This post is part of The Next Agenda, a series that will explore the main policy challenges facing the new Congress and the Trump administration on issues from immigration and infrastructure to economics and energy. Check back regularly for future installments.
The federal government’s Permitting Dashboard tracks 59 different permits and reviews that infrastructure projects may need to obtain from at least a dozen federal agencies in total to move forward with construction. In recent years, finding ways to fast-track the process of issuing these permits and conducting reviews has been a bipartisan objective. The Obama administration launched the Permitting Dashboard to make the review schedule and process for high-priority projects transparent to the public. Before that, the Bush administration created a task force to help move complex projects through the permitting process. Most recently, President Trump issued an executive order on permitting, and the 114th Congress passed new provisions in the FAST Act (P.L. 114-94) and WIIN Act (P.L. 114-322) to improve coordination and schedule adherence in permitting decisions. Yet the complicated and oftentimes lengthy process for environmental reviews and permit approvals can still hold up economically critical projects and is a key barrier to private investment in infrastructure.
Why It Matters
Unnecessary delays in the permitting process cost money for both the public and private sectors. Direct costs can go up if the costs of materials, supplies, and labor rise during a delay. There is also a public cost to delaying needed infrastructure improvements—older facilities may produce more emissions or break down more often. A report by the nonprofit organization Common Good estimated the cost of delaying the start of all U.S. public infrastructure projects by six years to be $3.7 trillion, which includes the adverse effects of prolonging inefficiencies and unnecessary pollution from existing and outdated infrastructure.
Unnecessary delays in the permitting process cost money for both the public and private sectors.
We also know the process can work faster: the Tappan Zee Bridge project, for example, was one of a handful selected by the Obama administration for expedited review. It took about 11 months to complete the project’s environmental impact statement (EIS), from its initial notice of intent to final EIS. In comparison, the 194 final EISs made available in 2015 took an average of five years each to prepare. Had EIS preparation taken four years longer for the Tappan Zee Bridge project, costs would have increased by 20 percent or nearly $800 million.[i] The Tappan Zee Bridge project illustrates the benefit of having agencies simultaneously consider and issue permits, reviews, and approvals (though the project also received a special push from the Obama administration). Countries like Germany and Canada regularly approve projects within two years, not because of weaker regulations but because they have coordinated their decision-making processes and established clear lines of authority.[ii]
Despite the recent steps taken by Congress and the new administration, permitting risk remains a key barrier to attracting more robust private investment in U.S. infrastructure. Here are four additional steps that should be taken:
- Make simultaneous reviews the norm. Enshrining the use of simultaneous rather than sequential reviews—a time-consuming process where differing agencies review projects and issue their respective permits one after the other—has the potential to significantly increase the speed with which decisions are made and projects can move forward. Agencies should be required to establish review schedules that maximize a simultaneous process.
- Empower key decision-makers. To cement interagency cooperation, projects need a lead agency to shepherd them through multi-agency reviews. The FAST Act included a number of provisions to improve coordination for some projects, but not across the board. The Council on Environmental Quality and White House Office of Management and Budget must also be empowered to make final decisions and resolve disputes that arise during interagency collaboration on permitting decisions.
- Continue expanding the Permitting Dashboard. The FAST Act formalized a Federal Permitting Improvement Steering Council (FPISC) and outlined new guidelines for “covered projects,” including online tracking. The FPISC has since selected 34 projects as covered and they have been added to the Permitting Dashboard. Adding additional projects to the dashboard is a step in the right direction and should be continued; the dashboard transparently tracks permitting requirements, timelines, and participating agencies’ responsibilities. President Trump’s executive order to expedite permitting and review focuses on empowering the head of the Council on Environmental Quality, among others, to designate “high priority” projects for an accelerated approval schedule. These too should be tracked on the dashboard.
- Increase data collection and transparency. A lack of transparency around the federal permitting process obscures inherent inefficiencies and limits the ability of project sponsors and policymakers to address them. As such, progress toward expediting reviews should be measured by requiring agencies to track and report on the time it takes them to make permitting decisions. Recognizing that not all delays are the fault of federal agencies, improved reporting processes should allow agencies to provide an explanation for any delay while increasing the broader understanding of what can hold up a project, informing any future reform efforts.
It is important to note that these recommendations do not depend on changes to the substantive elements of permitting or environmental reviews. Improvements in the permitting process can be achieved without changing the standards upon which those decisions are made. These recommendations focus on commonsense, process-oriented reforms, building upon past bipartisan efforts, which will save time and money, and attract increased private sector participation.
[i] In the report, “Two Years, Not Ten Years,” Common Good roughly estimated that delays increase projects costs by 5 percent per year. With a construction cost of $3.98 billion, adding four years to the Tappan Zee Bridge’s permitting and environmental review process would have increased costs by 20 percent or $796 million.
[ii] Philip Howard, Common Good, “Two Years, Not Ten Years: Redesigning Infrastructure Approvals,” (2015), http://commongood.3cdn.net/c613b4cfda258a5fcb_e8m6b5t3x.pdf.