Regional policy capacity for environmental governance: institutional dynamics in Brazil’s subnational context Open Access

The increasing complexity of environmental challenges necessitates a reevaluation of multilevel governance structures. While discussions on policy capacity often emphasize national and local governments, the regional level remains relatively underexplored – Pierre (2022, p. 524) has referred to it as “the ‘forgotten level of government’”. However, issues like climate change and environmental problems frequently transcend municipal boundaries and require coordinated action across jurisdictions. This paper examines policy capacity from a local-regional perspective, exploring the building of “regional policy capacity” to support local governments in addressing environmental issues. Regional is used here referred to the sub-state level, meaning cooperation arrangements involving municipalities, local and/or regional civil society organizations, and other stakeholders at the subnational level.

The debate on regional governance has been shaped by different theoretical perspectives. The approach applied refers to regional governance as the formation of clusters of local authorities seeking to promote intermunicipal collaboration to cope with collective action problems and address cross-jurisdictional challenges. This approach provides the conceptual foundation for our understanding of regional governance as an effort by local governments to collaborate and thereby build and strengthen regional policy capacity.

In this context, the concept of multilevel governance is fundamental to understanding the dynamics between local governments, intermunicipal agencies, and the higher levels of government (state and federal). Considering the lack of regional government structures within Brazilian federalism, promoting regional policy capacity could be an essential factor to meet local needs and coordination requirements in areas that lack formal regional governance. Regional governance arrangements are also an important strategy for public services delivery that requires inter-municipal cooperation for its implementation.

Dealing with these concepts, this paper addresses two questions: What conditions allowed the institutionalization of regional governance in a constitutional order that lacks institutionalized mechanisms of coordination? Under which conditions do those governance’ arrangements contribute to the building of regional policy capacity? The paper explores them in the context of Brazilian federalism, marked by an excessive municipal autonomy without institutionalized mechanisms of coordination. It deals with the implications for improving policy capacities in multilevel governance regimes through the lens of regional environmental policy, a policy field in which inter-municipal cooperation is particularly critical.

By focusing on regional policy capacities and dynamics, this research aims to fill a conceptual gap in the literature on policy capacity. Analyzing regional governance and its impact on environmental policy reveals regional policy capacities as key to adapting the policy capacity framework (PCF) to a multilevel context. This exploration not only contributes to the academic debate but also provides practical insights for policymakers seeking to improve environmental collaboration.

This study examines two distinct forms of regional governance in the state of São Paulo: the Greater ABC Intermunicipal Consortium and the Piracicaba–Capivari–Jundiaí (PCJ) River Basin Committee (CBH-PCJ). The former is a bottom-up, multisectoral alliance of seven municipalities—historically central to Brazil’s automotive and chemical industries—created to address shared socio-economic challenges at the local level. By contrast, the PCJ Committee was established under Federal Law No. 9.433/1997, which instituted the Brazilian National Water Resources Policy and the National Water Resources Management System (SINGREH). Together, these cases illustrate how different institutional arrangements of inter-municipal cooperation can mobilize public authorities, private actors, and civil society to address complex regional governance demands.

The Brazilian Constitution establishes overlapping and competing competencies among federal, state, and municipal governments, often creating ambiguity regarding their shared responsibilities. Complementary Law No. 140 of 2011 partially addresses this issue by delineating specific administrative functions for each level of government, facilitating a more coordinated and efficient distribution of responsibilities in environmental management. Consequently, municipal governments are responsible for implementing local policies on climate change adaptation, risk management, and solid waste management, among others. Additionally, the law promotes cooperation mechanisms, such as public consortia, for regional management of shared environmental issues.

The paper is organized as follows. After reviewing the literature on policy capacity in federal multilevel systems, challenges of regional action and the role of intergovernmental consortia are pointed out. It then presents the research methodology. Next, it discusses the conditions of policy capacity building in the two case studies. The next section analyzes the data through the lens of the policy capacity literature, pinpointing varying levels of regional policy capacity. It concludes with the contribution to the academic debate on PCF from a regional perspective.

The PCF by Wu et al. (2015, 2018) provides an analytical framework to identify essential capacities for public policy, defined as “the set of skills and resources - or competencies and capabilities - needed to perform policy functions” (Wu et al., 2018, p. 3). These capacities include analytical, operational, and political skills, with resources assessed at individual, organizational, and systemic levels. This framework is used to evaluate government’s capacities to formulate and implement effective policies, considering the capacities available to local governments. In contrast, Brenton et al. (2023) propose a four-level approach to policy capacity: program, policy sector, intersectoral, and the governance system, focusing on the government’s overall policy capacity rather than quantifying it. Both frameworks emphasize the interconnectedness of policy capacities and stress that the desired policy effectiveness can only be attained by dynamic cooperation.

The literature also indicates that policy capacities vary between sectors and levels of government (Brenton et al., 2023), i.e., not all sectors need the same data or resources for decision-making. It is therefore expected that different agencies will present different patterns in the use of political, analytical, and operational strategies.

While much of the literature on policy capacity has focused on national and local governments, the regional level remains largely unexplored, particularly in the field of environmental governance. Furthermore, there is still a lack of reflection on how political capacities can be conceptualized regarding multilevel systems (Hartley and Zhang, 2018; Hsu, 2018), particularly when federal policies rely on local implementation, or even when inter-municipal or trans-local problem-solving is required, as is the case with environmental issues such as climate change and pollution. Robust governance structures at different regional levels may prove crucial for addressing environmental and climate issues, as they can unify and direct policy capacities that municipalities or countries alone may lack (Corcaci and Kemmerzell, 2023).

Based on Wu et al. (2015)’s definition of policy capacity, this paper defines regional policy capacity as the ability of actors and institutions within a given region to develop and/or mobilize the necessary competencies and resources to formulate, implement, and evaluate public policies that are responsive to local needs and specific regional characteristics. This capacity should promote coordination, autonomy, and democratic legitimacy at the regional level.

While Wu et al.’s (2015) framework emphasizes the policy capacities of individual governments, this paper argues that regional policy capacities are shaped by the interactions among a range of governmental and non-governmental organizations. Regional policy capacities encompass both capacities designed explicitly for regional cooperation – those developed by municipal consortia or specialized agencies – and mobilizing policy capacities from other institutions, insofar as they can be applied for coordinated regional action. In this context, capacities to mobilize and coordinate diverse stakeholders, as well as to ensure democratic legitimacy, are critical criteria for establishing an effective regional governance regime.

Such policy capacities are especially important, yet also particularly challenging, in the environmental domain, as they touch upon a fundamental question in the social sciences: how to build collective capacity for action in contexts characterized by conflict-laden decision-making. It is therefore proposed that policy capacities are not only located at certain levels of government but can be built up through inter-jurisdictional cooperation. Regional policy capacity can be developed either through formal regional governance institutions or through alternative coordination mechanisms. In countries like Germany, this capacity is anchored in legally established regional bodies such as the Landkreise, which form part of the state administrative structure and support municipalities in delivering public policies and services, including environmental policies (Heinelt and Zimmermann, 2021; Kuhlmann and Wollmann, 2014). In contexts where formal regional authorities are absent, regional policy capacity may emerge through cooperative arrangements, such as the inter-municipal consortia or the River Basin Committees, as discussed below.

Although the literature on multilevel governance is extensive (Bache and Flinders, 2004; Feiock, 2013; Fischer and Jager, 2020; Peters and Pierre, 2001), it remains underdeveloped when it comes to the formulation and implementation of integrated public policies at the subnational level. Thus, the regional cooperation arrangements analyzed in this study provide a valuable foundation for exploring what such regional policy capacities entail in practice. If policy capacities vary among intra-municipal bodies, can municipalities (and states) coordinate their capacities at the regional level to improve their collective regional capacity to act? Achieving this depends on establishing a regional governance system that supports inter-municipal cooperation.

In Brazil, the regional level lacks a formal political-administrative structure. The 1988 Constitution assigned the creation and regulation of metropolitan regions to the states, which showed little interest in politically strengthening a sphere of political-administrative intermediation between the state and the municipalities. Both governors and mayors saw metropolitan governance as a threat to their autonomy and political power rather than as an opportunity for collective action. The idea of inter-municipal competition proved stronger than regional cooperation (Frey, 2012).

The absence of adequate regulation for regional and metropolitan planning and governance has resulted in significant costs, including insufficient regional infrastructure, socio-economic disparities, and fragmented urban planning. Environmental problems that transcend local jurisdictions often lead to a blame game among authorities, leading to omissions and worsening regional challenges. These dynamics underscore the need for new regional governance arrangements capable of addressing such issues effectively. This paper analyzes two regional institutional arrangements designed to strengthen inter-municipal capacity to address environmental issues: one emerging from voluntary municipal cooperation, and the other established through a federal legal mandate.

The selected cases are relevant for examining incentives and political dynamics that favor institutional strategies to overcome the collective action dilemma (Feiock, 2013; Thuranira and Frey, 2023). Clearly, coordination remains “a perennial challenge in public policy” (Ferry, 2021, p. 37). In Brazil, the absence of a dedicated regional government entity exemplifies what has been described as “governance in areas of limited statehood, where political institutions are too weak to hierarchically adopt and enforce collectively binding rules” (Börzel and Risse, 2010, p. 113; Risse, 2018). This situation demands collaborative practices among stakeholders - including governments, public agencies, civil society and service providers - across different levels and sectors. Thus, regional governance lacking a regional tier of government is unlikely to be sustainable unless strong coordination efforts are undertaken among multiple government bodies, giving rise to a polycentric governance structure (Frey et al., 2021).

To analyze the components of regional policy capacities, two cases of regional cooperation in environmental policy in the state of São Paulo are examined. They are selected as “critical cases”, a strategic choice designed to generate information that facilitates logical deductions and theoretical insights (Flyvbjerg, 2006, p. 230). By focusing on critical cases, the research deepens the analysis of specific characteristics of each regional arrangement, offering a clearer understanding of how diverse institutional arrangements foster “regional policy capacities”.

The case selection of regional intergovernmental institutions in the state of São Paulo aims to ensure comparability within a consistent political and administrative context, minimizing variations in state-level governance. This approach assumes that the state government interacts with each regional institution under similar legal, policy, and administrative frameworks, thereby isolating differences in institutional performance or outcomes.

In both cases, the institutional structures and the factors shaping the capacities of the intergovernmental institutions responsible for regional environmental policy are analyzed qualitatively, based on a review of documents and regulations concerning their establishment and operational frameworks. The data was collected from official websites, reports, legal regulations and existing studies. A comparative analysis was then conducted, drawing primarily on two strands of literature: policy capacity, which emphasizes the professional skills and resources necessary for effective policy implementation; and regional (environmental) governance, which highlights the importance of relational structures and processes that support regional public policymaking. Integrating these theoretical perspectives allows for a deeper understanding of institution-building and the development of regional policy capacity within a previously existing institutional void, as well as the conditions that enable their emergence (Feiock, 2009, 2013).

The cases were analyzed considering organizational and systemic levels in three dimensions: analytical, operational and political capacities. The combination of levels and capacities produces the following structure for comparative analysis (Table 1).

The next section presents the case studies, followed by a discussion of how the identified elements contribute to the development of regional policy capacities within the two intergovernmental cooperation arrangements.

Regional policy capacities can result from regional institutions provided by constitutional design. However, in the absence of such constitutionally mandated institutions, alternative arrangements may arise to foster regional cooperation.

To illustrate how cooperation arrangements foster regional policy capacity and consequently enable collective action, this study analyses an inter-municipal public consortium and a river basin committee. Consortia have played an increasingly prominent role in Brazil, especially since the enactment of the so-called “law of public consortia” (Law No. 11.107/2005). This legislation defines public consortia as public associations or legal entities governed by private law, established to pursue common objectives in areas such as health, education, environment, among others.

Mendes et al. (2022) identify a significant rise in “horizontal” intermunicipal consortia in Brazil, with municipal participation increasing from 52.2 percent in 2011 to 65.7 percent in 2019. In the absence of constitutionally mandated regional institutions and amid the increasing complexity of public service delivery, these consortia have emerged as key instruments of intermunicipal governance. Establishing an agency or another formal institutional arrangement to produce and implement public policies across several municipalities requires high levels of political acumen to effectively coordinate and align interests.

Intermunicipal consortia span various policy domains, with health (75.9 percent), solid waste management (35.2 percent), and environmental protection (25.2 percent) being the most common areas (Mendes et al., 2022, p. 7). Multifunctional or intersectoral consortia, operating multiple policy areas, remain less prevalent and is the case of the ABC Consortium. In contrast, the PCJ Watershed Committee represents a specialized and institutionalized governance arrangement focused on river basin management within the framework of the National Water Resources Management System (SINGREH). Its multilevel structure includes federal and state (São Paulo and Minas Gerais) actors alongside municipal governments, reflecting the transboundary basin.

The ABC region experienced significant development in 1990. Initially, The Intermunicipal Consortium of the Billings and Tamanduateí Basins were established for the joint management of water resources and solid waste disposal. This pivotal initiative led to the emergence of key regional governance structures — the Citizenship Forum, the Chamber of the Greater ABC Region, and the Economic Development Agency — all aimed at strengthening collaborative regional development (Ferracini, 2013).

During the 2000s, the Consortium effectively addressed municipal needs, notably through the creation of a landfill, which serves most of its member cities, and the implementation of macro-drainage projects. In 2010, a key institutional restructuring took place to ensure compliance with Federal Law, transforming it into Brazil’s first multifunctional public law consortium funded by municipalities. Consequently, it could contract with federal and state entities, increasing bidding limits, allowing collective bids, granting exemptions from standard bidding procedures, and assessing tax immunities.

The Consortium’s operations are driven by its technical staff and Working Groups, which consist of municipal civil servants. Administrative duties fall under a General Assembly of mayors, led by a rotating annual chair. Structurally, the organization comprises a General Assembly, an Executive Secretariat, an Internal Control Unit, a Communications Office, and four Directorates. Notably, the 2022 Management Report reveals a significant staffing gap: only 32 of the 60 approved positions (43 permanent, 17 commissioned) are currently filled. Although this collaborative governance model appears robust, it faces coordination challenges. A notable example was the withdrawal of two key municipalities (São Bernardo do Campo and São Caetano do Sul) in 2022 due to high maintenance costs. Although both rejoined the consortium in 2025, such political instability undermines the consortium’s long-term capacity to consistently advance regional interests.

The ABC Intermunicipal Consortium’s environmental initiatives are mainly overseen by the Environment Working Group, which addresses regional environmental challenges and participates in forums like the São Paulo Metropolitan Region Development Council and the Billings Basin Subcommittee. This group also prepares regional environmental plans. Additionally, the Urban Planning Working Group manages river drainage and flood prevention guidelines, while the Risk Management Working Group works with government agencies to monitor urban disaster risks.

In 2014, the Consortium established the Regional Plan for the Mutual Support of Civil Defenses in the Greater ABC region (Pram), which institutionalized the sharing of resources among municipalities to enhance disaster response and improve civil defense integration. The Climate Action Plan and the Regional Emissions Inventory were developed in 2015 through a partnership with ICLEI - Local Governments for Sustainability, reflecting the engagement of an external policy advisory service to enhance regional policy capacity. The emissions inventory employed the Global Protocol for Community-Scale GHG Emissions, which enabled the identification of emissions by activity type – such as transportation, industrial processes, waste – and differentiated between direct and indirect emissions. Utilizing ICLEI’s Green Climate Cities methodology, the initiative aimed to assess and strengthen both climate change mitigation and adaptation efforts. The plan established sector-specific guidelines, actions, and targets for reducing greenhouse gas emissions in each municipality. However, this objective has not been fully achieved. Only São Bernardo do Campo enacted its Municipal Climate Policy in 2019, followed by Ribeirao Pires in 2023.

In 2016, the group reached its peak in terms of output, publicly presenting three major regional environmental initiatives: (1) the Regional Integrated Solid Waste Management Plan, (2) the Climate Change Action Plan, and (3) the Regional Greenhouse Gas Emissions’ Inventory.

The Regional Plan for Integrated Solid Waste Management provides an overview of the regional context of waste generation, evaluates the existing municipal systems, and identifies key challenges in waste management. It recommends the establishment of a regional treatment and disposal system, supported by monitoring tools, a regional database, and dedicated institutional arrangements. Nevertheless, despite these recommendations, the proposed regional system has not yet been implemented.

The 1997 National Water Resources Policy (PNRH) defines water as a public good and promotes a decentralized, participatory governance model based on river basins as the primary territorial unit. It establishes regulatory mechanisms to mediate conflicts over competing sectoral demands. It instituted the National Water Resources Management System (SINGREH), which integrates hydrological data via the Water Resources Information System (SNIRH) to support policy coordination and the implementation of integrated resource management principles (Abers and Jorge, 2005).

River Basin Committees (CBH) play a crucial role in participatory governance, providing a platform for societal sectors to influence decision-making related to water use. These collegiate bodies are made up of representatives of various social interests, possess decision-making authority (Ribeiro and Hora, 2019) and operate according to three core principles: decentralization, integration, and participation (Frey et al., 2021). Consequently, CBHs serve as platforms for dialogue and decision-making in water resources management. They are responsible for approving catchment areas and establishing methodologies for water use fee assessment.

In contrast to other public policy domains where municipalities assume primary implementation responsibilities, water policy remains predominantly under the authority of federal and state governments. Municipal involvement in SINGREH is indirect, occurring mainly through representation in CBHs. Given that conflicts over water use typically arise within specific basins, regional governance has become essential, as it is widely recognized, as the most appropriate territorial scale for integrated and coherent water governance (Frey et al., 2021).

The CBH-PCJ, founded in 1993, was the first river basin committee created in the state of São Paulo. Its territory encompasses 71 municipalities in São Paulo state and 5 municipalities in Minas Gerais state, as well as state and federal areas. Currently, three committees collaborate in managing the PCJ River Basin: the São Paulo Committee (CBH-PCJ), the Minas Gerais Committee (CBH-PJ1), and the Federal Committee (CBH-PCJ Federal).

Brazil’s water governance framework has evolved through the establishment of the National Water Resources Policy (PNRH) and the SINGREH, with the state of São Paulo advancing earlier through its own regulatory initiatives. Within this context, the PCJ Committees have engaged in sustained “institutional work” (Patterson and Beunen, 2019), expanding organizational structures and enhancing the resilience of the governance system. From a path dependence perspective, this institutional consolidation has produced a form of lock-in, making municipal disengagement increasing unlikely once formal commitments are in place (Feiock, 2009, 2013). The highest decision-making authority within the PCJ structure is the plenary, which is governed by a unified regulatory framework that standardizes procedures across its three constituent committees.

The CBH-PCJ established twelve technical chambers to distribute activities and competencies among stakeholders to ensure civil society’s participation in decision-making. Although regulations mandate voting parity among the three segments – state, municipalities, and civil society – state bodies maintain a dominant presence, as private sector associations occupy a significant portion of the civil society seats, thereby limiting the diversity of perspectives within this segment.

The State Water Resources Fund (FEHIDRO) supports the implementation of the State Water Resources Policy by financing programs and actions. Through its funding of basin committees, FEHIDRO plays a critical role in consolidating the decentralized water governance model and sustains community engagement and participation in regional water governance processes.

The PCJ Basin Agency serves as the executive branch of the PCJ Consortium, managing funds from water use charges and acting as Executive Secretariat for both State and Federal PCJ Basin Committees. This dual function improves strategic planning and policy implementation for water security and governance. Oversight by the Regulatory Agency for Sanitation Services in the Piracicaba, Capivari and Jundiaí River Basins (ARES-PCJ) ensures regulation and monitoring of public sanitation services. Together, these entities create an integrated model linking water management with sanitation regulation to strengthen PCJ Basins’ institutional capacity.

The PCJ River Basin Committees have successfully developed their water resources management system thanks to a complex interplay of comprehensive regulations enacted at federal, state, and consortium levels, combined with the continuous and gradual establishment of key public institutions. These institutions comprise deliberative and collaborative arenas, a robust financing mechanism, an executive agency to operationalize decisions, a regulatory body overseeing municipal services, and dedicated operational staff. In essence, PCJ’s water resources management system has built substantial policy capacities through its intricate, multilevel governance structure.

The two cases of regional institutional arrangements analyzed show that policy capacities can emerge regionally based on inter-municipal cooperation. Within the inter-municipal consortia and the water basin committees, local authorities work together and generate ‘regional policy capacity’ at both the organizational and systemic levels (Wu et al., 2015), though the outcomes vary across the cases.

The Intermunicipal Consortium of the Greater ABC stands out as a crucial instrument of regional governance, solidified by its robust institutional characteristics. At the organizational level, it boasts significant administrative capacity, underpinned by a substantial team of dedicated technicians and public policy specialists. This technical body exhibits strong analytical skills that enable it to effectively assess existing policies, coordinate municipal actors, and produce environmental reports and plans. Politically, the consortium has proven highly effective in engaging municipal leaders across the ABC region. Although some mayors may opt to withdraw from the consortium during their terms, its established legitimacy has facilitated reintegration under subsequent administrations, thereby revitalizing its organizational capacity and underscoring the consortium’s political significance.

The consortium demonstrates policy capacity at the systemic level by partnering with diverse actors to develop regional plans and secure funding for infrastructure, with support from national and international governmental and non-governmental organizations. However, as pointed out, a notable bottleneck exists in the implementation of the regional plans produced, stemming from three main reasons, all directly related to municipal shortcomings: (1) Limited Operational Capacity; (2) Lack of Enforcement Authority; and (3) Electoral Volatility.

The consortium’s institutional structure and the regional policy capacity it fostered have certainly facilitated intergovernmental dialogue and the creation of regional plans. However, these strengths haven't yet translated into the effective implementation of local or regional environmental and climate policies.

Compared to the ABC Consortium, the PCJ Basin Committee exhibits an even more complex regional environmental policy capacity. Its robust organizational capacity is clearly demonstrated through formal structure and institutional practices that actively facilitate efficient water resource management. Its robust organizational capacity is demonstrated through a formal structure and institutional practices that actively facilitate efficient water resource management. The committee includes representatives from various sectors - government, users, and civil society - creating a platform for dialogue and deliberation on water issues, which highlights its analytical and political capacities at the organizational level. This structure is further enhanced by twelve technical chambers that distribute administrative responsibilities and ensure active civil society participation in decision-making. Additionally, the committee operates under a comprehensive regulatory regime that establishes clear rules for integrated operations among the three committees functioning within the basin.

The establishment of the PCJ Basin Agency further enhances this organizational capacity. It acts as the committee’s operational arm, managing financial resources and implementing agreed-upon decisions. The consistent availability of financial resources, secured through water usage fees, is another crucial organizational element, enabling consistent planning of activities. The systemic capacity of CBH-PCJ is evident in its ability to coordinate actions across various government levels and stakeholders, thereby promoting integrated water resources management. This capacity is robustly underpinned by the National Water Resources Policy (PNRH) and SINGREH, which provide a comprehensive legal framework for effective water management. The committee successfully coordinates efforts among municipalities in both São Paulo and Minas Gerais, while also integrating actions with federal entities. Access to the State Water Resources Fund (FEHIDRO) is a critical element supporting this systemic capacity, as it ensures consistent funding for programs aimed at improving water quality and protecting water bodies. Overall, the interplay of these capacities has enabled the PCJ River Basin Committee to effectively address complex challenges related to water management within a multilevel governance framework. The findings regarding the generation of regional policy capacity in the two study cases are summarized in Table 2.

Revisiting the initial question about whether municipalities (and states) can coordinate to enhance their collective regional capacity to act, this paper found that this capacity can vary significantly. This variability depends on governance continuity, political interests, and the financial resources that support inter-municipal cooperation. Furthermore, both policy formulation and implementation can be impacted differently by these factors.

The ABC Consortium successfully produced climate-related regional plans and diagnostics, indicating shared interests among its members. However, translating these interests into actionable policy has proven more challenging. Regional translocal policymaking requires capacities that extend beyond the traditional PCF, as it demands a distinct capability for regional integration. Accordingly, the following specific dimensions of regional policy capacity should be considered as essential additions:

• Institutional innovation: New self-governing entities, equipped with their own administrative competencies and resources

• Autonomy: Relative independence of regional institutional arrangements to formulate and implement policies that reflect local priorities and conditions.

• Coordination and collaboration: Capacity to foster effective coordination and collaboration among a diverse range of regional stakeholders, including local governments, the private sector, non-governmental organizations, and civil society actors.

• Context-sensitive knowledge use: Ability to access and utilize local data and knowledge to inform decision-making and adapt policies to the specific regional context, while accounting for the varied needs of participating municipalities.

• Financial capacity and resource mobilization: Ability of regional actors to generate, manage, and strategically allocate financial resources — whether through intergovernmental transfers, regional funds, grant programs, or public-private partnerships — to ensure the sustainable implementation of regional policies.

• Democratic deliberation: Establishment of a regional political arena that facilitates negotiation, compromise, and conflict resolution, enabling collective action and fostering democratic legitimacy through the creation of a vibrant regional public sphere.

The cases demonstrate that the establishment of regional policy capacities helps to foster environmental policies, especially in cases where federalism produces a high level of municipal autonomy and a low level of institutionalized regional coordination. However, the outcomes obtained by regional capacities depend on the robustness of the institutional framework, which in turn does not protect them from political maneuvering that can compromise their effectiveness. Institutions and agency matter. In any case, a coherent institutional framework is an important instrument for promoting intergovernmental cooperation where traditional institutions struggle to manage multilevel governance challenges, as is often seen with climate policies.

The cases of regional cooperation illustrate the potential for creating a regional environmental policy capacity that involves different governmental actors (municipal, state, and federal), as well as non-state stakeholders, for effectively managing environmental issues of regional interest, transcending municipal boundaries. Although the ABC Consortium has not succeeded in implementing a regional policy to address climate change, it did produce other important regional plans and policy initiatives, which serve as parameters for municipal actions (Frey and Bittencourt, 2022).

In contrast, the water resource management case successfully established a regional policy capacity that supported both the formulation and implementation of policies through public service provision. The PCJ-River Basin Committee benefited significantly from its inception. Its creation with concrete and clear objectives and responsibilities, coupled with support from a national integrated governance and policy framework, strongly favored its consolidation as a regional water governance regime. The accumulation of organizational capacity, institutional consolidation, and the development of routine tasks and processes guarantee its sustainability over time. In the case of the ABC Consortium, on the other hand, due to its multifunctional nature, there is greater innovative strength and flexibility to seek solutions to new challenges, while at the same time it is more vulnerable to government changes, which can lead to the cancellation of projects or plans, as in the case of climate policy, or even the withdrawal of municipalities from the inter-municipal association, as recently happened in this consortium.

Yet, some questions still need to be explored by future work based on the PCF, including: (1) Are there other types of regional policy capacities that can result from inter-municipal cooperation? (2) How, to what extent, and under what conditions can the regionalization of policy capacities be maintained? These questions have to be tackled by future research to address important elements of the debate on policy capacity in the context of multilevel governance regimes.

The authors would like to thank the anonymous reviewers for their constructive feedback and valuable suggestions, which greatly improved the quality of this paper.

This paper forms part of Special Section on “Policy Capacity Framework in Implementation Analysis Across Different Contexts in the World”, guest edited by Dr Fabiana C. Saddi, Dr Stephen Peckham and Dr Nagina Khan.