Policy Updates Inspire Environmental Purchasing

Policy Updates Inspire Environmental Purchasing

Scot Case is the Director of Procurement Strategies at the Center for a New American Dream.

Environmental purchasing policies are again making headlines. Over the last two decades, federal, state, and local governments have recognized the environmental impacts of their purchasing decisions. Governments began adopting “buy recycled” purchasing policies in the mid-1980s to reduce pressures on overburdened landfills and protect the environment by stimulating markets for recycled-content products. By 1998, 47 states and more than 500 local governments had adopted buy-recycled policies.

These policies have been extremely effective in extending the life of local landfills, stabilizing markets for the recyclable materials collected by curbside recycling programs, creating jobs, protecting natural resources, and meeting governments’ needs for effective and affordable products.

But now, “buy recycled” is not enough. Government leaders and taxpayers are recognizing that purchasing decisions impact a wider variety of environmental concerns. Everything from climate change to toxins in the environment can be linked to purchasing decisions. As a result, growing numbers of state and local governments are expanding their buy-recycled policies to incorporate a wider variety of environmental considerations such as buying less hazardous cleaning products, energy-and water-efficient products, and electricity from less polluting sources. As a result of the evolution from “buy recycled” to environ-mentally preferable or sustainable purchasing, more governments are revisiting their environmental purchasing policies. Based on a review of 76 environmentally preferable purchasing policies conducted by the Center for a New American Dream (www.newdream.org/procure) on behalf of the North American Green Purchasing Initiative (www.nagpi.net), the following checklist can assist purchasing officials when they are asked to update or establish an environmental purchasing policy.

Describe Why it is Important to Buy Environmentally Preferable Products
Many of the purchasing policies establish a clear link between purchasing decisions and environmental impacts. A North Carolina Executive Order, for example, explains that “the State constitutes a large consumer of goods and services, which, in the course of their manufacture, use, and disposition impact the quality of the environment.” The San Mateo County, CA, policy explains the goal of its policy is “to encourage and increase the use of environmentally preferable products and services in San Mateo County. By including environmental considerations in purchasing decisions, [the county] can promote practices that improve public and worker health, conserve natural resources, and reward environmentally conscious manufacturers, while remaining fiscally responsible.”

Effective environmental purchasing programs require organizations to think differently about purchasing decisions.

Define Environmentally Preferable Purchasing
The most effective environmental purchasing policies are careful to explain that environmental purchasing is more than an emphasis on recycled-content products. Many policies adopt an environmental purchasing definition first introduced in a 1993 U.S. Government Executive Order. It defines environmentally preferable products and services as “products or services that have a lesser or reduced effect on human health and the environment when compared with competing products or services that serve the same purpose. This comparison may consider raw materials acquisition, production, manufacturing, packaging, distribution, reuse, operation, maintenance, or disposal of the product or service.”

Identify Desired Environmental Attributes
Some policies, such as the one used by the State University of New York at Buffalo, include fairly extensive lists of environmental attributes ranging from recycled-content recommendations to renewable energy requirements. Others use a smaller but broader list of attributes. An Illinois Executive Order, for example, states, “Environmental attributes may include but are not limited to energy efficiency, water conservation, toxics use reduction, conservation of natural resources, and waste minimization.”

Balance Environmental Considerations with Performance, Availability, and Cost Requirements
Some environmentally preferable products might have a slightly higher initial cost. Policies address this potential issue in a variety of ways.

Refuse to Pay Extra:
A few policies explicitly prohibit paying extra. Gaston County, NC, for example, gives “preference to those products with higher levels of post-consumer recycled content…so long as the cost of the products…does not exceed the cost of similar products made from virgin materials.”

Provide Some Limited Price Flexibility:
Most policies use language similar to that adopted by the Waste Management Authority in Alameda County, CA. Its policy states, “Nothing contained in this policy shall be construed as requiring a purchaser or contractor to procure products that do not perform adequately for their intended use, exclude adequate competition, or are not available at a reasonable price in a reasonable period of time.” The phrase “reasonable price” gives purchasers some discretion about how much, if any, extra they are willing to pay if necessary. A few other policies are slightly more explicit. The San Mateo County, CA, policy, for example, states, “The County is aware that there [may be] an increased cost to purchase environmentally friendly products.”

Establish Price Preferences:
Dozens of policies give purchasers permission to pay between three and 15 percent extra for products meeting environmentally preferable criteria. While many purchasers are concerned this option provides manufacturers with an incentive to keep prices higher for safer products, it remains popular in jurisdictions that are traditionally required to award contracts to the lowest bidder. Some of the jurisdictions permitting price preferences for more environmentally preferable products include:

• Chatham County, NC (up to 15 percent)
• Cincinnati, OH (up to 3 percent)
• Kalamazoo County, MI (up to 10 percent)
• Kansas City, MO (up to 15 percent)
• San Diego County, CA (up to 5 percent)

Require Life Cycle Cost Evaluations:
A few policies recognize that the total cost of a product or service extends beyond the initial purchase price. An energy-efficient air conditioner, for example, might be slightly more expensive, but the reduced costs of operating and maintaining it more than offset the initial cost difference. The Ventura County, CA, Green Procurement Policy suggests, “Wherever feasible and appropriate, life cycle cost analysis should be used…to assist in selecting products and services. Cost shall be calculated over the life of the item and should consider final disposal and replacement costs, and not just initial, upfront costs. When comparing alternative products, the initial cost of the acquisition, as well as lifetime maintenance costs, operations costs, etc., should be considered in the analysis.”

Adopt Best Value Purchasing Principles:
More and more state and local governments are moving away from the “low bid always wins” mentality and toward the more flexible “best value” approach. Best value allows purchasers to incorporate a broader variety of considerations, including performance and environ-mental attributes, when making purchasing decisions. Massachusetts and Oregon have statutes encouraging best value purchasing and effectively incorporating environmental considerations as part of their evaluations.

Information on green policies in orientation materials alerts new employees to environmental efforts.

Modifying Specifications
Many policies require purchasing agents to re-view specifications to remove language that might conflict with the desire to buy more environmen-tally preferable products. The Toronto, Ontario, Canada, policy for example, requires purchasing officials to “ensure that wherever possible specifications are amended to provide for the expanded use of environmentally preferred products such as: durable products, reusable products, energy-efficient products, low-pollution products, products (including those used in services) that contain the maximum level of post-consumer waste and/or recyclable content, and products that provide minimal impact to the environment.”

Empower a Green Purchasing Team
Many of the policies recognize that purchasing decisions involve participants from across the organization. Decisions are not made solely by the purchasing department. As a result, several of the policies establish “green teams” tasked with reducing the environmental impacts of the organization’s purchasing practices. While organized in a variety of different ways, green teams typically include a senior manager and representatives from the purchasing department, environmental department, and end users.

Some green teams meet regularly; others meet only as needed. The Kansas City, MO, green purchasing policy, for example, establishes the Coordinating Committee on Environ-mentally Preferable Procurement. It is tasked with meeting “not fewer than ten times each year” and consists of a city council member, a local environmental organization, a local business representative, and the directors of the four largest city departments.

Identify Initial Priorities
Almost every green purchasing policy prioritizes at least one commodity for immediate attention. Most mention or incorporate by reference the more than 50 recycled-content product categories identified by the U.S. Environmental Protection Agency (www.epa.gov/cpg).

Many also mention the more than 35 energy-efficient product categories listed by the Energy Star Program (www.energystar.gov). In addition, policies frequently prioritize the following areas:

• Buildings (LEED certified)
• Cleaning products (less hazardous)
• Furniture (refurbished)
• Hybrid-electric or alternative-fuel vehicles
• Landscaping products (less hazardous)
• Paint (less hazardous)
• Paper (recycled content, process chlorine free)
• Pest management products (less hazardous)
• Products that do not contain persistent bioaccumulative toxins
• Products that do not contain wood from endangered forests
• Renewable electricity
• Vehicle maintenance products (less hazardous)

Assign Responsibilities and Establish Deadlines
To ensure someone from each of the relevant departments is directly responsible for specific activities, several policies list the actions to be completed, assign responsibility, and establish deadlines for their completion. The King County, WA, policy, for example, identifies responsibilities for the Purchasing Agency, Solid Waste Division, and all county agencies, departments, and offices.

Reference Existing Environmental Labeling and Certification Programs
Given the inherent complexity of identifying more environmentally preferable products, some purchasing agencies are recognizing the validity of credible, third-party environmental standard organizations. A few green purchasing policies endorse this trend. While many policies mention the federal government’s recycled-content and energy-efficiency programs, policies also are mentioning other standard setting and certification organizations.

Illinois, for example, references Green Seal’s paint standard. Boulder, CO, expresses a preference for wood products certified by the Forest Stewardship Council (FSC). The City of Richmond, British Columbia, policy states, “Consideration may be given to those environmental products that are certified by an independent accredited organization.” The text for the policy specifically mentions five programs—Environ-mental Choice, Green Seal, Energy Star, EnerGuide, and PowerSmart.

Create a Communications Plan
An effective environmental purchasing program requires an organization to think differently about its purchasing decisions, which requires educating senior managers, the purchasing department, product specifiers, end users, vendors, and, possibly, the general public.

The San Mateo County, CA, policy acknowledges the importance of an effective communication strategy by recognizing that environmentally preferable purchasing “will require changes in awareness, behaviors, practices and procedures.” Seattle’s policy holds “The Director of the [Executive Services Department]…responsible for establishing userfriendly tools to disseminate information to city staff.” Nevada County, CA, requires the purchasing department to “inform other agencies, departments, and divisions of their responsibilities under this [environ-mental purchasing] policy and provide agencies, departments, and divisions with information about recycled products and environmental procurement opportunities;…[and to] develop and implement an ongoing promotional program to educate and inspire County of Nevada staff to implement this policy. Information concerning this policy will be added to the new employee orientation process; [in addition, the purchasing department will] inform vendors of [the] Green Procurement and Sustainable Practices Policy.”

Regular review allows entities to strengthen policies with new information, establish or adjust goals, and shift roles to increase program effectiveness.

Develop Measurable Goals and Reporting Requirements
It is difficult to measure the effectiveness of a green purchasing policy unless performance measures are incorporated into the program from the beginning. Some policies task the purchasing department with developing goals and mechanisms for evaluating progress.

North Carolina, for example, tasks its purchasing department with reviewing “its sales report procedures and determin[ ing] any changes needed to facilitate tracking of environmentally preferable and recycled products purchased by state agencies and others from term contracts.” This information would be compiled in an annual report. While almost all of the purchasing policies require an annual report, few specify what is to be contained within the report.

The Kansas City, MO, policy is one exception. It requires an annual report that includes: “(i) a compilation of procurement data collected from all departments and other parties charged with implementation responsibility under this policy; (ii) an account of the current status of product evaluations conducted by departments; (iii) an assessment of procurement program effectiveness, an evaluation of program goals, and projections of future procurement opportunities; and (iv) recommendations for changes in procurement policy.”

Review Policy Regularly
To remain truly effective, policies should be reviewed regularly to en-sure they are meeting the organization’s current needs. Regularly reviewing the environmental purchasing policy ensures the policy focus continues to reflect the organization’s environmental goals. It also allows the organization to strengthen the policy based on new information, to establish or adjust goals, and shift roles and responsibilities to increase program effectiveness.

While a number of policies require the policy to “be updated when necessary,” the San Jose, CA, draft policy requires it to be reviewed “every three years.” Manitoba, Canada’s Sustainable Procurement Guidelines require that “within five years from the adoption of the Manitoba Sustainable Development Procurement Guidelines, Manitoba will undertake a comprehensive review of the guidelines, goals, and action plans.”

As political leaders continue to understand the environmental impacts associated with routine purchasing decisions, more communities are going to be faced with improving or establishing environmental purchasing policies. The policy components identified in the checklist above should help purchasing officials develop or review the next generation of environ-mentally preferable purchasing policies. Copies of all the policies refer-enced in this article along with numerous additional policies and suggestions are listed on the Center for a New American Dream Web site at www.newdream.org/procure.

Editor’s Note: Scot Case is the Director of Procurement Strategies at the Center for a New American Dream where he helps institutional purchasers buy less polluting products from less polluting companies. For additional information, visit www. newdream. org/ procure or e-mail Case at [email protected].

The Green Purchaser is a new, regular feature that will track the growing sustainable purchasing movement. Future articles will cover using environmental labels effectively, identifying relevant environmental attributes, creating useful contract language, and overcoming common challenges. E-mail suggestions for future sustainable purchasing articles to Scot Case at the above address.