Administration Issues “Legislative Outline for Rebuilding Infrastructure in America”

by Pillsbury - Gravel2Gavel Construction & Real Estate Law
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Recently, the Trump Administration released a 53-page Legislative Outline for Rebuilding Infrastructure in America of legislative proposals to rebuild American infrastructure, which it defines as surface transportation, airports, passenger rail, ports and waterways, flood control, water supply, hydropower, water resources drinking water and waste water facilities, storm water facilities, and surprisingly, Brownfield and Superfund sites. Infrastructure projects can be located in both urban and rural areas.

The proposal lists specific laws that will require amendments, and would make available billions of dollars in federal funds to trigger the process. This is a brief review of its many provisions.

Part I, entitled “Funding and Financing Infrastructure Improvements” is divided into these subsections:

  • Infrastructure Incentives Program;
  • Rural Infrastructure Program;
  • Transformative Projects Program;
  • Infrastructure Financing Programs;
  • Public Lands Infrastructure;
  • Disposition of Federal Real Property; and
  • Federal Capital Financing Fund.

Here are some highlights. State and local governments would receive “incentive grants.” and federal incentive funds will be conditioned on meeting milestones on a scheduled basis. $100 billion will be made available, and would be administered mainly by the Department of Transportation (DOT), the Army Corps of Engineers (Corps), and the Environmental Protection Agency (EPA).

Other federal departments and agencies will be able to petition for inclusion of their recommended projects. Some of these funds would be set aside for administrative purposes. Each lead federal agency will solicit applications as soon as possible.

A separate rural infrastructure program would be established to generate significant investment to address ”long-unmet needs.” $50B would be provided, and 80% would be allocated to the Governor of each affected state. In addition, tribes and territories would be included in the program.

The Department of Commerce would be in charge of “transformative projects” that will fundamentally advance and transform the way in which infrastructure is delivered.

There will be new infrastructure financing programs that will increase the capacity of existing federal credit programs and broaden the use of “Private Activity Bonds.” The Water Infrastructure Financing and Innovation Act (WIFIA) would be expanded and program eligibility would be broadened. For instance, EPA would be authorized to assist in the financing of all kinds of water improvement and flood mitigation projects, and water quality issues at Brownfields and some the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA or Superfund) sites would be eligible for the existing WIFIA program.

Under the Public Lands Infrastructure program, the additional revenues generated by energy production on federal lands would be used for capital and maintenance needs. In addition, the disposition of Federal real property would be streamlined; today, the “Government is largely unable to tap into the value of the [Federal lands]portfolio because of statutory limitations.” A Federal Capital Financing Fund would be established to enhance the federal property acquisition process.

Part 2, entitled simply, “Additional Provisions for Infrastructure Improvements” addresses Transportation, and the need to incentivize and remove barriers to the development and improvement of the nation’s transportation infrastructure—highways, public transit, rail, and airports. There are suggestions to streamline the National Environmental Policy Act (NEPA) review process in connection with highway construction, and provide small highway projects with some form of regulatory relief.

Rail projects would be able to take advantage of the Fixing America’s Surface Transportation (FAST) Act’s accelerated review process, and many non-aviation developments at airports would be subject to only limited FAA review and supervision.

With respect to Water Infrastructure, the Clean Water Act (CWA) Revolving Fund should be available for both publicly and privately-owned public-purpose treatment works. In addition, the paper notes that all Corps projects “remain authorized in perpetuity.” As a result, even simple modifications to older facilities are subject to the Corps’ CWA Section 408 authority, which increases costs to the Government and the applicant.

There are suggested provisions to provide additional flexibility to the Veterans Affairs Department to manage its assets that are aging and yet growing in value.

There are “Land Revitalization” provisions that address Brownfields and Superfund remediation and cleanup projects. A Superfund Revolving Loan Fund and Grant Program would be established, and some Superfund NPL sites would be made eligible for Brownfield grants. Other Superfund reforms would be enacted, including providing EPA with “express settlement authority” to enter into administrative agreements with Bona Fide Prospective Purchasers and “other statutorily protected parties” to perform remedial actions and thus expedite the cleanup and reuse of Superfund sites. The existing and complicated Superfund processes could be amended to allow for the creative integration of infrastructure projects that will be funded by a third party.

Part 3 addresses “Infrastructure Permitting Improvement.” The “One Agency, One Decision” environmental review structure would be enacted (currently, it is being promoted by Executive Order) to accelerate the federal environmental permitting review process. Interestingly, and this may be a response to recent decisions by the courts, an agency should not be required to consider alternatives that are outside of its authority or beyond its capability of the applicant.

The Council on Environmental Quality (CEQ) would be directed to update and streamline its NEPA rules that affect all federal agencies; they have largely been untouched since 1978. The perceived redundancy in EPA review of environmental impact statements required by Section 309 of the Clean Air Act (CAA) should be eliminated insofar—if this is the point– as they may not even relate to matters immediately subject to the CAA. There is also redundancy and duplication in the mitigation banking review process which should be addressed.

The paper notes the current authority of EPA to veto a Corps’ project long after it has been approved by the Corps; this should be eliminated, and the Secretary of the Army should have exclusive authority to make Section 404 “jurisdictional determinations.”

The ability of states to abuse their CWA Section 401 water quality certification is noted. The law should be amended to address this procedure, which has been used recently to frustrate pipeline permitting and construction. The five year permit limit of a National Pollution Discharge Elimination System (NPDES) permit should be lengthened to fifteen years to assure the stability needed by public and private investments in water infrastructure projects. The periodic CAA National Ambient Air Quality Standards (NAAQS) process should be reformed to allow states and other permitting authorities to conform only to the latest NAAQS.

More delegation to state permitting authorities is advocated, and courts would be limited in their ability to enjoin projects because of an alleged NEPA violation to “exceptional circumstances.”

Part 4 addresses “Workforce Development.” The existing state licensing requirements should be reasonably reformed to allow qualified out-of-state workers to work on projects receiving federal infrastructure funds. Pell Grant eligibility would be reformed to include short-term high quality skilled trades programs.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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