Evergreen Economies: Green Local Procurement Policy as a Sustainable Economic Driver

1. Evergreen Economies:Green Local Procurement Policy as a Sustainable Economic Driver Living Economy Salon Laurie Kaye Nijaki, Ph.D. University of Southern California; Price School of Public Policy University of Michigan; Erb Institute for Global Sustainable Enterprise

2. Today’s Talk • 1) Introduction to the Green Economy • 2) Defining Differences in Opportunities • 3) Green Economy Policies: A National Perspective • 4) Towards a Green Economy Action Plan: A Focus on Procurement

3. Part 1 Introduction to the Green Economy

4. Traditional Development Theory and Defining Progress: Economic Growth and the Urban Environmental Problem • Traditional focus on growth (expanded GDP etc.) as central goal. Environmental degradation is an externality of the pursuit of growth. • Rhetoric: Economy versus Environment. Fuels conflicts between stakeholders around development choices, and the pursuit of quality of life issues. • If we must choose between the economy and environment, can we ever win? (Source: Campbell, S. JAPA, 1995)

6. Moving Beyond Growth: Sustainable Development Theory • Sustainability/Sustainable Development: Economy, Environment, and Equity. Moving Beyond Growth. (Higgens, 1996; Roberts,2004 et.al.) • Rhetoric: Environment and Economy New Strategic Framing around development. (Snow and Benford, 2004) New benefits through new institutions and new partnerships between historically adversarial groups. • Key Question: How can we establish economic development in communities and also provide effective solutions to environmental degradation? How can we best shape development in a manner that is preservative of equity, environmental, and economic goals? • Sustainability as a “fuzzy concept;” difficulty in measuring and institutionalizing the rhetoric. (Gunder, 2007 et.al)

7. Why Study the Green Economy?:Green Jobs as a Sustainable Solution? • Operationalize/concretize “sustainability” through concept of green jobs as a new form of economic growth created by new markets and made possible through technological advance. Similarly fueled by the rise of corporate social responsibility, and new niche, consumer-driven markets. (Dahlsrud, 2006, Younger and Tiley, 2006, Hardjona and Klein, 2003) • Green Jobs: “Activities which produce goods and services to measure, prevent, limit, minimize or correct environmental damage to water, air and soil, as well as problems related to waste, noise and ecosystems.” (OECD,2000) Green jobs are economic opportunities in environmental preservation/remediation. • The green economy may be a new institutional nexus for dealing with development decisions in communities and in providing economic goods to communities while achieving environmental benefits.

8. Why Study the Green Economy?:Trends in Term “Green Jobs” • In order to understand and build opportunities in this framework, • we need to define and systematically examine the “green economy.”

9. Defining Green Differently

10. An Array of Green Actors • Green Producers: Job opportunities directly in the manufacturing and production of green goods and services Ex: Solar panel manufacturing, installation of DFP filters on heavy duty vehicles. • Green Consumers: Job opportunities in companies that include “environmental sustainability” as part of their operating principals. Theoretically, they are the customer’s of the green producers. EX: Environmental/sustainability consulting, green restaurant owners and workers

11. Dimensions of the Green Economy Source: Nijaki et. al. Employment Development Department Green Jobs Survey, 2010

12. Green Jobs or Green Washing? • What jobs are “green jobs”? • Who determines the standards? • And, how do we know it’s all reliable? How do we ensure we are getting green jobs and not green washing?

13. Part 2 Defining Differences in Opportunities in the Green Economy

14. Are there Differences in Green Economic Opportunities? • A) Differences in aggregate number of green Jobs. • B) Differences in “type of green employment.”

15. A) Differences in Aggregate Number of green Jobs.

16. Are there differences in green employment by urban type?

17. Differences in Green Jobs by Urban Typology

18. How Does Green Employment Vary by Urban Type? Total Green Employment Small Poor Leading Big Poor Trailing Big Rich Leading Small Poor Trailing Small Rich Leading

19. Green Employment Per Capita Small Poor Leading Big Rich Leading Small Poor Trailing Small Rich Leading Big Poor Trailing

20. B) Differences in “type of green employment.”

21. Green Economy Clusters See Appendix for Complete Codes

22. The “Type” of Green Economy Differs

23. Boston-Cambridge-Quincy MSA

24. San Francisco-Oakland-Freemont MSA

25. Los Angeles-Long Beach-Santa Ana MSA

26. Part 3 Green Economy Policies: A National Perspective

27. How Are Cities Taking About Green Jobs? Measure Impact of “Discourse”: Frequency of References of “green jobs” on each city’s website. Small Poor Trailing Small Poor Leading Small Rich Leading Big Poor Trailing Big Rich Leading

28. Type 1: Unsustainable Underdogs • Little focus on green jobs. No references in city website. • Exception: Omaha

29. Type 2: Struggling Startups • Specific green jobs programs, but little impact. • Specific websites focused on the green economy. (i.e. City of Tucson) • Focus on workforce development programs-Green Jobs Corps. (i.e. City of Fresno, City of Miami) • Some Focus on Clean Technology. (i.e. City of San Antonio Clean Tech, City of Louisville financing programs/revolving loan fund)

30. Type 3: Green Boutiques • Well developed programs around the green economy. Green Jobs as a stated goal. (i.e. Minneapolis “green economy” indicator on sustainability plan) • “clean technology” focus. (i.e. City of San Jose, City of Austin)

31. Type 4: Lagging Leviathans • Green jobs focus as inconsistent and diverse. • Some focus on workforce development strategies. • Green jobs focus tends to be “project specific.” (i.e. City of Mesa Solar Energy Park, City of Long Beach green goods movement focus)

32. Type 5: Green Giants • Concerted and consistent approaches towards the green economy • “clean technology” focused initiatives (i.e. City of Chicago Clean Tech Jobs Center, City of New York Green Tech and Manufacturing Initiative) • Workforce development programs. (i.e. “green collared jobs corps” City of Las Vegas, City of Oakland City of New York jobs former felons)

33. Who’s Generating Green Jobs: Green Leaders and Brown Laggards

34. A Package of Potential Programs • Green Purchasing • Green Business Certification • Clean Tech Corridors/Land Use Approaches • Business Incubation Strategies/university partnerships • Workforce development for resulting opportunities

35. Part 4 Towards a Green Economy Action Plan: A Focus on Procurement

36. Traditional Procurement • Choosing the Lowest Cost Bid: the contractor who produces the lowest cost service or product estimate in response to a request for proposal (RFP). • Key Goal: “Obtain the most appropriate and highest quality good and service possible for the least cost.” • Benefits: • Transparency in choosing bids • Regularity in evaluating bids • Simplicity in decision-making process • Economic efficiency/lowest cost

37. What is the Role of Government Procurement? Source: Nijaki, L. K. and Worrel, G. “Sustainable Procurement at the Local Government Level” International Journal of Public Sector Management, Forthcoming

38. Types of Procurement: Going Beyond Lowest Cost Estimates • Purchasing for Economic Development  • Purchasing for Economic Equity • Purchasing to Achieve Environmental Benefits

39. Purchasing for Economic Development • “Buy local” efforts • Efforts seek to develop local markets through government procurement • i.e.“Buy America” provisions in ARRA

40. Purchasing for Social Equity • Minority/Woman Owned Business Requirements • Using procurement to create targeted business opportunities. • i.e. City of Los Angeles MBE/WBE requirements

41. Purchasing for Environmental Benefits • Environmentally Preferable Procurement • Defined as buying “products or services that have a lesser or reduced effect on human health and the environment when compared with competing products or services.” e.g. higher recycled content, energy efficient machines, less toxic products. • i.e. City of Santa Monica

43. Same City, Different Tracks An Example: City of San Jose: • Environmental: EPP policy: Procurement of services and products that reduce toxicity, conserve natural resources, material and energy, maximize recyclability and recycled content. • Equity: Up to a 5 percent bid preference for minority-owned and woman-owned businesses. • Economic: Local Preference Policy gives up to 5 percent bid preference for local business enterprises.

44.  Sustainable Procurement: Three “E”s for Green Jobs?

45. Procurement for Sustainable Local Development • Examinecurrent public procurement processes. • Definewhether or not any of those products could be manufactured within their locale. • Analyzewhether growth is appropriate for the community in terms of industrial mix and workforce capabilities. Define occupations and industries. • Determineother economic incentives and industry incubation strategies. • Implementprocurement strategies, considering phase-in priorities and measurement of results. Three major approaches: bureaucratic assistance, bid preferences, and blanket policies.

46. Bureaucratic Assistance • Offering case management within procurement process for firms representative of sustainability values. • Advantages: • Strategic targeting of businesses • Engage “start-ups”, opportunities to bolster innovation • Long term personal and customized support • Disadvantages: • Long-term vision • Time and resource intensive • Potential for favoritism • Sample Policies: King County, Washington; Portland and Multnomah County, Oregon

47. Blanket Policies • Widespread policy incorporating sustainability goals within procurement decisions. • Advantages: • Sends strong message. • Ensures outcome and rigorous evaluation of programmatic goals. • Disadvantages: • May be politically infeasible. • Inflexible in implementation • Threshold levels may de-incentivize attainment of higher environmental goals. • Sample Policies: Woodbury County, Iowa; San Francisco, California.

48. Bid Preferences • Integration of sustainability goals within the ranking of prospective firms. • Advantages: • Target particular groups for benefits • Flexibility in meeting multiple outcomes • Layer procurement policies on top of existing system • Disadvantages: • Favoritism and due to ambiguity • Difficulties in being able to structure preferences to achieve most sustainable end • Sample Policies: Cal Trans, Marion County, Oregon

49. Key Challenges • Political Feasibility and Ensuring Against Favoritism/Transparency • Training Staff • Evaluating Products and Developing Implementation Plans • Coordination Between Disparate Departments • Workforce Development and Economic Development—Equity Considerations

50. Creating the “tools” Based upon the results of this research, there is needed to develop a “green economy” growth tool for local green jobs growth. There is a need to create an effective green economy database for local communities that can consist of the following toolsets that collectively can indicate avenues of opportunities. Such a tool should be available online. For Businesses: -Searchable database for city/county procurement requests for proposals. -Searchable database for government incentives related to “green.” -Searchable database for events relevant to the “sustainable business community.” For Governments: -Database of “local” and “nonlocal” businesses offering green products. -Ability for businesses to “pitch” and/or showcase “green” products. -Ability to locate “local businesses” on a map in order to showcase local impacts. -Database for city/county procurement requests that can be done collaboratively across city boundaries. Such a database can provide resources for cities looking to partner with one another, as well as for regional government agencies seeking collaboration.