By Andrea Hogan and Joshua Marnitz

On May 6, 2015, the US Senate Committee on Homeland Security and Governmental Affairs voted 12-1 in favor of a bill designed to streamline the Federal permitting process for major energy and infrastructure projects. The bill, first introduced in January 2015 by Senators Rob Portman (R-Ohio) and Claire McCaskill (D-Missouri) as S. 280 or the Federal Permitting Improvement Act of 2015, will now proceed to the full U.S. Senate for consideration.

If passed, the proposed bill would establish a multi-agency permitting council known as the Federal Infrastructure Permitting Improvement Steering Council (Council) to oversee and coordinate the Federal permitting process for covered projects. The Council would be chaired by an Executive Director appointed by the President, and would consist of a designated member of each Federal agency with permitting authority over covered projects — including, without limitation, the US Department of Energy, the US Department of the Interior, the US Environmental Protection Agency, and the Federal Energy Regulatory Commission — as well as the Chairman of the Council on Environmental Quality and the Director of the Office of Management and Budget (OMB). Of note, in the version of the bill introduced in January 2015, the chair role was to be held by an officer of the OMB.

The proposed bill defines a “covered project” as any construction activity in the United States (1) involving renewable or conventional energy production, electricity transmission, surface transportation, aviation, ports and waterways, water resource projects, broadband, pipelines, manufacturing, and any other sector as determined by a majority vote of the Council (2) that is likely to require a total investment of more than $200 million and does not otherwise qualify for abbreviated authorization or environmental review processes, or (3) the size and complexity of which make the project likely to benefit from enhanced oversight and coordination. A project likely to benefit from enhanced oversight and coordination includes any project likely to require authorization from or environmental review involving more than two Federal agencies, or the preparation of an Environmental Impact Statement (EIS) under the National Environmental Policy Act (NEPA).

The legislation would, among other things, direct the Executive Director to establish and maintain an inventory of covered projects for which a Federal review or authorization is pending, categorize that inventory based on sector and project type, and designate a lead Federal agency for each category of covered project. It would also require the Executive Director to maintain an online database (known as the Permitting Dashboard) to track the status of Federal reviews and authorizations for covered projects. In addition, the Executive Director is required to develop nonbinding performance schedules that include intermediate and final deadlines for Federal reviews and authorizations for each category of covered project. Those performance schedules would set the deadline for a Federal agency decision on an environmental review or authorization at 180 days from the date the relevant agency receives all information needed to complete the review. Additionally, the bill provides that the comment period for a draft EIS shall not be less than 45 days or greater than 60 days, unless the lead agency, project sponsor and any cooperating agency agree to a longer period, or unless the lead agency extends the deadline for good cause. The Executive Director would be required to review and revise the performance schedules at least once every two years, in consultation with the full Council.

Also under the proposal, the Council would be required to issue annual recommendations on the best practices for:  enhancing early stakeholder engagement; ensuring timely decisions regarding environmental reviews and authorizations; improving coordination between Federal and non-Federal governmental entities; increasing transparency; reducing information collection requirements and other administrative burdens on agencies, project sponsors and other interested parties; developing and making available to applicants appropriate geographic information systems and other tools; creating and distributing training materials to Federal, state, tribal and local permitting officials; and addressing other aspects of infrastructure permitting, as determined by the Council. Any agency designated as the facilitating or lead Federal agency for a project would also be required to establish and submit to the Executive Director a concise plan (the Coordinated Project Plan) for coordinating agency and public participation in any required Federal environmental review or authorization for the project. The Coordinated Project Plan must include: a list of, and roles and responsibilities for, all entities with environmental review or authorization responsibility for a project; a permitting timetable setting forth a comprehensive schedule of dates (including intermediate and final deadlines) by which all Federal environmental reviews and authorizations, and to the maximum extent practicable, state permits, reviews and approvals, must be made; a discussion of potential avoidance, minimization and mitigation strategies, if required by applicable law and known; and plans and a schedule for public and tribal outreach and coordination, to the extent required by applicable law. A facilitating or lead agency must also establish a process for early consultation between project sponsors and participating agencies to identify and address key issues of concern, and to communicate issues that must be addressed before an environmental review or authorization can be completed.

To reduce delays, the proposed bill includes provisions requiring responsible agencies to coordinate environmental reviews and authorizations to the maximum extent practicable. To that end, the bill would allow, on the request of a project sponsor, a lead Federal agency to consider and, as appropriate, adopt or incorporate by reference the analysis and documentation that has been prepared for a covered project under state laws and procedures as the documentation, or part of the documentation, required to complete the Federal environmental review. The analysis and documentation prepared under state laws, however, must have been prepared under circumstances that allowed for opportunities for public participation and consideration of alternatives and environmental consequences that are substantially equivalent to NEPA.

To minimize litigation delays, the bill would reduce the statute of limitations for claims arising under Federal law and relating to Federal authorizations for covered projects from six years to two years from the date of publication in the Federal Register of the final record of decision or approval or denial of a permit. For an action pertaining to an environmental review under NEPA, the action would also need to be filed by a party that submitted a comment during the environmental review or a party that lacked a reasonable opportunity to submit a comment, and that comment would need to have been sufficiently detailed to put the lead agency on notice of the issue for which the party is seeking judicial review. The proposal would also require courts to consider the effects on public health, safety, and the environment, the potential for significant job losses, and other economic harm resulting from an order or injunction, and not presume that these harms are reparable, before issuing a temporary restraining order or preliminary injunction.

Finally, the bill would also authorize the Federal government to issue regulations to establish a fee structure by which project proponents would reimburse the Federal government for reasonable costs incurred in conducting environmental reviews and authorizations for covered projects. Such a fee structure would be established by the heads of the Federal agencies with permitting authority, with guidance from the Director of the OMB and the Executive Director, in consultation with the affected project proponents, industries and other stakeholders, after public notice and an opportunity for comment.

Proponents of the bill contend that the current Federal permitting process is laden with uncertainty and unpredictability that hinders investment, economic growth and job creation.  They believe the proposal would improve the review and authorization process for major capital projects by promoting better agency coordination, setting deadlines for permitting decisions, enhancing transparency, and reducing litigation delays. The bill appears to have strong support from Senate Republicans, who control the chamber 54-46, and it may gain the support it needs to pass in the full Senate with Democratic co-sponsorship. Notably, the bill also has support from some environmental groups, including the Natural Resources Defense Council. Project sponsors should pay close attention to this legislation, as it may have far-reaching impacts on the process for siting and developing major energy and infrastructure projects in the United States.