Experts Explore Permitting Obstacles to Infrastructure Projects

WASHINGTON — Permitting delays that can cost infrastructure projects years and many millions of extra dollars may be mitigated by better implementation of laws and regulations, experts at a conference on “Rethinking Infrastructure Approvals” concluded on Tuesday.

But sponsors of major projects from New York City to San Diego voiced frustration and pessimism about prospects for simplifying and speeding up labyrinthian processes that often entail approvals by state and local authorities, as well as federal departments and agencies.

A full-throated cry of anguish came from Patrick J. Foye, executive director of the Port Authority of New York and New Jersey, about delays suffered and anticipated for projects vital to the regional economy. Foye lamented the endless reviews that concluded when a plan was finally approved for reconstruction of the Bayonne Bridge that spans the entrance to Newark Bay.

The $750 million project is building a roadbed at 215 feet above the water while the existing roadbed, at 151 feet, is still in operation. It is vitally needed to accommodate the new class of taller supertankers constructed to take advantage of the widening of the Panama Canal. Between 300,000 and 400,000 jobs are depended on port operations that would be severely curtailed absent the higher bridge span that’s now under construction, Foye said.

Another huge project—reconstruction of rail tunnels under the Hudson River—may suffer more debilitating delays, Foye added. Amtrak has said that one of two tunnels, built in 1901 and damaged by Hurricane Sandy, will have to be taken out of service before long. That would cripple the regional economy if a substitute is not built, as proposed by Amtrak in its Gateway Project, Foye predicted.

The half-day session on infrastructure approvals was sponsored by two public policy think tanks, Common Good and the Bipartisan Policy Center, and by the National Association of Manufacturers and Covington, a major law firm.

Its convenor was Philip K. Howard, founder of Common Good, a partner at Covington and the author of “The Rule of Nobody,” whose provocative thesis holds that our economy suffers because no one in or out of government has the power to make crucial decisions. Infrastructure offers a prime case in point, requiring, as Howard said, two key inputs: money and permits.

“No one designed the system we have now,” Howard said at Tuesday’s gathering. “It just grew. No one anticipated thousands of pages of environmental reviews, taking years to complete. No one thought that any one of two dozen agencies would have a veto power over projects, or that negotiating one would be like negotiating a multilateral international treaty.”

Delays, Howard noted, cause uncertainty and raise costs.

The Bayonne Bridge, the Port Authority’s Joann Papageorgis told the gathering, required 50 permits from more than 20 different agencies—six federal, five New York state, four New Jersey agencies, and eight local jurisdictions. These processes were “redundant and conflicting,” she said, on issues as to what constitutes an “impact” or whether a tree must be preserved if a bird is nesting in it.

Another compelling example of regulatory delay was described by Kelly S. Huffman, general counsel for Poseidon Water, developer of what will be the largest desalination plant in the world in Carlsbad, California, just north of San Diego.

The concept for the plant was developed in 1998, but construction did not begin until 2012. In the meantime, Poseidon sought permits under the California Environmental Quality Act, which, said Huffman, “is administered by some 500 state agencies.” The California Coastal Commission, which carefully protects the state’s coastline, was another big hurdle—”very difficult” to surmount, said Huffman.

Unlike the Bayonne Bridge, no permit was required under the notoriously complex processes of the National Environmental Quality Act (NEPA), but other federal permits were needed to authorize the plant’s discharges into the ocean.

Along the way, Poseidon had to deal with nine lawsuits, in an example of the excessive judicial review that often characterizes major infrastructure initiatives.

U.S. Deputy Secretary of Transportation Victor Mendez reminded the gathering that the Obama administration, in its proposed “Grow America Act,” has recommended legislative language to speed up infrastructure project approvals. In its description of the proposal, the Transportation Department describes its regulatory elements:

Improve project delivery and the Federal permitting and regulatory review process. The GROW AMERICA Act will build on recent efforts to expedite project approval timelines while delivering better outcomes for communities and the environment. The proposal expands on a series of successful efforts by the Administration to expedite high priority projects and identify best practices to guide future efforts without undermining bedrock environmental laws or public engagement. Not only will important projects break ground faster, but the increased level of transparency and accountability will lead to delivering better environmental outcomes, as the proposal will improve interagency coordination by advancing concurrent, rather than sequential, project reviews and will improve transparency of project reviews and timelines through online “dashboards.” It will also increase flexibility for recipients to use Federal transportation funds to support environmental reviews, and help to integrate overlapping requirements.

The legislative proposal is currently stuck in Congress, as members dispute both the level and sources of funding for the federal infrastructure program, which expires at the end of May.

But Mendez described one regulatory reform pilot project the department has promoted: the $5.2 billion replacement of the Tappan Zee Bridge spanning the Hudson River north of New York City.

In late 2013, the department undertook a special effort on permitting, bringing together the Federal Highway Administration, the Coast Guard and other agencies in a bid to get federal permitting, that would normally require five years, completed in 18-20 months. This, Mendez said, should become “business as usual.”

Shawn Denstedt, a lawyer who has advised major energy companies on infrastructure projects in Canada, described the significant reforms that nation has undertaken to speed up environmental reviews and regulatory approvals. Nick A. Malyshev, a regulatory policy expert at the Organization for Economic Cooperation and Development (OECD), told the group about similar reforms in Australia.

To date, these kinds of reforms aren’t evident in the United States, observed former U.S. Deputy Secretary of Transportation John D. Porcari. Major projects have to pass through the gatekeepers of at least four major federal laws, he noted: NEPA, the National Historic Preservation Act, the Clean Water Act and the Endangered Species Act.

“There is no single point of leadership,” he observed, no decision-maker who can declare a definitive “yes” to major projects. Porcari and others advocated greater efforts to designate a “lead federal agency” in complex cases like the Bayonne Bridge (where the Coast Guard ultimately took on that role). This might solve one piece of the puzzle, though it would not address state and local government permitting requirements, nor the blizzard of litigation that slows down many projects.

So in our highly fragmented system, what steps can be taken that don’t require legislative action?

One idea, proposed by Common Good, is for a new presidential “Executive Order to Streamline Environmental Review.” It would designate the Environmental Protection Agency as overseer of federal environmental reviews “including conclusive authority to determine scope and adequacy of review.” The decisions should be afforded deference by courts, Common Good asserted, “alleviating the ‘defensive medicine’ approach that drives current process to pointless detail.”

The importance of environmental reviews, and environmental mitigation in major development projects, was emphasized by spokesmen for important environmental groups, including the National Resources Defense Council and the Nature Conservancy, which was represented by President and CEO Mark R. Tercek. They were among many at the gathering who advocated another step toward process reform: early convening of all interested parties to allow competing values to be aired even before projects are formally proposed.

That might well avoid later dissent and perhaps litigation, but it would not go far toward solving what Howard describes in “The Rule of Nobody”: the critical absence of a decision-maker who can say, “Yes,” after two or three years of debate, not the five-to-10 or more years now required for projects of consequence.