Institute for Progress Post on Permitting Reform and NEPA

As we shall see in the next series of posts, our forest and federal lands world of NEPA has become a piece of a much larger discussion of “permitting reform” that is being pursued by significantly more powerful political actors, and hosts of very smart policy wonks in Coastal think tanks.  Permitting reform, as framed, is much broader than NEPA; it includes all FERC, NRC and any other permitting efforts you can think of.  And yet perhaps our experience may be able to add to the discussion.

I’d like to start with a post by Aidan Mackenzie and Santi Ruiz of the Institute for Progress.

Imbedded in the document is a CEQ report..  “NEPA Litigation Surveys: 2001-2013.”  The FS seems to win the prize for most NEPA cases filed for the years I checked.  I don’t know why CEQ appears to have stopped in 2013.

Is looking at FS data when discussing an example of the ever-popular science “streetlight effect?”

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U.S. Forest Service data is not representative for clean energy

Defenders of NEPA argue that critics exaggerate review delays by relying on unrepresentative anecdotes, claiming that statistics show NEPA reviews to be far less burdensome. For example, in the Roosevelt Institute policy brief, Jamie Pleune claims to debunk the idea that “NEPA-mandated analysis is the primary source of permitting delays.”^[4] She points out that the median time for the U.S. Forest Service to prepare an Environmental Impact Statement (EIS) — the most rigorous type of NEPA review — is only 2.8 years.^[5] Pleune says she chose to look at the Forest Service because it is “the only agency that collects comprehensive, reliable data regarding NEPA decision-making at all levels of review.” While that may be true, it doesn’t mean the Forest Service is representative of other agencies. The White House Council on Environmental Quality surveyed review times across federal agencies in 2020, and found they take an average of 4.5 years.^[6] And the Forest Service is not even the primary agency tasked with reviewing clean energy projects. In fact, out of the 90 clean energy projects that required an EIS over the last thirteen years, only two were completed by the Forest Service.^[7] When we look at the agencies responsible for reviewing most energy and infrastructure projects, we see a very different picture.^[8]

The U.S. Forest Service is housed within USDA, which has a below-average EIS completion time of 3.31 years. Of the federal agencies most frequently tasked with reviewing clean energy infrastructure projects,^[9] only the Federal Energy Regulatory Commission has a lower average completion time than the Forest Service. The Department of Energy, along with the Bureau of Land Management at the Department of the Interior, conducts NEPA reviews for clean energy projects and takes far longer on average. Other departments tasked with reviewing important initiatives, such as congestion pricing (DOT) and nuclear energy (NRC), have some of the highest average review times.^[10]

But even in the case of the Forest Service, no one should be proud of taking three years to review projects. These years-long reviews have often led to disastrous results. For example, in 1999, delays in the NEPA process for the prescribed burning of the Six Rivers National Forest resulted in the wildfire that the prescribed burning was meant to prevent from occurring. That even routine reviews take multiple years is an indictment of NEPA, not a defense.

Who decided that the denominator is even relevant to the question of whether and what the problem is? If we go back to my example of “gender discrimination only occurs at a small percentage of universities, so it’s not a problem”, we could add two- year colleges to the denominator, and gender discrimination would be an even tinier percentage .. but certainly a problem to those who experience it. Who gets to decide what is a problem worth dealing with is a function of power, not math.

2. Categorical exclusions under NEPA can be misleading

Perversely, because the NEPA procedure has expanded over the last half-century to touch nearly every federal action, defenders of the status quo can claim that major reviews (EISs) make up only a tiny fraction of all NEPA reviews. For example, the Roosevelt Institute suggests that NEPA’s impact is exaggerated because 95% of projects receive “categorical exclusions,” or CEs, expedited reviews for projects that don’t have a significant impact on the environment. This argument has also been made by U.S. Rep. Raúl Grijalva, ranking member on the House Committee on Natural Resources. Unfortunately, this statistic misrepresents reality. In response to the administrative burden imposed by NEPA (and case law interpreting it), the number of categorical exclusions for minor actions has exploded, inflating the denominator for what counts as a “project.”

It is true that the vast majority of reviews under NEPA receive categorical exclusions and don’t go through a substantive review process. However, this is largely due to the fact that a surprisingly large set of federal actions must undergo a NEPA review, including those that have no plausible environmental impact. Although the law was originally created to force agencies to assess the environmental impact of “major federal actions,” “major” action was left undefined in the statute. In 1974, a court decision read the term “major” out of the law, effectively requiring the government to review virtually every federal action, including U.S. Treasury paying staff members, USDA conducting educational programs, or the DOE preparing internal administrative documents.^[11] Categorical exclusions have proliferated in response to this reality, vastly inflating the denominator for projects.

The vast majority of CEs are for minor actions and cannot be used for major projects except in rare cases where Congress has created legislative CEs. And CEs often require agencies to file paperwork justifying why small actions should avoid years-long reviews. Although completion times for CEs are shorter than the more rigorous Environmental Assessments (EAs) or EISs, they can still create delays of up to a year.^[12] While roughly 12,000 substantial environmental reviews occur each year,^[13] the roughly 230,000 categorical exclusions each year^[14] inflate the denominator.

And of course, litigation and litigation-prep…and what I would add to the below discussion is that it’s not just NEPA claims, it will be FLPMA/NFMA claims, ESA claims, MBTA claims and any other ones that people with lawyers who don’t want projects can use. I’d also add that the below discussion does not go into the timeframes associated with litigation, sending projects back to the agency, redoing and relitigating.. possibly because the info is not collected.  And when folks point out specific cases, it’s “anecdotal.”  It seems to me as if it will always be anecdotal if people don’t collect information on it.

Litigation risk slows down all infrastructure projects

NEPA reviews are ripe targets for litigation seeking a judicial injunction against a project. This procedural vulnerability makes suing agencies under NEPA an effective means of blocking all kinds of energy infrastructure.

Defenders of NEPA argue that litigation of NEPA decisions is relatively rare — for instance, the Roosevelt Institute points out that “only an estimated 0.22 percent of NEPA decisions are litigated.”^[15] But this statistic doesn’t capture how the expectation of potential litigation shapes decision-making by federal agencies and project sponsors. And the denominator is (again) inflated by trivial categorical exclusions that are almost never challenged in court.

It makes sense that the vast majority of NEPA decisions aren’t litigated, since they’re overwhelmingly administrative CEs for things like hiring staff. If we look instead at how many lawsuits there are for every important infrastructure project,^[16] the calculation changes dramatically: between a quarter and a third of Final EISs get challenged every year.^[17]

The ability to sue projects derives from the Administrative Procedures Act, which allows anyone to sue an agency on the basis that it did not take a sufficiently “hard look” at a project under NEPA review. However, what counts as a “hard look” at environmental impact is entirely a matter of case law and judicial interpretation. NEPA’s mandate to “review environmental impacts” is unconstrained and undefined in statute. As a result, NEPA has been wielded as a cudgel: by NIMBYs protecting their property values, companies blocking potential competitors, and short-sighted conservationists blocking clean energy.

Successful litigation against a NEPA review puts pressure on agencies to perform longer reviews in the future. When lawsuits successfully kill a project, the rulings explicitly state that a NEPA document failed to account for some environmental impact, forcing future agency reviews to include that impact.

But just the threat of potential litigation is enough to incentivize agencies to expand their reviews.^[18] To avoid potential lawsuits, agencies try to produce litigation-proof reviews that go above and beyond existing case-law standards. A 2014 GAO survey found that these documents are often a waste of agency time:

“Although the number of NEPA lawsuits is relatively small when compared with the total number of NEPA analyses, one lawsuit can affect numerous federal decisions or actions in several states, having a far-reaching impact. In addition to CEQ regulations and an agency’s own regulations, according to a 2011 CRS report, preparers of NEPA analyses and documentation may be mindful of previous judicial interpretation in an attempt to prepare a “litigation-proof” EIS. CEQ has observed that such an effort may lead to an increase in the cost and time needed to complete NEPA analyses but not necessarily to an improvement in the quality of the documents ultimately produced.”^[19]

Litigation’s effect on document preparation helps explain the massive expansion of NEPA documents from a handful of pages in the early 1970s to the current average of 1,626 pages.^[20]

Opponents of reform argue that NEPA is not the problem per se: instead, agencies are chronically underfunded and understaffed to perform NEPA reviews. But agencies are stretched too thin largely because the procedural requirements have ballooned. Increasing procedural requirements while holding staffing constant drives up wait times. To strengthen agency capacity, reformers need to ensure staff can use their time effectively, not spend years trying to avoid frivolouslitigation.

In the next post, we’ll discuss some of IFP’s ideas for reform.