Project XL: Best Practices for Proposal Development

A guide designed to help project sponsors create effective XL proposals
Table of Contents

Introduction

I. What information should the Introduction section contain?

II. What information should the Project Description section contain?

III. What information should the Project XL Criteria section contain?

IV. What information should the Requested Flexibility section contain?

V. What information should the Enforcement and Compliance Profile section contain?

VI. What schedule information should be included?

VII. What are the major steps and milestones in the XL process?

VIII. Does EPA have examples of good proposals?

What is the purpose of this guide?	This guide is designed to help project sponsors submit Project XL proposals which will go through the review process as quickly and smoothly as possible. EPA hopes the guide will: Tell you in clear terms what information to put in your proposal. Help you understand why we need the information we are requesting. Reduce the number of times EPA requests additional information from you after you have submitted your proposal. You are not required to use the format suggested in this guide, but providing the information described below will be necessary at some point in the process. The sooner it is provided, the less work for everyone involved-including you. Reading this guide should give you some initial sense of whether your idea is a likely candidate to become an XL project. Don't rule out your idea too quickly-you may be surprised at the flexibility Project XL is able to offer. Before developing and submitting an initial proposal, it's a good idea to discuss the concept with EPA and your state environmental agency staff. Please see Internet address below for listing of EPA XL contacts: https://www.epa.gov/projectxl/contactxl This step should help you refine your ideas and can prevent unnecessary effort. Once you decide to participate in Project XL, a proposal needs to be developed. This guide should help you develop an effective proposal.
What should my proposal look like?	A sample outline of a Project XL proposal is provided below. Again, you are not required to use this format-making sure that all of the requested information is included somewhere in your proposal is more important than sticking to our suggested format. If you submit a proposal, the number of additional information requests you are subjected to will be reduced if your proposal contains the following sections and information: Sample Proposal Outline Note: Each of the headings in the outline below are explained in detail in sections immediately following the outline. I. Introduction A. Description of Your Facility/Community/Geographic Area B. Contact Information II. Project Description: A. Summary or Overview of Project B. Specific Project Elements 1. Project Element #1 2. Project Element #2 III. Project XL Criteria: A. Superior Environmental Performance 1. Tier 1: Is the Project Equivalent? 2. Tier 2: Superior Environmental Performance 3. How Will You Measure the Superior Environmental Performance of Your Proposal? B. Flexibility and Other Benefits C. Stakeholder Involvement D. Innovation or Pollution Prevention E. Transferability F. Feasibility G. Evaluation, Monitoring, and Accountability H. Shifting of Risk Burden IV. Requested Flexibility V. Compliance and Enforcement Profile VI. Schedule Information
I. What information should the Introduction section contain?	A. Description of Your Facility/ Community/Geographic Area The Introduction section should contain basic background information about your facility, community, and geographic area. You should indicate whether your proposal involves the entire company or just one facility. This section helps reviewers understand details you will provide in later sections. Exhaustive details are not generally necessary, but be sure to discuss background information which is pertinent to your proposal. Specific information in this section should include: A description of your company, facility, community and region. What industry sector is the facility in? Describe the sector. What is produced there? What is the size of the facility? How many people does it employ? Where is the facility located? Providing maps is helpful, especially if your facility is remote. What is the proximity of the facility to people, private residences, other businesses, and natural resource areas (e.g., surface waters, wildlife habitats)? What is the proximity of the facility to sensitive populations (hospitals, schools, retirement homes, etc.)? Does the facility have a community outreach plan? If your facility has an environmental management plan, compliance strategy or mission statement, provide relevant details. Some indication of how your Project XL proposal fits into your long-term environmental vision or plan is helpful. When putting this section together, keep your proposal idea in mind and try to provide background information that is particularly relevant to the project. For example, if your geographic area has problems with air or water pollution and your proposal might help address these problems, include a description of these local environmental concerns. You should also use this section to document any environmental leadership your facility has shown prior to submitting your XL proposal. Describe any environmental awards or participation in EPA or state environmental initiatives. B. Contact Information The Contact Information section lets EPA know who to call with questions about your proposal. This section should include: The name, phone number and mailing address of the primary contact. If you have them, E-mail addresses. Information on any Internet sites for your facility, company or community.
II. What information should the Project Description section contain?	A. Summary or Overview of Project This is the section where you tell EPA in plain, clear terms what you propose to do and what type of flexibility you are requesting. Be sure to state the principal objective of the proposal as well as any other expected outcomes. One helpful practice is to describe two scenarios -one explaining what you would do in the absence of Project XL and a second explaining what you plan to do if your XL proposal is accepted and implemented. This is your opportunity to summarize the strengths of your proposal. Although later sections of your proposal should describe in more detail how your project would address each of the eight Project XL criteria, the Project Description section is where you paint "the big picture." Try to build on the background information you provided in the Introduction section by describing what parts of your facility will be involved or affected by the project. The broad view of the project provided in this section will help reviewers put details you provide later in context. B. Specific Project Elements It's a good practice to include clear explanations of separate components of your proposal -especially if they are not directly related. If your project is made up of more than one component, each component should be described and explained in this section. You may not need a Specific Project Elements section in addition to your Project Description section -this depends on the structure and complexity of your proposal. Some projects include different elements that are carried out simultaneously. Others may include elements that are dependent on the results of initial steps of a project. For example, your project may include a testing component and then an implementation component. It helps reviewers understand your proposal if you describe each component separately and then explain how it fits into the project. Here is some sample language from an introduction to a Specific Project Elements section: "This Project XL proposal is composed of two parts. Component #1 seeks to test the development and implementation of the Environmental Management Plan for use in the Laboratory. Component #2 seeks to test the small-scale treatment of laboratory process byproducts." The section then goes on to explain the two components, how they relate to one another, and why each was an integral part of the proposal.
III. What information should the Project XL Criteria section contain?	All proposals should address each of the eight Project XL selection criteria. One important thing to keep in mind as you write the Project XL Criteria sections is that every proposal is unique and therefore emphasis may be greater on some criteria than others. The details of your project should help determine the amount of time and energy you put into any given section. Three components which EPA considers particularly important in every proposal are Superior Environmental Performance, Flexibility, and Stakeholder Involvement. You should make sure to address these thoroughly. Here are some other tips to remember as you work on your Project XL Criteria sections: Focus on what is relevant to your proposal. Don't assume EPA or the public know why something you are proposing is good - explain why. Back up claims with numbers/data, or other evidence. Longer is not necessarily better. Don't hesitate to ask EPA for guidance! The next eight sections of this guide provide more information to help you address all of the Project XL criteria in your proposal. A. Superior Environmental Performance XL Projects must produce some form of Superior Environmental Performance (SEP). This is one of the most important and highly scrutinized (by both EPA and others) criteria to be addressed in your proposal. This section of your proposal addresses one of the most basic principles of Project XL: You show EPA how to do something better, and we give you the flexibility to do it... but first show us how it will be better. Demonstrating that your proposal will result in SEP is essential and is often the key to its legal defensibility. The SEP section is usually the most difficult section to write. Because SEP is so important, we will spend more time discussing it than other sections. You should do the same in your proposal. EPA will expect you to provide technical documentation for your claims so that we can help you develop a defensible XL project. We may suggest particular testing or estimating techniques to you, but as noted below, it will save time if you have thought about SEP and suggest a plan supporting your proposal. 1. Provide numbers and facts. To the best of your ability, describe the quantitative and the qualitative factors that would back up any assertions of Superior Environmental Performance in your proposal. Below are some suggestions to help you prepare your description of SEP: Compare the projected environmental results of your proposal with baseline results (discussed further below) in each category affected by the proposal (e.g., air emissions, water discharges, amount of toxics used, pollution prevented, waste stream composition, etc.). If possible, quantify the SEP that would result from your project. If you cannot quantify the results, explain why and describe why you think that SEP would occur. Also explain how the SEP could be quantifiable at some point in the future. Identify and discuss all environmental outcomes that are influenced by your proposed XL project (e.g., poses a risk to human health, contributes to smog formation, introduces polluted effluent into the waste steam). If your proposal includes tradeoffs among different environmental media (for example: greatly reduced air emissions, but slightly increased solid waste streams), try to determine and document the environmental risks and benefits associated with the tradeoff. Proposals involving tradeoffs among media will generally result in a higher level of scrutiny. An analysis of the tradeoff must be particularly thorough and the methodology for the analysis should ultimately be agreed to by stakeholders. If your proposal includes any measures to reduce sources of environmental impacts, describe them (using numbers and hard data when possible). Please refer to: https://www.epa.gov/p2. Many industries have common practices for improved environmental management including Life Cycle Management, Environmental Management Systems and Total Cost Accounting. 2. The two-tier analysis of SEP Discerning the environmental impacts of an XL project often presents difficult analytical challenges. For example, people looking at a project have to assess past, present and future performance baselines, the impacts of flexibility, the value of unquantifiable benefits, and other factors. To help you convey the superior environmental performance associated with your proposal, EPA has developed a two-tier analysis. As described below, Tier 1 addresses the question, "Is the project equivalent?" while Tier 2 looks at what makes the environmental benefits "superior." A best practice for proposal writing is to go through the steps of the Tier 1 and Tier 2 analysis. Tier 1 - Is the Project Equivalent? Tier 1 analysis quantitatively compares the baseline of the loadings to the environment that will occur without XL to the environmental loadings under the XL project. Tier 1 analysis determines whether the project is at least as protective of the environment as what would happen absent the XL project. Tier 1 serves as a quantitative benchmark from which the SEP of your proposal can be measured. Tier 1 benchmarks are generally set at current actual environmental loadings. Tier 1 benchmarks might be expressed on a per-unit of production basis or other comparable measure, as appropriate, to show real environmental gains (e.g., volume of hazardous waste generated per unit of product). Projects must produce environmental performance at least equivalent to Tier 1, to be considered superior overall Tier 2 - Superior Environmental Performance Tier 2 is a presentation of quantitative and qualitative factors which show the level of environmental performance beyond "equivalence" established in Tier 1. Following are examples of Tier 2 factors you should consider when writing your proposal: How much your project would improve on the corresponding Tier 1 benchmarks. Pollution prevention or source reduction (e.g., a project that alters processes to eliminate toxic ingredients, rather than disposing of toxic waste). Environmental performance more protective than the industry standard or best practices of comparable facilities (e.g., closed loop production at a steel mill). Improvement in environmental conditions that are priorities to stakeholders, including issues not covered by EPA rules (e.g., habitat preservation, green space, parks or other protected areas, odors, noise, water or energy conservation). The extent to which your project addresses community and public health priorities, including issues not covered by EPA rules (e.g., identification of community health patterns, employee safety issues beyond those regulated by EPA). Please note that the Tier 1-Tier 2 analysis may not be appropriate in some projects. If you have worked to understand and apply this analysis and find that it not appropriate for your project, provide a rationale for how your project meets that standard of superior environmental performance. You should express the factors in quantitative terms wherever possible. Any data, statistics or research you have which supports your claims to SEP should be cited or included in your proposal. If data is not available when you are writing your proposal, will it be developed during the course of the project? If so, mention this and describe how it will be collected. Some proposals which have involved cost savings have been credited with SEP by committing to use some or all of the money saved for specified environmental improvements. For an example, please refer to the New York State Department of Environmental Conservation proposal at: https://www.epa.gov/projectxl/nydep/index.htm If you have an innovative idea that results in cost savings but are having difficulty demonstrating SEP, consider calling EPA or state environmental staff to discuss possible approaches. 3. How will you measure the SEP of your proposal? In order to fully understand the Superior Environmental Performance your proposal might produce, it is helpful for EPA and other stakeholders to know how you plan to collect supporting data. Indicate in your proposal what measuring or modeling techniques you are planning to use to determine SEP. Some XL projects use data collection techniques developed and/or recommended by EPA. Using techniques approved or recommended by EPA is not a requirement-but if you propose to use some other type of measuring or monitoring, you should explain in your proposal why you are choosing it and how it will achieve the desired results. B. Flexibility and Other Benefits XL projects should produce benefits, flexibility, cost savings, or other economic gain for the project sponsor, and/or result in a decrease in paperwork burden (otherwise you wouldn't be proposing it). Explain in this section benefits you hope to achieve if your proposal is implemented. Costs avoided as a result of your project, such as avoided downtime, should be included. Quantify any cost savings, including those which result from reductions in paperwork burdens. Describe any increases in efficiency or productivity that will result from your proposal. Are you better equipped to respond to market demands? Try to estimate a dollar value for the benefits associated with your proposal if it is implemented. Keep in mind that your proposal may result in benefits for entities other than your facility, such as the community-mention those in this section. Be sure to include benefits to Federal, state or local governments. Establish and discuss the relationship between the benefits and the innovative idea your proposal will test. Examples of benefits from XL projects can be found in the Lucent Technologies project proposal at: https://www.epa.gov/projectxl/lucent/index.htm C. Stakeholder Involvement The extent to which you seek and achieve the support of parties that have a stake in the environmental impacts of your project is an important factor in EPA's evaluation. One basic best practice for stakeholder involvement is quite simple: The earlier you involve stakeholders, the better. Use this section to describe any activities you have conducted or plan to conduct in order to involve stakeholders in your proposal. Whether or not you have already involved stakeholders, you should present a plan explaining how you will engage stakeholders throughout the process and what role they will play. The stakeholder involvement process for your project should be proportionate to the effects or nature of your proposal. Generally, complex projects, projects affecting more people or projects involving issues of known interest to stakeholders, should have a more extensive stakeholder process than smaller, less complex projects. Although it is not required, some project sponsors attach a separate Stakeholder Involvement Plan as an appendix to their proposal-this is well received by reviewers. The Elmendorf Air Force Base proposal includes an example of a good stakeholder involvement plan and can be viewed at: https://www.epa.gov/projectxl/elmen/040298_a.htm Because of the importance of this criterion, EPA and its stakeholders have developed the "XL Guide to Stakeholder Involvement," to help you formulate a stakeholder involvement plan. The document is available on the EPA XL web site at: http: //www.epa.gov/projectxl/032599.pdf. D. Innovation or Pollution Prevention Through Project XL, EPA is looking for proposals that test innovative strategies for achieving better environmental results. These strategies may include changes to processes, new technologies, or improved management practices. For the purposes of Project XL, Innovation may be something as simple as doing things differently than you currently do them. In this section, describe the innovation you would like to test and explain why it is innovative. EPA strongly encourages proposals which include strategies promoting pollution prevention and new technologies that improve environmental protection. Project themes EPA is particularly interested in include: Approaches that encourage source reduction and recycling of hazardous waste or materials produced or used during manufacturing or commercial operations; On-site reuse of wastes or by-products in production processes; Projects involving better or continuous collection of emissions data; Approaches that minimize the generation of wastes containing persistent, bio-accumulative, and toxic chemicals; Enhanced systems for data collection on employee health and exposure to environmental pollutants to aid company efforts to minimize work-related health problems; and Regulatory mechanisms to encourage consideration of the environment throughout the entire life cycle of a product. If your project includes any of these innovations, describe them in this section of your proposal. Additional information regarding project themes of particular interest to EPA can be found at: https://www.epa.gov/projectxl/eval2.htm E. Transferability XL projects are intended to be pilots which test new approaches that could conceivably be incorporated into EPA programs, other industries, or other facilities in the same industry. Describe the potential transferability of the innovation you would like to test under Project XL. Projects which provide relatively small levels of superior environmental performance may be more compelling if there is a high degree of transferability associated with them. If your good idea has the potential to produce results beyond your facility, provide a clear statement explaining the innovation and how it may be transferrable. Both the Lucent ISO 14000 and the Molex XL projects provide good examples of the transferability of Project XL experiments. For more information, please refer to: GOT https://www.epa.gov/projectxl/molex/index.htm or https://www.epa.gov/projectxl/lucent/index.html. F. Feasibility Although XL Projects are designed to benefit your company or facility as well as the environment in the long term, there are usually up-front costs associated with participation. These costs might include things such as human resources used to draft and revise the proposal, resources for data collection, or investments in process changes to reduce waste streams or emissions. In this section you should demonstrate that your project is technically, financially, and administratively feasible. Questions to answer include: Has your company or community management agreed to support the project? Has your company or community committed the necessary resources to successfully develop and implement your proposal? Do you have access to the technical expertise your proposal requires? In order for any project to be successful, relevant state and local agencies must be involved. Have you consulted state and local contacts with your idea? G. Evaluation, Monitoring, and Accountability 1. Accountability. Projects should have clear objectives and requirements that will be measurable in order to allow you, EPA, state and local authorities, and the public to evaluate the success of the project. XL Projects usually redefine compliance on a site-specific basis. Each project will have an enforceable component, described in the Final Project Agreement (FPA), but also contained in some type of legal mechanism, such as a permit, site-specific rule-making, waiver, variance, or administrative order. The legal mechanism will incorporate your commitment to superior environmental performance and EPA's commitment to flexibility. The more information you can provide in your proposal on enforceable commitments you are willing to make, the easier it will move through the XL process. There are three levels of commitment which project sponsors can make: Enforceable commitments -participant is legally bound to meet commitment. Voluntary commitments -not legally enforceable, but the participant can be held accountable through other means, such as termination of the project. Corporate aspirations-The goals or aspirations category exists to encourage you to aim as high as possible in your project. Project sponsors are not held accountable to these commitments through government action or citizen enforcement. Corporate aspirations can be contained in your proposal and in the Final Project Agreement, but should be clearly distinguished from accountable commitments. You should understand that although Project XL may redefine compliance for your facility or community, EPA remains responsible for enforcing the implementing legal mechanism. In other words, EPA's oversight role remains-it is your site-specific requirements which change. Your proposal should explain the different ways you are willing to be held accountable for commitments to superior environmental performance. 2. Tracking, Reporting, and Evaluation. As we mentioned in the SEP section of this guide, EPA and other stakeholders need to know how you plan to collect and make available supporting data. At some point in the XL process, you, the regulatory agencies (EPA and state or local), and the stakeholders will have to come to agreement on an acceptable tracking methodology. The sooner you present a framework for that methodology, the better. If your method of tracking the project was described in detail in the SEP portion of your proposal, it is not necessary to repeat the details here, but remember to refer readers to the discussion in the earlier section. In addition to describing the method you will use for tracking, identify how you intend to make information about the project, including performance data, available to the public, stakeholders, and EPA in a form that is easily understandable. The method for making project information available should be discussed with stakeholders. EPA encourages you to make all project related information available on the Internet. You should be aware that it will be necessary to monitor results throughout the life of your project. Tracking and evaluation data is generally for the purpose of determining if the project is resulting in the SEP that was expected. However, EPA will be looking for information on all significant aspects of the project in an annual evaluation. 3. What if my project fails to meet the expected performance after it is implemented? That's a good question for you to be thinking about, but not one which has to be addressed in your proposal. If your proposal is accepted for participation in Project XL, the Final Project Agreement (FPA) will generally contain a "soft landing" or contingency plan. If the project encounters problems or you choose to end your participation, these plans are designed to bring your company or facility back into compliance with requirements that existed absent Project XL. The details of the "soft landing" plan are unique to each project and are negotiated between you, EPA, the state and stakeholders during FPA development -you are not expected to provide such a plan in your proposal. If you have ideas or suggestions how a "soft landing" plan might be structured for your project, you should discuss them with EPA. H. Shifting of Risk Burden Your project must protect worker health and safety and ensure that no population is subjected to unjust or disproportionate environmental impacts. This is required by Executive Order 12898 which addresses the issue of Environmental Justice. When EPA considers any project, it is always with the intention of producing clear risk reduction-not shifting of risks from one population to another. This section should explain whether implementation of your proposal would shift of risks from one segment of the population or community to another.
IV. What information should the Requested Flexibility section contain?	Project XL is designed to provide flexibility from existing requirements (e.g., regulations, permit requirements, reporting or monitoring requirements, policies, compliance deadlines, etc.) Which, in specific instances, may act as barriers to innovative environmental solutions. Such flexibility and its potential to reduce costs and improve the operating efficiency of facilities is the principal reason project sponsors choose to voluntarily participate in Project XL. Try to articulate the link in your project between the flexibility you are asking for and the Superior Environmental Performance you expect to achieve. Where that link is strong (i.e., where flexibility and other benefits are factually or legally linked) the project's ideas are more likely to be transferrable. Although direct linkage is not a requirement, the closer the relationship is between the flexibility you are requesting and the anticipated environmental benefits of your project, the more likely EPA is to approve the project. Your proposal will be more effective if you identify as precisely as you can which requirements you would like flexibility from. Don't presume we know the relevant state or local codes or regulations you are subject to list them clearly in this section. Mention any existing or reasonably anticipated state, local, or federal regulations, policies or permits which you think may impact the project. If your project meets the other XL decision criteria, EPA will aggressively offer the flexibility you need to produce Superior Environmental Performance. Charts or tables showing the relationship between project components and flexibility requested are helpful.
V. What information should the Enforcement and Compliance Profile Section include?	Participants in Project XL are expected to be "good actors"- meaning that they should have a good history of compliance with environmental regulations. If your company or facility has a history of violations it will pose additional issues for EPA and your state to consider. EPA will conduct an enforcement screen of your facility or company, if it is selected for participation in Project XL. None of the information you provide in this section will result in automatic refusal of your proposal. But because of the high level of mutual trust required for successful projects, providing the information up-front is an indication of your commitment to the project. You should provide the following information in your proposal: Any violations of environmental regulations or permits within the last 5 years; Any on-going enforcement action or outstanding compliance issues; Any obligations under an administrative order or judicial decree; Any litigation against EPA or the state which your company, community or facility is party to; and Any relevant civil lawsuits pending against your company or facility.
VI. What schedule information should be included?	The Schedule Information section of your proposal should answer the following questions: What is the proposed duration of your project? How long will initial implementation of the project take? What are some of the milestones associated with implementation of your project? Are there any relevant permit renewal dates or other upcoming compliance deadlines? Does the business cycle of your industry affect implementation of your proposed project? Many projects require amending of state regulations in addition to flexibility from federal requirements. Does the schedule of your state legislature affect your proposal?
VII. What are the major steps and milestones in the XL Process?	A brief description of the XL process can be viewed at: https://www.epa.gov/projectxl/file2.htm
VIII. Does EPA have examples of good proposals?	Yes. Our Internet site, https://www.epa.gov/Projectxl, is a great resource and contains many past proposals. We recommend looking at the Merck XL project at: https://www.epa.gov/projectxl/merck/index.htm and the Weyerhaeuser XL project at: https://www.epa.gov/projectxl/weyer/index.htm as examples of proposals which might be useful. Remember, your proposal is unique and providing the information described in this guide is more important than modeling your proposal on one of the examples on our Internet site.

Project XL: Best Practices for Proposal Development

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