As environmental regulatory agencies have limited resources to enforce compliance, they tend to optimize the efficiency of resource allocation by employing targeting strategies. This thesis investigates the scheduling of Clean Water Act inspections in Illinois and the extent to which these inspections are memoryless. Using facility level and local EPA agency level data, we test inspection strategies for common decision factors, such as environmental performance, and compare them across the different jurisdictions in Illinois.
Our analysis has several key results. First, at the facility level, a majority of inspections are memoryless, though they are targeted according to local jurisdiction parameters. Second, although some facilities are targeted for more frequent non-memoryless inspections, none of our environmental performance parameters seem to influence this sorting. Finally, different inspection types are implemented in different ways, suggesting that they serve distinct purposes in the regulatory process
