How NEPA crushes productivity

NEPA, the National Environmental Policy Act, was signed into law in 1970 by President Richard Nixon with the intent to assess environmental impacts of Federal projects. “In enacting NEPA, Congress recognized that nearly all Federal activities affect the environment in some way and mandated that before Federal agencies make decisions, they must consider the effects of their actions on the quality of the human environment.” NEPA is administered by the Council on Environmental Quality within the Executive Office of the President.

Although established with good intentions, the reality is that NEPA has turned into a byzantine bureaucratic maze that stifles productivity. For instance, remember a few years ago when President Obama touted “shovel ready projects” to get the economy working again? Well, those “shovel ready projects” were delayed because they had to contend with NEPA. Before a single shovel can hit the dirt it usually takes more than five years for the average Federal project to jump through all the normal environmental hoops. Some private projects take longer, for example the proposed Rosemont Copper project is seven years into the permitting process.

Hal Quinn, president of the National Mining Association, notes that permit delays are among the biggest hurdles for mineral development. “The length, complexity and uncertainty of the permitting process are the primary reasons investors give for not investing is U.S. minerals mining. In the U.S., necessary government authorizations now take close to 10 years to secure, resulting in decreased competitiveness and increased reliance on foreign sources of minerals.” Permitting time in Canada and Australia is typically less than two years.

That being said, let’s look at how NEPA should theoretically work. The Council on Environmental Quality has published a Citizen’s Guide to NEPA, which I will summarize with excerpts and comments:

NEPA applies to a very wide range of Federal actions that include, but are not limited to, Federal construction projects, plans to manage and develop Federally owned lands, and Federal approvals of non-Federal activities such as grants, licenses, and permits.

NEPA requires Federal agencies to consider environmental effects that include, among others, impacts on social, cultural, and economic resources, as well as natural resources.

Frequently, private individuals, companies, and municipalities will become involved in the NEPA process when they need a permit issued by a Federal agency. Federal agencies usually require the private company or developer to pay for the preparation of analyses, but the agency remains responsible for the scope and accuracy of the analysis.

Although many Federal agencies get involved, there are three Federal agencies that have particular responsibilities for NEPA. Primary responsibility is vested in the Council on Environmental Quality. The Environmental Protection Agency (EPA) reviews environmental impact statements (EIS) and some environmental assessments (EA) issued by Federal agencies. The third agency is the U.S. Institute for Environmental Conflict Resolution (located within the Morris K. Udall Foundation, a Federal agency located in Tucson). This agency is supposed to provide an independent, neutral, place for Federal agencies to work with citizens as well as State, local, and Tribal governments, private organizations, and businesses to reach common ground.

Navigating the NEPA process:

Once the lead Federal agency has received a proposed action, it has three possible actions: it can issue a Categorical Exclusion (CE), require an Environmental Assessment (EA), or require an Environmental Impact Statement (EIS).

A Categorical Exclusion means that the agency has determined that the proposed action will not have a significant effect on the quality of the human environment.

In an Environmental Assessment, the purpose is to determine the significance of the environmental effects and to look at alternative means to achieve the agency’s objectives. The EA is intended to be a concise document that (1) briefly provides sufficient evidence and analysis for determining whether to prepare an EIS; (2) aids an agency’s compliance with NEPA when no environmental impact statement is necessary; and (3) facilitates preparation of an Environmental Impact Statement when one is necessary. The EA process concludes with either a Finding of No Significant Impact (FONSI) or a determination to proceed to preparation of an EIS.

The Environmental Impact Statement (EIS) is the big, expensive, time-consuming process. A Federal agency must prepare an EIS if it is proposing a major Federal action significantly affecting the quality of the human environment. [In actual practice, a private company such as a mining company prepares a draft EIS and submits it to the Federal agency.] It begins with publication of a Notice of Intent (NOI), stating the agency’s intent to prepare an EIS for a particular proposal. The NOI is published in the Federal Register, and provides some basic information on the proposed action in preparation for the scoping process. The NOI provides a brief description of the proposed action and possible alternatives. It also describes the agency’s proposed scoping process, including any meetings and how the public can get involved.

The next major step in the EIS process is when the agencies submit a draft EIS for public comment. The agency must analyze the full range of direct, indirect, and cumulative effects of the preferred alternative, if any, and of the reasonable alternatives identified in the draft EIS.

When the public comment period is finished, the agency analyzes comments, conducts further analysis as necessary, and prepares the final EIS. In the final EIS, the agency must respond to the substantive comments received from other government agencies and from the public.

When it is ready, the agency will publish the final EIS and EPA will publish a Notice of Availability in the Federal Register. There is an additional (but rarely used) procedure worth noting: pre-decision referrals to CEQ. This referral process takes place when EPA or another Federal agency determines that proceeding with the proposed action is environmentally unacceptable. If an agency reaches that conclusion, the agency can refer the issue to CEQ within 25 days after the Notice of Availability for the final EIS is issued. CEQ then works to resolve the issue with the agencies concerned. CEQ might also refer the agencies to the U.S. Institute for Environmental Conflict Resolution to try to address the matter before formal elevation.

The end of the process is the Record of Decision (ROD), a document that states what the decision is; identifies the alternatives considered, including the environmentally preferred alternative; and discusses mitigation plans, including any enforcement and monitoring commitments.

What I have described above is the streamlined NEPA process. But we are not done yet. Sometimes a Federal agency is obligated to prepare a supplement to an existing EIS if it makes substantial changes in the proposed action that are relevant to environmental concerns, or if there are significant new circumstances or information relevant to environmental concerns and bearing on the proposed action or its impacts. An agency may also prepare a supplemental EIS if it determines that doing so will further the purposes of NEPA. A supplemental EIS is prepared in the same way as a draft or final EIS, except that scoping is not required. If a supplement is prepared following a draft EIS, the final EIS will address both the draft EIS and supplemental EIS.

In actual practice, the NEPA process is complicated by lawsuits and sometimes by foot-dragging Federal agencies. There are no statutory time limits imposed upon Federal agencies to complete the NEPA process. The NEPA process is long and complicated, and environmental groups have used this to their advantage to cause delay after delay in the hope that the project would become too expensive to continue. From Enviro Defenders legal handbook: “Though a lawsuit by itself will seldom stop a project, it can serve as an important element of a larger campaign to do so.”

A 2007 Congressional Research Service report notes: “As a procedural statute, the courts have ruled that NEPA does not require agencies to elevate environmental concerns above others. Instead, NEPA requires only that the agency assess the environmental consequences of an action and its alternatives before proceeding. If the adverse environmental effects of the proposed action are adequately identified and evaluated, the agency is not constrained by NEPA from deciding that other benefits outweigh the environmental costs and moving forward with the action.”

It seems that Australia and Canada have found a more efficient way to move forward while addressing environmental issues. The U.S. economy would benefit by taking note of their methods.

If you found it exhausting just reading about NEPA, imaging how it is trying to comply with it.

(This article first appeared in the Arizona Daily Independent.)

See also:

Mining and the bureaucracy

Uncorrected Forest Service errors block marble mine

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8 comments

  1. 1. If the projects were “shovel ready,” then by definition, they would have already been approved under NEPA. Otherwise, “shovel ready” is a meaningless term.

    2. I puzzled by the fact that your central complaint is that NEPA stopped “shovel ready” projects, but you don’t provide a single example from the “shovel ready” list that was stopped, never mind an overview of the total percentage. Please provide us with the percent of such projects which were stopped so we can determine if NEPA really is a problem.

    3. NEPA has existed since 1970. Since then, the U.S. economy and wealth has grown vastly faster than Australia’s or Canada’s. So clearly the latter’s weaker environmental laws didn’t help their economic grow vis a vis the United States. How do you explain that?

    1. The term “Shovel ready” is normally taken to mean that due diligence and a feasibility study have been done and the project could start were it not for NEPA. Obama used it in that sense. But the project must then go through NEPA. You wanted an example of a stopped project: Keystone XL Pipeline project, also several highway construction projects which the Federal Highway Administration says t normally take “from 2 to 8 years to complete the NEPA and section 404 reviews.” BTW the “shovel ready” sentence was just an example not my “central complaint.” You missed the point.

      Finally your contention that the U.S. economy grew much more and faster than Australia or Canada is wrong, see: http://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG

      1. No investor, contractor, economist, or manager calls a project “shovel ready” just because it’s gone through a due diligence research phase. That is not what Obama meant by the phrase. He used the same meaning everyone else does: a project which has been approved and is ready to go pending additional funding. Indeed, you may recall there was a political battle over the exact issue of qualifying pre-NEPA compliant projects for stimulus funding and it was resolved that only project which had already past environmental review and permitting could qualify since funding had be awarded in the current fiscal year.

        Your creative parsing of words is also evident in your citation to a Washington Post “story.” It is not a story at all, it is an oped, an opinion piece.

        And even that oped doesn’t mention NEPA and doesn’t even put all the blame on federal environmental review. Indeed, it only refers to state review. It also, btw, refers to technological problems, lack of employees, etc.

        Keystone XL? Try again. It was not on the list of “shovel ready” projects. Seriously, you construct a grand these around this theme and you can’t provide a single example? Really? How is that possible?

        Keystone, btw, is not stopped. The southern portion is being constructed right now with the biggest hurdle being lawsuits over the hundreds of parcels of private land that are being taken under eminent domain. For a guy so very, very concerned about the government taking our lands, you seem utterly pleased with corporations taking our lands. What gives?

        The northern Keystone section is also not stopped, it’s under review with a decision to issued this summer. And the biggest issue with it is not NEPA, but a State Department requirement to certify that it’s in the “national interest.”

        Finally, the World Bank link you provided DOES NOT indicate that Australia or Canada have experienced stronger economic growth since 1970.

        Our environmental and working conditions are much better today than the 1970s. The water is cleaner, the air cleaner, forests and wetlands are better protected, and far fewer people (per capata obviously) are injured or die in workplace accidents. And that all happened with the U.S. still being the strongest, richest, freest country in the world. I think few people would want to return to the days prior to NEPA, worker protection and civil rights laws. Indeed, even the author of your Washington Post “story” describes ours as the era of good governacne as opposed to the 1930s you find so appealing.

      2. The fact remains, Jeremy, that many of Obama’s “shovel ready” projects were not ready for the funding provided by the stimulus.

      3. Jeremy, excellent post and excellent points. You pretty much beat me to the reply. After reading this “article” I find it interesting that the anti-regulatory crown seems to lose the connection between the current improvements we have achieved in environmental conditions and worker safety with the fact that laws enacted decades ago are the reason we have these improvements and are always quick to suggest we must return to the “golden” pre-regulatory era.

        Hal Quinn, president of the National Mining Association, notes that permit delays are among the biggest hurdles for mineral development.
        “The length, complexity and uncertainty of the permitting process are the primary reasons investors give for not investing is U.S. minerals
        mining. In the U.S., necessary government authorizations now take close to 10 years to secure, resulting in decreased competitiveness and increased reliance on foreign sources of minerals.”

        Of course this would be the case. Mining has a significant environmental impact therefore the process going to be much more in depth than many other sorts of projects.The projects experiencing the delays are the most controversial and potentially detrimental.

      4. Below is the Wikipedia description of “shovel ready” as used in the context of the stimulus bill. As common sense would expect, it expressly denotes projects that have already cleared NEPA and other reviews:

        “Having originated in the United States, the term is now used generally in reference to projects which are candidates for economic stimulus spending: money put into a shovel ready project will have a more immediate impact on the economy than money spent on a project on which a great deal of time must elapse for architecture, zoning, legal considerations or other such factors before labor can be deployed on it…The Georgia Department of Transportation has established specific criteria projects must meet to be considered shovel ready including National Environmental Policy Act (NEPA) clearances and relevant property acquisition requirements.”

        It is interesting though, that in your mind, we should consider a project “shovel ready” simply because a corporation has determined that it is in its financial interest to proceed. It reflects a very undemocratic world view in which corporations should be able to infringe on the rights of individuals to clean air, clean water, safe neighborhoods, and open space. A corporation’s decision that it wants to dig a mine, build a Walmart or put in feed lot does not make the project “ready.” It is only ready when the people who’s lives are affected have their say in public permitting processes designed to ensure public safety and well-being.

  2. But our President just told the graduating class at Ohio U to never distrust government! Know that the government knows best! Including the NEPA!
    So go home and be quiet! Yea! Don’t listen to this government hating radical right wing extremist! He probably made up all this nonsense about government crushing productivity. Those miners, contractors etc are just to lazy to be productive while filling all those forms and doing all those studies. Yea, that’s it!

    1. No, Wes, Obama did not say government knows best, nor that people should go home and be quiet. HE SAID THE EXACT OPPOSITE: that people should become more engaged and active in their communities and governments:

      “This democracy is ours. As citizens, we understand that it is not about what America may do for us. It’s about what can be done by us, together, through the hard and frustrating but absolutely necessary work of self-government and to he class of 2013 you have to be involved in that process…Just look at the past year. When a hurricane struck our mightiest city, and a factory exploded in a small-town in Texas. We saw citizenship. When bombs went off in Boston, and when a malevolent spree of gunfire visited a movie theater, a temple, an Ohio high school, a first-grade classroom in Connecticut. We saw citizenship. In the aftermath of darkest tragedy, we have seen the American spirit at its brightest…And that’s what citizenship is. It’s at the heart of our founding – that as Americans, we are blessed with God-given talents and inalienable rights, but with those rights come responsibilities – to ourselves and to one another, and to future generations.”

      Don’t listen to the government hating, right wing extremist? Well, if you say a speech was the exact opposite of what was said…then, yeah, people might just stop listening to you. That’s a reasonable reaction.

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