The deal reached between the President and House Speaker McCarthy on the debt limit bill includes provisions approving a natural gas pipeline project (Mountain Valley Pipeline) and eliminating any judicial review of its existing and future permits, and also includes some limited reform of the National Environmental Policy Act (NEPA) by establishing deadlines for environmental review of large infrastructure projects.

What You Need to Know:

• Buried in the debt limit bill is an approval of the Mountain Valley Pipeline project, including elimination of any judicial review of its existing and future permits needed for construction.
• The debt limit bill also contains the first steps towards some reform of federal environmental permitting, with a time limit on environmental reviews of up to two years on large infrastructure projects.

President Biden and House Speaker McCarthy announced a deal this weekend on a bill to raise the debt limit and avoid defaults by the U.S. government on its obligations. The proposed Fiscal Responsibility Act of 2023 includes in Title III a saving provision intended to speed completion of the Mountain Valley Pipeline (MVP) by directing issuance of remaining permits and by eliminating any judicial review of the existing and future permits, and also includes amendments to the National Environmental Policy Act (NEPA) which are intended to curb years-long delays in NEPA reviews of infrastructure projects. While there were a number of proposals to "fix" federal permitting for both renewable and fossil fuel infrastructure projects, those comprehensive reforms did not make it into the bill. Assuming Congress votes to enact the bill into law, there is some indication that both parties will work on more comprehensive permitting reform later.

Provisions Relating to MVP

The bill finds that MVP is in the national interest, reciting: "The Congress hereby finds and declares that the timely completion of construction and operation of the Mountain Valley Pipeline is required in the national interest. The Mountain Valley Pipeline will serve demonstrated natural gas demand in the Northeast, Mid-Atlantic, and Southeast regions, will increase the reliability of natural gas supplies and the availability of natural gas at reasonable prices, will allow natural gas producers to access additional markets for their product, and will reduce carbon emissions and facilitate the energy transition." Congress therefore "ratifies and approves" all existing permits and approvals for MVP and directs all agencies to maintain those approvals. In addition, the Army Corps is directed to issue all remaining permits and approvals necessary to complete construction of MVP within 21 days of the date of enactment of the Act. Judicial review by any court of the existing and future permits needed for MVP is eliminated, and the DC Circuit Court of Appeals has original and exclusive jurisdiction over challenges to that judicial review provision.

Provisions Relating to NEPA

In addition to the pipeline-specific proposal, the bill provides global NEPA and permitting reform that benefits all infrastructure projects, including the following. 

The bill:

(1) requires a full environmental impact statement only when the proposed action has a reasonably foreseeable significant effect on the quality of the human environment;

(2) requires that an environmental report include only:

(a) reasonably foreseeable environmental impacts, and

(b) a reasonable range of alternatives with consideration of technical and economic feasibility, purpose and need;

(3) clarifies and codifies the responsibilities of lead and cooperating agencies, as well as certain process rules like page limits;

(4) creates a two-year or one-year deadline for EIS approval after an EIS is required based on the type of federal action involved, and provides the right to petition a court to force agency action if a delay occurs;

(5) requires each agency to report every delay to Congress and the Senate;

(6) allows an agency to rely on a programmatic environmental assessment without re-evaluation if within five years and clarifies that re-evaluation is necessary after five years;

(7) requires CEQ to study an e-portal system to facilitate data and comment sharing to expedite collective review and to track timelines and progress;

(8) provides the federal agency carrying out the action authority to decide if it is subject to federal control and responsibility;

(9) narrows the scope of the defined term "Major Federal Action," which triggers a NEPA EIS, by excluding actions with minimum federal funding or involvement and certain federal financing mechanisms;

(10) adds energy storage to the FAST Act approval process.

If passed and fully implemented by agencies, these new provisions, particularly the NEPA e-portal and one-year or two-year deadlines, should materially change the delivery of the NEPA review process and improve the United States' capacity to deliver on key infrastructure projects, particularly in the energy sector.