, May 1998: 55-78.

Metzenbaum, Shelley. Making Measurement Matter: The Challenge and Promise of Building a Performance-Focused Environment

Protection System. Washington, DC: Brookings Institution, October 1998.

METROPOLITAN AND RURAL COMMUNITIES

Bollier, David. How Smart Growth Can Stop Sprawl: A Briefing Guide for Funders. Washington, DC:

Essential Books, 1998.
Center for Neighborhood Technology. The Metropolitan Initiative: Learning Sustainability Region by Region.

Chicago, 1997.

Economic Research Service. Understanding Rural America. Washington, DC: U.S. Department of Agriculture,

February 1995.

Goldman, Benjamin A. Sustainable America: New Public Policy for the 21st Century. Washington, DC: Economic Developmen

Administration, 1995.

Kinsley, Michael J. Economic Renewal Guide: A Collaborative Process for Sustainable Community Development. Snowmass, CO:

Rocky Mountain Institute, 1997.

Lachman, Beth E. Linking Sustainable Community Activities to Pollution Prevention: A Sourcebook. Washington, DC: Rand

Critical Technologies Institute, 1997.

Lund, Robert T. The Remanufacturing Industry: Hidden Giant. Boston: Boston University, Manufacturing Engineering

Department, 1996.

McKnight, John, and John Kretzmann. Building Communities From the Inside Out. Evanston, IL: Northwestern University,

1995.

National Academy of Public Administration. Building Stronger Communities and Regions: Can the Federal Government Help?

Washington, DC, 1998.

Presidents Council on Sustainable Development. Sustainable Communities Task Force Report. Washington, DC, 1997.

U.S. Environmental Protection Agency. Green Development: Literature Summary and Benefits Associated With Alternative

Development Approaches. Washington, DC, 1996.

Weinberg, Adam. Non-Metropolitan Sustainable Community Development in the Global Context: Enacting Local

Economic Development Strategies in a New Political Economy. In Annals of the American Academy of Political and Social

Sciences, forthcoming.

Yaffee, Steven, L., et al. Ecosystem Management in the United States: An Assessment of Current Experience. Washington, DC:

Island Press, 1996.

Young, John E., and Aaron Sachs. The Next Efficiency Revolution: Creating a Sustainable Materials Economy. Worldwatch Pap

121. Washington, DC: Worldwatch Institute, 1995.

INTERNATIONAL PRIVATE CAPITAL FLOWS

French, Hillary. Investing in the Future: Harnessing Private Capital Flows for Environmentally Sustainable Development.

Worldwatch Paper 139. Washington, DC: Worldwatch Institute, February 1998.

Ganzi, John, Frances Seymour, and Sandy Buffett. Leverage for the Environment: A Guide to the Private Financial Services

Industry. Washington, DC: World Resources Institute, 1998.

Gentry, Bradford. Foreign Direct Investment and the Environment: Boon or Bane? Background paper for the OECD

Conference on Foreign Direct Investment and the Environment. New Haven: Yale Center for Environmental Law and

Policy, 1999.

Gentry, Bradford, ed. Private Capital Flows and the Environment: Lessons From Latin America. Cheltenham, UK: Edward

Elgar, 1999.

World Bank. World Development Report 1998. Washington, DC, 1999.

HELPFUL SUSTAINABLE DEVELOPMENT WEBSITES
The Presidents Council on Sustainable Development