Environmental Streamlining Measures in Title 41 of the Fast Act: What Will They Mean for Infrastructure Project Developers?

• Jurisdiction: United States,Federal
• Citation: Vol. 25 No. 1
• Publication year: 2016
• Author: by Laura Zagar William Malley, and Stephanie Regenold
• topic: Construction Law,Environmental Law,Energy & Natural Resources,Federal,Transportation

Environmental Streamlining Measures in Title 41 of the FAST Act: What Will They Mean for Infrastructure Project Developers?

by Laura Zagar,^* William Malley,^** and Stephanie Regenold^***

Congress passed the Fixing America's Surface Transportation Act ("FAST Act") last December.¹ The FAST Act provides new funding for surface transportation projects and includes measures to streamline environmental reviews for highway, transit, and rail projects. But the FAST Act is more than a transportation bill. Title 41 of the Act adopts significant reforms to the federal environmental review process for a wide range of infrastructure projects, including those involving energy production, electricity transmission, surface transportation, aviation, ports, waterways, water resources, broadband, pipeline, and manufacturing.²

For project applicants, these reforms have many potential benefits, including:

• Making it easier for applicants to engage federal agencies at the outset of the process, in determining a lead agency and establishing a project schedule.
• Setting deadlines for specific agency actions and comment periods during the National Environmental Policy Act ("NEPA") process.
• Setting benchmarks for the total time needed to complete the NEPA process and requiring project schedules to be consistent with those benchmarks.
• Establishing an online Dashboard to provide greater transparency regarding the federal actions required and the target dates for those actions.
• Establishing an early consultation process for applicants to obtain information and identify key issues of concern to federal agencies.
• Providing clear statutory authority for federal agencies to adopt state environmental documents to satisfy federal laws.
• Providing new mechanisms for resolving disputes among federal agencies regarding the review and permitting of infrastructure projects.
• Setting new limits on litigation challenging federal agencies' environmental reviews and permit decisions, including a two-year statute of limitations.

The potential benefits of these changes are significant. But the Act also introduces new terminology, new participants, and new requirements - all of which will add complexity and could create confusion and delay. Moreover, while the new statute is already in effect, the related guidance has not yet been issued, and the timing of any such guidance is uncertain. Such guidance will be important for interpreting many key provisions of the FAST Act, such as the use of state environmental review documents. It is reasonable to expect some difficulties in implementation, especially during the first few months or even years after enactment.

This article provides an overview and initial assessment of the environmental review process reforms in Title 41 of the FAST Act. We review previous efforts to streamline federal environmental reviews, summarize key provisions in Title 41, and assess the practical implications of these changes for project developers.

BACKGROUND

NEPA requires federal agencies to evaluate the potential environmental effects of actions they carry out, fund, permit, or otherwise approve.³ The Council on Environmental Quality ("CEQ") has issued regulations defining the basic steps in the NEPA process.⁴ Many federal agencies have promulgated their own regulations or procedures for implementing the process established in the CEQ regulations.⁵

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Projects that require NEPA review also typically require environmental review and permitting under numerous other federal and state laws. Federal laws include Section 404 of the Clean Water Act, Section 7 of the Endangered Species Act, Section 106 of the National Historic Preservation Act, and many others. On projects under federal jurisdiction in California, compliance with these federal laws typically occurs in conjunction with the reviews required by the California Environmental Quality Act ("CEQA") and other state and local laws.

In recent years, there have been many attempts to streamline the federal environmental review process through legislation and administrative actions. Without amending NEPA itself, Congress has enacted legislation to streamline NEPA reviews for several types of activities or projects, including forest management actions,⁶ highway and transit projects,⁷ and water resource development projects.⁸ Most notably, federal transportation legislation created a streamlined process that must be used whenever an environmental impact statement ("EIS") is prepared for a highway or transit project. This streamlined process, now codified in 23 U.S.C. § 139 (Section 139), includes several elements:

• Designating all federal agencies that may have an interest in the project as "participating agencies" and specifying the responsibilities of those agencies;
• Requiring the lead agency to provide participating agencies and the public an opportunity for involvement in developing the purpose, need, and range of alternatives considered in the EIS;
• Requiring the lead agency to collaborate with participating agencies in determining methodologies for assessing environmental impacts;
• Setting deadlines for certain steps in the process, including a limit on the length of comment periods;
• Creating a process for identifying and resolving issues that could delay or prevent issuance of required permits and approvals; and
• Establishing a 150-day statute of limitations for challenges to federal agency approvals for highway and transit projects.⁹
• The streamlined process established in Section 139 was later adopted, with only minor changes, as part of a streamlined process for water resource development projects.¹⁰

The legislative emphasis on environmental streamlining has been complemented by administrative actions. In 2002, President George W. Bush issued Executive Order 13274, which established an inter-agency task force to streamline environmental reviews for transportation projects.¹¹ President Barack Obama has continued and expanded the emphasis on environmental streamlining. In 2011, President Obama issued a Presidential Memorandum, directing all federal agencies to expedite environmental reviews and permits for infrastructure projects,¹² which led to creation of the online tool known as the "Dashboard," which tracks progress on federal reviews for a small set of high-priority projects. In 2012, President Obama issued Executive Order 13604, which formalized the policies requiring agencies to expedite environmental reviews.¹³

WHAT'S NEW IN TITLE 41 OF THE FAST ACT

In the FAST Act, Congress applied Section 139 to railroad projects,¹⁴ and also included many of the elements of Section 139 in Title 41, to establish an environmental review process that is more predictable, structured, and transparent.

To achieve that outcome, Title 41 creates a new administrative structure within the federal government; new procedural requirements for individual projects; new optional tools that agencies and applicants can use; new limits on litigation; and new authority for agencies to charge applicants fees to support federal environmental reviews. No existing laws or other requirements were repealed.

New Players: The Permitting Council, the Executive Director, and the CERPOs

The FAST Act creates a new interagency body, the Federal Permitting Improvement Council ("Permitting Council"), and requires each federal agency with membership on the Permitting Council to designate a Chief Environmental Review and Permitting Officer ("CERPO"). The Council is chaired by an Executive Director, who has broad responsibilities for coordinating and overseeing federal review and permitting activities for infrastructure projects.

• The Executive Director will be appointed by the President and will serve as chair of the Permitting Council.¹⁵ The Executive Director is required to consult with and consider recommendations made by the Council, is charged with establishing the overall framework required under the Act, including an expanded Dashboard, and also plays an ongoing role in oversight and dispute resolution for individual projects.
• The Permitting Council will consist of representatives of the Office of Management and Budget ("OMB"), the CEQ, and more than a dozen permitting and reviewing agencies,¹⁶ and will advise the Executive Director. The CERPO is not a member of the Permitting Council, but serves in both a policy-making capacity and an operational capacity.¹⁷ This official advises the agency's representative on the Council, provides technical support on environmental reviews for individual projects, participates in resolving inter-agency disputes, recommends process improvements, and oversees training programs.

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New Framework for Federal Environmental Reviews

During the first year after enactment, the Executive Director is directed to develop an overall framework for carrying out environmental review and permitting activities for individual projects.¹⁸ The Executive Director's responsibilities include:

• Establishing an inventory of "covered projects," which generally include infrastructure projects estimated to cost over $200 million that require NEPA review (subject to exceptions discussed further below);
• Categorizing all covered projects based on industry sector (e.g., renewable energy) and project type (e.g., solar power generating plant);
• Identifying the types of federal environmental reviews and authorizations commonly required for projects in each category;
• Designating a "facilitating agency" for each category of covered projects, based on Permitting Council recommendations;
• Publishing a list of the facilitating agencies for all categories of covered projects on the Dashboard, based on Permitting Council recommendations; and
• Developing "recommended performance schedules," including intermediate and final completion dates, for the environmental reviews and authorizations commonly required for each category of covered projects.

The statute includes a series of deadlines for these tasks, all of which occur within the first year...