The pipeline

trump administration proposes comprehensive reforms to nepa process By: dan kennedy, director of environmental & utility operations

vironmental Assessments (“EA”) for major federal actions significantly affecting the quality of the environment for larger projects. In addition, New Jersey has its own requirements for EA / EISs to comply with Executive Order #215 of 1989 (Kean), regardless of federal participation. Observers may remember the scuffle between the Kerry-lead US State Department and Environmental Protection Agency (EPA) in relation to the Keystone XL oil pipeline. Or…the classic sibling rivalry between EPA and FERC that came to a head through a strongly worded public letter in 2016 related to indirect climate impacts of the pipelines FERC permits. NEPA’s flaws spilled out for all to see as these federal agencies sparred over control. An embarrassing outcome for the federal government. What’s Being Done to Modernize NEPA? President Trump issued Executive Order 13807 (Establishing Discipline and Accountability in the Environmental Review and Permitting Process for Infrastructure) during his first six months in office. The EO has a clear stated purpose to “ensure that the Federal environmental review and permitting process for infrastructure projects is coordinated, predictable, and transparent” with policy statements that clearly consider the need to safeguard communities and maintain a healthy environment. Nowhere in the EO calls for an elimination of NEPA reviews. The EO focuses on federal agency performance and accountability for performing environmental reviews and making authorization decisions. It requires all federal agencies to set goals related to their role under NEPA, establishes a “One Federal Decision” mechanism to avoid duplicative efforts and a process for enhancements to get through the NEPA process in two years or less. These changes and others are sensible and measured for the operations of the federal government, as most agree with the basic tenet of EO 13807 that, “America needs increased infrastructure investment to strengthen our economy, enhance our competitiveness in world trade, create jobs and increase wages for our workers, and reduce the costs of goods and services for our families.” This January, CEQ issued a proposal to reform NEPA. This is the next step in meeting the stated purpose of EO 13807. The CEQ proposal purports to simplify regulatory requirements, reflect current technologies and agency practices, and improve the format and readability of the regulations. The proposal sets presumptive time limits to prepare EAs at one year and two years for EISs unless a senior agency official approves in writing a longer time period. In addition, the proposal would limit the page length (not T he National Environmental Policy Act (“NEPA”) is a foundational environmental law enacted in 1970 (exactly 50 years ago during the Nixon Era) with a mission to enhance the environment by requiring Federal agencies to evaluate environmental effects of proposed projects prior to construction. Born during a time of increased public concern for the environment in the 1960s, NEPA came to be concurrently with the Clean Air Act and was followed shortly after by the Clean Water Act. Further driving NEPA into existence was the outpouring of local opposition efforts to both the construction of the Interstate Highway System, which often cut through existing communities, and to the aggressive delivery of federally funded housing projects. NEPA predates most state environmental laws, and if there was a Mt. Rushmore for environmental laws, let’s just say NEPA would be on it. Rulemaking recently initiated by the White House Council on Environmental Quality (“CEQ”) is the first significant revision of the NEPA regulations since the original regulations were promulgated in 1978. According to the new proposal, its revisions would modernize the NEPA regulations and facilitate more efficient, effective, and timely NEPA reviews. The current regulatory construct is accused of being a major drive of project delays. This matters to all UTCA members because projects that trigger NEPA reviews are not put out to bid until their processes (and any litigation) play out. Efforts to streamline and modernize NEPA are long overdue and welcome to the infrastructure construction industry. What Does NEPA Currently Require? NEPA casts a wide net in terms of infrastructure. It has broad applicability to federally funded / sponsored projects, permits for some private activity, federal grants and funding decisions, and rulemaking. This includes most infrastructure projects where the federal government is a funding partner, including critical components of our network of roads, bridges, and tunnels. It also includes interstate energy infrastructure projects given the role of the Federal Energy Regulatory Commission (“FERC”) in approvals. This federal review process rarely works in concert with state and local reviews resulting in a complicated web of oversight even for projects with clear environmental benefits. Under its current regulations, Federal agencies must consider the “environmental impact of major Federal actions significantly affecting the quality of the human environment before taking such actions.” Federal agencies comply with NEPA and its regulations by developing Environmental Impact Statements (“EIS”) or En-

A quote I have kept on my office wall for as long as I can remember comes from William H. White, a respected urbanist who in his work The Organizational Man, originally published in 1956, wrote:

"We are not hapless beings caught in the grip of forces we can do little about, and wholesale damnations of our society only lend a further mystique to organization. Organization has been made by man; it can be changed by man." So instead of condemning or supporting one side of the argument, I will say that UTCA is both supportive of the CEQ proposal and the need for informed public engagement. When done right, informed and organized public engagement can produce better design, more community value and fewer issues during construction. The government and its consultants do not have all the solutions. To design and approve critical or costly infrastructure in a complete vacuum has negative consequences to taxpayers and rate payers alike. A reformed NEPA process can help save money and accelerate the construction schedules of infrastructure projects that we know are needed to improve public health and safety. Paraphrasing Mr. White…NEPA was created by man; it can be changed by man. What’s Next? Public comment is open on the CEQ proposal. Comments are due by March 10th and you can be sure that UTCA will be submitting supportive comments. Vital infrastructure projects have no justification for artificial and unnecessary roadblocks. It is anticipated that the proposal will be adopted unless blocked by court order. Litigation is expected. Stay tuned. including appendices) of EAs to 75 pages and 300 pages for EISs unless a senior agency official provides written approval to lengthen the document. The CEQ proposal limits the scope of review to direct impacts, which would essentially limit environmental reviews for infrastructure to the impact of putting it in the ground and operating it. Supporters argue that this was always the intent of the law. Truncating how agencies look at indirect and cumulative environmental impacts would reverse the trend of the federal government to take a broader look at individual projects. This past June, CEQ replaced Obama-era guidance issued in 2017 with new draft guidance that gave agencies broader discretion. Battlelines Drawn The predictable lines have been drawn with environmentalists on one side and the business community on the other. The sides throw out examples of poster child projects that either illustrate that there is a problem under NEPA related to unnecessary delays or there is not. Predictably, this is being billed as an “attack on climate change” by opponents. I concede that that projects can be delayed for a multitude of reasons and that NEPA has been scapegoat for all that can go wrong with project delivery. That being said, a 50+ year old construct can always use some fine-tuning and UTCA supports the intent of this proposal. All laws, governmental regulation and policy, like the people that operate them, are imperfect. NEPA was written and authorized by people who, at the time, were responding to the challenges and opportunities of the day. No governmental process should be exempt from improvement. I would argue that critical laws of consequence like NEPA, which is considered the Magna Carta of environmental law, can and should be reviewed as a priority and periodically improved as a default function of government. The stakes are too high to leave any critical law unimproved for over five decades without a critical eye.