*This is the first post on a symposium on Cynthia Giles’ “Next Generation Compliance: Environmental Regulation for the Modern Era.” For other posts in the series, click here.
With her new book Next Generation Compliance: Environmental Regulation for the Modern Era, Cynthia Giles offers a comprehensive and uniquely well-informed view of the state of compliance with environmental laws in the U.S. It’s not a pretty picture – which will be a surprise to many people. But Giles, drawing on her own extensive experience, research and collaborations with other experts, has lots of great ideas about how to fix it, or at least do it better, to deliver on the promises of our environmental laws.
The subject couldn’t be more important in the moment, as the Biden Administration (which Giles has now joined) strives to craft new environmental regulations, and use the ones already on the books, to address the daunting challenges of climate change and environmental injustice. As one of the most experienced environmental enforcement practitioners in the country, and a scholar to boot, Giles is uniquely situated to provide the insightful analysis and constructive suggestions for a path forward that are so critical to success.
Giles pulls no punches. She is not shy about exposing the threadbare state of the “emperor’s clothing” when it comes to the widespread perception (or assumption) that there is a high level of compliance with environmental laws in the U.S. And she is frank and honest about pointing to the kinks in the federal and state regulatory systems that lead to surprisingly weak regulations and high rates of non-compliance in many environmental protection programs.
This may sound like a heavy tome given the book’s subject matter and length (almost 300 pages). But Giles’ plain-spoken, down-to-earth writing style and numerous real-world examples make this book a very accessible read. Her wise-cracking personal style, for which she is famous, even makes many passages entertaining.
This book is a “must-read” for environmental policy makers, program managers, rule writers, lawmakers, and scholars. It should be required reading for all high-level managers of government environmental programs. And, as Giles points out, the lessons learned in her review of the on-the-ground reality of environmental compliance are equally applicable in many other fields, where non-compliance is a lot more prevalent than most people think – including tax laws, drug and Medicare regulations, and transportation safety regulations.
The Widespread Myth of High Compliance. Giles sets the premise in the first part of the book that there is a much higher rate of non-compliance with environmental regulations than most people realize. She presents the facts and the data to back that up, pulling together a wealth of reports and analyses that have been collected over the years by EPA’s Office of Enforcement and Compliance Assurance, the EPA Inspector General, the General Accounting Office, and others. By enabling readers to see and appreciate the full scope of the problem, she sets the stage for the important work of figuring out the underlying causes and how to address them.
Why the System Doesn’t Work Well. As a former leader of EPA’s Office of Enforcement and Compliance Assurance, Giles has deep experience with how EPA regulations are developed, how compliance is assured (or not), and what happens at the tail end of the process when enforcement is needed to compel compliance. She takes a frank, no-nonsense approach to analyzing the factors that contribute to low compliance rates, and is not shy about blowing the whistle on shortcomings in the rule development approaches of EPA and the White House Office of Management and Budget (OMB) that contribute to weak regulations. She is equally frank in her discussion of federal and state interactions that present challenges for compliance.
Some of the most enlightening and interesting parts of the book are Giles’ examples of success and failure, i.e., regulations that have high or low rates of compliance. She cites the Clean Air Act Acid Rain program as one of the most notable successes, and the Clean Air Act New Source Review and Clean Water Act Lead and Copper Rule as failures that led to widespread non-compliance. As a former federal and state official who was personally involved in several of the example cases, this reviewer can attest that Giles is quite right that inadequate rule design was a basic underlying cause of the disputes that ultimately led to litigation. She is also quite right that the consequences of inadequate rule design and low compliance too frequently end up disproportionately impacting communities that are already overburdened with pollution.
Giles is realistic about the many human behavior factors that contribute to non-compliance: “Companies look for ways around, people make mistakes, it is not easy to pay attention, most follow the path of least resistance, and some cheat.” She also notes the critical role of public transparency in companies’ and individuals’ compliance decisions: “If visibility into violations is low, and opportunities to evade or obfuscate or ignore abound, we know what happens.”
Toolkit of Solutions. The most valuable part of the book, particularly for program managers and rule writers, is Giles’ list of strategies and tools for smart rule design. She demonstrates, with examples, how these strategies can result in widespread compliance without extensive government oversight. That’s a win-win both for government (and the taxpayers who fund it) and for businesses (who will appreciate the prospect of less intrusive government oversight).
The book’s suggested strategies and tools include new monitoring technologies, aerial and satellite monitoring, continuous emissions monitoring, fenceline monitoring (particularly meaningful for overburdened communities) and electronic data reporting. Electronic reporting in turn enables smart use of data analytics to identify compliance problems that previously have gone unnoticed. These modern tools provide a cost-effective, streamlined approach to compliance that has great potential benefits for both regulators and regulated entities.
Giles also encourages regulators to take advantage of citizen monitoring, to harness the tool of public transparency to encourage compliance. As an example of the power of public transparency, she highlights the remarkable increase in compliance that resulted from implementation of the Safe Drinking Water Act “right-to-know” requirement that drinking water systems notify customers when they have violations.
Giles does not claim to have found a magic bullet that will solve all compliance problems. She acknowledges that there will always be some violations, intentional or not, and that enforcement must always be a critical part of any successful compliance program. But she sensibly concludes that “The key to widespread compliance is having a well-crafted rule that picks a strategy that matches the problem.”
In contrast, Giles fires a shot over the bow of ideologues who are adamant that only market-based or performance-based approaches should be considered in environmental rulemaking, and who demonize “command-and-control” strategies. This myopic approach, she points out, fails to recognize that each of these strategies has strengths and weaknesses, and that much-maligned command-and-control tools can be a necessary component to underpin market and performance-based approaches. She makes a convincing case, for example, that the command-and-control aspects of the Acid Rain program (e.g. continuous emissions monitoring and reporting, and year-end “true up” requirements) were more responsible for that program’s success in reducing sulfur dioxide emissions from coal-fired power plants than the much-touted “cap-and-trade” aspects of that rule.
Giles is refreshingly open and honest about the shortcomings in the federal government’s rule development process, which currently hamper consideration of many of the smart approaches to rule design that she advocates. EPA and OMB – as well as other agencies – would be well-advised to consider her constructive suggestions for reform of their rule development processes to allow consideration of these good new ideas.
Hopefully, Giles will be able to influence the rule development process and implement many of her ideas in her new role as an EPA official. In any event, with this book she has made a substantial contribution to our understanding of how to design effective environmental (and other) regulations, and what happens when we fail to do so.
Catherine R. McCabe is a former federal and state environmental official, who served as an environmental enforcement attorney for the U.S. Department of Justice and the State of New York, Principal Deputy Assistant Administrator of the EPA Office of Enforcement and Compliance Assurance, a judge on EPA’s Environmental Appeals Board, Deputy Regional Administrator of EPA’s Region 2 office, and Commissioner of the New Jersey Department of Environmental Protection.