Add Federal Permits to the List of U.S. Crises

The Biden administration’s American Jobs Plan talks about a climate crisis and an affordable housing crisis in its attempt to address the country’s infrastructure crisis. But before it can make serious progress on any of those issues it will need to address another crisis: federal permitting.

Last week President Joe Biden met with Republican Senators to discuss building bipartisan support around infrastructure. His Jobs plan proposes spending an estimated $2.3 trillion, plus $400 billion in tax credits, to be offset by $2.1 trillion in additional tax revenue. Objectives include modernizing 20,000 miles of roads, 10,000 bridges, replacing lead drinking water lines, 100% national broadband coverage and, most ambitious of them all, overhauling the entire U.S. economy to achieve net-zero greenhouse gas emissions by 2050.

But the federal government stands in its own way in accomplishing any of those goals. Many large infrastructure projects, especially linear projects such as utility lines that can cover hundreds of miles of right-of-way, are subject to a slew of federal, state and local permits and other authorizations. Most prominent among those is the National Environmental Policy Act, known as NEPA.

The average time to complete an Environmental Impact Statement — the type of analysis required for most major infrastructure projects — is 4.5 years, with some reviews taking over 10 years, according to a 2020 report from the White House Council on Environmental Quality that examined submissions from 2010 to 2018. Once approved, the most controversial projects, which are often also the largest, are subject to litigation from opponents searching for any vagaries in the law or process that they can exploit, delaying projects by an average of another two years.

In 2020, the White House Council on Environmental Quality  revised the NEPA regulations for the first time in more than 40 years. Many of those reforms relied on objectives outlined in the original statute and regulations, which called for striking a balance between economic, technical and public good considerations.

The 2020 reforms established a "One Federal Decision" framework to streamline the approval process, providing senior level oversight of the timeline and limiting the length of submissions. For substantially similar activity, the reforms allowed for the re-use or substitution of environmental documents and public input processes conducted under other environmental laws. To help reduce litigation over interpretations of the rules, vaguely written regulatory language was clarified with more specific guidance.

Upon rollout of the revised NEPA regulations in 2020, businesses both large and small from nearly every part of the U.S. economy issued statements supporting the changes. Unfortunately, the reforms have been challenged in multiple U.S. courts by both environmental groups and several states, prompting the Department of Justice to ask for time to review the reforms so the Biden administration can submit its own version. 

In the meantime, there are ominous indications that the rapid expansion of clean energy infrastructure in the U.S. is already running into permitting problems. Leaders from the Atlantic fisheries recently boycotted a public meeting to discuss future wind energy leases offshore New York and New Jersey, stating that there have been “no accommodations to mitigate impacts from individual developers” and calling the permitting process “broken.” There are currently 16 construction and operations plans for offshore wind farms winding their way through the lengthy NEPA process in the federal government. Elsewhere, environmental litigants are challenging the New England Clean Energy Connect, a $1 billion project that will provide 1,200 megawatts of renewable energy to the New England grid, with the Sierra Club calling the project an “environmental crime.”

Perhaps one can take comfort in the single line in the American Jobs Plan that refers to “smart, coordinated infrastructure permitting,” but color me a skeptic. Brenda Mallory, the current chair of the White House Council on Environmental Quality, refused to endorse the need for more efficient timelines during her confirmation hearing. In fact, the sole change in the 2020 revisions that she endorsed was expanded engagement by Tribal Nations, suggesting this administration might follow the example of the Obama years, when officials lay down on the tracks to prevent meaningful reforms to NEPA. One thing you can count on: the tracks won't be high speed rail, because those won’t be built for many years if all the recent improvements to NEPA are discarded.

A bipartisan approach to NEPA permitting reform is still possible by focusing on these three key elements:

  • Implement the "One Federal Decision" framework to structure interagency coordination;
  • Establish presumptive time limits for approvals, reinforced by senior level oversight by the department leading the review; and
  • Authorize greater use of the existing trove of federal, state and tribal environmental documents and administrative processes.

These reforms won’t address all the reasons for delays, but they will help. The country has a solid foundation to create sensible permitting reform — let’s not waste valuable taxpayer funds in a slow and inefficient pursuit of the next generation of American infrastructure. 

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Stuart Levenbach has held positions in three presidential administrations, including in the Office of Management of Budget, the Council on Environmental Quality, and the National Oceanic and Atmospheric Administration, and most recently as senior adviser to the former director of the National Economic Council.

©2021 Bloomberg L.P.

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