with mediation leading the way, justice department readies progress report touting big adr savings

VOL. 25 NO. 5 MAY 200790 ALTERNATIVES

Published online in Wiley InterScience (www.interscience.wiley.com).Alternatives DOI: 10.1002/alt

WITH MEDIATION LEADING THE WAY,JUSTICE DEPARTMENT READIES PROGRESS REPORT TOUTING BIG ADR SAVINGS

The U.S. Justice Department is set to senda detailed report to President Bush on thefederal government’s successful use of alter-native dispute resolution techniques.

The report, based on submissions fromfederal agencies, is the first in seven years,and the second since President Clinton re-quired ADR use by the executive branch,and periodic reporting, nearly a decade ago.

At press time, a panel of federal ADRadministrators was ready to debut the dataat an April 26 seminar at the American BarAssociation’s Section of Dispute ResolutionAnnual Meeting in Washington. In themonth preceding the session, Linda A.Cinciotta, director of Justice’s Office ofDispute Resolution who has overseen thecompilation, writing, and editing of the re-port, previewed some of the results. Cin-

ciotta was scheduled to retire on April 28.The report will contain the most

sought-after data in the conflict resolutionfield. It will state agencies’ savings in termsof dollars and time. The report will be thekind of statistical support for alternativedispute resolution that private companiesoften seek to support ADR systems instal-lation—and often have a difficult timetracking when they do.

Some of the figures are startling. TheU.S. Air Force will report it has avoided anaverage of $83.7 million in liability annu-ally for reporting years 2002-2004, by us-ing ADR in contract matters. The numbersare skewed because of a backlog of high-value litigation when the Air Force ADRpolicy was instituted, but updated figures,added to the report last month, confirmcontinued substantial savings. [See accom-panying box on page 91.]

The results also constitute a victory lapfor federal ADR specialists by showing costand time savings when using ADR to avoid

litigation. The report will assess whereagency practices need to focus their effortsto increase ADR use and savings.

The agencies’ reporting extends wellbeyond the walls of Beltway governmentbuildings. It will cover government agen-cies nationwide, and show their effective-ness in resolving commercial disputes out-side of courtrooms. A sizable chunk of thereport, the draft of which was more than150 pages in early April, deals with successin contracting disputes, explains Cinciotta.

She says that about 100 governmententities are represented, including all 15cabinet departments, 31 independent fed-eral agencies, and subcomponents. The re-port gives the ADR coordinators a chanceto crow nationally about what they do, andserves as a ratification for their work–andeven their existence. Many participated inthe report’s compilation and writing via theFederal Interagency ADR Working Group,an organization of executive branch ADRspecialists formed about a decade ago topromote ADR use.

Many of those officials had felt neg-lected in recent years after big pushes toincrease ADR use in the 1990s by theClinton administration and the first Bushadministration, including moves that es-tablished the working group.

In March 2004, then-Attorney GeneralJohn Ashcroft sent a letter to the federal In-teragency ADR Working Group, accompa-nying a report by an associate attorney gen-eral reaffirming the current Bush adminis-tration’s ADR support, despite decreasedresources due to national security concerns.See Ashcroft’s letter at www.adr.gov/adrw-gagltrtochair031204.htm; Attorney Gen-eral Robert D. McCallum Jr.’s report to theworking group’s steering committee atwww.adr.gov/asgreport0304.htm; and “TooLittle, Too Late? Ashcroft Issues SupportLetter to Agency ADR Officials,” 22 Alter-natives 71 (May 2004).

Cinciotta says that the working group’sefforts on the report, and the reported re-sults characterize the federal ADR commu-nity’s operations, and affirm their purpose.“We are all in the business of collaboration,partnerships, and consensus building,” shesays. “We wanted a report that truly repre-

ADR BRIEF • ADR BRIEF • ADR BRIEF

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SO HOW GOES THE MEDIATION PROCESS UP THERE?

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sented a collaborative effort.”Cinciotta’s predecessor, Peter Steenland

Jr., who oversaw Justice’s dispute resolutionoffice from 1995 to 2002, says “With littlevisible support and crumbs for resources,the hardy souls promoting dispute resolu-tion within the federal government have

done an amazing job.”“Looking over the history, I’m feeling

very satisfied that I was part of this move-ment,”says Cynthia Mazur, longtime ADRspecialist of DR office director at the Fed-eral Emergency Management Agency inWashington, who was scheduled to appear

on the ABA conference panel. “It’s growingin the right direction with positive results,and it’s showing a lot of benefits.”

The first ADR report, which then-At-torney General Janet Reno submitted toPresident Clinton on May 8, 2000, is avail-


In the month before the expected releaseof the U.S. Department of Justice’s com-pilation report on conflict resolutionpractices and results in about 100 execu-tive branch and independent governmentagencies, Linda Cinciotta, who has justretired as director of the Office of DisputeResolution, and Joanna Jacobs, who wasslated to become acting director, respec-tively, of Justice’s Office of Dispute Reso-lution, provided some of the results to Al-ternatives. They expected that the follow-ing “concrete examples” would appear inthe report, but also said that at press timein mid-April the final report was subjectto revision.

CONTRACTS & PROCUREMENT ADR PROGRAMS

• The U.S. Air Force “ADR First” pol-icy in contract disputes has enabled itto avoid an average of $83.7 millionin liability in each of the three yearsleading up to the Justice Depart-ment’s report survey request in 2005,while expending an average of onlyabout $1.94 million per year in liti-gation costs. Air Force Dispute Reso-lution Acting Deputy General Coun-sel Lynda O’Sullivan notes that thethere was a “large backlog of highvalue litigation when we first insti-tuted the policy, and ADR helped usclean out that backlog.” Since sub-mitting its survey response nearlytwo years ago, O’Sullivan notes thatthe Air Force numbers for liabilityavoided were nearly $26 million infiscal 2005, and $11 million in 2006.Cinciotta states that the report wasedited last month to incorporate theupdated figures.

WORKPLACE ADR PROGRAMS

• The Social Security Administrationcalculated that the average cost of pro-cessing an equal employment opportu-nity complaint through a traditionalprocess was about $40,000. But thecosts of mediating an EEO complaintran from $50, when a “shared neu-tral”–a governmental ADR providerprogram—was used, to $1,500 if anoutside vendor was used.

• The U.S. Air Force reported thatworkplace disputes resolved throughmediation took an average of 27-40days, as opposed to 390 days, forEEO cases that proceed to the admin-istrative phase.

ADR PROGRAMS & AGENCY MISSIONS

• The U.S. Commerce Department’sNational Oceanic and AtmosphericAdministration used consensus build-ing and public participation through-out the development of the naturalresource damage assessment regula-tions promulgated pursuant to theOil Pollution Act of 1990.

• The U.S. Department of Health andHuman Services' Departmental Ap-peals Board uses ADR to provide lesscontentious and quicker resolution ofdisputes involving Medicare andMedicaid program exclusions, impo-sition of civil sanctions against healthcare providers and nursing homes,and disputes with grantees, includingstates and universities, concerningdisallowances of funds.

• The Federal Aviation Administra-tion has integrated a neutral evalua-tion program into the negotiated

grievance process for all labor dis-putes between air traffic controllersand the FAA. The program pro-motes collaboration and resolutionearly in the process by presentingdisputes to an independent neutral,with expertise in the particular sub-ject matter, to provide a nonbindingadvisory decision.

• The Comptroller of the Currency'sombuds Customer Assistance Groupaddresses disputes between con-sumers and national banks.

• The Consumer Product Safety Com-mission used mediation to resolve amajor dispute involving a public riskof carbon monoxide poisoning.

• The U.S. Department of Environ-mental Protection’s Small BusinessOmbuds Office resolves disputes withthe small business community in thedevelopment and enforcement of en-vironmental regulations.

• The Federal Energy Regulatory Com-mission provides a menu of ADR op-tions such as facilitation of collabora-tive pre-license processes, mediation,settlement judges, and the use of ear-ly neutral evaluation.

• The Federal Maritime Commissionfacilitates the flow of U.S. ocean com-merce by using ADR to quickly re-solve disputes involving ocean ship-ping transactions, violations of ship-ping statutes, and freight charges.

• The Nuclear Regulatory Commis-sion employed collaborative, facili-tated ADR processes to involve thepublic in decision making about re-vision of agency rules and guidanceon emergency planning in the wakeof Sept. 11. �

BY THE NUMBERS–HOW YOUR GOVERNMENT IS APPLYING ADR TO ITS BUSINESS

VOL. 25 NO. 5 MAY 200792 ALTERNATIVES


able on the federal Interagency ADRWorking Group’s Web site at www.adr.gov/presi-report.htm.

The exact release method for the newPresident’s Report hadn’t been determinedat press time, though Cinciotta said it wasunder final Justice Department review.She said that she expected the report to beofficially available around the time theABA panel debuted the material. Sheadded that she expects it eventually will beavailable on the federal Interagency Alter-native Dispute Resolution WorkingGroup’s Web site at www.adr.gov.

From the agency specialists’ perspec-tive, the report is not merely celebratory.The idea, Cinciotta explains, is to create aresearch guide that lays the groundwork fornext-generation government ADR use. Shesays that the report will identify challengesand opportunities, directed to improvingand increasing conflict resolution practices,in part by spreading the word about theireffectiveness. She says the report will avoidgeneralized recommendations, because ef-fective practices need to be specific to aparticular agency’s mission.

The report looks at nine federal conflictresolution practices: mediation, arbitration,labor grievances, facilitation, settlementjudges, “public participation,” partnering,conflict coaching and ombuds’ operations.The top ADR areas for federal agencies,and much of the report’s focus, accordingto Cinciotta, are facilitation; public partici-pation, which involves consensus buildingin communities for government projects;and, most prominently, mediation.

Of the processes, Cinciotta says media-tion, “It is far and away the most commontype used in the federal sector.”

She says that the results lead to twoconclusions: ADR is a “very effective toolin many circumstances.” She says thatconflict resolution methods can’t be heldout as “a panacea for all cases, but certain-ly are an appropriate, effective tool for ap-propriate cases.”

And, she says, the second key finding isthat the agency’s results show ADR “really isgiving better results,” both in agency oper-

ations, and in conflict instead of litigation. The agencies’ submissions will be bro-

ken down along the lines of the Federal In-teragency ADR Working Group’s sections.Three of the group’s sections—Civil En-forcement and Regulatory; Contracts/Pro-curement, and Workplace—helped corre-

late the results and write the report, overseenby the full working group’s steering commit-tee, and Cinciotta and her deputy, JoannaJacobs, who was to assume the role of actingdirector of the Justice Department’s disputeresolution office at the end of last month.

RESPONSIVE AND INCLUSIVE

The compilation efforts revealed that gov-ernment ADR operates under two “para-digms,” explains Cinciotta. The first is thatADR has helped make the government

“citizen-centered—responsive and inclu-sive.” The second illustrates how ADR hascontributed to cost management by con-trolling conflict costs, and preservingagency resources.

She adds that, similarly, ADR also con-tributes to overall agency management bypromoting innovation and continuous im-provement in agency operations and in theADR programs themselves.

In an E-mail, Cinciotta points out thatthe full report will challenge agency ADRspecialists to continue to develop theprocesses, and moving beyond their initialsteps. “ADR still is being used primarily tofix problems as they occur,” she notes. “Ithas not been fully harnessed to address theunderlying causes of disputes in order todecrease the actual incidence of conflict.The report contributors hope that federalADR in the next decade will grow into asystem of proactive conflict management,as opposed to reactions to disputes.”

Anthony N. Palladino, dispute resolu-tion service director at the Federal EnergyRegulatory Commission, who worked onthe report’s contracts segment for theworking group, agrees. “I hope we’re at thepoint of moving in the direction of callingit something other than ‘ADR,’” he says.“It’s not ‘alternative’ anymore.”

Palladino, who also was scheduled to beon the ABA Dispute Resolution Sectionpanel last month to introduce the reportresults, adds, “It’s going to be consensualdispute resolution, . . . and it’s going to belitigation that is more the alternative.”

Linda Cinciotta notes that there is a va-riety in sophistication levels at agencies,and the next best expansion move for manywill be to emphasize early intervention.“There are a number of agencies that aretrailblazers . . . on early intervention,” shenotes, “including the Federal Aviation Ad-ministration Early Dispute ResolutionCenter; the Federal Energy RegulatoryCommission Dispute Resolution Serviceand Enforcement Hotline; the Departmentof the Interior Collaborative Action andConflict Resolution Program; the Depart-ment of Justice Americans With Disabili-ties Act Mediation Program for disabilityrights; and the U.S. Institute for Environ-

(continued from previous page)


A new federal ADR

report looks at nine

conflict resolution

practices: mediation,

arbitration, labor

grievances, facilitation,

settlement judges,

public participation,

partnering, conflict

coaching and ombuds’

operations.

VOL. 25 NO. 5 MAY 2007 ALTERNATIVES 93


mental Conflict Resolution's work withother federal agencies on engaging stake-holders early in the process of resourceplanning or environmental review.”

The statistics released by Cinciotta andJoanna Jacobs back their view that the re-port will make a strong argument in sup-port of ADR. Cinciotta cited the following:

• The U.S. Navy reported on 41 contractcases using ADR that it estimates savedabout $1.8 million in direct expensesavoided, along with another $1.1 mil-lion in interest, which it attributed tothe speed of ADR over standard ad-ministrative processes.

• The Defense Logistics Agency reportedthat 87% of its 2005 contracts disputeswere settled either partially or com-pletely in ADR, saving an estimated$1.4 million.

WORKPLACE ADR COMFORT

The report will indicate a high degree ofcomfort with workplace ADR. Cinciottasays that agencies’ workplace dispute ADRcases settle at—at least—a 50% rate, withsome agencies reaching 75% or more.Those results include:

• The U.S. Air Force reporting that onethird of its workplace disputes are re-solved through alternative dispute resolu-tion processes “in no more than 40 days.”The average case disposal is an average of390 days if the case goes through the for-mal EEO administrative process.

• The U.S. General Services Administra-tion finding that for EEO case resolvedin mediation, it saves up to $4,500 ininvestigation fees.

The workplace mediation programsprovide a number of lessons learned, notesCinciotta. For example, “many managersfelt less threatened when they participatedin a ‘problem-solving’ mediation to resolvea work-related dispute,” she points out.

CONTRACTS: 91% SUCCESS RATE

Tony Palladino says that in preparing for

the report submission last year, the FERCdispute resolution service examined adecade’s worth of contract matters underthe agency’s acquisition management sys-tem. Since the filing, he says, the agencyhas completed the 10-year study. The re-sults for its universe of more than 500 cas-es are consistent throughout the period, hesays: About 91% of all contract disputeshave been resolved using ADR processes.About two-thirds of bid protests also wereresolved in ADR.

The results overall point to potentialareas to develop more ADR proficiency.“There are a number of factors that couldassist in fulfilling the promise of ADR inthe coming years,” notes Linda Cinciotta.“They include: integration of conflictmanagement principles into performancemanagement structure; external promo-tion and facilitation to educate represen-tatives of regulated and other entities onhow ADR works and the benefits it canproduce; easily accessible and widelyavailable internal ADR training; intera-gency sharing of federal resources, andinstitutionalization and integration ofADR programs.”

It’s business-like, explains FERC’s Pal-ladino. “In procurement, it fosters betterbusiness relationships between the govern-ment and the companies,” he says, adding,“Less acrimonious [partners] tend to fostergood future relationships. There’s a for-ward-looking aspect to the report.”

Former Justice Department dispute res-olution office director Peter Steenland Jr.,now of counsel in the Washington, D.C.,office of Sidley Austin LLP, also is opti-mistic. “Perhaps the next administrationwill promote ADR actively,” he notes. “Be-cause there are so few civil trials any more,judicial ADR may provide many peoplewith their only experience with a federalcourt. Similarly, use of ADR by federalagencies can take a dispute between a citi-zen and her government, and resolve it in arespectful, civilized, and efficient manner.Ultimately, then, federal ADR is about re-spect for our citizens, for business people,and for organizations that find themselvesin conflict with their government.”

Linda Cinciotta sees prevention as the

key to ADR development. She concludesthat the “future of ADR is . . . anticipatorydispute resolution to ward off conflict be-fore ripening into dispute.” She also saysagencies will use conflict as a “catalyst forcooperative activity, added value, moreadaptability in business decisions, andmore stakeholder input.”

The report’s suggestions will be intend-ed to be options offered for agency consid-eration, and aren’t intended to be “one sizefits all” recommendations, Cinciotta says.

She also notes that progress will emergefrom the report’s side mission of sharingthe success stories. The existence of suc-cessful programs will provide a resource forother agencies who need ADR systems andprocess design help and advice.

* * *

The new report was begun two years agowith a survey. The process also began theend of a 30-year Justice Department runfor Cinciotta, who retired at the end ofApril. She said she considered departinglast fall, but stayed beyond the end of 2006to finish work on the report.

Cinciotta says that the agencies neededup to 10 months to assess their ADR re-sults and report back to the Justice Depart-ment. She says that the agencies needed tosign off on the presentation of their data,which involved getting permissions overthe past year, delaying the final product.

Cinciotta worked in personnel and re-cruiting at the department before movingto the dispute resolution office in 2002.The assistant attorney general in the of-fice of dispute resolution, Joanna Jacobs,will take over until a permanent appoint-ment is made. Jacobs, who organized theABA panel, has spent most of her timesince joining the office last year on the re-port’s construction.

Jacobs and Cinciotta say that after the re-port’s release, the office expects to focus onwork on long-range, ADR training programsat Justice, as well as other executive branchagencies, and on improving the InteragencyADR Working Group’s Web site. �

DOI 10.1002/alt.20180

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with mediation leading the way, justice department readies progress report touting big adr savings

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