ROANOKE TIMES
Copyright (c) 1997, Roanoke Times
DATE: Sunday, January 5, 1997 TAG: 9701070025
SECTION: BUSINESS PAGE: 5 EDITION: METRO
TYPE: ECONOMIC FORECAST
SOURCE: GREG EDWARDS STAFF WRITER
Relatively new environmental policies that let businesses correct problems voluntarily rather than face the threat of fines should be a source of new income for environmental consulting and engineering firms this year, says Bren Huggins, president of C.B. Huggins & Associates of Roanoke.
One example, Huggins said, is a Virginia program that allows voluntary cleanup of old industrial sites where pollution problems have not yet drawn the attention of state or federal regulatory agencies. Superfund and other previously regulated sites are not eligible for the program.
If property is going to be used again for industrial purposes, the state allows it to be cleaned to lower environmental standards than would be required if people were going to live there. Previously, contaminated industrial property had to be cleaned to residential standards, Huggins said.
The more flexible policy will result in industrial sites being rehabilitated and put back to use when they would not have been left unused under the previous rules, he said.
The state program, which is similar to a U.S. Environmental Protection Agency's "brownfields" program, should result in more sites being cleaned as Virginia comes up with creative forms of tax relief for participants, Huggins said.
The EPA came up with its brownfields program to help reclaim contaminated sites in inner cities, explained Dave Griffiths, president of Olver Laboratories Inc. of Blacksburg. Local tax relief provides the incentive for people to participate, particularly those whose sites are located in enterprise zones.
One thing that is holding back such programs is concern over liability, Griffiths said. Banks and other lenders are hesitant to lend money to clean up a site because they fear the state or EPA will come back in the future and demand more be done, he said.
Griffiths agreed with Huggins that such brownfields programs hold the promise of more business for environmental firms. The two also agreed that voluntary compliance programs can provide more business for firms such as theirs.
In voluntary compliance programs, businesses that study themselves and discover environmental problems are not penalized if they agree to fix the problems within a reasonable period of time.
The development of international environmental standards for manufacturers through the ISO 14000 program also will mean new business for environmental firms, Huggins and Griffiths said.
Another opportunity is in the design of new waste water treatment plants, Griffiths said. So, too, he said, is the contracting out of environmental work by big businesses that used to do the work themselves.
Griffiths also anticipates more active government enforcement of standards for both water and waste water systems and more careful monitoring of toxic emissions into the air. The plans that companies handling toxic chemicals must have in place by June 1999 to prevent and respond to catastrophic events will also mean more business for environmental firms, he said.
A number of factors, however, are helping create a shakeout among environmental firms, Griffiths said.
Government, a major contractor of environmental firms, is watching its spending more closely. And regulatory reform and relaxed enforcement of environmental laws have had a negative effect on business, Griffiths said.
The market for environmental services has matured, he said. Overcapacity has led to lower prices and profits and sometimes reduced quality.
"The buyer of environmental services in today's market has to be careful," Griffiths said.
Still, Griffiths said he is optimistic about the future for firms providing environmental consulting and services.
Olver, itself, is expanding. During the past year, the company opened its first branch offices in Charlotte, N.C,. and Charleston, S.C. It sells its services in most of the United States, Puerto Rico and Canada.
The country has made "tremendous progress" in the past 25 years in the environmental arena. "I don't think anybody wants us to back off," Griffiths said.
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