WASHINGTON — Don’t expect to see a radical retreat from existing environmental policies at the federal level following George W. Bush’s inauguration as president, say interested observers of the nation’s environmental and regulatory establishment.

Instead, industries affected by environmental laws and regulations should look for more subtle shifts in policies and programs, such as a greater emphasis on the costs, benefits and effectiveness of environmental controls. That’s the view offered by one veteran observer of federal-government machinations, National Paint & Coatings Association Vice President and General Counsel Thomas J. Graves.

Graves says Bush and his choice to head the Environmental Protection Agency — New Jersey Gov. Christine Todd Whitman — will be constrained by existing statutes from embarking on a radical overhaul of federal environmental policy. Instead, the administration will be forced to “work around the edges” in seeking reforms and policy shifts. One area of focus, Graves predicts, will be a campaign for cost-effectiveness in environmental policy, as opposed to an assumption that simply enacting new laws and regulations will help clean up the air and water. Another hoped-for result of the new administration’s policy direction could be more efficient administration of laws and regulations than has been seen during the Clinton years, Graves said.

Bush has received mixed reviews from environmental groups for his nominations to Cabinet posts and other high-profile positions that involve environmental policy. Whitman has won praise from some environmental groups for her “centrist” approach, while some of those same groups have criticized Bush’s choices of Spencer Abraham as secretary of Energy and Gale Norton as Interior secretary.

Graves agrees that Whitman, a Republican, followed a middle-of-the-road philosophy as governor of New Jersey. “It’s a moderate environmental record,” he says, noting that the leader of a highly industrialized state such as New Jersey can ill afford to take a hostile approach to environmental protection. Whitman, who was serving her second term as New Jersey governor, has won praise for championing innovative approaches to environmental regulation in the state. One such program provides incentives to industries that exceed regulatory standards in their operations.

Graves said Whitman brings strong credentials to the EPA post. “She’s fair, honest, and wants to do the right thing,” he says.

In keeping with a greater emphasis on cost effectiveness, Graves said he expects to see a more assertive posture on the part of the Office of Management and Budget (OMB) in the review of regulatory measures and their economic impact on industry and small business.

But Graves says Bush — or any Republican administration — would be embarking on an exercise in futility by seeking to sharply curtail environmental controls, due to strong public support for environmental quality and the nation’s extensive framework of environmental laws and regulations. Republicans, in fact, would fare better by assuming a stronger leadership role in developing environmental policies — by “doing their homework” — and focusing on the costs and benefits of specific policies and programs, he says.

Although outgoing EPA chief Carol Browner sparked fears early on that she would take a hard line with industry, her tenure on balance reflected a generally moderate approach. “She favored a top-down, centralized system,” Graves says, and relegated state-based programs and policies to secondary status under federal dictates. “But she was not as aggressive as some expected her to be, and did not expand EPA authority to the extent people feared she would.”

Still, Graves acknowledges that Browner and President Bill Clinton presided over a flurry of last-minute actions favored by the environmental lobby, ranging from new regulations to the protection of public lands. One such 11th-hour move was the enactment of new reporting requirements for companies that use lead. The new rule requires those users to report Toxic Release Inventory (TRI) emissions reports if they use 100 pounds of lead a year, a drastic reduction from the previous 10,000-pound threshold.

Actually, Graves says Bush has the capability to initiate bold new initiatives on a partnership basis with industry, rather than follow the traditional “command-and-control” approach long favored by the EPA. Here, Bush Chief of Staff Andrew Card could prove to be a key player, based on his past association with the auto industry and credibility with the business community. Graves says Bush could cause a stir by unveiling bold, imaginative policy initiatives.

“This guy is going to surprise people,” Graves says. “If there’s one thing he probably learned from the experience of his father’s administration (former president George Bush), it’s that a lukewarm ‘muddling’ environmental policymaking bent won no favor from any quarter” — that inaction and adhering to the status quo is a formula for failure. “I think he’s (George W. Bush) got to throw the (environmental policy) ball down the field, once in a while, but do it in a way that responsive industry and the affected public are positioned to catch it.”