<p>Clean water is one of the primary goals of the EPA and environmental regulatory agencies across the country. Over the agency’s long history, hundreds of EPA regulatory programs have tried to improve water quality. However, very few programs focus on the role of enforcement. The EPA’s Priority Sector Program increased enforcement, along with regulatory monitoring, against certain industrial manufacturing sectors in an attempt to reduce water pollution. The purpose of this paper is to examine the impact of the Priority Sector Program by analyzing its effect on the chemical manufacturing industry as it pertains to improving compliance with discharge limits. Using a difference-in-differences framework and event studies, we find that inclusion of chemical manufacturing facilities in the Significant Sector tier of the Priority Sector Program was effective at reducing discharges and improving compliance, whereas inclusion in the more stringent Priority Sector tier did not significantly improve compliance. To assess the causal channels, we examine whether the Priority Sector program prompted the EPA regional offices to conduct more inspections, take more enforcement actions, and impose bigger sanctions.</p>