United States: Executive Order Set To Expedite Permitting And Authorization Of Infrastructure Projects

Last Updated: September 5 2017
Article by Van P. Hilderbrand Jr and Christopher S. Denny

During the campaign and thus far in the current administration, the President has prioritized the modernization of the Nation's infrastructure and promised a $1 trillion investment plan to help fund that vision. There is rare bipartisan support in Congress for such a measure, as many agree that our roads, bridges, tunnels, railways, airports, energy, and water systems are in need of repair and replacement.

Although no legislation has been proposed to fund such projects, last week the President signed an Executive Order that may lead to a more efficient and effective permitting and authorization process and is viewed by many in Congress as a step toward the introduction of a long-awaited infrastructure funding package.

Executive Order "Establishing Discipline and Accountability in the Environmental Review and Permitting Process for Infrastructure"

The President's Executive Order streamlines the permitting process for infrastructure projects, such as transportation and water systems, by easing several environmental rules, regulations, and policies. The Executive Order states that it will "ensure that the Federal environmental review and permitting process for infrastructure projects is coordinated, predictable, and transparent." You can read the full Executive Order here, but we highlight the critical provisions below. Executive Order highlights:

  • One Federal Decision Policy. Requires a "One Federal Decision" policy in which each major infrastructure project will have a lead Federal agency to guide the project through the environmental review and authorization process. A major infrastructure project is defined in the Order as a project for which multiple authorizations by Federal agencies will be required, the lead Federal agency has determined that it will prepare an environmental impact statement under the National Environmental Policy Act (NEPA), and the project sponsor has identified the reasonable availability of funds sufficient to complete the project.
  • Two Year Goal for Environment Reviews. Establishes a two-year goal to complete all Federal environmental reviews and authorizations for major infrastructure projects.
  • Modernization CAP Goal. Directs the Office of Management and Budget (OMB) to develop a modernization cross-agency priority (CAP) goal to ensure that environmental reviews and authorizations are consistent, coordinated, and predictable and to reduce the review timeline to not more than an average of approximately two years, "measured from the date of the publication of a notice of intent to prepare an environmental impact statement or other benchmark deemed appropriate by the Director of OMB."
  • Agency Accountability. Instructs OMB to develop a performance accountability system to track each Federal agency's implementation of the Executive Order and provides OMB the authority to consider performance during budget formulation and to impose penalties on an agency for poor execution.
  • Strategic Plan Modification. Requires Federal agencies to modify their Strategic Plans and Annual Performance Plans to include goals for improving their environmental review and permitting processes.
  • Improved Review Process. Directs the Council on Environmental Quality (CEQ) to develop and implement an action plan to improve environmental reviews, including NEPA, across the Federal government.
  • Cost Tracking. Requires Federal agencies to track the costs of conducting environmental reviews and making permitting decisions.
  • Flood Risk Management. Revokes the Federal Flood Risk Management Standard which allowed agencies to consider climate change impacts in their decisions.

The practical impact of the Executive Order:

  • Single Contact. Infrastructure project developers and contractors will have a single point of contact to help them achieve project approval – expediting the process.
  • Forecasting Clarity. The two year environmental review completion goal gives project stakeholders a clearer and more consistent benchmark for forecasting the impact of such reviews on project schedule and cost.
  • Accountability. Federal agencies will be held more accountable for expeditiously moving projects through the permitting and authorization pipeline.

Implementation of the Order, however, will face obstacles similar to those encountered by prior reform efforts. For example, judicial interpretations regarding the extent and scope of environmental reviews under NEPA and other laws have lengthened the review and permitting process and ensured that agencies conduct such reviews consistent with applicable laws. In addition, any reform effort needs to be balanced with the right mix of strategic tools and personnel (something the current budget will make difficult), and maintain environmental protections mandated by existing statutes. In addition, some of these critical provisions are already being challenged.

Past Actions to Streamline the Permitting and Authorization Process

Most agree that the Federal review and permitting process can be confusing, daunting, and lengthy, which sometimes translates into delayed projects and increased costs for agencies, developers, and contractors. Thus, an attempt at increasing the effectiveness and efficiency in the process is not something new. On September 18, 2002, President George W. Bush issued Executive Order #13274, "Environmental Stewardship and Transportation Infrastructure Project Reviews," to streamline the environmental review and development of transportation infrastructure projects. Further, on March 22, 2012, President Obama issued Executive Order #13604, "Improving Performance of Federal Permitting and Review of Infrastructure Projects" with the goal to "significantly reduce the aggregate time required to make decisions in the permitting and review of infrastructure projects by the Federal Government, while improving environmental and community outcomes."

In December 2015, President Obama also signed into law the Fixing America's Surface Transportation (FAST) Act—a transportation authorization and spending bill, which required Federal agencies to coordinate their environmental reviews to avoid duplication and accelerate the review process. Federal agencies also implemented during the Obama administration new rules to significantly cut bureaucratic red tape, while achieving better environmental outcomes.

The latest Executive Order is the second directive of the current administration involving expediting environmental reviews for infrastructure projects. In January 2017, the White House issued Executive Order #13755, "Expediting Environmental Reviews and Approvals for High Priority Infrastructure Projects." The Order however was light on details and did not change any substantive requirements in the review process. Congressional Democrats have argued that the administration should instead spend money and resources continuing to implement the prior streamlining provisions rather than developing a new authorization scheme, according to the Associated Press.

The important factor in all of these streamlining attempts has been to establish a process that is transparent and one that accelerates the improvement of the Nation's infrastructure while also emphasizing environmental protections. The President's most recent Executive Order purports to put forth a process under which Federal agencies will maintain these protections and will help develop infrastructure in an environmentally sensitive manner. In the announcement of the Order, the President stated "[a]nd if doesn't meet environmental safeguards, it won't get approved." Whether or not this is truly the end result will have to be seen in the Order's implementation and in the plans and goals set by the CEQ and the OMB over the next few months.

The Executive Order Revoked the Federal Flood Risk Management Standard

Opponents were immediately critical in the press about one provision. In an attempt at further streamlining, the Executive Order revoked the Federal Flood Risk Management Standard (Executive Order #13690) established by President Obama on January 30, 2015. The now-revoked standard allowed Federal agencies to consider the impacts of climate change and potential flood elevations when making decisions concerning federally-funded infrastructure development and siting. Opponents, such as the American Society of Civil Engineers and the Sierra Club, were critical of the standard's revocation, arguing that not building critical projects in areas susceptible to flooding and increased storms ensured that taxpayer dollars are responsibly spent. In contrast, building trade groups, such as the National Association of Home Builders, and Republican lawmakers have argued that compliance with this standard was difficult and drove up the overall development cost of projects. Although the revocation of the standard is immediate, it does not prohibit states and local agencies from considering flood risk and using stricter standards in their decisions.

Conclusion

The White House has made it clear that it wants infrastructure investment, dedicating $200 billion in new Federal government spending to the endeavor according to the Fact Sheet released with the Order. The remaining funding, the White House says, will come from local and state governments, and the private sector, including public-private partnerships. This is a rare opportunity during the first year of the administration to deliver on a promise to the Nation. Infrastructure spending may be one of the few measures that will enjoy bipartisan support in the near future.

If such a bill is passed, the President hopes this Order will pave the way to a better and more efficient use of the funds by taking projects from the review and planning phases to construction and completion faster, while still protecting human health and the environment. Only time will tell if this Executive Order is a positive step down a path to an efficient, and funded, improvement of our nation's infrastructure; or one step on a path to nowhere.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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