so that analysis need not rely solely on retrospective surveys after the NSR rule changes are firmly entrenched (when firms’ and regulators’ recollections about what they knew and when they knew it may be colored by their knowledge of what eventually happened).
Second, the committee recommends that a suitable database on NSR and minor state permits be collected. Perhaps EPA could work with state agencies to develop a consensus on the information such a database should include facilitating the development of a national permit database and permitting cross-state analyses for the impacts of NSR rule changes as well as analyzing other regulatory activity.
EPA has done some updating of its NSR permit database beyond the initial 1997-1999 data collection and should be encouraged to continue the updating. Although that database cannot provide complete measures of the effects of the NSR rule changes on outcomes, it constitutes a useful description of where NSR-covered activity continues. Much greater effort will be needed to assemble a useful collection of data on minor state permits. States that have not yet developed permit databases of their own could be encouraged to adopt a common database layout or at least to design their database to make it easy to export permit information to a compatible national permit database. States that do have permit databases should develop conversion programs to export their data into a national permit database.
Third, the committee recommends that resources be made available for analyses of the effects of the NSR rule changes on investment behavior and other outcome measures. Census Bureau data appropriate for facility-level analyses are already being collected, but funding would need to be made available for researchers with Census Bureau-approved projects in secure RDCs to be able to analyze the effects of rule changes on the basis of facility-level data. There is enough time to develop a research protocol before adequate data are available, and these analyses could be an important element in evaluating NSR and related regulations.
Finally, the limitations of an econometric approach should be recognized. If firms respond fairly quickly (within a year or two) to the NSR rule changes with a considerable expansion in investment activity, the change in investment should be noticeable. Conversely, it may be possible to provide upper bounds for the effects of the NSR rule changes on investment (we might observe an average increase in investment of 2% and be able to rule out an impact greater than 20%). Still, it is likely that there will be relatively wide bounds on the estimated effects, especially in the initial years in states where relatively few facilities are being affected by the rule changes.