Research challenges the view that environmental regulators are anti-business

Regulators test soil for hazardous chemicals at a brownfield cleanup site in West Seneca, New York. NYSDEC/Flickr, CC BY-NC-ND

During the 2016 presidential campaign, Republican candidates strongly agreed that the United States has too many regulations, and that these rules often are bad for business or a waste of taxpayer dollars. President Trump calls himself an environmentalist, but asserts that environmental regulations are “out of control.” Trump’s nominee to run the Environmental Protection Agency, Oklahoma Attorney General Scott Pruitt, has repeatedly sued to block federal environmental regulations.

Pruitt asserted in his confirmation hearing that “My first and primary goal as administrator will be to return the agency to that core mission of protecting the American people through common sense and lawful regulations.” This approach may seem popular. In Gallup polls administered between 2001 and 2016, an average of 49 percent of respondents agreed with the statement, “There is too much government regulation.”

However, in a Reuters poll released this month, 60 percent of respondents said they wanted to see EPA’s power strengthened or maintained. These results indicate that while Americans are concerned about regulation stifling businesses, they also value clean air and water.

Much of my research seeks to understand relationships between environmental regulators and regulated businesses. In contrast to popular images of bureaucrats tying entrepreneurs up in red tape, I have found that interactions between regulators and the private sector at the federal and state levels typically are collegial, and that both sides work to build and maintain cooperative partnerships.

What regulators do

Although we teach high school civics students how a bill becomes a law, few Americans think about how laws become regulations. Here’s how it works.

After Congress passes a bill and the president signs it into law, federal agencies draft rules that tell regulated entities in detail how to comply with the law and publish the draft rules for public review. Anyone can view and comment on draft rules. Normally, however, only affected businesses and relevant advocacy groups submit public comments.

EPA divers monitor discharges from a seafood processing plant in Alaska to confirm that the plant is complying with its permit.

As political scientists have pointed out, many processes through which the U.S. government forms policy – including environmental regulation – can be adversarial: They pit contending interests, such as businesses and advocacy groups, against each other. As such, the end result often is that neither side is totally happy with the final outcome. However, the criterion should be whether the process and final rule are fair.

This was what I found when I reviewed EPA’s development of a rule setting emissions standards for large diesel engines for locomotives and ships. Environmental groups believed that the rule would not do enough to protect public health, while manufacturers were concerned that it would be an economic burden for locomotive companies. However, both sides agreed they understood the final results because EPA managed the process fairly.

Building collaborative relationships between an agency and a variety of groups is not an easy task. In another case study on EPA’s development of a rule for mandatory reporting of greenhouse gas emissions, we found that EPA rule writers acted as honest brokers among stakeholders, creating an open dialogue between affected groups and the agency.

Working relationships

Regulations are written by federal agencies but mainly carried out at the state level. EPA and other regulatory agencies delegate authority to state agencies to carry out activities such as inspections and ensure that regulated entities are complying with the law.

Observers often assume that state environmental regulators operate as either good cops or bad cops. Bad cops implement laws rigidly, while good cops take a soft approach, often working with businesses to help them comply. Both approaches have pitfalls. If regulators are perceived as rigid, their interactions with businesses may become hostile. Conversely, regulators who are too soft could be “captured” by business interests and fail to enforce the law effectively.

Testing drinking water for contaminants, Duval County, Florida. Florida Department of Health

However, this framework is outdated. In a survey of 1,200 environmental regulators across 17 states, Michelle Pautz and I found that only four percent reported having adversarial interactions with businesses, while more than 75 percent believed that the regulated community made an honest effort to comply with regulations. Only 20 percent thought that regulated entities were solely concerned with making a profit.

One might expect regulated businesses to see things differently. But in a preliminary study of over 100 regulated entities from a range of industries in Montana, we have found similar results. More than 84 percent of our sample of Montana businesses have had positive working relationships with state environmental regulators, and 56 percent have great respect for their contacts at the Montana Department of Environmental Quality. More than two-thirds strongly disagreed with the statement that “My relationship with state regulators could be classified as adversarial.”

Regulators under pressure

Within our nationwide study, we also examinedchallenges that environmental regulators face on the job. Among the 1,200 environmental regulators across the nation whom we surveyed, we found that on average each respondent oversaw between 50 and 100 facilities per year, ranging from dry cleaners to coal companies.

Shrinking budgets and staff cuts at state environmental agencies have made it increasingly hard for regulators to conduct site visits and collect data. Over 54 percent of our respondents said they did not have sufficient funding to conduct their work, and 47 percent reported that their agencies had been unable to fill open positions.

These challenges also exist at the federal level. In a survey by the Partnership for Public Service, the EPA ranked 14 out of 19 large agencies on “best places to work.” Staff morale has reportedly declined further in anticipation of changes under the Trump administration.

Leilani Sanchez, a supervisory wildlife inspector with the U.S. Fish and Wildlife Service, checks a shipment of wildlife pelts to look for illegally trafficked items. Catherine J. Hibbard, USFWS/Flickr, CC BY

Challenges to state and federal regulators should give pause to regulated entities, because they could mean delays for businesses. The American College of Environmental Lawyers predicts that “As experienced personnel are replaced by those who are less experienced, or in many instances not replaced at all, these routine business activities [such as permitting] will increasingly be subject to delays which may ultimately have serious impacts on the company.”

In addition to protecting public health and natural resources, environmental regulation can benefit businesses in tangible ways – for example, by stimulating innovation that leads to new products and markets. Better understanding of what state regulators and federal rule-writers do and how they do it can help us find ways to improve the process, while delivering the environmental benefits that Americans want.

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