United States: An Environmental Law Strategy Is Key To Getting Major Infrastructure Projects Approved

Last Updated: October 12 2017
Article by Neal McAliley

The process of obtaining required governmental approvals is among the biggest challenges to building major transportation, energy, and water infrastructure in the US. Large projects typically require approval from multiple federal, state, and local agencies. The permitting process can take years. As private sector actors assume greater roles in public infrastructure projects, they must be prepared to navigate the approval process successfully.

Infrastructure project developers need to build their permitting strategy around obtaining environmental approvals. Most major infrastructure projects require some type of federal approval, and federal agencies must conduct environmental reviews before making final decisions. The time needed to complete these reviews drives project timelines, and can define interactions between agencies responsible for a project's different aspects. Third parties seeking to block projects in court typically challenge the validity of those approvals on environmental grounds. Project developers must integrate an environmental law strategy into their planning process from the start, to speed the issuance of necessary agency approvals, and defend the approvals if they are challenged.

Virtually every major infrastructure project needs one or more federal approvals to move forward. Some relate to using federal lands or money. This is especially true if the federal government seeks to spur infrastructure investment by contributing money to P3s.

Some projects require federal agency oversight and sign-off, for example the Federal Aviation Administration must approve most airport projects. Federal permits are also required for certain types of environmental impacts that are ubiquitous in large projects, such as impacts to wetlands. These approvals are in addition to state and local approvals, and it is not uncommon for large projects to require sign-offs by multiple agencies.

Federal approvals invariably require environmental review, whether or not the approval is based on an environmental statute. The National Environmental Policy Act (NEPA) requires federal agencies to prepare an environmental impact statement for major federal actions significantly affecting the quality of the human environment. These can include issuing permits, committing federal funds, or authorizing federal property use. The Endangered Species Act requires federal action agencies to consult with wildlife agencies about a project's likely effects on threatened and endangered species.

Environmental reviews drive the permitting process. A recent survey found the average completion time for an environmental impact statement under NEPA was five years. Even for simpler projects that do not require a full environmental impact statement, environmental reviews can take years.

The process takes more than time. Agencies often require applicants to pay for consultants to prepare environmental documents for the agencies - in addition to those hired to assist project developers - which can cost millions of dollars. Where multiple agencies must approve a project, preparing environmental reviews can become the principal mechanism by which they coordinate and share information. Poor coordination among agencies can delay the date by which all required approvals are issued, lead to inconsistent permit conditions, and erode the project's support. In fact, multi-year permitting delays can allow partnerships to decay, political support to erode, and financing to disappear.

Persons who lack experience with a complex environmental review process may be unprepared for the time and fortitude it takes to reach the construction starting line. Project developers can accelerate the process by facilitating coordination among agencies, structuring projects to minimize unnecessary reviews, and speeding the preparation of required documentation. This requires planning and dedicating a team of environmental An environmental law strategy is key to getting major infrastructure projects approved professionals to interact regularly with agency staff.

Much of the day-to-day work can be done by environmental consultants (often engineers and biologists) who manage agency relationships. But environmental lawyers are also crucial because legal questions often arise over issues such as what approvals are required and what analyses must be completed.

Environmental lawyers are especially needed for controversial projects. It is common for opponents of infrastructure projects to try to block or delay them by challenging the legal basis for agencies' permits and approvals. Almost invariably, these challenges claim that federal agencies inadequately complied with environmental laws such as NEPA and the Endangered Species Act.

Planning and winning these legal challenges requires preparation. Courts review agency approvals based on their administrative records - the documents in an agency's files when it makes a final decision - not on a record made by trial lawyers after the case is filed.

The issues are often technical or scientific matters involving complex nuances of environmental law. This means the permitting team must constantly evaluate the record before the agency, respond to adverse submissions, and ensure that the agency has all the information it needs to issue - and defend if necessary - an approval. Controversial projects that survive the regulatory gauntlet and subsequent legal challenges usually have strong teams of environmental lawyers and consultants who guided them through the process.

A project developer's goal is not simply to obtain a permit. Instead, it should be to obtain a permit that is properly issued, supported by the record, and able to survive a legal challenge, so it can be built. The best way to accomplish this is to develop and execute an environmental review process plan.

This article first appeared in P3 Bulletin Vol. 5, Issue 5.

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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