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September 26, 2013

Surveys 2013: Innovex Environmental Management

Specialty: Environmental engineering; site planning and remediation; permitting and compliance; health and safety training and oversight; groundwater and surface water services

Management: Ron Chinn, Peter Battuello

Founded: 2002

Headquarters: San Francisco Bay Area

2012 revenue: $1.9 million

2013 projected revenue: $2.6 million

Current projects: BP/ARCO Northwest retail environmental portfolio; Point Reyes national seashore cleanup; Young Street main replacement in Aberdeen; First Avenue main replacement in Kelso; Greyhound Seattle terminal

Ron Chinn, president and CEO, answered questions about the industry and his firm.

Q: What is environmental liability and how do you deal with it differently than others?

A: Innovex is an environmental consulting firm that specializes in the proactive management of environmental liabilities. Traditionally, environmental consulting is highly reactive in nature; consultants are typically asked to address new or changed conditions, or respond to new regulatory demands. By managing the overall environmental life-cycle of a project, Innovex has a far greater opportunity to devise an innovative, long-term solution that is more protective, more robust, and more cost-effective than traditional reactive approaches.

Our objective is to close out and completely extinguish environmental liabilities as rapidly as possible, and at lowest life-cycle cost.

Q: How important are environmental considerations when planning a big project?

A: Most of our clients recognize that environmental permitting and compliance are critical considerations during project planning, however I suspect that few actually understand how Byzantine environmental regulations can be. One of the biggest mistakes is to not have a full understanding of the entire body of environmental permits that must be obtained prior to project start, which can lead to enormous cost overruns to redesign the project and significant delay to the project schedule.

Additionally, it is critical to conduct due diligence analysis of environmental conditions at a project site to account for hidden environmental liabilities and devise strategies for meeting federal, state and local requirements. In some circumstances, early involvement of the Innovex team has resulted in reductions to the projected cost by redesigning the project plan to avoid critical environmentally sensitive areas such as aquifer recharge areas, thereby reducing permitting cost and streamlining the project schedule.

Q: How did your company handle the recession?

A: The environmental consulting industry was particularly susceptible to the recession since industry has a tendency to reduce work on environmental liabilities during economic downturns, and government spending was severely curtailed due to budget shortfalls.

Though Innovex’s revenue remained flat from 2009 through 2012, an enormous effort was made to diversify and expand the company. This resulted in the renaming and rebranding of Innovex, certification as an SBA 8(a) Small Disadvantaged Business, diversification of our client base to include state and federal contracts, and the expansion of our geographic footprint to include Northern California, Southern California and Washington state. These diversification and expansion efforts are beginning to pay off, with projected growth over the next two years to be in excess of 30 percent per year.

Q: What do you see as some of the biggest trends and issues for environmental consultants?

A: As the economy begins to recover, many of the projects that were placed on hold during the recession are beginning to move forward again. While money is more available than in past years, our clients are competing heavily for funding in a still lean environment. Increasingly, we are working with our clients to identify more creative ways of funding and executing their projects, such as leveraging public-private partnerships.

Q: How is working in the Seattle market different than California?

A: From an environmental regulatory perspective, I think that Washington can learn a great deal from California’s mistakes.

California’s extremely stringent environmental policy, while well intentioned, did not fully consider the economic burden to the business community, and resulted in a long-term chilling of California’s economy. California policy makers are now in the process of reworking environmental policy to shift the emphasis toward the protection of human health and ecological receptors, rather than the pursuit of total environmental restoration.

Especially in the real estate development market, Washington has an opportunity to strike a reasonable balance between environmental protection and economic growth.

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