How Much Regulation Is Too Much?

Janice_Kaspersen_Blog

As many new presidential administrations do, Donald Trump’s is promising to take action on improving the country’s infrastructure. How fast it can move ahead might depend on which environmental and other regulations stay and which ones go.

This recent article from the Wall Street Journal titled “Speed Limits Await Infrastructure Spree” looks at some of the things that might delay the process—notably, what many of the people interviewed for the article consider excessive environmental regulation. It points out that infrastructure projects and spending by the two previous administrations were also hampered by lengthy environmental review; in 2015 Congress exempted some bridge replacement projects from those reviews.

“’I am totally for the national and statewide environmental laws,’” says one of the people interviewed in the article, the executive director of the Southern California Association of Governments. “Still, ‘sometimes it gets to be ridiculous.’” He is specifically referring to a 6-mile freeway extension in Los Angeles that was approved nearly 60 years ago, according to the article, and because of legal delays and environmental reviews still has not been completed.

With Scott Pruitt confirmed last week as the new EPA administrator, though, many environmental groups are expressing grave concerns about possible cutbacks in environmental regulation and oversight. As the attorney general of Oklahoma, Pruitt sued EPA several times, opposing what he viewed as federal overreach. He has argued that the states, not the federal government, should have regulatory primacy in environmental matters. One of the measures he opposed was Clean Water Rule, which was proposed by EPA and the Army Corps of Engineers to clarify what is and is not covered by the federal Clean Water Act. We’ve covered some aspects of the Clean Water Rule here.

The executive director of the Rainforest Action network, in a statement, called Pruitt’s confirmation “an insult to the very name of the Environmental Protection Agency”; the executive director of Voces Verdes, a network of Latino business leaders who support sustainable environmental progress, said, “We are appalled.” The environmental group Friends of the Earth declared, “Donald Trump selected Scott Pruitt to oversee the dismantling of the Environmental Protection Agency.” There are many more such reactions.

Here, again from the WSJ article, is the view that regulations cause excessive delay: “Reviews under the National Historic Preservation Act of 1966, the National Environmental Policy Act [NEPA] of 1970, the Endangered Species Act of 1973, and other laws can involve multiple agencies before permits are issued. Completing the process took an average of almost 10 years for major highway projects that received their final review in 2015, up from about five years in 2005.” The article presents several examples of work that has been held up because of environmental reviews and lawsuits.

The article focuses particularly on environmental impact statements, which are required under NEPA for large projects, “detailing how they would alter surroundings while offering ways to mitigate damage.” But today, it says, even on project where an environmental impact statement isn’t required, officials might spend years “working through every detail” for fear of being sued sometime in the future. There has been much discussion in the medical field about limiting or capping the dollar amount of malpractice suits, which proponents say would cut medical costs overall. Could some similar limit or protection be put in place in the environmental arena?

What’s your view? Is it possible to streamline the environmental review process without weakening the protections it provides? Would you do so across the board, or mainly for critical projects that affect public safety—failing bridges or dams, for example? Leave a comment below.SW_bug_web

Comments
  • The hypocrisy of the Clean Water Act can not be denied any longer when one simply looks at the swollen rivers far upstream from development here in California as a result of the recent heavy rains. While disguised as an effort at the Federal level to save the “Waters of the United States” from pollution, it is time for the CWA to be called what it is particularly in California under the draconian Department of Water Resources: a whole-hearted and end-around effort by environmental groups to stop development at all costs, no matter what the impact to jobs and the economy. California has seized the front-line position in the war on development with its interpretation and implementation of the CWA. The State Regional Water Quality Control Board agency has become the most feared by developers of any agency in California by it’s ability to levy fines in the hundreds of thousands if not millions of dollars when it deems a project as non-compliant. The frightening costs of the enforcement actions this self-funded agency is able to extort from developers should be a wake up call to all of us of government and regulation run amok. Our company spends over $18k per home on erosion control and it all ends up in the garbage (landfill, which is great, right?), with exactly ZERO value add to the buyer, which means we cannot charge more for the homes. Take one look at the rivers and streams in the mountains when all of the rain runoff and snow pack melts from BLM land and other government owned properties, and justify the costs of the CWA on developers. What a joke!

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  • $18k per home on ESC? I assume you plucked this from some industry report which probably includes engineering & permitting, grading & drainage and stormwater management, and not just temporary ESC that is required during construction, as you are implying.

    If you are spending $18k per home on temporary ESC, then you have more pressing things to worry about than ‘business killing regulations’. Besides, if we got rid of all of the regulations, you would then have no choice but to blame your own incompetence for your failures.

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    • The $18k per home is not an industry report as you assert. It is a cold hard truth and fact, a significant “cost of doing business” in the “Golden State”, and it is what we budget (and spend) per home to make sure that we aren’t extorted for more by the State. If we wish to not run afoul of Storm Water inspectors from city or county agencies that ultimately report to the SRWQCB, the the onus is on us to ensure that the stormwater that leaves our sites is as clean or cleaner than when it came onsite, and that comes with a painful cost. As with most folks that share your jaded view of environmental stewardship, you fail to recognize under any circumstances that in some cases the natural environment dynamic and activity can cause more damage than development ever would, and in the case of the CWA and the storms we in California have experienced this year this is clearly evident in the rivers and streams throughout the state.

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      • What a narrow-sighted view to say the protections have “…exactly ZERO value add to the buyer.” That is literally the same as saying there was zero value added to the buyers of unleaded gasoline in the 70s (though I’m sure some tried to make that argument at the time!). Environmental impacts are complex, and the costs are felt in equally complex ways and over very long timelines. There are plenty of peer-reviewed studies that document the net value of environmental protections – including commercial value, habitat value, recreational value, property value, job creation, etc. There may be increased costs to developers, which in turn are passed on to buyers, but looking at the big picture those investments (protections) are covered by the avoided costs of cleanup and the added value of non-degraded environments. That’s not a jaded view from an environmentalist, it’s economics. It’s just a bit more complex than the short-term build-then-sell economics. Second, no one would argue that “the natural environment dynamic and activity CAN cause more damage than development…” However, large, naturally disruptive events occur much less frequently than the erosion than can occur under more frequent storms. (At least historically that is. These days large events seem more and more common. Let’s not get into that discussion.) Regardless, natural rivers and streams can recover from infrequent natural events. They cannot sustain with persistent erosion and sediment deposition month after month (i.e., if no ESC protections were in place). Last, recognize than in most of CA, many of these flooding and erosion events are not from “natural” events. There are essentially no “natural” watersheds left. They’ve all been modified to some extent by agriculture, development, etc. So there’s really no such thing as a “natural” event any more.

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  • Robert Moore.

    Across-the-board is the only ‘fair’ methodology from a structural perspective, but prioritizing projects with a view toward public welfare is also necessary. Begin with the plethora of information regarding which regulations are ‘taking the most heat’ from We The People – and get those issues in front of citizen voters – to ask their ‘take’ via online SURVEY to make the focus of the task easier to ‘narrow down’ to main priorities. Then do a separate online SURVEY to ALL the U. S. Small Business Owners/Managers on which our economy depends – and get their ‘take’ on what regulations are restrictive to their company’s success most.
    Another step is to establish and structure a Review Panel consisting of at least 9 Review Committee Chairs appointed by Scott Pruitt (or his designee) to review the major jurisdictional areas of every given regulatory ‘package’. If a regulation is not backed by a LAW on the books that specifically ‘speaks’ in support of the regulation as worded – AND a prolific amount of ENVIRONMENTAL SCIENCE that specifically ‘speaks’ in support of the regulation – eliminate it. Also eliminate ‘pork barrel’ corruption that ‘tacks-on’ regulations or ‘extensions’ or ‘interpretations’ that limit business competition in the environmental sustainability INDUSTRY.
    Certainly “…many environmental groups are expressing grave concerns about possible cutbacks in environmental regulation and oversight.” Because it is highly likely that a high degree of corruption exists at high levels in those groups – supported by collusion within ‘lobbyist’ bribes to multiple group chairs/members to support each other – because those people desire to be the ones that “protect” Nature defined by ‘THEIR best interests (NOT We The People) – to substantiate the existence of their paid position in the budgetary ‘condundrum’ that is the “Swamp” – with the basis of its existence – purely a matter of CONTROL to enhance success of special interests.
    Yes, I recognize those men and women who are truly giving of themselves to make this world a better place to live for future generations – but wonder how many of the LEADERS of such environmental groups have the same dedication to the scientific PRINCIPLES of environmental protection – and so, set aside their personal interests for the good of others?

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    • Fred Dillon.

      Remember the foamy toxic-laden discharges from the industries of yore? Or the Cuyahoga River fires that (literally) sparked the creation of the Clean Water Act? In the absence of this landmark legislation, the likelihood that the responsible entities would have stopped or cleaned up these discharges voluntarily is slim to none.

      While the CWA is certainly not perfect, it has made a tremendous difference in helping to improve the nation’s waterways. And yet – assuming we can agree that unbiased science is still a credible and rational means for identifying adverse impacts to water quality and aquatic habitat – we still have a long way to go. There are countless reports over the past decade documenting the continued impaired state of our nation’s waters. Here are just a few sources worth review:

      • EPA’s National Rivers and Streams Assessment, 2008/2009
      • USGS’s National Water Quality Assessment Program (literally dozens of reports on a variety of pollutant types)
      • Urban Stormwater Management in the United States, National Research Council, 2009

      The notion that regulations are inherently hypocritical is sorely misplaced and the tired old argument that pits jobs and economic development against environmental protection is a patently false dichotomy. The environmental ills identified by scientific assessments are real whether we choose to believe in them or not. Environmental regulations like the Clean Water Act were not conspiracies cooked up by academic elites or a by “government run amok” to force a world view on an unsuspecting public. Rather, they were established in recognition that the key to our survival (and the survival of other countless other species) lies in conceiving of economic development and environmental protection as mutually supportive rather than mutually exclusive. We live on a finite planet. We fail to recognize this immutable fact at our peril.

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  • Speaking to the question posed in the original article – yes, it is possible to streamline the environmental review process without weakening the protections it provides. However, it would require some rethinking on the part of developers and permitting agencies. First, developers (private and public) would need to include as part of their project designs and submittals distinct mitigation and or restoration measures. This may seem like a stretch on the surface, but this is already the eventual outcome of the process under the status quo. (Moreover, this process already happens in some situations where both sides understand the reality of the situation.) So, if developers truly want to streamline the process (and reduce design iterations, and permitting delays), they could meet or exceed the goals of environmental protections and regulations right out of the gate. I.e., come in with a project that includes clear and valuable protections and mitigations that make the project almost painfully easy to permit. That’s a win-win. Second, this would also require the permitting agencies to set clear expectations and not to nitpick the mitigation proposals, but this is achievable (particularly if developers consult with the agencies and/or informed environmental consultants early in the process). If developers still think this approach is unfair and feel the protections needs to be cut or eliminated, they’re not being realistic and will continue to see permit delays and project changes for perpetuity. Over the long-term, you can’t get away from the fact the development causes environmental impact. You can only work to limit and mitigate those impacts. Either now, or down the road, we all pay a price for environmental degradation, so we might as well minimize those costs and impacts up front.

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  • Verel Benson.

    About 30 years ago I led an evaluation of the PL-566 program. The advent of Environmental Impact Statement increased planning cost about 10 fold and added a 5 year or more delay
    to construction. Many of the potential environmental benefits would be very hard to evaluate economically. However, it appears that that the net effect was to reduce the construction of small watershed structures designed to protect individual property owners from flooding, create a municipal water supply, and/or recreation for fishing, swimming, and boating and concentrate on land treatment that required less environmental assessment. Is that good or bad? That question was beyond our evaluation, but it should be something considered when changing regulations is considered. The focus of the program created by congress was changed with no direct input from congress. Environmental impacts need to be considered; however, the difficulty of placing economic value on the environmental impact can easily become subjective and philosophical versus scientific and economic resulting in delays and lawsuits. I hope this contributes to the discussion.

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  • Richard W. Goodwin.

    An engineering approach to attaining USA infrastructure goals – see also
    Goodwin, R.W. “Implications, of the 2016 Presidential Election, to USA Energy and Environmental Policy: Energy Central; November 16, 2016
    We Have a New President: How Will it Affect Energy and Environmental Issues?
    http://www.energycentral.com/c/pip/implications-2016-presidential-election-usa-energy-and-environmental-policy

    IMPLEMENTING PRESIDENT’ TRUMP’S ONE TRILLION DOLLAR INFRASTRUCTURE PROGRAM
    Background

    – Supposedly delay until 2018 – not acceptable USA skilled workers need jobs now
    – Too Costly – based on traditional ways of govern funding programs based on President Roosevelt to President Obama i.e. federal spending without proper Project Management and Engineering Control
    Suggested Approach
    – Combine Public Private Partnership [P3] with Design Build [DB] and, where applicable, Own Operate [OO] e.g. Merchant Power Plant
    – Fast Track – DB projects by avoiding time-consuming RFP [Specification] and Bid Process and combining Engineering Design and Construction [two firms joint venture or one firm with both capability e.g. Bechtel, Jacobs, AECOM]
    – Avoid cumbersome federal, state and local regulation by prioritizing permitting and siting via Preliminary Initial Regulatory, Municipal and DB entities reviewing salient requirements and receiving preliminary approval. DB firms must agree to meeting schedule, estimate and performance guarantees
    Finance
    – Self-Finance if DBOO or use municipal bonds with interest rate 200 B.P above average as incentive for Tax-Free Investment – Underwriting by Investment Bankers and investment by PE and VC firms
    – Bond Debt Service paid by Municipality based on revenue sharing program [user fees] or local taxes
    Dr, Richard W Goodwin PE.., MBA

    Reply

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