10 Questions with DEEP’s Ross Bunnell

Engineer explains agency’s new hazardous waste compliance assistance program

By Lesia Winiarskyj

Ross Bunnell

Connecticut’s Department of Energy and Environmental Protection (DEEP) has developed an outreach program—COMPASS—to help businesses comply with Connecticut’s hazardous waste regulations. Ross Bunnell, an engineer and 25-year veteran with DEEP’s hazardous waste program, explains.

First of all, what is ‘hazardous’ waste?

Hazardous wastes include wastes that are flammable, corrosive, reactive, toxic, or specifically listed due to certain hazardous properties and that require special handling and disposal. Examples include residues from industrial wastewater treatment, spent process solutions, solvent and paint-related wastes, and old or unused chemicals. Hazardous wastes also include some fairly common items, like fluorescent lamps, mercury thermostats, batteries, and computers and other electronic equipment, all of which can contain toxic metals.

Tell us about COMPASS.

COMPASS, short for “compliance assistance,” is a program DEEP created to help businesses stay in compliance with hazardous waste regulations. We’ve posted fact sheets, guidance manuals, and other key information and set up a toll-free compliance assistance hotline, 888.424.4193, where folks can get answers to specific questions. Also—and this is of particular interest to businesses—we offer free compliance assistance audits.

What happens during an audit?

We come out to companies and determine whether their wastes are hazardous, what requirements they may need to comply with, and even whether and how they can reduce or eliminate the hazardous waste that they generate. It’s free advice and assistance from our inspection staff—without enforcement action or fines levied. You can schedule a visit, which includes a walk-through and tour of your facility, a review of your operations and manufacturing processes, and an evaluation of wastes generated and on-site documentation, such as shipping records, hazardous waste determinations, and waste profiles. Anyone who wants to set this up should call us [or click here].

What types of businesses should know about COMPASS?

Really, almost any company that generates hazardous waste. This could be a large manufacturer, a neighborhood autobody shop, or a business of just about any size in between. If a company generates wastes as a result of their operations, there’s a good chance at least one of those wastes could be hazardous.

What advice do you have for businesses and other entities that are new to these requirements?

There’s a section of DEEP’s website called “RCRA Help!” that provides step-by-step guidance for those who are new to hazardous waste requirements. RCRA stands for Resource Conservation and Recovery Act, the law that established the requirements for properly managing hazardous waste.

Does COMPASS help with requirements other than hazardous waste?

Sure—businesses that generate hazardous waste often are subject to other environmental requirements, such as solid waste and recycling, wastewater discharge, and air pollution regulations. The staff at DEEP’s hazardous waste program has experience with these requirements, so we may be able to help with them as well.

What has been the business response to COMPASS?

Literally thousands of Connecticut companies have accessed our materials or called our hotline. We’ve also performed free audits for numerous facilities. We’re finding that businesses are very pleased with the level of site-specific help they get—not only to comply with requirements but also to reduce or eliminate the hazardous waste they generate and save money on disposal costs. If companies can easily get the compliance information they need, they can save staff time, lower their costs for waste management, and even in some cases, save on material and energy.

Have businesses helped shape COMPASS?

Definitely. After developing the program, we knew we needed input from potential users. So we created a stakeholder group called the Hazardous Waste Advisory Committee. This group put together recommendations for improving our program—and an implementation schedule.

What were some of their recommendations?

They suggested holding meetings a few times a year to provide free training and a forum for agency staff and the business community to discuss and collaborate on key hazardous waste issues. They also asked for an interactive, computer-based compliance assistance program, which we’re calling “iCOMPASS.” It would involve users going online and answering a series of questions about the hazardous waste activities at their site. Based on their answers, iCOMPASS would generate a detailed report about hazardous waste requirements that apply to them. Basically, it would work a lot like the tax preparation software that people use. It could also be designed to link to relevant topics and required forms at DEEP’s website.

What’s the status of iCOMPASS?

We’re still gathering feedback from those who handle and manage hazardous waste. We’re asking what they want out of a Web-based program like iCOMPASS, and we’re eager to hear from CBIA member companies about their preferences. We’ve developed a simple, 12-question survey businesses can take to help guide us. ■

Lesia Winiarskyj is a writer and editor at CBIA. She can be reached at lesia.winiarskyj@cbia.com.

Biotech Alive and Growing in Connecticut

By Lesia Winiarskyj

In the midst of what was, arguably, the worst flu season in the last five years, the U.S. Food and Drug Administration in January approved a revolutionary vaccine made using recombinant DNA technology. Unlike other flu vaccines on the market, Flublok (which will be widely available for the 2013–2014 flu season) is manufactured without live influenza viruses or eggs—eliminating the need for antibiotics and formaldehyde in the production process.

Flublok uses cells from the ovaries of a caterpillar, reprogrammed to make a highly purified protein—hemagglutinin—associated with the flu virus. The cells’ ability to grow and divide indefinitely allows for accelerated, large-scale production.

Dr. Karen Midthun, director of the FDA’s Center for Biologics Evaluation and Research, says this cutting-edge technology “offers the potential for faster startup of the vaccine manufacturing process in the event of a pandemic, because it is not dependent on an egg supply or on availability of the influenza virus.”

Economic Boost

Besides being a public health breakthrough, Flublok is also, importantly, a boon for Connecticut’s growing biotech economy. The new vaccine, together with an additive designed to reduce the duration and severity of influenza and prevent its spread, is a product of Meriden-based Protein Sciences Corporation.

“Fewer than one percent of the biotech companies on the planet get a product approved,” says Dan Adams, executive chair and global head of business development at Protein Sciences. “Ninety-nine percent of people who work for pharmaceutical companies never work on a product that gets approved. So we are really rare birds here. And we did it as a small company.”

Protein Sciences added more than 70 high-paying jobs to its payroll in the last 18 months—and they are not the only Connecticut biotech experiencing rapid growth.

Here We Grow Again

Cheshire-based Alexion Pharmaceuticals, which started as a small biotech in New Haven’s Science Park, has twice outgrown its space since 1992. Thanks to significant incentives provided through Governor Malloy’s First Five program—including urban and industrial site reinvestment tax credits, grants for laboratory construction and equipment, and loan forgiveness based on job creation—Alexion is combining its research, operational, and administrative headquarters functions into a single state-of-the-art facility in downtown New Haven, scheduled for completion in 2015. The company, which develops treatments for ultra-rare diseases, expects to create 200–300 new jobs in the state by 2017.

Similarly, Achillion Pharmaceuticals, which develops oral treatments to cure hepatitis C, is continuing to expand operations at its New Haven headquarters.

Over the past two years, Achillion has grown its employee base by nearly 50%, hiring highly trained personnel with regulatory and clinical operations expertise. That growth is likely to continue, says Senior Vice President and CFO Mary Kay Fenton, as Achillion announced last month the completion of a $142 million follow-on stock offering to support its future development plans.

“With an ideal geographic location between New York and Boston, New Haven has always been home to a number of emerging life sciences and pharmaceutical companies,” says Fenton. “We owe much of our success to the world-class talent available to us here in Connecticut, and to the bioscience cluster that is expanding in downtown New Haven and throughout the state.”

Leading the Way

According to Paul Pescatello, Connecticut—which is home to more than 500 bioscience companies—ranks seventh in the nation in the number of bioscience companies per capita and in total employment supported by biopharma. Pescatello is chair of the Bioscience Growth Council for CURE (Connecticut United for Research Excellence).

“The industry contributes over $14 billion to the state’s economy,” he says, “or about six percent of the gross state product.”

Recent efforts to recruit and retain bioscience firms and solidify Connecticut’s position as a national leader in stem cell research, genomics, and personalized medicine show great promise, Pescatello adds.

“The state is leveraging public-private partnerships, creating new and expanded facilities, and offering targeted incentive packages that will attract life sciences companies to Connecticut and keep them here once their products reach the point of commercialization.”

Examples of recent initiatives include:

  • Governor Malloy’s proposed Bioscience Innovation Act, which would provide $200 million in funding to strengthen Connecticut’s bioscience sector over the next 10 years
  • The formation of a new bipartisan Life Sciences Caucus consisting of state legislators from both the House and Senate tasked with supporting scientific innovation and the growth and expansion of bioscience through public policy
  • Increasing the UConn Health Center’s research innovation capacity through facility upgrades, a doubling of incubatory space for bioscience business startups, and a $1.5 billion investment in UConn to support STEM (science, technology, engineering, and math) education activities
  • Connecticut’s Innovation Ecosystem, a public-private partnership (with hubs in Hartford, New Haven, Stamford, and Storrs) to support high-value technology-based startups and stage 2 companies

“Simply put, bioscience is a wise investment that generates rich dividends,” says Pescatello. “This is especially the case for a state like Connecticut—a state whose assets are its patents, its intellectual property, its expertise in high-value-added R&D, and its talent pool—men and women ready and able to take the jobs created by bioscience, from lab technicians to lead Ph.D. scientists. Bioscience creates great jobs with robust benefits that aren’t easily outsourced. And no industry invests or exports more. The multiplier effect of each dollar expended—the ripple effect across the state’s economy—is greater for the biopharma industry than for any other.“ ■

Lesia Winiarskyj is a writer and editor at CBIA. She can be reached at lesia.winiarskyj@cbia.com.

Sample Recommendations from CBIA’s 2013 Government Affairs Program

A Stronger, More Competitive Connecticut

Five years after the recession began—and two years since it technically ended—Connecticut continues to face serious economic and fiscal problems. Our challenge is to build a stronger, more competitive Connecticut where:

  • Small businesses, manufacturers, and large corporations are all able to succeed in regional, national, and global economies.
  • Employers can offer and sustain the high wages and benefits that raise our standard of living and provide a dependably good quality of life for all residents.
  • A high-performing education system, modern infrastructures, equitable tax and regulatory policies, and a streamlined, efficient state government boost business confidence and economic performance.
  • Our greatest strengths—such as skilled workers, core industries, and advanced manufacturing—are made stronger, and innovators are encouraged to create new businesses, products, and services.

CBIA’s 2013 Government Affairs Program shows how state policymakers can achieve those goals in ways that give employers a clear indication that the time is right to create more jobs and increase investments in the state. The following are examples of our recommendations.

A Sustainable State Government

State spending. Make state government more efficient, effective, and affordable by budgeting responsibly and streamlining the state bureaucracy. Key steps include:

  • Creating a new state budget that reduces the size and cost of state government while improving its effectiveness without additional tax or fee increases
  • Implementing government reforms based on recommendations by the Connecticut Institute for the 21st Century and best practices from other states in such areas as long-term care, corrections, and state employee pensions and retirement benefits

State taxes. Make state tax policy simpler, fairer, and more strategic to help drive our economy by (1) promoting tax policy that encourages business investment, jobs, innovation, and productivity, and (2) encouraging consistency and predictability in the development and application of state tax policy and avoiding retroactive changes to ensure fairness, effectiveness, and economic growth. Specific short-term steps include:

  • Clarifying the manufacturing exemption for mixed-use businesses and repairs
  • Phasing out the corporate income tax surcharge as planned
  • Clarifying the apportionment methodologies applicable to limited liability companies and partnerships to provide a level playing field with corporations

We also recommend several long-term solutions—for example, phasing out the 70% cap on corporate tax credits for R&D and fixed capital and allowing all business entities to claim tax credits.

More Competitive Business Costs

Energy costs. Promote a comprehensive energy policy that provides our economy with reliable, diverse, and affordable power. Policymakers should, for example:

  • Implement aspects of the state’s new Comprehensive Energy Strategy that reduce energy costs for Connecticut manufacturers and other businesses.
  • Allow greater flexibility to meet the state’s Renewable Portfolio Standards (such as by broadening the universe of “Class 1” renewables).
  • Further develop and maintain a diverse portfolio of energy sources to fuel our economy, including natural gas, large-scale hydropower, nuclear, fuel oil, clean coal, and renewables.

Healthcare costs. Shape state healthcare policy to reduce costs while increasing quality and access by, for example, reducing existing state health benefit mandates, rejecting future mandates that would be a direct cost to the state, and encouraging competition and a level playing field that will offer employers more choice among health insurance plans within and outside the state’s new healthcare exchange. Furthermore, support modification of medical malpractice claim statutes by basing pre- and post-judgment interest rates on the prime rate and promoting voluntary alternative dispute resolution programs.

Environmental costs. Better align environmental laws, regulations, and policies with economic development goals. Among other things, CBIA urges DEEP to quickly revise its cleanup standard regulations, and the legislature to reject any proposal prior to the adoption of such regulations that would expand the number of properties in DEEP’s cleanup programs. DEEP should also continue its positive efforts to achieve greater compliance through education and technical assistance, and the state should continue to reform its brownfield programs to encourage private-sector investment in developing these properties.

Labor and employment costs. Remove barriers to job creation by controlling business costs and reducing administrative burdens. Among CBIA’s recommendations are that the state modify the paid sick leave law so that Connecticut employers are able to administer it more effectively. Specifically, the law should be changed to:

  • Allow employers the flexibility to administer the leave on a calendar, fiscal, or alternative-year basis.
  • Exempt manufacturers as originally intended.
  • Permit employers to address absenteeism that results from the misuse of paid sick leave.
  • Allow employers to verify their number of employees by the same method used under the state’s family leave law.

CBIA also recommends that the state take action to control workers’ compensation and unemployment compensation costs through steps such as:

  • Eliminating barriers to allowing hospitals, self-insured employers, and insurers to negotiate appropriate charges for medical services in workers’ comp cases
  • Ensuring unemployment comp recipients are actively trying to return to the workforce

Corporate governance and liability. Make Connecticut’s corporate laws consistent with those of competitor states. Steps policymakers should take include appropriately recognizing the vitally important role boards of directors play in corporate governance and updating state antitrust laws to put Connecticut on a level playing field with our competitor states.

A Stronger Connecticut

Education and workforce development. Implement the landmark education reforms passed last year. CBIA urges state policymakers to focus on several goals to improve education, close the achievement gap, and strengthen workforce development programs. For example:

  • Remove red tape to allow students and schools to achieve their academic goals. Steps include streamlining certification programs to attract and retain qualified teachers and administrators and establishing an alternative route to certification for school administrators.
  • Ensure that the state’s recent education reforms are implemented effectively so that students get the tools they need to become tomorrow’s competitive workforce. Policymakers should, for example, plan to further increase the number of available pre-K opportunities and identify a process to ensure the quality of existing and future pre-K seats.
  • Measure the effectiveness of education programs to determine whether adjustments are necessary by, for example, reviewing grant programs to ensure funds are reaching the schools most in need.
  • Expand manufacturing internships to include opportunities for minors not involved in a school or secondary-education manufacturing or mechanical program.

Manufacturing. Adopt policies that allow Connecticut’s manufacturers to grow, create jobs, and drive economic recovery. CBIA urges policymakers to support Connecticut’s manufacturers through commonsense improvements in education, environmental, tax, and economic development policies. Specific action steps include adopting the recommendations of the National Governors Association Policy Academy that will provide manufacturers with the policies, business environment, and resources they need to innovate and compete globally.

Energy and telecommunications. Promote policies that deliver reliable, diverse, and affordable energy and telecommunications infrastructures that give Connecticut greater flexibility to meet its Renewable Portfolio Standards and possess a diverse portfolio of energy sources to fuel our economy—including natural gas, large-scale hydropower, nuclear, fuel oil, clean coal, and renewables.

Transportation. Upgrade Connecticut’s infrastructures through strategic, priority investments. Steps include expediting the implementation of priority transportation projects that will help drive economic recovery, working with the Connecticut Airport Authority to ensure that the state achieves the full economic potential of our airports, and implementing a strategic plan to bring all roads and bridges into good repair. ■

For more information, contact CBIA’s Bonnie Stewart at 860.244.1925 or bonnie.stewart@cbia.com. Read the complete CBIA Governement Affairs Program here and urge your state legislators to adopt its recommendations.

Head of Curtis Packaging Elected to Chair CBIA’s Board

Board of directors selects full slate of officers at Dec. 6 meeting

Donald R Droppo, Jr., CEO of Curtis Packaging in Sandy Hook, was elected chair of CBIA’s board of directors at the association’s Dec. 6 board meeting. He will serve a one-year term, succeeding Thomas S. Santa, president and CEO of Santa Energy Corporation in Bridgeport, who becomes immediate past chair.

CBIA’s board also elected two vice-chairs, James P. Torgerson, president and CEO of UIL Holdings Corporation in New Haven, and Donna R. Galluzzo, Ph.D., president and CEO of HMS Healthcare Management Solutions Inc. in Wallingford.

“Going into this very important legislative session, which has great potential for impacting not just the fiscal issues facing Connecticut but also our future economic vitality, we’re very pleased that such a strong group of business and community leaders will be heading up our board,” says John Rathgeber, CBIA’s president and CEO. “Don, Jim, Donna, and Tom have shown true commitment to creating a more competitive economic climate in Connecticut, a critical factor in maintaining high-paying jobs and the great quality of life we have in the state. CBIA will greatly benefit from their knowledge and expertise in the months ahead.”

Donald R. Droppo, Jr.

Droppo was named president and CEO of Curtis Packaging in 2010. Under his leadership, the company dramatically increased sales and rebranded itself “luxuriously responsible,” becoming the first printing and packaging company in North America to be Forest Stewardship Council certified, manufacture using 100% clean renewable energy, and be carbon neutral. In 2011, he was named one of Connecticut Magazine’s “40 Under 40” most promising young leaders.

Prior to his appointment as president and CEO, Droppo served as the senior vice president of marketing, responsible for marketing, sales, and innovation. Before joining Curtis, he was an assistant vice president at General Reinsurance, a subsidiary of Berkshire Hathaway. Droppo holds a B.S. in marketing and finance from the University of Vermont. He lives in Avon with his wife and their three children.

James P. Torgerson

Torgerson became president and CEO of UIL Holdings Corporation in 2006. (UIL is the parent company of several energy firms: The United Illuminating Company, Southern Connecticut Gas Company, and Connecticut Natural Gas.)

Previously, he was president and CEO of the Midwest Independent Transmission System Operator Inc. and a member of its board of directors. Before joining the Midwest ISO, he served as CFO for several gas and electric utilities in North America.

Actively involved in the community, Torgerson serves in many capacities, including as board member of Yale New Haven Hospital, the Edison Electric Institute, the American Gas Association, and the Business Council of Fairfield County. He is also chair of REX Regional Growth Partnership and the Connecticut Institute for the 21st Century, and he serves as a trustee of the Foundation for the Advancement of Catholic Schools.

A native of Cleveland, Torgerson received a Bachelor of Business Administration in accounting from Cleveland State University.

Donna R. Galluzzo, Ph.D.

Galluzzo is president and CEO of HMS Healthcare Management Solutions Inc. in Wallingford. HMS was founded in 1996 and provides a full range of services for physician practices, homecare, hospice, long-term care, and other healthcare providers.

Prior to starting HMS, Galluzzo was president and COO of Connecticut VNA Inc., which owned and operated the largest network of home health agencies in New England. She also was a principal at AccessOne Health Systems LLC, a Connecticut state-licensed utilization and case management organization. In addition, she was a principal at Professional Home Care Services Inc. and OMNI Home Health Services Inc.

Galluzzo has received numerous honors and awards. Most recently, she was named a Connecticut Women’s Hall of Fame Women in Healthcare Honoree.

She earned her Ph.D. in nutritional biochemistry from the University of Connecticut and remains committed to lifelong learning. Much of her energies are spent serving on educational boards and sponsoring multiple projects for schools in the U.S. and abroad.

She lives in Durham with her husband, who is a retired lawyer and businessman. They have three young adult children.

Thomas S. Santa

Santa joined Santa Energy in 1982 and became president and CEO in 2004. He is a third-generation family member to lead the company, transforming it from a local family heating oil dealer to a major New England energy supplier.

Santa pioneered the marketing of low-sulfur heating fuels, bio fuels, and natural gas and has an active consulting practice in energy conservation and energy price risk management.

He serves on the boards of the Bridgeport Regional Business Council, Connecticut Maritime Coalition, Junior Achievement of Western Connecticut, and the Barnum Festival.

A licensed professional engineer, Santa earned a B.S. from Syracuse University and an M.B.A. from the University of Bridgeport. He lives in Redding. ■

For more information, visit CBIA.

Governor: No Intention of Raising Taxes

Will the state legislature follow his lead?

Pictured with the governor are CBIA board chair Tom Santa, president and CEO of Santa Energy Corporation (left), and Michael Wise, president of ConnectiCare.

Early next year, Gov. Dannel Malloy will present a new budget to the General Assembly. Two years removed from the largest tax increase in the state’s history, the governor has different plans this time around.

“I don’t know what’s going to come out of Washington,” he told more than 400 business leaders at CBIA’s Annual Meeting in Hartford, “but I don’t intend to raise taxes. We’ve done enough of that. We need to live within the means that we’ve established, and we need to continue the process of becoming substantially more efficient in the provision of [state] services.”

Despite progress that’s already been made, reaching those goals is absolutely critical, especially given that the state is already on course to end the current fiscal year

(FY 2013) with a $60.1 budget deficit, a shortfall that could reach $200 according to current estimates by the Office of the State Comptroller. Whether the majority party in the state Senate and House follow the governor’s lead, however, remains to be seen.

Business Speed

The administration’s focus during the last budget cycle, the governor said, was on “getting our own fiscal house in order,” while making government more efficient.

“It’s not easy. It’s not pretty,” he said, “But we have to approach the business of government the same way that you approach running your businesses.

“I’m not a job creator. You’re the job creators. Government needs to get off your backs and get to yes or no in a reasonable period of time—not measured by the glacial speed that government normally reacts at, but at the speed that business has to be conducted at.” ■

New Energy Plan, Environmental Policies Take Shape

Connecticut businesses asked for their input

By Lesia Winiarskyj

In his rollout of Connecticut’s new energy strategy last month, Gov. Dannel Malloy said, “Our environmental, energy, and economic challenges are all related—and tackling them together offers the best chance to lower the cost of electricity and heat for our families and seniors, the best chance to lower the cost of power, and make our businesses and industries more competitive so that they can create the jobs that our residents need, and the best chance to reduce air emissions and other harmful impacts on our land and water.” (Photo by John Kallio)

At last month’s annual “What’s the Deal?” business energy conference, presented by CBIA and the Connecticut Power and Energy Society, Gov. Dannel Malloy unveiled Connecticut’s first-ever comprehensive energy strategy before an audience of 250 business leaders and public officials.

The administration is hosting a series of public debates and technical reviews of the draft plan over the next two months, collecting feedback and recommendations prior to the 2013 legislative session. Proposed legislative recommendations will be taken up by the Connecticut General Assembly, which convenes Jan. 9.

First Real Blueprint

The new energy plan is designed as a roadmap for cheaper, cleaner, more reliable energy in the state, which traditionally has paid some of the highest energy prices in the nation.

“For too long in Connecticut, it was the same old story,” said Malloy. “Our businesses struggled to compete because the cost to keep your lights on, heat your buildings, run your…equipment, or fuel the cars and trucks that are essential to your operations was too high.

“A comprehensive energy strategy can help us create jobs, it can make our state’s businesses more competitive, and it can ensure that we preserve and protect our environment for generations to come.”

CBIA President and CEO John Rathgeber agrees that the new framework presents opportunities to transform the state’s struggling economy.

“Connecticut’s high energy costs place a real burden on the state’s economy,” he noted, “particularly the manufacturing sector. If we’re going to grow our economy, become more competitive, and create jobs, we must change how we access, distribute, and consume energy.”

Key Components

Connecticut’s energy strategy focuses on a few key areas, which Gov. Malloy and Department of Energy and Environmental Protection (DEEP) Commissioner Dan Esty explained more fully at the October conference. These include:

  • Leveraging limited state funds to attract private capital for energy efficiency and clean energy investments
  • Expanding residential, business, and industrial consumers’ access to lower-cost natural gas
  • Redesigning the state’s energy efficiency programs to include more vendors and more incentives for “deeper” efficiency investments (beyond lighting and weather stripping) in industrial processes, water storage and heating, and boiler replacements
  • Aligning Connecticut’s renewable portfolio standards (RPS) with abundant regional supplies of clean, affordable, reliable energy, such as large-scale hydropower

“I know this is a pretty savvy crowd,” the governor said. “So the question you all want to ask is, ‘How are we going to pay for all this?’”

That’s part of the public dialogue now taking place. To learn more and join the conversation, click here or contact CBIA’s director of energy and environmental policy at eric.brown@cbia.com.

Other Energy and Environmental Policies

Federal and state regulators also recently updated Connecticut businesses about changes—and pending legal challenges—to other energy and environmental policies that impact their operations and their bottom line.

EPA’s Gina McCarthy outlines changes to key federal energy and environmental policies. (Photo by John Kallio)

At the fall meeting of CBIA’s Environmental Policies Council in Hamden, Gina McCarthy, assistant administrator of the U.S. Environmental Protection Agency’s (EPA) Office of Air and Radiation, outlined developments in her agency’s Mercury and Air Toxics Standards (MATS) Rule, Cross-State Air Pollution Rule (CSAPR), and Greenhouse Gas Rule.

Mercury Standards

Issued in December 2011 to facilitate the transition to a cleaner, more efficient electric power system, the MATS Rule prescribes standards under the Clean Air Act to control mercury emissions from power plants—collectively among the largest sources of such pollution in the U.S.

Sophisticated technologies to reduce mercury emissions have been around for 30 years, said McCarthy, but many utilities in southern and Midwestern states that have been around for 70 years—“our legacy fleet,” she called them—have been slow to adopt these existing tools.

“EPA decided it was time for these older power plants to invest, upgrade, and innovate the way New England states had been for decades,” she said. The challenge, however, was that affected power plants had only three years to come into compliance. McCarthy described the three-year timeline as “ambitious,” acknowledging business leaders’ concerns that it threatened to increase electricity costs and impact energy reliability.

To address those concerns, utilities were granted some flexibility in implementing mercury-reducing technologies. They could apply for a one-year extension to install the necessary controls, and in some cases, a fifth-year extension could be granted to allow them to come into compliance without dramatically raising energy costs or compromising reliability.

Winds of Change

The Cross-State Air Pollution Rule (CSAPR) was EPA’s second attempt to address the interstate transport of nitrogen oxides and sulfur dioxide emitted by power plants in upwind states such as Ohio and Pennsylvania. These and other air pollutants that contribute to the creation of ground-level ozone travel downwind and significantly impair the ability of Northeastern states such as Connecticut to comply with air quality standards under the Clean Air Act. (EPA recently determined that Connecticut does not similarly contribute to air quality problems in states downwind of us.)

In many cases, McCarthy noted, southern and Midwestern power plants have increased the height of their smoke stacks in an effort to disperse pollution and decrease the impact on local communities. But because taller smokestacks release air pollutants high into the atmosphere, where wind currents are faster, the pollution they emit travels hundreds of miles to other states.

“We are like the tailpipe of the U.S.,” she said, noting that the problem of air pollution transport from upwind to downwind states has not been sufficiently addressed despite the Clean Air Interstate Rule, or “good neighbor” obligation, which requires upwind reductions sufficient to allow downwind states to be within their air quality standards.

Legal challenges have frustrated her agency’s ability to address the air pollution transport problems—but she’s not giving up. “We have an obligation to New England to do better,” she said.

Incentives over Mandates

McCarthy also talked about how maintaining an efficiently operated and diverse fuel supply makes good economic sense and addresses environmental concerns. She offered the example of the Natural Gas STAR Program, a voluntary partnership that encourages oil and natural gas companies to improve operational efficiency and reduce emissions of methane, a potent greenhouse gas that is emitted in the fracturing process (known as fracking) used to extract natural gas.

Methane, she noted, happens to be a commodity the regulated community can capture and sell. In fact, new technologies are allowing companies to capture methane released during fracking and sell it as a commodity.

Moving forward with improving our environment while improving our economy, McCarthy added, “[is] not so much about what you mandate, it’s increasingly more about what you incentivize.”

‘Process Rethink’

Macky McCleary, deputy commissioner of DEEP, shared his agency’s major state environmental policy initiatives for 2013, saying they will continue to streamline remediation programs; upgrade information systems and technology; improve customer experiences; reduce application wait times; and increase efficiency, flexibility, and responsiveness.

The agency’s approach, he noted, has been to move away from a command-and-control style, providing penalty relief and compliance assistance, especially to smaller businesses struggling to keep up with complex environmental rules.

“As we modernize our regulatory environment, business support and buy-in are critical, and we are starting to have it. So many of our businesses share environmental protection as a core value,” and the continued leaning of DEEP, its “process rethink,” and its pursuit of market-based approaches have resulted in higher ratings of business leaders’ interactions with the agency, he said.

Indeed, in a survey CBIA conducted this fall, business leaders’ ratings of DEEP’s customer service have improved significantly since McCleary and Esty took over in 2011.

“You really have made a tremendous difference in the last two years, with reduced permitting times and increased responsiveness,” an audience member noted. “So many of the folks at DEEP now ‘get it.’” ■

Lesia Winiarskyj is a writer and editor at CBIA. She can be reached at lesia.winiarskyj@cbia.com.

Progress Seen in DEEP’s Performance

Businesses report improvements in customer service, regulatory climate

It’s no secret that Connecticut’s business community and the state’s environmental regulators have had something of a bumpy relationship over the years. Recently, however, businesses are noticing some meaningful improvements, largely as a result of regulatory reform legislation passed in 2010 and 2011—with significant input from CBIA—and the addition of enlightened leadership at the Department of Energy and Environmental Protection (DEEP).

Under Commissioner Dan Esty, DEEP has taken important steps to help the environment and the economy by streamlining the agency’s permitting and other processes, improving compliance through better customer service and assistance, and modifying regulations to meet environmental goals without unnecessarily burdening Connecticut businesses.

Then and Now

Over the summer, CBIA surveyed the members of its Environmental Policies Council (EPC), a group of informed business leaders from a broad range of industries that deal with environmental issues and agencies in Connecticut and elsewhere. Among other things, EPC members were asked to rate the quality of DEEP’s customer service and how Connecticut’s environmental regulatory climate compares with other states in which they do business.

“Our members who interact most directly with DEEP and other environmental agencies have experienced substantial changes,” says CBIA Associate Counsel Eric Brown, an expert in environmental and energy policy.

The findings show marked improvement from 2010—when the last EPC survey was conducted—to 2012 across all industry sectors, including manufacturing. The number of respondents rating DEEP’s customer service as poor, for example, decreased by 17 percentage points (from 26% to 9%) in that two-year period. At the same time, respondents rating DEEP’s customer service as good or excellent increased from 20% to 42%.

On the issue of Connecticut’s environmental regulatory climate, the survey found that EPC members feel like Connecticut is moving toward greater parity with other states.

The number of respondents rating the state’s environmental regulatory climate as significantly worse or worse than other states’ decreased by 27 percentage points, from 85% in 2010 to 58% in 2012, while the number rating it as the same as other states’ rose from 6% to 26%.

“Although there is still plenty of room for improvement, we are very encouraged by the survey results, and we appreciate all the effort DEEP leadership and staff are making,” says Brown. “This shows we can improve our environment and our business climate together.” ■

For more information about environmental and energy issues affecting Connecticut businesses, contact CBIA’s Eric Brown at 860.244.1926 or eric.brown@cbia.com.

Near-Term Economic Outlook ‘Uncomfortable’

Leading analyst looks for improvement later in 2013; says housing market will be key driver of recovery

By Bill DeRosa

Ryan Sweet, senior economist for the U.S. Macroeconomics Team at Moody’s Analytics, speaking at CBIA’s Connecticut Economy Conference in Rocky Hill. The Sept. 7 event drew 225 business leaders from across the state.

If you’re worried now, you’ll still be worried over the next six months.”

That bit of inspiring economic news came from Ryan Sweet, senior economist for the U.S. Macroeconomics Team at Moody’s Analytics, speaking at CBIA’s Connecticut Economy conference on Sept. 7 in Rocky Hill. He noted that over the short term, U.S. GDP will continue to average around 2%, “which is positive, but below the economy’s potential.”

The news, however, wasn’t all bad. Sweet told the 225 business leaders in attendance that although the next six to nine months “are going to be uncomfortable for the U.S. economy, by this time next year, [we’ll] be in much better shape.”

‘A Lot of Cliffhangers’

What’s preventing a more robust recovery, the kind we’ve seen following other recessions?

“Businesses are nervous,” says Sweet, “and when businesses are nervous, they’re not going to hire, and when they’re not hiring, consumers are not going to spend.”

He blames this state of affairs in large part on worry over political uncertainties. “By this point in a recovery, we should be seeing less uncertainty,” says Sweet. “But in fact, we have more, and this is really weighing on consumers, businesses, and investors. There are just too many questions and not enough answers.”

The most important questions center on the European debt crisis, U.S. monetary policy, and U.S. fiscal policy—in particular how policymakers choose to address the Jan. 1 “fiscal cliff,” when deep across-the-board spending cuts are triggered and the Bush-era tax cuts are set to expire.

Sweet believes that in light of recent action by the European Central Bank to buy sovereign debt, Europe will become less of a threat. And he foresees the Fed continuing to take measures to stimulate the economy through quantitative easing. The big cliffhanger, he says, is the fiscal cliff—whether or not policymakers will allow the spending cuts to kick in and the tax cuts to expire.

The most likely outcome? Sweet forecasts that policymakers will scale back the spending cuts and extend the Bush tax cuts for everyone but those in the top bracket.

Housing to the Rescue?

“The composition of growth is shifting,” says Sweet, noting that manufacturing—which has been the bright spot in the recovery so far—is beginning to slow. In addition, he says, consumer spending, typically about 70% of GDP, will be sturdy but not enough to drive growth. So where will it come from? “We need to turn to housing,” he argues.

“Housing is showing signs of life, partly because the job market is slowly improving and mortgage rates are at historic lows. I think potential buyers are starting to get the itch to go out and buy a house.”

Housing prices are beginning to edge up, says Sweet, and once they make a definitive move, “that will be enough to get people off the bench and into the housing market.” He points out that home sales are picking up, builders are feeling more confident, and retail sales of building materials and furniture are increasing.

“This pent-up demand is one of the reasons we think the economy will pick up in late 2013 and 2014. As house prices pick up, household wealth is going to improve. People will start buying more goods and services, because they feel better.”

Sweet cautions that this won’t happen overnight but predicts that the housing market will “shift from being a drag to a driver of the economy.” ■

Bill DeRosa is editor of CBIA News. He can be reached at bill.derosa@cbia.com.

Election 2012 at Glance

Learn about the state legislative candidates in your district and let them know where you stand at CBIA’s Election 2012 Website

Offices on the Ballot

Federal

  • President
  • U.S. senator (six-year term)
  • U.S. representative (two-year term)

State

  • State senator (two-year term)
  • State representative (two-year term)

Voter Registration

Only registered voters may vote. If you have moved since the last election, you will need to reregister. Here’s how:

In Person

You can register at any Registrar of Voters office in Connecticut through Oct. 30. Those who turn 18, become U.S. citizens, or move to another town between Oct. 30 and election day (Nov. 6) have until Nov. 5 to register in person.

By Mail

Download a mail-in voter registration form (in English or Spanish) here or obtain one from your town clerk’s office or Registrar of Voters. Forms must be sent to your hometown Registrar of Voters, postmarked by Oct. 23.

Voting

In Person

Election Day is Tuesday, Nov. 6. Polls will be open from 6 am to 8 pm. Find the location of your polling place here.

Absentee Voting

If you will be unable to vote in person on Election Day, you may vote via absentee ballot. You must first request an absentee ballot application form from your town clerk by mail or in person, or download the form (in English orSpanish) here. After receiving your completed application, the town clerk will give you a ballot. Your completed ballot must be received by the town clerk before the polls close on Nov. 6.

State’s ‘Triple E’ Agenda Moves Forward

Policymakers, regulators focus on environment, energy, economy

By Lesia Winiarskyj

CBIA Associate Counsel Eric Brown (far right) introduces DEEP Commissioner Dan Esty (far left) and EPA Region I Deputy Administrator Ira Leighton, keynote panelists at CBIA’s 2012 Environmental & Energy Conference.

Since taking the helm of Connecticut’s newly created Department of Energy and Environmental Protection (DEEP) last year, Commissioner Dan Esty has advanced what he refers to as “the triple E agenda: better environmental protection, movement to a cleaner, cheaper more reliable energy future, and a platform for economic growth, prosperity, and jobs success.”

Indeed, under Esty’s direction—and with considerable input from businesses—the agency has begun accelerating the permitting process, leaning its operations, and increasing its focus on assistance as an effective, efficient tool to maximize regulatory compliance.

Nicole Lugli, director of DEEP’s Office of Planning and Program Development, explains: “We met with small manufacturers and found out they couldn’t easily locate compliance assistance and guidance at DEEP. Many weren’t able to afford the tools and strategies to come into compliance. That was kind of an eye-opener for us,” she says.

“CBIA, our partner, was instrumental in the passage of legislation in 2011 requiring DEEP to develop a consulting services program to do on-site assistance.”

Rather than take punitive measures against small businesses for minor violations, which often pose little or no environmental risk but can trigger thousands of dollars in fines, DEEP’s compliance assistance programs give businesses the opportunity to identify and correct areas of noncompliance without significant penalties.

“We’re giving people an opportunity to come into compliance,” says Lugli. “We’re also improving web content and accessibility, making it user-friendly and interactive. Companies can subscribe to municipal and business newsletters on DEEP’s website and get updates and notices on new requirements and training.”

Over the next several months, DEEP will move forward on a wholesale overhaul of Connecticut’s environmental cleanup laws and regulations, with potentially significant implications for—and, CBIA hopes, significant input from—the regulated community.

“We’re optimistic that legislative and regulatory changes will result in an even more streamlined, efficient, and predictable system of environmental cleanup,” says Eric Brown, CBIA associate counsel specializing in environmental and energy issues.

‘21st Century Approach’

“We need a 21st century approach to environmental protection, to regulation, and to our energy strategies,” Commissioner Esty told business leaders at CBIA’s 2012 Environmental and Energy Conference.

More than 215 environmental health & safety professionals, engineers, project managers, consultants, and analysts attended the June program in Waterbury, which featured breakout sessions on environmental cleanup, management, and enforcement; a manufacturers’ roundtable; and sessions on clean, affordable energy.

“I think in Connecticut we have an opportunity to break new ground,” said Esty, “moving away from command-and-control regulations toward more focus on economic incentives, really trying to do things in a practical way, with common sense underpinning our choices, and doing things like rebuilding our remediaton program generally…getting brownfields back into productive economic use; doing things that are incentive-oriented, like changing the liability for off-site releases…[W]e are also trying to drive innovation…in terms of technology development, in terms of policy approaches, in terms of the financing for clean technology, clean energy. All of this we’re doing with a broad commitment to lighten the burden of regulation without lowering standards.”

Connecticut, in fact, already has some of the highest standards of environmental protection in the nation.

“We have run out in front of the rest of the country and want to be recognized for that as well as be given some flexibility,” said Esty, who acknowledged a “real spirit of partnership” between DEEP and the U.S. Environmental Protection Agency’s (EPA) Region I, which governs the six New England states.

The flexibility Esty refers to concerns EPA headquarters in Washington, D.C., however, which still tends to favor traditional command-and-control strategies rather than more innovative, market-based approaches.

“New England is unique,” agreed EPA Region I Deputy Administrator Ira Leighton, who joined Esty in a keynote discussion and manufacturers’ roundtable at the conference.” We’ve had a tradition that most of our agencies have developed regulations stronger and broader in scope than elsewhere in the nation.”

Leighton emphasized the need for federal agencies to “partner with states to maintain economic competitiveness…assuring environmental compliance while also advancing economic development.”

‘Window into the Future’

DEEP’s Dan Esty hears from business leaders about environmental and energy issues.

Energy policy—including strategies for diversifying the state’s fuel sources, establishing viable goals for renewable energy, and hardening the state’s energy infrastructure—was also a key topic at the conference.

Energy costs and policies are among the top three factors driving global manufacturing competitiveness, according to the 2010 Global Manufacturing Index developed by Deloitte and the U.S. Council on Competitiveness.

“On the energy side,” said Esty, “‘cleaner, cheaper, and more reliable’ is our mantra. The clean energy bank, LREC, ZREC…these are key pieces of our agenda. We’re dead serious about bringing down costs.

“We have a very nice window into the future, looking at what natural gas availability could do for Connecticut in the next 10–20 years. Shale gas is a game-changing element and part of [our] comprehensive energy strategy, [and] there will be programs to support this cheaper, cleaner fuel,” Esty said, pointing out that natural gas boasts a “two-thirds price differential over other types of fuel, thanks to the Marcellus Shale.”

The Marcellus Shale, a geologic formation covering several states, including much of Pennsylvania and New York, produces natural gas at levels that have surpassed industry projections. Because natural gas typically sets the price of electricity in New England’s wholesale market, better access to this cheaper resource would mean lower overall energy prices—including electric rates—for all end users in Connecticut. (Connecticut’s commercial and industrial electricity costs are the 10th highest in the U.S.)

“The question is, how do we take advantage of it? That’s a core question in our comprehensive energy strategy, and we will rely on the governor to help us answer it,” said Esty. “The problem in Connecticut is we have one of the lowest penetration rates for natural gas.” Expanding access, he noted, would “enormously benefit” residents and businesses.

‘On-the-Ground Results’

One year ago, two powerful storms—Irene and Alfred—knocked out power throughout much of the state, resulting in business disruptions, lost wages, and other hardships for Connecticut residents and employers.

Over the last 60 years, said Leighton, large storms have increased in New England more than in other parts of the country, leading to problems with infrastructure, insurance costs, public health, and “all sorts of other extraordinary challenges resulting from power loss and the inability to treat wastewater.”

Esty agreed, adding that the state must focus not only on cheaper and cleaner energy but also more reliable energy, which requires protecting and upgrading the state’s energy transmission and distribution systems.

“Our emphasis this year is delivering on-the-ground results. This year’s mission is execution. Getting the job done.” ■

Lesia Winiarskyj is a writer and editor at CBIA. She can be reached at lesia.winiarskyj@cbia.com.