How to navigate the accelerated approval process for federal infrastructure projects
President Trump signed Executive Order (EO) 13807 in August 2017 that aims to complete environmental review and approve major infrastructure projects within two years.
This means new accountability requirements for lead agencies, their personnel, and other reviewing and permitting agency personnel. While the two-year requirement might seem daunting, agencies have already achieved that time-frame (and even shorter) for a number of major infrastructure projects.
How do the new requirements stack-up against those enacted by predecessors, and how can agencies and environmental practitioners prepare?
Streamlining: Where are we now?
The President’s Council on Environmental Quality (CEQ) and the Office of Management and Budget (OMB) wrote a major provision of EO 13807 called One Federal Decision (OFD). CEQ and OMB prepared the OFD Memorandum of Understanding (MOU) for Major Infrastructure Projects that was signed by a dozen agencies in April 2018.
The MOU facilitates the implementation of EO 13807 by instituting processes that enable better interagency coordination for the timely review and approval of significant infrastructure projects. OMB issued guidance on implementing the performance accountability system aspects of EO 13807 and OFD in September 2018.
In the meantime, many federal agencies have been updating their project planning, NEPA, and permitting regulations and processes to implement EO 13807 and OFD.
Even with all of these directives focused on streamlining, more are expected to come. Insiders anticipate that in FY2019 there will be further CEQ and federal agency updates made to the National Environmental Policy Act (NEPA) implementing regulations and processes.
With initiation of divided government in early 2019—Democrats controlling the House of Representatives and Republicans controlling the Senate and the White House—it is doubtful that any legislative changes to the NEPA statute will be forthcoming until after the 2020 general election, given the two parties distinctly different perspectives on environmental regulation.
How have past administrations and Congress tried to expedite environmental reviews and permits?
Since 1970, NEPA has required federal agencies to weigh the environmental consequences of their actions before making decisions. It can, and often does, take years to complete NEPA reviews, particularly for major infrastructure projects.
Over the years, agencies have produced Environmental Impact Statements (EISs) that greatly exceed the CEQ guideline page limits and many parties think they take too long to complete. This is in spite of NEPA’s regulations on page limits, emphasis on focusing only on essential components, directives to integrate NEPA requirements with other planning and environmental review procedures, and provisions for time limits.
While there are various reasons that an EIS process takes too long, the excessively lengthy ones lead to protracted internal reviews and requests from stakeholders to extend comment periods.
In the end, an extensive EIS does not necessarily make the document and process more legally defensible. Moreover, they can overwhelm and bog-down reviewing agencies, the public, elected officials, and, ultimately, the judges.
Also, the amount of time involved in agency decisions regarding areas such as wetlands, endangered species, historic properties, and bridges can take too long because of staffing constraints, varying statutory responsibilities, differing missions, and policy differences. The new EO is the latest of many attempts by administrations and Congress to streamline the NEPA review and authorization processes:
- President George W. Bush signs Executive Order 13274 ;emphasizing the importance of expedited transportation project delivery while being good stewards of the environment.
- Congress passes the Safe, Accountable, Flexible, and Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU), aimed at improving efficiency in environmental review of transportation projects.
- President Barack Obama signs Executive Order 13604 to improve efficiency in federal permitting and review, including tracking progress against performance goals, in addition to transparency and environmental protection.
- Congress passes the Moving Ahead for Progress in the 21st Century Act (MAP-21) to accelerate transportation project delivery through the increased use of Categorical Exclusions, programmatic approaches, and planning and environmental linkages.
- Congress passes the Fixing America’s Surface Transportation (FAST) Act. This codified the FHWA “Every Day Counts” initiative, allowed greater use of funds for permitting improvements, improved early engagement, expanded the federal project Dashboard, formalized the Federal Permitting Improvement Steering Council (FPISC), accelerated processes for emergency projects, and established a pilot program to delegate NEPA to certain states for transportation projects.
Changes in the approval process
The key process change in the EO is the “One Federal Decision” Process. The OFD process requires designation a single Federal lead agency throughout the NEPA and authorization processes and include all approving agency NEPA decisions in one Record of Decision (ROD), with certain exceptions.
The Federal lead, as well as cooperating and participating agencies, are required to agree on a permitting timetable. Federal authorization decisions for the construction of a significant infrastructure project must be completed within 90 days of the issuance of a ROD by the lead Federal agency, provided that the final EIS includes an adequate level of detail to inform agency decisions.
The CEQ and the Office of Management and Budget OMB are required to develop the framework for implementing One Federal Decision, in consultation with the FPISC. The framework will include guidance on the development of permitting timetables, including the criteria for advancing a project into schedule development and the process for extensions.
Timelines are necessary to account for federally required decisions or permits assumed by or delegated to state, tribal, or local agencies. CEQ and OMB will also develop guidance for applying One Federal Decision whenever the lead agency is a state, tribal, or local agency exercising an assignment or delegation of an agency's NEPA responsibilities.
Other process improvements include the following:
- CEQ Streamlining Guidelines: CEQ is required to provide guidance enhance and modernize the Federal environmental review and authorization process.
- Energy Corridors: The Departments of the Interior (DOI) and Agriculture are required to facilitate the identification and designation of energy right-of-way corridors on Federal lands for Government-wide expedited environmental review for the development of energy infrastructure projects.
- FPISC: The EO provides organizational support for the FPISC.
- Dashboard: Projects subject to the EO must be tracked under the federal Dashboard.
- Agency Reorganization: The DOI is required to provide OMB a strategy and recommendations for a multi-agency reorganization effort that would further the aims of the order.
Accountability in agency performance
The 15 cabinet-level agencies and a score of other executive-level agencies have existing Cross-Agency Priority (CAP) goals established by the Government Performance and Results Act (GPRA) Modernization Act of 2010. Pursuant to the EO, OMB—in consultation with the FPISC—established a CAP Goal on Infrastructure Permitting Modernization so that:
- Federal environmental reviews and authorization processes are consistent, coordinated, and predictable.
- The processing of environmental reviews and authorization decisions should be reduced to not more than an average of approximately two years, measured from the issuance of the Notice of Intent (NOI) or other benchmark deemed appropriate by OMB.
Agencies with environmental review, authorization, or consultation responsibilities for infrastructure projects are required to modify their Strategic Plans and Annual Performance Plans (under the GPRA) to include performance goals related to the completion of environmental reviews and authorizations consistent with the new CAP Goal.
The agencies are required to incorporate the achievement of these performance goals into appropriate agency personnel performance plans such as those of the agency Chief Environmental Review and Permitting Officers (CERPOs) or other appropriate officials.
In September 2018, OMB, in consultation with the FPISC, issued guidance for creating a performance accountability system to determine whether agencies are meeting their goals, including the costs of environmental review and authorization for each project. OMB will consider each agency's performance during budget formulation and determine whether appropriate penalties should be imposed for those that significantly fail to meet a permitting timetable milestone.
Accountability under OFD
Simply put, agencies now have a goal to complete EISs for major infrastructure projects in approximately two years, and issue all necessary authorization decisions within 90 days of issuance of the Record of Decision (ROD) that is either integrated with or follows a Final EIS. The two-year goal applies to EISs with a Notice of Intent (NOI) published after August 15, 2017.
Before the issuance of the NOI, the lead agency, in consultation with the project sponsor and cooperating and participating agencies, develops a permitting timetable for the environmental review and authorizations. The timeline becomes publicly available on the permitting dashboard.
To make the process easier, project sponsors need not apply, as federal agencies determine which projects fall under OFD.
Projects subject to OFD MOU:
- Require multiple authorizations by Federal agencies before construction can begin.
- Prepare an EIS, as determined by the lead Federal agency.
- Prove reasonable availability of funds to complete the project, as identified by the project sponsor.
Through the OFD MOU, the OMB, in consultation with the Federal Permitting Improvement Steering Council, has established a performance accountability system that will score each agency on its implementation of EO 13807. OMB intends to publish a quarterly scorecard of agency performance. The OMB will consider poor performance in budget formulation, which could result in the imposition of penalties.Considerations in the accountability system include the following six assessment areas:
- whether major infrastructure projects are processed using the "One Federal Decision" framework;
- whether major infrastructure projects have a complete Permitting Timetable;
- the extent to which agencies are meeting major milestones in the Permitting Timetable for major infrastructure projects;
- whether delays for major infrastructure projects follow a process of elevation to senior agency officials;
- the length of time it takes to complete the processing of environmental reviews and authorizations for each major infrastructure project; and
- the cost of the environmental reviews and authorizations for each major infrastructure project.
While the two-year requirement might seem challenging, agencies have already achieved that timeframe and even shorter ones for significant infrastructure projects without cutting corners.
Among other things, it takes focused pre-scoping activity, clear decisions on what is essential to the issue at hand, relationships with cooperating agencies and other agencies, page limits for every section in the EIS, purposeful meetings, incorporation by reference, and environmental consequences defined around the critical issues identified during scoping.
Revising Departmental NEPA regulations and processes
Many agencies took streamlining actions in 2017 and 2018.
First out of the blocks, in September 2017, the Department of Interior issued Secretarial Order 3355, taking a more aggressive approach to implementing EO 13807 and applying it to all proposed actions, not just infrastructure. This order also imposed page and time limits on EISs.
Some of the first EISs implementing the DOI Secretarial Order were issued in 2018. NEPA lead agencies and project proponents have been utilizing Title 41 of Fixing America’s Surface Transportation Act (FAST-41) to further ensure timely outcomes.
In January 2018, FHWA signed a working agreement with the U.S. Army Corps of Engineers, Fish and Wildlife Service, National Oceanic and Atmospheric Administration, and the Coast Guard on coordination, planning, project development, and permitting for major infrastructure projects.
In October 2018, FHWA issued internal guidance regarding activities that should be completed prior to initiation of new EISs for significant infrastructure projects and subject to OFD. During the same month, USEPA issued standard operating procedures for implementation of FAST-41 and EO 13807. USDOT finalized rulemaking shortly after, which merged FHWA, FRA, and FTA NEPA and Section 4(f) regulations, establishing the same overall environmental review process for all three agencies.
The rulemaking incorporates FAST-41 requirements, expands the number of categorical exclusions (CEs) for rail projects, and allows FRA to use FTA and FHWA CEs. CEQ’s Advanced Notice of Proposed Rulemaking issued June 20, 2018, contained 20 questions for input on the efficiency of the process. Topics included: optimal interagency coordination of environmental reviews and authorization decisions, format and page length of NEPA documents, time limits for completion, and greater clarity around issues that are relevant and useful to decision-makers and the public. The comment period has closed, and CEQ is to preparing the proposed rulemaking in 2019.
Realizing better performance
With fewer unknowns a year and a half into the streamlining initiative and with processes and regulations becoming more refined at every step, developers and investors should grow more confident engaging in new projects. ICF will continue to monitor and share changes as they occur and we encourage you to reach out to our team with your questions as you navigate the ever-changing streamlining landscape.
Streamlining is an elusive goal, given the need to assess complex environmental effects, take into account the input and perspectives of numerous stakeholders and the public, apply the many cross-cutting imperatives of environmental statutes other than NEPA, meet the institutional prerogatives of different federal agencies, and comply with the legal requirements of NEPA itself. The new EO seeks to promote better federal performance through process and accounting improvements.
Achieving an average two-year target will require skill, dedication, and decisiveness in planning, initiating, and conducting environmental reviews and permitting processes. Agencies and practitioners need to examine their approach to meet the expectations of the EO.
In a way, it is like going back to basics—to the principles and requirements established decades ago. Good public policy means project proponents, the public, and other stakeholders receive a decision on a project within a reasonable amount of time, rather than floundering under a cloud of uncertainty for years.