Renewal of an

Information collection request

for

Regulatory Pilot Projects

OMB Control No. 2010

- 0026

EPA ICR No. 1755. 09

The United States Environmental Protection Agency

September 20 10Table of Contents

Title Page

1. Identification of the Information Collection

................................ ................................ .. 1

1(a) Title of the Information Collection

................................ ................................ ........ 1

1(b) Short Characterization/Abstract

................................ ................................ ............ 1

2. Need for and Use of the Collection

2(a) Need/Authority for the Collection

................................ ................................ ........ 2

2(b) Practical Utility

/Users of the Data

................................ ................................ ......... 2

3. Nonduplication, Consultations, and Other Collection Criteria

3(a) Nonduplication

................................ ................................ ................................ .... 3

3(b) Public Notice Required Prior to ICR Submission to OMB

................................ ....... 3

3(c) Consultations

................................ ................................ ................................ ...... 3

3(d) Effects of Less Frequent Collection

................................ ................................ ....... 3

3(e) General Guid elines

................................ ................................ .............................. 3

3(f) Confidentiality

................................ ................................ ................................ .... 3

3(g) Sensitive Questions

................................ ................................ ............................. 3

4. The Respondents and The Information Requested

4(a) Respondents/NAICS Codes

................................ ................................ .................. 4

4(b) Information Requested

................................ ................................ ........................ 4

(I) Data items, including record keeping requirements

(II) Respondent Activities

5. The Information Collected

-- Agency Activities, Collection Methodology,

and Information Management

5(a) Agency Activities

................................ ................................ ................................ 5

5(b) Collection Methodology and Management

................................ ............................. 5

5(c) Small Entity Flexibility

................................ ................................ ........................ 5

5(d) Collection Schedu le

................................ ................................ ............................. 5

6. Estimating the Burden and Cost of the Collection

6(a) Estimating Respondent Burden and Cost

................................ .............................. 6

6(b) Estimating Agency Burden and Cost

................................ ................................ ..... 7

6(c) Estimating the Respondent Universe and Total Burden and Costs

............................. 8

6(d) Reason for Burden Hour Change

................................ ................................ ........... 8

7. Burden Statement

................................ ................................ ................................ ....... 91 U.S. ENVIRONMENTAL PROTECTION AGENCY

Regulatory Innovation Pilot Projects (ICR) No. 1755.0 9

1. Identification of the information collection

1(a) Title and Number of the Information Collection

Title: Regulatory Innovation Pilot Projects, ICR No. 1755.0 9 , OMB Control No. 2010

- 0026

.

1(b) Short Characterization

This is a request for renewal of currently approved ICR No. 1755.0 8 , which authorizes the

solicitation of proposals for innovative pilot proje cts. A 60

- day comment period for this ICR

renewal in the Federal Register concluded on [ ] , during which [ ] comments were

received.

In 1995, the U.S. Environmental Protection Agency (EPA) began to solicit innovative pilot

projects in re sponse to a challenge to transform the environmental regulatory system to better

meet the needs of a rapidly changing society while maintaining the nation s commitment to

protect human health and safeguard the natural environment

. Since then, t hrough a num ber of

mechanisms including: site

- specific agreements with project sponsors at the facility or community

level; broader agreements under the Joint EPA

– State Agreement to Pursue Regulatory

Innovation ( http://www.ecos.org/files/1426_file_Agreement.pdf ); and at the State whole

regulatory program

- level through the Agency’s State Innovation Grant Program , EPA has been

working effectively with partners to test innovative approaches to environmen tal regulation that

focus on better environmental outcomes and better efficiency. Under prior Information Collection

Requests (ICRs), EPA has been gathering data on performance under the earlier, facility

- specific

innovation projects identified under Proje ct X L ( http://www.epa.gov/projctxl/ ). P roject experience

gained in these earlier projects is helping the Agency redesign current approaches in pursuit of

improved public health and environmental protection and more efficient use of limited resources.

Thro ugh these projects, sponsors private facilities, multiple facilities, industry sectors, Federal

facilities, communities, universities, Tribes and States are implementing innovative strategies

that produce superior environmental performance, provide fle xibility, cost savings, paperwork

reduction or other benefits to sponsors, and promote greater accountability to the public.

The intent of conducting and supporting innovative pilot projects is to allow EPA to experiment

with untried, potentially promis ing regulatory approaches, both to assess whether they provide

superior environmental performance or other benefits, and whether they should be considered for

wider application. Using this piloting approach, EPA can rely on carefully controlled, but small er

scale tests to evaluate methodically the broader applicability of any s pecific regulatory innovation.

This piloting approach provides EPA with a structured, applied policy laboratory where tests of

innovation at a manageable scale can be controlled and evaluated carefully much the same as2

engineering innovations require component

- by component tests and evaluation to bring an

innovation to implementation. The piloting, or applied policy laboratory approach allows EPA to

propose and adopt changes based up on an actual assessment of success at a small scale. Thus, the

careful piloting of a regulatory innovation allows EPA to identify possible new policy approaches

within the general statutory directive, and suggest alternative regulatory approaches aimed at

better results and better efficiency, so long as the alternative proposed is permissible under statute.

The adoption of such alternative approaches or interpretations in the context of a pilot project

does not, however, signal EPA's willingness to adopt that interpretation as a general matter, or

even in the context of other pilot projects. It would be inconsistent with the forward

- looking

nature of these pilot projects to adopt such innovative approaches prematurely on a widespread

basis without first de termining whether or not they are viable in practice and successful for the

particular projects that embody them. These pilot projects are not intended to be a means for

piecemeal revision of entire programs. Depending on the results of these projects, EPA may or

may not be willing to consider adopting the alternative approach or interpretation again, either

generally or for other specific facilities. EPA believes that testing alternative policy approaches

and/or interpretations, on a limited basis (e.g., in a site

- specific circumstance or within a specific,

state

- managed permitting program) and under the tight control of a carefully selected pilot project

is consistent with the expectations of Congress about EPA's role in implementing the

environmental sta tutes (so long as EPA acts within the discretion allowed by the statute).

Congress' recognition that there is a need for experimentation and research, as well as ongoing

reevaluation of environmental programs, is reflected in a variety of statutory provisi ons.

EPA’s Office of Policy (OP) has tested and evaluated innovative approaches in collaboration

with state environmental agencies and directly with regulated entities through pilot projects

supported through formal mechanisms such as the State Innovatio n Grant Program which ran

from 2002 through 2009 and under Project XL which ran from 1995 through 2003

, . The Office of

Policy historically has manag ed a careful program to pilot test, evaluate and implement select

innovations in support of the Agencies reg ulatory programs . Since 1995, EPA has implemented

pilot projects to test innovative ideas working with EPA headquarters, EPA regions, Federal,

State, and local government agencies, as well as individual facilities and whole business sectors.

The renewal o f this ICR is important as it will allow the Agency to continue to monitor and

present the outcomes of the projects still remaining from those earlier programs ev e n though they

are no longer creating new pilot projects. It will also allow the Agency to co ntinue its

commitment to testing and evaluating innovati ve approaches for better environmental results as a

partner with States, Tribes and communities . The r enewal of this ICR will allow EPA to continue

to collaborate with the states as co

- regulators to t est innovative approaches for addressing

emerging environmental issues such as climate change adaptation . In addition, the renewal of this

ICR is necessary to allow EPA to continue information collection supporting its c ommitments to

current projects unde r previous approved ICR amendments (1755.03

- 1755.0 8 ).

2. Need for and Use of the Collection

2(a) Need/Authority for the Collection3

The information is needed to allow the Agency to continue its ongoing work with states, regulated

entities, and other st akeholders that are already engaged in innovative regulatory piloting projects.

The information is of value to the Agency in meeting its commitment to document and transfer

practical innovation and regulatory flexibility for attainment of compliance and su perior

environmental results in partnership with regulated facilities , communities, states and tribes

. The

information will support the reporting of improved environmental results and the analysis of pilot

projects to determine their efficacy and potentia l for broader use. S tates implementing innovative

regulatory pilot tests in projects funded by a State Innovation Grant are required to report on

progress during the operation of a project and to provide a final project report summarizing

outcomes and maj or findings of each project. EPA’s policy on performance measurement in

assistance agreements is an implementation outcome under the Government Performance and

Results Act (GPRA § 1115 (a)(4) and §1116(c) ). The renewal of this ICR will allow OEPI to

con tinue to receive and work with project sponsors on proposals for innovation as well as

document results from those projects.

Responses related to inquiries by EPA about Project XL pilot projects are voluntary, as are any

responses by state environmental a gencies to EPA’s request for input for the design of the annual

competition. Under this ICR, EPA would be allowed to solicit its co

- regulators and the regulated

entities for their best i deas on pilot projects to test and evaluate innovative practices , an d for

information that will document the processes and environmental outcomes of pilot testing. .

2(b) Practical Utility/Uses of the Data

Information collected under this ICR renewal will have two purposes. First, EPA seeks to

document the results o f regulatory innovation pilot projects: to provide accountability reflected in

environmental results; to understand the circumstances under which these innovative approaches

work best; and to fully document the projects and their outco mes in a way that all ows other states

or tribes to work with regulated entities to adopt successful approaches. Second, EPA will be

allowed to consult with state and local environmental regulatory agencies on development and

testing of novel approaches to addressing emerging environmental issues

3. Nonduplication, Consultations, and Other Collection Criteria

3(a) Nonduplication

The information to be obtained under this ICR has not been collected by EPA or any other Federal

agency.

3(b) Public Notice Required Prior to ICR Submission to OMB4

In compliance with the Paperwork Reduction Act (44 U.S.C. 3501 et seq .), EPA is currently

soliciting comments on specific aspects of this ICR. A Federal Register (F.R.) notice for this ICR

package was first published in the Federal Register on [ ] 20 10 , (Volume [ ] , Number [ ]

,

page [

- ]

. [ ] public comments were received.

3(c) Consultations

This notice was developed by the Office of Policy in consultation with EPA Regional personnel.

3 (d) General Guid elines

This ICR complies with OMB ’ s general guidelines for the collection of information.

3(e) Confidentiality

The nature of the data being requested as part of this information collection is not confidential.

3(f) Sensitive Questions

The informatio n gathering activities discussed in this ICR do not involve any sensitive questions

.

4. The Respondents and the Information Requested

4(a) Respondents/NAICS Codes

EPA historically has work ed with states, t ribes, local governments , businesses and othe r regulated

entities on regulatory innovation piloting . Potential respondents include the states and tribes as

well as entities regulated by EPA and its co

- regulators in state and tribal agencies pursuant to its

authority under the various environmental s tatutes who are participat ing in innovative pilot

projects.

4(b) Information Requested

No new proposals are being accepted through Project XL or the State Innovation Grant program

Therefore the information collection activities fall generally into two c ategories within this ICR:

(1) progress reporting and final reporting for all projects in implementation under Project XL and

the existing State Innovation Grant Program ; (2) occasional consultation with state, tribal and

local environmental agencies rel ated to pilot testing and evaluation of innovative approaches to

address emerging environmental issues

.

For projects in implementation under Project XL , EPA anticipates collection of information to

allow the Agency to document and evaluate the outcomes of the remaining fourteen (14) pilot5

project s , including measurements of environmental outcomes including collection of final project

report s , as identified in the Final Project Agreement or a project workplan that will provide the

information required to assess the success and outcomes of each project. For the remaining twenty

(20) projects sponsored under the now

- closed State Innovation Grant Program, EPA anticipates

collection of quarterly progress reports and a final project report for each project to s ummarize

results and provide evaluative information to describe the success and broader applicability of the

piloted innovative approach.

EPA also anticipates needing the opportunity for occasional consultation with state and tribal

environmental regula tory agencies to identify potential partnership areas for piloting and

evaluating innovative solutions to emerging environmental issues such as climate change

adaption.

5. The Information Collected. Agency Activities, Collection Methodology, and Informa tion

Management

.

5(a) Agency Activities

Agency activities associated with the collection of information for innovative pilot projects

include:

Gather information from project sponsors on progress and results from existing innovation

pilot tests in itiated under Project XL and the State Innovation Grant Program.

Occasional consultation with state and tribal environmental agencies through Federal

Register Notices and responses, email, or written correspondence as well as through

symposia and other me etings to gather ideas for pilot testing of innovative ideas focused

on addressing emerging environmental issues.

5(b) Collection Methodology and Information Management

For projects implemented through Project XL and the State Innovation Grant program : progress

reports, correspondence, and final reports are submitted by each project sponsor by email or mail

and following review these reports are kept in project files by EPA project personnel. For the

occasional consultation with states and tribes on pil ot testing innovative approaches to address

emerging environmental issues, EPA anticipates using Federal Register Notices and responses,

email, or written correspondence as well as through symposia and other meetings

5 (c) Small Entity Flexibility

.

F acilities participating in innovation projects under all projects under Project XL and State

Innovation Grant projects : participate on a voluntary basis and entities can choose not to6

participate at any time if undue burden exists.

5(d) Collection Schedu le

.

No new proposals are being accepted through Project XL or the State Innovation Grant Program

. For regulatory innovation projects in implementation, progress reporting generally occurs

quarterly and as a final project report for grant

- supported proje cts and annually and a final project

report for XL projects

.

6. Estimating the Burden and the Cost of the Collection

6(a) Estimating Respondent Burden and Cost

This section presents EPA s estimates of the burden and costs necessary to complete th e

information collection activities associated with this collection. Burden hours and costs were

based upon estimates provided by EPA staff with extensive experience working with innovative

pilot project sponsors and States to assess innovative pilot proje ct ideas and proposals.

EPA estimates average hourly respondent labor cost (including fringe and overhead) for the

Project XL pilots (principally private sector) of $8 2.23 for legal staff, $ 68.90 for managerial staff,

$ 42.09 for technical staff, and $ 1 9.98 for clerical staff. To derive these estimates, EPA referred to

the National Employment Cost Indexes developed by the U.S. Bureau of Labor Statistics

( http://www.bls.gov/oes/current/oes_nat.htm )

.

In using this analysis it should be remembered not only that all responses to this solicitation are

voluntary, but that sponsors have some expected value attached with their participation. Not

unlike a contracts

- based Request For Proposals, one would not expect a response from any entity

where the burdens ass ociated with preparing the response outweigh the expected benefits to the

sponsor.

EPA anticipates requesting final project reports from 12 XL Projects during the lifetime of this

ICR as a means of closing out and documenting the results of these projects and evaluating the

further applicability of the ideas tested in these demonstrations.

No capital expenditures are needed by the respondent to complete the interview since the

responses can be made using existing equipment (e.g., telephone). Moreover, no operating and

maintenance costs are needed since the activities (reviewing instructions, writing, discussions, and

submissions of proposals) can be conducted in with existing equipment (e.g., phone, computer).

For progress and final reporting on XL Pro jects, EPA projects that each project will require up to

20 hours to compile, compose and edit material to fulfill the commitment made by project7

sponsors in the Final Project Agreement to report fully on the outcomes of these voluntary

projects. Thus, ap proximately 240 hours will be required over the lifetime of this ICR ( 80 hours

annually) for these reports. The cost of this is estimated to be $ 4,084 annually.

For activities related to the preparation and submission of progress and final reports rel ated to

State Innovation grant projects, EPA anticipates tha t for the 20 remaining State Innovation Grant

projects, the affected states may expend up to 77 hours each to develop and submit quarterly and

final reports to the Agency for a total annual burden of 640 hours costing approximately

$ 117,016. The total burden over the lifetime of this ICR is expected to be approximately 1920

hours with an estimated cost of $ 351,018

Staff in the Office of Environmental Policy Innovation that work on the developme nt of

innovative pilot projects have reviewed the cost findings of the report and found them to be

reasonable and sound estimates of current and future costs.

Table 1. Average Annual Burden and Cost to Respondents

Table 1. Average Annual Burden and Cost to Respondents

Collection Activity Burden Hours and Individual Costs per

Recipient Total Costs

Hours per Respondent per

Activity Costs per

Respondent

per Activity Total Hours

for all

Respondents Total Costs

for all

Respondents

Legal Mgmt Tech Cler

STATE INNOVATION GRANT

SPONSORS: PROGRESS AND OUTCOME

REPORTING PHASE

Collection of Annual Compliance and Other Performance Information By Participating Facilities to Report to State Agenc ies (Assumes

800 Facilities Annually) 1 1 2 $ 235.31 3,200 $ 188,248

Quarterly Project Reporting on State Innovation Grant Projects ( 80 annually) 1 2 8 2 $596.71 1040 $ 143,210

Final Project Reports on State Innovation Grant Projects ( 5 annually) 4 16 32 8 $2, 978.00 400 $ 19,560

TOTAL 6 19 42 10 $ 3,810.01 4640 $ 351,018

PROJECT XL FI NAL REPORTING8

Collection Activity Burden Hours and Individual Costs per

Recipient Total Costs

Hours per Respondent per

Activity Costs per

Respondent

per Activity Total Hours

for all

Respondents Total Costs

for all

Respondents

Legal Mgmt Tech Cler

Compile project information and develop final

project report and closeout (assume 6 annually) 2 6 8 2 $936.54

216 $ 11,238.48

Consult with EPA to resolve any questions on

final report and respond to brief evaluation

survey for clo seout activities (assume 6 annually) 2 $ 84.18 24 $ 1,010.16

TOTAL 2 6 10 2 $ 1020.72 240 $12,248.64

CONSULTATION WITH STATES ON

INNOVATION PILOTING

Solicitation of Input from State Environmental Agencies (Assume 20 Respondents ) 1 1 1 193.22 60 $3,864.40

TOTAL 1 1 1 193.22 60 $3,864.40

EXTERNAL BURDEN TOTAL 9 26 53 12 4820 $367,131.04

6(b) Estimating Agency Burden and Cost

Agency burden hours and costs were based upon estimates provided by EPA staff with extensive

experience working with innovative pilot project sponsors and States to assess innovative pilot

project ideas and proposals. The rate EPA u sed to estimate agency hourly wage was based upon

20 10 GS

- 13/01 salary (Baltimore

- DC) of $ 89,033 (or $ 42.66 ) with overhead of 110% factored in,

resulting in $ 89.57 /hour.

To perform the necessary activities associated with this information collection, EPA estimates that

it will require the Agency 208 hours and cost the Agency $ 18,720 per year.

Staff in the Office of Environmental Policy Innovation that work on the development of innovative

pilot projects have reviewed the cost findings of the report and found them to be reasonable and

sound estimates.9 Table 2. Annual Average Burden and Cost to Agency

Collection Activity Costs

Labor Total Hours Total

Costs

Hours Costs

EPA

Evaluation of State Innovatio n Grant Project Progress Reports (assume 80 quarterly a reports 1 $ 90 80 $ 7,200

Evaluation of State innovation Grant Final Reports (assume 5 annually) 8 $ 720 40 $ 3,600

Evaluate Project XL Final Reports (assume 6 annually) 8 $ 720 48 $ 4,320

Solicit state input on innovation piloting and develop recommendations report 40 $3,600 40 $3,600

INTERNAL BURDEN TOTAL 57 $ 5,130 208 $ 18,720

6(c) Estimating the Respondent Universe and Total Burden and Costs

6(d) Reasons for Burden Hour Change

OMB currently has approved 80,047 burden hours for this ICR including time spent by EPA to

solicit ideas and fo rmal proposals to develop innovative pilot projects under the now retired State

Innovation Grant Program . This total also includes annual burden hours approved as part of four

amendments to ICR (1755.02). EPA requires 2582 hours annually ( 7748 hours over the

lifetime of the ICR to perform information collection activities described in the ICR

amendments (1755.03, 1755.04, 1755.05 , 1755.06, and 1755.07 ). With the renewal of this ICR,

total annual hours needed to conduct information collection activities d escribed in this ICR, as well

as in the three ICR amendments listed above, will be increased by 318 hours. This difference is

largely a result of our ability to refine the estimates based upon the increased number of projects

coming to completion and requ iring final reporting as well as almost 15 years of experience

promoting regulatory innovation and a better understanding of the burden requirements necessary

to develop and submit proposals for innovative pilot projects, and an improved understanding of

i nnovative pilot projects and how to develop them.

7. Burden Statement

Burden means the total time, effort, or financial resources expended by persons to generate,

maintain, retain, or disclose or provide information to or for a Federal agency. This incl udes10

the time needed to review instructions; develop, acquire, install, and utilize technology and systems

for the purposes of collecting, validating, and verifying information, processing and maintaining

information, and disclosing and providing informati on; adjust the existing ways to comply with

any previously applicable instructions and requirements; train personnel to be able to respond to a

collection of information; search data sources; complete and review the collection of information;

and transmit or otherwise disclose the information. An agency may not conduct or sponsor, and a

person is not required to respond to, a collection of information unless it displays a currently valid

OMB control number. The OMB control numbers for EPA's regulations ar e listed in 40 CFR Part

9 and 48 CFR Chapter 15.

Send comments on the Agency's need for this information, the accuracy of the provided burden

estimates, and any suggested methods for minimizing respondent burden, including through the use

of automated c ollection techniques to the Director, Collection Strategies Division, U.S.

Environmental Protection Agency (2822T), 1200 Pennsylvania Avenue, NW, Washington, D.C.

20460; and to the Office of Management and Budget, 725 17th Street, NW, Washington, DC

20503. Attention: Desk Officer for EPA. Include the EPA ICR number (1755.0 8 ) and OMB

control number ( 2010

- 0026 ) in any correspondence.