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[Federal Register Volume 63, Number 120 (Tuesday, June 23, 1998)]
[Notices]
[Pages 34161-34170]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-16398]

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ENVIRONMENTAL PROTECTION AGENCY

[FRL-6113-5]

Solicitation of Additional Pilot Projects Under Project XL; June 
12, 1998

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice; solicitation of additional pilot projects under project 
XL to ``Reinvent'' Environmental Regulations and Policies.

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SUMMARY: Project XL, which stands for ``eXcellence and Leadership,'' is 
a national pilot program that provides a unique opportunity to test 
innovative ways of achieving better and more cost-effective public 
health and environmental protection. Under Project XL, EPA offers 
flexibility in its regulations, policies, procedures, processes and 
guidance, as well as other benefits to encourage companies, communities 
and other project sponsors to develop and test ``cleaner, cheaper and 
smarter'' alternatives to the current system. As of May 1998, seven 
pilot projects are being implemented and 20 more are in development. 
Several project sponsors have already achieved a number of significant 
benefits by participating in XL, including substantial cost savings, 
increased operational flexibility, better stakeholder relationships, 
increased environmental protection, and the ability to adapt processes 
and products more quickly to changes in consumer demand.
    One company, for example, in just the first year of its pilot 
project, was able to consolidate a number of routine reports into two 
per year and use alternative means to meet air pollution control 
technology requirements. In addition, the company was able to achieve 
substantial environmental improvements while saving nearly $176,000 in 
operating costs. The company is also expecting to avoid $10 million in 
future capital spending.
    Another company--also just in its project's first year--has avoided 
millions of dollars worth of production delays by eliminating 30-50 
permit reviews while substantially increasing recycling, reducing solid 
and hazardous

[[Page 34162]]

waste, and applying stricter air pollution controls. For other 
examples, please refer to Project XL's Web site at: www.epa.gov/ProjectXL
    In developing innovative proposals, project sponsors, regulators, 
and stakeholders alike must be willing to make resource and time 
commitments commensurate with designing and implementing new approaches 
in a multi-stakeholder environment. For some projects, resource 
commitments have been significant. However, as current project sponsors 
are eager to attest, the reward lies in the outcome: superior 
environmental results for the facility and the community, and 
substantial operational and financial benefits for the project sponsor. 
The Agency, its co-regulators, and other XL partners have been and are 
continuing to work hard on streamlining the proposal development 
process and reducing ``transaction costs.'' EPA has learned a great 
deal from the first set of proposals that has gone through the process, 
and as one of the lessons learned, urges potential project sponsors to 
discuss their idea with Agency and State staff as early as possible. 
Substantive and process issues can then be raised and addressed early 
before substantial time and resource investments have been made.
    This Federal Register document is organized into four sections 
which have the following purpose: Section A--to clarify the role of 
regulatory and policy flexibility in XL pilot projects; Section B--to 
solicit additional ideas for experimental projects under XL (please 
note that no funding is associated with this solicitation); Section C--
to stimulate ideas through a list of optional Project XL themes (note 
that the suggested themes are entirely optional, and have the sole 
purpose of conveying a sample of general areas of innovation EPA and 
others in the regulated and environmental community are interested in 
exploring under Project XL); and Section D--to describe key elements of 
good XL proposals that increase EPA receptivity and make the review 
process easier and faster.

EFFECTIVE DATE: June 23, 1998; an open solicitation with no set end 
date; project sponsors may submit more than one proposal.

FOR FURTHER INFORMATION CONTACT:
    (1) For XL projects for private and federal facilities, states, and 
industrial sectors: Contact Christopher Knopes, Office of Reinvention 
Programs, United States Environmental Protection Agency, Room 1029, 401 
M Street SW, Mail Code 1802, Washington, DC 20460. The telephone number 
for the Office is (202) 260-5754; the facsimile number is (202) 401-
6637.
    (2) For XL projects for communities: Contact Kristina Heinemann, 
Office of Sustainable Ecosystems and Communities, USEPA, 401 M Street 
SW, Mail Code 2182, Washington, DC, 20460. The telephone number is 
(202) 260-5355; the facsimile number is (202) 260-7875.
    (3) Additional information on Project XL, including documents 
referenced in this document, other EPA policy documents related to 
Project XL, EPA regional contacts, application information, and 
descriptions of existing XL projects and proposals, is available via 
the Internet: For private and federal facilities, states, and sectors 
at ``http://www.epa.gov/ProjectXL''; and for communities at http://www.epa.gov/ProjectXLC. Faxed information is also available via an 
automated fax-on-demand menu at (202) 260-8590 both for XL facilities 
and communities.

SUPPLEMENTARY INFORMATION: President Clinton announced on March 16, 
1995, a portfolio of reinvention initiatives to be implemented by the 
Environmental Protection Agency as a part of its efforts to achieve 
greater public health and environmental protection at a more reasonable 
cost. Project XL is one of these reinvention priorities. Through a 
series of site-specific agreements with project sponsors, EPA expects 
to gather data and experiences that will help the Agency make 
improvements in the current system of environmental protection. Project 
XL conducts experiments in four areas: facilities, sectors, federal 
facilities, and communities. State projects are also welcome.
    XL projects directly benefit the local environment, participating 
facilities--both public and private--and their communities. But the 
benefits of Project XL extend beyond its participants, because EPA, 
working with state environmental agencies, intends to incorporate 
successful approaches into the current system of environmental 
protection.
    Much information on Project XL has been provided in previous 
Federal Register documents. In Project XL's first Federal Register 
document on May 23, 1995 (60 FR 27282), EPA described Project XL as a 
program that offers a balanced set of benefits to the environment, the 
regulated community and the public, and issued a general solicitation 
for proposals. In that document, Project XL also defined the following 
eight criteria by which proposals are selected for participation. The 
criteria help evaluate whether the project can:
     Produce superior environmental results;
     Produce benefits such as cost savings, paperwork 
reduction, and operational flexibility;
     Garner stakeholder involvement and support;
     Achieve innovation and multi-media pollution prevention;
     Be transferable to other facilities, sectors, communities, 
etc.;
     Be feasible (technically and administratively);
     Identify monitoring, reporting, accountability, and 
evaluation methods; and
     Avoid shifting the risk burden.
    A successful project sponsor must also have a solid record of 
compliance. For more detailed descriptions and definitions of these 
criteria, please refer to the Federal Register documents of May 23, 
1995 (60 FR 27282) and April 23, 1997 (62 FR19872).
    Because community-based XL projects differ from projects sponsored 
by other public or private-sector facilities and sectors, EPA addressed 
the distinction in a separate Federal Register document on November 1, 
1995 (60 FR 55569). In addition to the criteria listed above, the 
November 1, 1995, Federal Register document included several unique 
criteria for XL community-sponsored projects. XL for Communities 
encourages projects that:
     Build capacity for community participation;
     Create economic opportunity; and
     Promote community planning.
    In another Federal Register document on September 11, 1996 (61 FR 
47929), EPA supplemented the general solicitation with an invitation 
for projects specifically aimed at creating innovative environmental 
technologies. EPA retains a strong interest in proposals in this area.
    An April 23, 1997, Federal Register document (62 FR 19872) more 
clearly defined the criteria of superior environmental performance, 
regulatory flexibility, and stakeholder involvement. In addition, the 
document identified several more potential project themes that are 
important to pursue in the context of testing innovations for 21st 
century environmental protection. It also included revisions to the 
process by which an idea becomes an XL project. Emphasis is placed on 
pre-proposal planning and communication with stakeholders, on EPA's 
improved internal management of project reviews, and on the need for a 
close partnership with the states.
    Since Project XL is continuously evolving, EPA is always open to 
and

[[Page 34163]]

welcomes comments on the various aspects of the program.

(A) The Role of Flexibility in XL Pilot Projects

    Flexibility is an important and essential component of Project XL. 
As an incentive to undertake an XL project, EPA is offering project 
sponsors flexibility in regulations, policies, guidance, procedures and 
processes, provided the flexibility does not violate statutory 
requirements. Please note that regulatory flexibility is only one kind 
of flexibility offered as a benefit. It can be granted through site-
specific rules that replace otherwise applicable requirements; existing 
waiver mechanisms; alternative permits; and generally applicable 
interpretive statements. Other tools may be identified on a case by 
case basis as projects are developed. (For more details, please refer 
to the Federal Register document of April 23, 1997 (62 FR 19872). Cost 
savings and burden reduction are other examples of incentives and 
benefits to a project sponsor. Communities may be particularly 
interested in visibility and recognition for innovative ideas and 
superior environmental performance that can result from participation 
in Project XL. To date, XL has implemented projects that take advantage 
of each type of flexibility and benefit offered.
    In summary, XL is about testing new approaches which:

--May require regulatory flexibility or involve changes to policy, 
guidance, procedures, or processes; and
--Test a different way of doing something, even if EPA already has 
the authority to do so under the current system, but is not doing 
it.

    Whenever a project also meets the other applicable XL facility or 
community decision criteria, EPA will aggressively offer the necessary 
flexibility to produce superior environmental performance and promote 
greater accountability to stakeholders.

(B) Solicitation of Additional Ideas for Pilot Projects

    EPA encourages private and public sector facilities, sectors, 
states, local governments, and communities to use this opportunity to 
sponsor projects that can truly reinvent the way they conduct 
environmental management. EPA is also interested in having stakeholders 
not directly connected with regulated facilities come forward with XL 
proposal ideas or co-sponsor projects with companies, local 
governments, or other community organizations. Project XL offers 
environmental leaders and average performers alike a tremendous 
opportunity to think ``outside the box'' of our current system and to 
find solutions to obstacles that limit environmental performance.
    To stimulate new XL project ideas, EPA is publishing the optional 
project themes listed in the next section. Because the total number of 
projects is limited to 50, it is vital that each project test new ideas 
with potential for wide application and broad environmental benefits.
    EPA is promoting XL projects, both for facilities and communities, 
which test the following:
     Broader concepts, e.g. projects defined on a geographic 
basis; projects involving a larger number of facilities; projects which 
demonstrate Community-Based Environmental Protection (CBEP); projects 
with a broader, more comprehensive scope. This does not exclude 
smaller, more incremental, yet significant ideas;
     New strategies, e.g., market-based incentives, paperwork 
reduction, and environmental information and management systems;
     New tools and technologies, e.g. performance measurement 
tools and innovative environmental technologies; and
     Approaches for dealing with new environmental challenges, 
such as control of non-point sources, urban sprawl, and ecosystem 
protection.

(C) List of Optional New Themes for XL Projects

    The potential themes listed below are entirely optional and have 
the sole purpose of conveying which general areas of innovation EPA and 
others in the regulated and environmental community are interested in 
exploring under Project XL. In category I below, EPA is suggesting a 
number of fairly detailed, program-specific themes. In category II, 
several ideas are listed that have been suggested by outside 
organizations as worth testing under Project XL and are not explored at 
the same level of detail. This should in no way discourage 
consideration of these less developed themes.
    In considering XL projects for selection, EPA makes a determination 
of whether a proposal presents a new approach that EPA wants to test. 
Proposals which address any of the themes in category I below have the 
advantage that the Agency has already made that determination. While 
these proposals must still meet the XL criteria for facilities or for 
communities and go through a review and negotiation process like other 
proposals, EPA is committed to streamlining the processing of proposals 
submitted under any of the themes in category I.
    It is important to emphasize again, that this list of themes in no 
way precludes any other innovative ideas to be tested under Project XL 
facilities and XL communities, as long as they meet the XL criteria, 
have a solid compliance record, and can produce ``cleaner, cheaper, and 
smarter solutions.''
    The themes are organized into two broad categories, as summarized 
below:

Category I: Themes Developed by EPA

Testing New Strategies
(in alphabetic order:)
1. Air: Existing Preconstruction Requirements for Major Sources of Air 
Pollution in Attainment Areas
2. Air: U.S.-Mexico Border Emissions Trading
3. Environmental Management Systems (EMS)
4. Hazardous Waste: Reduction of Persistent, Bioaccumulative, and Toxic 
(PBT) Chemicals in Hazardous Waste
5. Permitting
6. Superfund Cleanup: Innovative Contracting Approaches
7. Superfund Cleanup: Partnering with Industry to Enhance Completion of 
Cleanup at Hazardous Waste Sites
8. Superfund Cleanup: Sustainable Reuse--``Recycling'' of Superfund 
Sites
9. Sustainability of Natural Ecosystems
10. Water: Environmental Performance Measures for Waste Water 
Pretreatment Programs
Developing New Tools and Technologies
(in alphabetic order)
11. Air: Continuous Monitoring Units for Radionuclides
12. Air: Leak Detection Technology
13. Air: Maximum Achievable Control Technology (MACT) for the Coke Oven 
Push and Quench Process
14. Multi-media Pollution Prevention: Using the Pollution Prevention 
(P2) Assessment Framework to Assess Manufacturing Processes

Category II: Themes Suggested by External Organizations

    The first group of themes below include brief descriptions, while 
the ideas in the second group were suggested merely as topics to be 
explored: (in alphabetic order):

 Administrative Paperwork Reduction
 Community-Based Water Protection
 Concentrated Animal Feeding Operations

[[Page 34164]]

 Hazardous Waste: Land Disposal Restrictions Regulations
 Market-Based Approaches
 Multi-facility and Multi-media Projects
 Multi-media Pollution Prevention: Using ``Green Chemistry'' To 
Make Manufacturing Processes ``Greener''

    Other ideas suggested by external organizations that the Agency 
considers worthy of further exploration:

 Alternatives for reducing persistent toxins in the Great Lakes
 Conservation and sustainable use of biodiversity and ecosystem 
services
 Energy conservation
 Environmental consequences of urban sprawl
 Global warming/climate change
 Green spaces
 Habitat preservation
 Improved management of timberland
 Watershed management
    The full write-ups of the themes follow:

Category I: Themes Developed by EPA

Testing New Strategies
    The themes below would test strategies that could help EPA move 
toward a new system of environmental protection or make improvements in 
the current system.
1. Air: Existing Preconstruction Requirements for Major Sources of Air 
Pollution in Attainment Areas
    Background: Currently, before beginning construction of a major new 
air pollution source or a major modification at an existing source in 
an attainment area, the source must undergo preconstruction review 
pursuant to the applicable Prevention of Significant Deterioration 
(PSD) program (see, e.g., 40 CFR 52.21). This review, which involves 
permitting, technology requirements, and air quality monitoring and 
analysis, is time and resource intensive. The monitoring responsibility 
imposes a significant time restriction on when a source can begin 
construction and, in turn, start operations. The impact of this delay 
can be of particular concern in northern areas where the construction 
season is limited.
    Idea or approach to be tested: This idea is aimed at reducing the 
preconstruction waiting period in exchange for corresponding benefits 
to the environment. The premise is simple: to ascertain if the EPA and 
permitting agencies can predict whether certain types of construction 
will adversely impact air quality. This would allow for confirmatory 
monitoring rather than monitoring in advance of construction. At this 
time, EPA is only soliciting comment on the concept and determining the 
level of interest in such a study. If EPA determines that there is 
sufficient interest to proceed, it will issue a more detailed 
description of the study and solicit requests from sources wishing to 
participate. At that time, the Agency will discuss in more detail the 
possible mechanisms for implementing the study, including whether a 
rulemaking will be required. This XL concept is also discussed in more 
detail in a memorandum available on the Internet. For further 
information, please review the memorandum available on the XL homepage 
at ``http://www.epa.gov/ProjectXL or at www.epa.gov/TTN/OARPG
    Regulatory or other flexibility needed: By providing superior 
benefits to the environment and agreeing to offset any adverse impacts 
on air quality, a participant in the study could obtain a PSD permit 
and begin construction prior to completing all air quality analysis, 
which can take up to twelve months or more. This could occur as long as 
the source: (1) satisfied all other applicable PSD permitting 
requirements, including installation and operation of the best 
available control technology (BACT), as agreed to by EPA and the 
permitting authority; (2) agreed to purchase impact offsets if the 
completed monitoring or modeling demonstrated a violation of the 
National Ambient Air Quality Standards or exceedance of any applicable 
increments; and (3) agreed to superior environmental performance that 
would at a minimum include the installation and operation of continuous 
emissions monitors. Although the source would still be required to 
obtain the necessary monitoring data, it would not need to complete the 
monitoring prior to the permit issuance and beginning of construction. 
Thus, in exchange for undertaking some superior environmental 
performance and agreeing to offset any prohibited impacts on air 
quality through the purchase of offsets, a source could begin 
construction and start operations up to a year earlier than currently 
allowed under existing regulations. At this time, the Agency 
anticipates applying at least the following restrictions to 
participation: (1) the project would not extend to sources in 
nonattainment areas, areas considered unclassifiable, or sources that 
may require Class I impact analysis; (2) EPA would not select sources 
that are in violation of the PSD program; (3) EPA believes that the 
study should include only participants for which the relevant state and 
EPA agree that the proposed construction is not likely to improperly 
exceed available air quality increments or violate the National Ambient 
Air Quality Standards.
    For more information on this particular theme, please refer to 
EPA's Project XL home page at http://www.epa.gov/ProjectXL.
2. Air: U.S.-Mexico Border Emissions Trading
    Background: The border between the U.S. and Mexico runs through the 
center of the sister cities El Paso and Ciudad Juarez. This common 
airshed does not meet U.S. standards for ozone, PM and CO. The air 
pollution problem will not be solved by the U.S. side alone-- 
significant reductions from Mexican sources will be required. Business, 
environmental and community groups from both sides of the border have 
been working together to develop solutions to the air pollution 
problem, including market incentives.
    Idea/approach that could be tested: U.S.-Mexico Border emissions 
trading.
    Technology that could be tested: Retrofit technologies (including 
conversions to natural gas) for older vehicles and brick making 
facilities.
    Possible superior environmental performance: A source facing a 
pollution control requirement in El Paso could probably achieve far 
more reductions at lower cost and with greater environmental benefit to 
El Paso by cleaning up sources in Mexico.
    Regulatory or other flexibility needed: The trading requirements 
that credits be surplus and enforceable would be the most difficult to 
comply with in a U.S.-Mexico emissions trading program. EPA's revised 
Economic Incentives Program will help with determination of surplus 
credits. Mexican environmental law contains provisions for enforcement. 
Work with our Mexican counterparts on enforcement is ongoing and would 
be further benefited by an XL project. (Legal analysis is available)
    Possible candidate applicants: Utility companies along the U.S.-
Mexico border.
3. Environmental Management Systems (EMS)
    Background: EPA recently published a position statement on EMSs in 
the Federal Register (63 FR 10294, March 12, 1998), in which it 
encouraged the use of EMSs in general, and especially those that 
address overall environmental performance and compliance. It also 
encouraged the inclusion of stakeholders in EMS development. That 
statement described a data-gathering effort that EPA is

[[Page 34165]]

undertaking, along with a number of states, to evaluate the effect of 
EMSs.
    Today's solicitation of XL proposals in the EMS area is distinct 
from the data-gathering effort described in the Federal Register 
mentioned above, although a facility participating in that effort could 
also participate in Project XL. As in all XL projects, EPA would expect 
a commitment not simply to adopt an EMS, but to attain environmental 
results better than those that would occur without the project. EPA 
would be most interested in proposals that involve an exceptionally 
high quality EMS that appears likely to provide substantial 
environmental improvements.
    Idea/approach to be tested: The purpose of this initiative would be 
to test the use of comprehensive EMSs, including those based on the ISO 
14001 International EMS Standard that can also meet the criteria for 
Project XL, such as superior environmental results and stakeholder 
involvement. Organizations or communities interested in these projects 
would be asked to collect information and report on implementation of 
the EMS in a number of key areas, like environmental performance for 
both regulated and unregulated activities, compliance, pollution 
prevention, EMS costs and benefits, and, where feasible, changes in 
environmental conditions. The value of third-party certification of 
EMSs and how certification relates to environmental performance may be 
another area to test.
    Regulatory or other flexibility needed: An EMS must achieve 
compliance, but since XL projects are designed to test new approaches, 
EPA would consider streamlining or otherwise modifying existing 
regulatory requirements to achieve the superior environmental 
performance objectives established through an EMS. Any proposals for 
regulatory relief should be linked to exploring ways in which an EMS 
may create opportunities for transferable improvements in the 
regulatory system (e.g. by simplifying reporting or procedural 
requirements).
    Possible superior environmental performance: A project might, for 
example, provide superior environmental results by committing to a 
reduction in emissions that was expected to result from implementation 
of the EMS.
4. Hazardous Waste: Reduction of Persistent, Bioaccumulative, and Toxic 
(PBT) Chemicals in Hazardous Waste
    Background: The Agency is committed to working with the States and 
regulated community to reduce by the year 2005 50% of the most 
persistent, bioaccumulative, and toxic chemicals contained in 
industrial hazardous waste. Many of the approximately 25,000 companies 
regulated as large quantity generators under the RCRA hazardous waste 
laws have demonstrated that reduction of hazardous chemicals at the 
source of production, using pollution prevention and recycling 
technology, is in the long run more cost-effective than end-of-the-pipe 
waste treatment and disposal methods, and that pollution prevention 
rather than treatment and disposal provides more enhanced protection of 
human health and the environment and relief from liability than 
traditional end-of-pipe methods. EPA's Waste Minimization National Plan 
lays out a strategy for a voluntary program that carries these efforts 
to the 50% reduction goal by the year 2005.
    Idea/approach that could be tested: EPA invites companies to 
explore experiments in regulatory reinvention that promote pollution 
prevention technologies over waste treatment and disposal technologies. 
For example, a company may wish to pursue process redesign, equipment 
modifications, or materials substitutions that would reduce PBT levels 
in hazardous waste to an extent that would render wastes non-hazardous, 
reduce the level of treatment needed, and/or reduce the amount of 
treatment capacity needed--however, compliance requirements for other 
regulations (e.g. permit modification schedules, effective dates for 
Land Disposal Restrictions standards, trial burns for combustion units) 
may impede or preclude achieving this objective.
    Possible superior environmental performance: Earlier and more cost-
effective methods for achieving compliance and reducing risks posed by 
hazardous waste.
    Regulatory or other flexibility needed: We would be willing to 
consider changes to existing policies, procedures, and other 
requirements to make this possible.
    Possible candidate applicants: ``Good citizen'' companies, 
preferably those managing or influencing numerous sites, who have 
provided leadership in cooperating with other companies and 
facilitating issue resolution on their own.
5. Permitting
    Background: EPA believes that innovative technologies and 
alternative strategies are stepping stones to cleaner, cheaper, smarter 
environmental management. Elements of some permit programs may, 
however, impede use of innovative technologies or alternative pollution 
prevention strategies. Efforts to streamline permitting may be adding 
further complications by favoring ``routine'' permit actions that may 
be faster and easier to process over permit actions that involve 
innovative technologies or alternative strategies. The Agency is 
looking for approaches that create and maintain enough flexibility 
within the permitting process to support continued innovation. EPA has 
already tested some approaches to permit flexibility for innovative 
technologies, and some permit programs (e.g. the prevention of 
significant deterioration program for air pollutants, 40 CFR 52.21 (v)) 
already have approval processes for alternative technologies. The 
Agency is interested in testing additional techniques.
    Idea/approach to be tested: EPA is interested in developing a menu 
of potential permit conditions that could encourage innovation and 
accommodate the possibility that an innovative or alternative strategy 
may not perform as expected. Adequate safeguards would be built in to 
fully protect human health and the environment, and stakeholders would 
have a role in the decision making.
    Possible superior environmental performance: Development of more 
effective environmental technologies and strategies.
    Regulatory or other flexibility needed: EPA would be willing to 
consider options, such as compliance schedules providing enough time to 
get new technologies up and running, offset by interim emissions 
reductions or decreased emissions over the long term; a reasonable time 
frame for reinstalling traditional controls if a new technology fails 
to perform; provisions for reopening the permit; or alternative 
strategies for sharing legal and financial risks. In return for a 
superior environmental outcome, EPA would also be willing to consider 
providing flexibility in areas such as consolidating or streamlining 
certain administrative requirements, expediting the permitting process, 
pre-approving certain process changes in lieu of permit modifications, 
or experimenting with alternative monitoring strategies.
    Possible candidate applicants: Public and private sector permitted 
entities.
6. Superfund Cleanup: Innovative Contracting Approaches
    Background: The FY 1998 House Appropriations Committee Report 
expressed interest in using fixed-price, ``at-risk contracting'' for 
the cleanup of an ``orphan'' Superfund site. (``Orphan sites'' are 
sites where there are no viable

[[Page 34166]]

responsible parties able to do necessary cleanup. EPA uses money from 
the Superfund Trust Fund to clean up these sites.) The appropriations 
language indicated a belief that this type of contracting, once tested, 
holds potential for speeding up site cleanup and reducing related 
costs.
    Idea/approach that could be tested: A cleanup contractor would 
submit to EPA a complete cost package based on completion of the Record 
of Decision, which identifies the cleanup remedy selected for a 
specific site. The contractor would guarantee a fixed price for 
implementing the remedy selected by EPA and would absorb any cost 
overruns.
    To the extent permitted by law, EPA would select the cleanup 
contractor at a pilot site based on the best combination of reasonable 
cleanup costs and economic reuse of the site.
    Possible superior environmental performance: Linking site cleanup 
and site economic reuse assures that cleanup decisions provide maximum 
protection of workers during cleanup and construction of the intended 
reuse of the site, and for the public living in proximity to the site 
and frequenting the site after development. Cleanup decisions are made 
up-front, with input from the developer, the community, local 
government, State government, as well as the Federal government. 
Controlling costs at individual sites will allow EPA to eliminate risks 
at more sites more quickly.
    Regulatory or other flexibility needed: EPA would be willing to 
consider addressing potential Superfund liability concerns regarding 
waste existing at the site; participating in cleanup costs necessary 
for reuse which are not inconsistent with the cleanup specified in the 
Record of Decision, and modifying existing procurement procedures 
consistent with such a test of an alternate procurement process.
    Anticipated future change in EPA's approach to environmental 
protection: The Congress, in the FY 1998 House Appropriations Committee 
Report, appears to encourage EPA's investigation of more fixed-price 
contracts in an effort to better contain cleanup costs, and the use of 
``at-risk contracting'' where the government does not bear all the 
risks associated with hazardous site remediation. Both these efforts 
are intended to control the cost of Superfund cleanups and add an 
additional contracting mechanism.
    Possible candidate applicants: Cleanup contractors, real estate 
developers, or a joint venture of several companies would be likely 
candidates for this project. Eligible sites include those on the 
National Priority List which lack viable responsible parties to 
implement the necessary cleanup.
7. Superfund Cleanup: Partnering With Industry To Enhance Completion of 
Cleanup at Hazardous Waste Sites
    Background: With sufficient funding from Congress, the President 
has committed to enhance protection of human health and the environment 
by completing cleanup construction at a greatly accelerated rate. More 
than two-thirds of Superfund sites are being cleaned up by potentially 
responsible parties (PRPs). The program is faster, fairer, and more 
efficient due in part to the administrative reforms instituted by the 
Agency. EPA must continue to find better ways to identify and resolve 
scientific and technical problems, legal and policy issues, or other 
potential impediments that may delay the completion of construction at 
National Priority List sites in order to expedite cleanups that protect 
human health and the environment.
    Idea/approach that could be tested: Taking care not to interfere 
with ongoing enforcement, EPA would partner with companies and affected 
states to develop new mechanisms for early resolution of potential 
problems. EPA would also like to find ways to promote waste 
minimization strategies and innovative cleanup technologies, examine 
``batching of remedies'' for certain technologies to enable larger-
scale (and lower-priced) approaches to cleanup, and collaborate on 
research related to hazardous waste cleanup methodologies to facilitate 
cleanup.
    Possible superior environmental performance: Earlier elimination of 
threats to human health and the environment related to risks posed by 
hazardous waste sites; ``smarter cleanup solutions'' which make 
treatment cost-effective by optimizing remedy costs over multiple 
sites, increasing the volume of waste to be treated, or blending waste 
from multiple sites to make treatment operations more efficient; and 
greater use of innovative and more effective cleanup technologies.
    Regulatory or other flexibility needed: EPA would be willing to 
consider changes to existing policies, procedures, and other 
requirements to make this possible, being mindful of limitations posed 
by existing settlements or orders for the performance of work.
    Anticipated future change in EPA's approach to environmental 
protection: More collaborative and efficient partnership with PRPs in 
getting Superfund sites cleaned up in a timely manner. This may have 
broader application to other environmental cleanup programs.
    Possible candidate applicants: ``Good citizen'' companies, 
preferably those managing or influencing numerous sites who have 
provided leadership in cooperating with other companies and 
facilitating issue resolution that have resulted in expeditious site 
cleanup.
8. Superfund Cleanup: Sustainable Reuse-``Recycling'' of Superfund 
Sites
    Background: EPA has made substantial progress in speeding cleanup 
at Superfund sites, but until cleaned-up sites are put back into 
productive use, the nation will fail to reap the full benefits of the 
Superfund program. Brownfields programs have successfully leveraged 
resources from a wide range of stakeholders to clean up properties to 
facilitate their redevelopment, but these programs have been limited to 
sites that are not on the Superfund National Priority List.
    Idea/approach that could be tested: EPA would consider offering 
procedural flexibility and addressing potential Superfund liability to 
facilitate redevelopment of cleaned-up Superfund National Priority List 
sites. EPA would also be willing to offer technical expertise to 
support local efforts, advice in involving the community, use of 
helpful information resources, and coordination of access to other 
agencies and resources.
    Possible superior environmental performance: Converting cleaned-up, 
but otherwise underused properties into valuable community assets. In 
addition, incorporating redevelopment considerations into the cleanup 
process can (1) lead to faster cleanups with consequent faster 
environmental protection as parties take voluntary actions to achieve 
the desired redevelopment use; (2) ensure binding agreements are in 
place to monitor institutional controls that are necessary at sites 
with waste left on-site, and (3) in many cases, result in environmental 
enhancements that are associated with the reuse (e.g., cleanup of 
nearby creeks to support fishing and recreation).
    Regulatory or other flexibility needed: EPA would be willing to 
consider changes to its existing policies, procedures, and guidance in 
order to minimize or eliminate, where appropriate, barriers to the 
redevelopment of cleaned-up Superfund National Priority List sites 
posed by the potential applicability of the Federal Superfund statute 
and regulations. EPA may also consider expediting the release of parts 
of sites from the Superfund process if they would be returned to 
productive use through redevelopment.

[[Page 34167]]

Cleanups consistent with the National Contingency Plan would still be 
required.
    Anticipated future change in EPA's approach to environmental 
protection: Removal or minimization of barriers to returning cleaned-up 
Superfund sites to productive use. This may have broader application to 
other environmental cleanup programs.
    Possible candidate applicants: Companies with expertise in 
redeveloping properties, communities interested in regional 
redevelopment opportunities or in combining multiple sites for economic 
and environmental master plans, and Community Development Corporations.
9. Sustainability of Natural Ecosystems
    Sustainability is a concept that describes the balance between 
conservation of natural resources and economic development. The 
following is a possible project scenario for testing an approach that 
includes sustainability as a key feature.
    Background: In an effort to address threats to ecosystem viability 
arising from sedimentation and non-point source runoff caused by local 
farming in river watersheds, EPA is interested in testing the idea of 
stakeholders developing and implementing resource plans for watersheds.
    Idea/approach that could be tested: Restoration approaches through 
community planning and local involvement. A planning committee of local 
farmers, landowners, and environmentalists could be formed. That 
committee would develop a resource plan that identifies a vision for 
the restoration and protection of the area that includes the type of 
future conditions they want to obtain and target for restoration. They 
also could identify issues of concern including ecological diversity, 
erosion, open dumping, and ground and surface water quality, and seek 
to address these issues in a manner compatible with a healthy economy 
and high quality of life. Issues of concern could be identified through 
committee discussions, watershed assessment field trips, and public 
meetings. Representatives from conservation organizations and local 
universities could also support the committee. Ultimately, this effort 
could provide a model for partnerships between EPA and local 
communities to solve long-term ecosystem problems.
    Technology that could be tested: Community visioning and long-term 
planning for preservation of local natural resources and a sustainable 
economy that integrates economic, social, and environmental goals. 
Planning that involves a diverse cross-section of the community. 
Citizen monitoring of water quality and tracking of results.
    Possible superior environmental performance: Preservation of an 
ecosystem important to the local community both for quality of life and 
economic reasons.
    Regulatory or other flexibility needed: The community may desire 
flexibility in an area being addressed by the project or in another 
area where federal or state regulations, policies, guidance or Agency 
standard operating procedure present obstacles to achieving better 
environmental results.
    Possible candidate applicants: Communities--local governments, 
community organizations, regional planning associations, and any other 
interested public or private entity. Projects addressing this theme 
could also be implemented through regional or ecosystem-scale 
initiatives like some of the National Estuary Projects that have 
resulted in comprehensive conservation and management plans, and other 
efforts such as the work in EPA's Atlanta Office (Region IV) with the 
Southern Appalachia Project that could result in recommendations that 
could be implemented through XL.
10. Water: Environmental Performance Measures for Waste Water 
Pretreatment Programs
    Background: The Pretreatment Program is a cooperative effort of 
federal, state, and local regulatory environmental agencies established 
to protect water quality. Generally, the Program is implemented by 
Publicly-Owned Treatment Works with the objective of reducing the 
amount of pollutants discharged by industry and other non-domestic 
wastewater sources into municipal sewer systems, and thereby, reducing 
the amount of pollutants released into the environment from wastewater 
treatment plants.
    Idea or approach that could be tested: EPA is interested in 
exploring alternative environmental performance-based pretreatment 
programs on a pilot basis. The intent of this effort is to investigate 
ways of increasing the effectiveness of the pretreatment program and 
thus obtain greater environmental benefit. Please refer to a separate 
segment of this Federal Register Notice, in which the Agency announces 
and describes its interest in exploring alternatives in this area in 
much greater detail. It is also available from Patrick Bradley, 
telephone number 202-260-6963.
    Regulatory or other flexibility needed: EPA would be willing to 
provide POTWs regulatory relief from certain programmatic requirements 
(e.g., specific monitoring frequencies, specific control mechanism 
issuance requirements, etc.), so that they could implement alternative 
programs that would increase the environmental benefits. EPA is willing 
to consider various concepts of what an adequate environmental 
performance-based program might be, what POTWs would qualify for 
administering such a program, and what existing pretreatment program 
requirements would not be applicable to approved pilot programs.

Developing New Tools and Technologies

    The themes listed below suggest ways that could help EPA improve 
current monitoring, measurement, and assessment tools and technologies.
    1. Air: Continuous Monitoring Units for Radionuclides
    Background: DOE is planning to use mixed waste incinerators to 
process high BTU content waste. Process pollution control equipment, 
when operating properly, captures most of the radionuclides. To 
determine if there are any releases, a filter is examined and tested on 
a daily or weekly basis to gather data. Many gases (CO, NOX, 
SOX) are monitored real or near real time, but radionuclides 
are monitored periodically. Thus, incinerators may potentially expose 
individuals to radionuclides during the time elapsed between periodic 
testing and actions taken to shut down the incinerator.
    Idea/approach that could be tested: Continuous monitoring units for 
radionuclides. On time reporting of this information to the public 
could be another dimension of this project.
    Technology that could be tested: A real or near real time monitor 
for radionuclides.
    Possible superior environmental performance: A rugged and reliable 
unit which provides continuous real time monitoring data would allow 
almost simultaneous shut down of the incinerator if radionuclides are 
emitted. Thus, potential exposure to radionuclides should be reduced.
    Regulatory or other flexibility needed: Radionuclide emissions from 
DOE facilities are regulated under 40 CFR part 61, subpart H 
(radionuclides NESHAPs). Subpart H allows use of environmental 
measurements to demonstrate compliance under certain conditions and 
with prior EPA approval. The project would require EPA flexibility in 
granting prior

[[Page 34168]]

approval to test the units and possibly relaxing the criteria for 
approval.
12. Air: Leak Detection Technology
    Background: The chemical and petroleum refinery industries have to 
deal with a large number of potential emission points and a personnel-
intensive approach to monitoring them under the Leak Detection and 
Repair provisions of current air rules (CAAA section 111 and 112). The 
number of components requiring emissions monitoring at refineries can 
range from 60,000 at small facilities to 500,000 at large facilities. 
While these provisions were developed via regulatory negotiation with 
industry and environmentalists, there may be alternative approaches to 
reduce emissions from these sources that are less burdensome and 
potentially more productive.
    Idea/approach that could be tested: The Consolidated Air Rule and 
the Petroleum Refinery subcommittee of EPA's Common Sense Initiative 
are both exploring the question of whether industry can demonstrate 
that certain valves, pumps or seals do not leak as much as others and 
thereby reduce the frequency that they must be monitored. However, 
there will always be some amount of monitoring required.
    Independent studies conducted by the Petroleum Refining Common 
Sense Initiative (CSI) Subcommittee and the American Petroleum 
Institute (API) suggest that the incidence of leaks in the population 
of refinery equipment is ``essentially random in well-controlled 
plants'' and that chronic leakers of regulatory significance (>10,000 
ppm) are difficult, if not impossible to identify.
    This XL project would explore whether there are other monitoring 
technologies that may be equally or more effective at identifying leaks 
than EPA's rules require, but that may be cheaper and easier to use for 
industry. Another aspect of this project may be to verify the CSI and 
API studies by exploring how much a component may leak and use that 
information to target the big leakers.
    Technology that could be tested: There are new advances in leak 
detection that could be explored for industry use. One leak detection 
technology currently under development is a periodically-poled lithium 
niobate (PPLN) laser imaging system which, if proven effective, could 
be used to identify Volatile Organic Compound emissions from groups of 
components. Based on information provided by the Petroleum CSI 
Subcommittee, the CSI Council has recommended that the Agency prepare 
to engage in a process to test, verify, and approve this new leak 
detection technology that might be proposed as an alternative to 
current monitoring requirements. Subcommittee members informed the 
Council that the U.S. Department of Energy has pledged financial 
support for the development of a PPLN laser imaging system prototype. 
Industry, through API, has pledged in-kind services in terms of 
facilities and personnel to field test the technology. The CSI 
Subcommittee plans to fund an evaluation of the pilot test.
    Possible superior environmental performance: If leaking components 
can be more effectively identified, overall emissions to the 
environment can be reduced. At the same time, EPA could potentially 
reduce burden and cost to industry.
    Regulatory or other flexibility needed: EPA would need to allow 
participating plants the flexibility to use monitoring approaches other 
than the prescribed rule approach.
    Possible candidate applicants: Any of the Consolidated Air Rule 
participants in the chemical industry, American Petroleum Institute, or 
the National Petroleum Refiners Association may be interested.
13. Air: Maximum Achievable Control Technology (MACT) for the Coke Oven 
Push and Quench Process
    Background: The coke oven push and quench process is a listed 
source category to be regulated under Title III. EPA is required to 
promulgate a final Maximum Achievable Control Technology (MACT) 
standard by November 2000. The push and quench operations deal with the 
removal and cooling of coke from coke ovens. Once the coal to coke 
conversion is complete inside of the coking ovens, the hot coke is 
pushed by a ram from the oven into a quenching car. The quenching car 
of hot coke is moved by rail to the quench tower, where several 
thousand gallons of water are used to cool the coke. The push and 
quench process at coke oven facilities is a very large source of 
fugitive dust (PM10, PM2.5) organic Hazardous Air 
Pollutants (HAPs) and waste water. Conventional control technologies 
(i.e., localized hooding and control) are only marginally successful 
due to technical and economical limitations. As such, the MACT for this 
significant source category, if based on conventional technologies, 
will result in minimal benefits.
    Technology that could be tested: The Kress Indirect Dry Cooling 
(KIDC) System replaces the quenching car with a box that is slightly 
wider and deeper than the coke charge. A carrier positions the box 
flush against the coke oven where the box can receive the push. After 
the push is complete and the pusher ram is withdrawn, the KIDC box's 
guillotine door closes. Fugitive dust is nearly eliminated from the 
push operation. VOCs which continue to offgass from the coke are 
controlled by a flare at the rear of the box. Following the push, the 
carrier moves the box to the quench station, and onto a cooling rack. 
Cooling water runs over the box to cool the coke indirectly. In 
addition to the environmental benefits, the KIDC system is intended to 
improve coke quality due to the indirect cooling.
    In 1990, EPA/ORD began a demonstration of KIDC system at the 
Bethlehem Steel Coke Plant at Sparrows Point, Maryland. Unfortunately, 
the demonstration was interrupted and not completed for reasons 
unrelated to the KIDC system. However, preliminary data received from 
the demonstration were promising. Based on visible emission 
observations, emissions of particulate from the pushing operations were 
reduced by roughly 75% while emissions during quenching were virtually 
eliminated.
    Possible superior environmental performance: The KIDC system has 
the potential to greatly reduce the air and water pollution resulting 
from the coke oven push and quench processes.
    Emissions, based on AP-42 emission factors and the preliminary data 
for KIDC, are as follows:

------------------------------------------------------------------------
               TSP                   Conventional            KIDC       
------------------------------------------------------------------------
Coke Pushing....................  2.0 lb/ton........  0.5 lb/ton.       
Quenching.......................  1.0 lb/ton........  0.0 lb/ton.       
------------------------------------------------------------------------

------------------------------------------------------------------------
               VOC                   Conventional            KIDC       
------------------------------------------------------------------------
Coke Pushing....................  0.2 lb/ton........  0.15 lb/ton.      
Quenching.......................  Unknown...........  0.00 lb/ton.      
------------------------------------------------------------------------

    Regulatory or other flexibility needed: Substantial capital and 
time would be required to modify an existing facility and install the 
demonstration equipment. There are no guarantees that the equipment 
will work as planned (although the design indicates that it would 
likely be superior to the technology upon which the MACT standard would 
be based) or that the demonstration would be complete by the MACT 
standard compliance date. For these reasons, the facility would need 
some guarantee of relief from the MACT standard for a defined period of 
time, in order to protect the facility's capital investment in the 
demonstration project.

[[Page 34169]]

    Possible candidate applicants: Other integrated steel mills.
14. Multi-media Pollution Prevention: Using the Pollution Prevention 
(P2) Assessment Framework to Assess Manufacturing Processes
    Background: When designing an industrial process and producing new 
chemicals (in the form of new products or waste), industry often does 
not have any guidance from EPA to help them assess the potential 
regulatory burden associated with products of a new process. The 
Pollution Prevention Assessment Framework (P2 Assessment Framework), 
developed by EPA, packages a number of hazard, exposure and risk 
assessment methodologies that EPA uses in evaluating chemicals for 
which there are little or no data. The goal of the P2 Assessment 
Framework is to provide industry with methodologies that can identify 
problematic chemicals early in the design or manufacturing stage, or to 
assess the risk of chemical options for a specific purpose. The P2 
Assessment Framework can aid industry in fostering pollution prevention 
as well as saving time and money, as demonstrated by a pilot project 
with the Eastman Kodak Company. Kodak recently issued a press release 
describing the business benefits of using EPA's P2 Assessment 
Framework. Kodak's press release indicated that the P2 Framework ``. . 
. saved Kodak tens of thousands of dollars in development costs . . . 
with each one tested.'' EPA is interested in doing further testing of 
the tool in addition to the Kodak pilot.
    Idea or approach to be tested: The P2 Assessment Framework can help 
industry practice cost-effective pollution prevention by reducing the 
regulatory burden associated with the production or use of new or 
existing high-risk chemicals. A wide array of chemicals can be screened 
quickly, thereby saving time and money by identifying potentially 
problematic chemicals early in the process, and finding more benign 
substitutes for them.
    Possible superior environmental performance: Prevention of the 
production of potentially more hazardous chemicals (either as product 
or waste) from a production facility.
    Regulatory or other flexibility needed: We would consider changes 
to existing policies, procedures, or permitting requirements to make 
this possible.
    Possible candidate applicants: Any company developing new chemical 
substances, reformulating existing products or processes, or choosing 
among competing chemical substances for product development and 
manufacturing.

Category II: Themes Suggested by External Organizations

    To stimulate additional ideas, EPA is including some themes in this 
Notice that were suggested as good ideas for Project XL pilots by 
representatives of public and private sector organizations during 
numerous meetings around the country. These ideas are briefly described 
below and, based on Agency review, are considered worthy of further 
exploration.
Administrative Paperwork Reduction
    Record-keeping and reporting-burden reductions could be achieved 
through projects that provide EPA with the same information but in 
formats and ways that are more useful to EPA and less burdensome to the 
regulated entity. For example, EPA might agree to drop requirements for 
hard copy reporting of data in exchange for electronic submission of 
data. Superior environmental performance could be achieved, for 
example, by reinvesting cost savings in other areas that produce such 
results.
Community-Based Water Protection
    Municipalities are required to implement multiple water protection 
programs, most notably the operation of publicly-owned treatment works, 
the storm water program and pretreatment programs, and in some cases 
combined sewer overflow programs. In many cases, these programs are 
implemented independently with little or no coordination or 
communication between them. In some communities, non-point sources that 
are not addressed by these programs may pose significant threats to 
water quality. The suggestion is to explore possible ways of 
integrating multiple water protection programs.
Concentrated Animal Feeding Operations
    Nationally there are approximately 7,000 concentrated animal 
feeding operations (CAFOs). Under the Clean Water Act, CAFOs are 
``point sources'' and subject to the National Pollutant Discharge 
Elimination System (NPDES) permitting requirements. The largest 
operations are also subject to the feedlots requirements under the 
Effluent Limitation Guidelines. The current technology standard 
specifies ``no discharge.'' The applicable NPDES and Effluent Guideline 
regulations have not kept pace with technology improvements nor the 
changing nature of the animal agriculture industry. Potential projects 
could test innovative approaches, such as watershed permits, or 
innovative technologies for the management of animal manure.
Hazardous Waste: Land Disposal Restrictions Regulations
    Industry has often suggested that if they had more time to come 
into compliance with new land disposal restriction regulations that 
they would be able to make significant steps towards waste 
minimization, potentially even eliminating a particular waste stream. 
Companies may be able to develop approaches that allow complete 
elimination of a waste stream, specifically under the technology-based 
treatment standards that hazardous waste must meet before being placed 
in or on the land.
Market-Based Approaches
    Economic and market incentives could be developed for better 
environmental performance, including exploring financial instruments; 
the insurance industry; lenders, (e.g. for the redevelopment of 
brownfields); ways to combine sources of funding to help pay for the 
development and testing of new technologies; and ways to provide 
economic incentives for environmentally beneficial behavior, e.g. 
credits for using solar power.
Multi-facility and Multi-media Projects
    Projects might test strategies for large companies that have many 
site locations or manufacturing and supplier chains; or strategies for 
related industries in different geographic locations, such as hazardous 
waste disposal and treatment companies; or auto companies, body shops, 
and paint shops. An example might be: Establishing a network of 
preconstruction air monitoring for a group of facilities giving relief 
from individual monitoring requirements. Even though these types of 
projects are very broad and may pose considerable management and 
implementation challenges, EPA is eager to entertain ideas along these 
lines as opportunities for truly innovative environmental protection 
approaches.
Multi-media Pollution Prevention: Using ``Green Chemistry'' To Make 
Manufacturing Processes ``Greener'
    The Green Chemistry program is designed to foster chemical methods 
that reduce or eliminate the use or generation of toxic substances 
during the design, manufacturing, and use of chemical products and 
processes. A part of the Green Chemistry program promotes partnership 
with industry in developing green chemistry

[[Page 34170]]

technologies. A possible XL project may involve the use of green 
chemistry that would make a production process cleaner, and reduce the 
regulatory burden that would be required of the production facility.
Other Ideas Suggested by External Organizations that the Agency 
Considers Worthy of Further Exploration:
    These ideas were proposed merely as topics that would need to be 
fleshed out. (in alphabetic order)

 Alternatives for reducing persistent toxins in the Great Lakes
 Conservation and sustainable use of biodiversity and ecosystem 
services (for example, pollination, natural pest control, natural water 
flow management, and natural filtering and breakdown processes of 
pollutants)
 Energy conservation
 Environmental consequences of urban sprawl
 Global warming/climate change
 Green spaces
 Habitat preservation
 Improved management of timberland
 Watershed management

(D) Key Elements of Good XL Proposals

    A successful project sponsor must have a solid record of compliance 
and demonstrate that the proposed XL project meets the eight XL 
criteria, as discussed in previous Federal Register documents and 
summarized in the ``Supplementary Information'' section in the 
beginning of this document. The review process will be easier and EPA, 
States, and other stakeholders will be more receptive to proposals if 
they:
     Clearly lay out what is innovative about the approach to 
be tested and the potential benefits of applying the approach to other 
facilities, sectors, or communities, i.e. its transferability;
     Clearly identify the area(s) of flexibility needed in EPA 
regulations, policies, and/or procedures;
     Be as clear as possible about the benefits the project 
sponsor will derive from implementing the project, such as 
environmental improvements at the facility and in the community, worker 
health protection improvements, time-to-market savings and/ or 
paperwork reductions. EPA is also very interested in measurements of 
resources and cost savings.
     Avoid being focused primarily on the requirement the 
project sponsor wants to avoid, but focus instead on the new approach 
to be tested;
     Have early stakeholder support and a well-developed plan 
for facilitated stakeholder involvement;
     Plan your idea in pre-proposal discussions before the 
actual proposal is formally submitted; pre-proposal discussions with 
EPA, States and other stakeholders go a long way toward reducing 
``transaction costs'' (i.e. time and resources) in the selection and 
negotiation of projects;
     Lay out a plan for how environmental baselines will be 
measured and superior environmental performance achieved. For more 
information on baselines, please refer to the Federal Register document 
(62 FR 19872) issued on April 23, 1997.
     Propose a workable schedule for the development of a 
final project agreement and a plan for how the project will be managed.
    EPA encourages potential project sponsors to talk early to EPA 
before submitting a formal proposal. This allows the Agency to help 
develop the proposal and to explain the process. The Agency recognizes 
that community project sponsors may require special assistance from EPA 
in developing proposals and any resulting projects. This assistance 
could include working with community project sponsors to help identify 
additional resources to support development and implementation of XL 
projects.
    Proposals, in brief, will go through the following process: EPA 
will evaluate all proposals with input from relevant EPA and State 
offices to determine whether a proposal has the potential of meeting 
Project XL's set of criteria for facilities and/or communities, and 
whether it contains environmental, regulatory, and policy concepts 
worth testing in Project XL. If the Agency and the relevant State(s) 
determine that it is appropriate to proceed with proposal development, 
the project sponsor then leads a process involving all affected 
stakeholders to develop an agreement on the project.

Conclusion

    Project XL presents a unique opportunity for private and public 
sector facilities, states, sectors, and local communities to design and 
test alternative approaches, while deriving substantial benefits for 
themselves and the communities around them. 27 facilities, sectors, 
states, and communities are already implementing or developing such 
innovations. EPA has integrated many ``lessons learned'' into its 
regulatory and policy-setting system. In addition, the Agency has 
learned how to process XL proposals with greater efficiency and 
efficacy. EPA's goal of implementing 50 XL pilot projects will provide 
the Agency with a range of innovations that can create a better system 
of protecting our environment and our health in the 21st century.

    Dated: June 11, 1998.
J. Charles Fox,
Associate Administrator, Office of Reinvention.
[FR Doc. 98-16398 Filed 6-22-98; 8:45 am]
BILLING CODE 6560-50-P
```