The Associated General Contractors of America (AGC) is the nation's largest and oldest construction trade association, founded in 1918. AGC represents more than 33,000 firms, including 7,500 of America's leading general contracting firms. AGC's general contractor members have more than 25,000 industry firms associated with them through a network of 99 AGC chapters. AGC member firms are engaged in the construction of the nation's commercial buildings, factories, warehouses, highways, bridges, airports, waterworks facilities, waste treatment facilities, dams, water conservation projects, defense facilities, multi-family housing projects, site preparation, and utilities installation for housing developments.
AGC Supported the TEA-21 Streamlining Provisions
AGC aggressively pursued the inclusion of the environmental streamlining provisions in TEA-21. AGC has long stated that it was essential that Congress accelerate the process of planning, designing and constructing transportation projects. Toward that end, AGC sought the statutory change which would protect the environment and at the same time expedite the environmental permitting process by requiring a coordinated environmental review process within U.S.DOT. More specifically, the legislative language requires all reviews, analysis, and permitting to be performed concurrently and cooperatively within a mutually agreed upon schedule by both the federal and state agencies with jurisdiction over the particular project.
Congress recognized the need to expedite the permitting process. The congressional intent behind the environmental streamlining provisions as described in the TEA-21 Conference report was to, "address the same concerns, the delays, unnecessary duplication of effort and added costs often associated with the current process for reviewing and approving surface transportation projects." I am sure every member of this committee has examples in their own state of roads that cannot be built because of the layers of red tape and differing priorities of state and federal agencies.
According to a document I have seen prepared by the Ohio Department of Transportation, road projects require eight years of planning and permitting before they can even begin construction.
Congress, more than 20 years ago, recognized that the construction of highway projects is unnecessarily delayed. Section 141 of the Federal-Aid Highway Act of 1976 required the Secretary of Transportation to carry out a project to demonstrate the feasibility of reducing the time to complete a highway project. The entire 4.6-mile project was open to traffic on August 2, 1980, merely 3 years and 7 months after the inception of the project--six years less than the average project of this size and type in the state.
Had the project taken the normal time to complete, it would have cost an additional $11 million due to inflation alone. Timesavings by major project phase were as follows:
Time Savings Environment 1 year 10 months Location 2 years 2.5 months Design 1 year 10 months Right-of-way 1 year 7.5 months Construction 3 months Early coordination of priorities and procedures allowed identification and elimination of time-consuming federal and state procedures without going outside statutory requirements.
This was a very successful experiment. At the completion of the project the federal highway administration estimated, "on a national basis, federal funds of about $64 million per year could be saved if 10% of all federal-aid highway projects were accelerated like this project."
Major projects must adhere to the NEPA process. This now cumbersome process requires that the Federal Highway Administration, the Corps of Engineers, the Environmental Protection Agency, the Fish and Wildlife Service, and the US Coast Guard to sign off on all projects. Each agency must prepare separate review and approval documents. In some cases this consecutive review process can add three years to a project approval life cycle. Many of these agencies adhere to their own schedule and do not feel the time pressure shared by those in the local community, the Department of Transportation or their state colleagues. Recognizing this obstacle to safe roads, Congress streamlined the process in TEA-21, but this paradigm shift has not been recognized in our federal bureaucracy.
One Year After Passage Of TEA-21
The Federal Highway Administration proposed an options document in which stakeholders commented on how the process should move forward. Some of these proposals would allow the process to take longer than is currently conceived. The main goal of getting all the regulatory parties to the table will not be recognized for several years. Most troublesome of the stakeholder comments was that this streamlining provision was optional. AGC strongly objects to this characterization. All parties must come to the table on the front end of a project so that potential conflicts can be avoided, the environment can be preserved, and the local community can be protected.
Currently, FHWA has a consensus on a draft Memorandum of Understanding (MOU) with the resource agencies. These include the Corps of Engineers, the Environmental Protection Agency, the Department of Interior, and the Advisory Council on Historic Preservation. There are some bi-lateral agreements still to be worked out. AGC understands this is targeted for completion by the end of June. In addition, the regional administrators are participating in a similar effort. Stakeholders are still welcome to comment on the streamlining MOU. AGC urges the members of this committee to continue to monitor the development of this MOU to ensure that the goals of TEA-21 are realized. Specifically AGC supports several of the goals outlined in the MOU such as: establishing an integrated review and permitting process that identifies key decision points and potential conflicts as early as possible; integrating NEPA as early as possible; encouraging full and early participation by all relevant agencies; establishing coordinated time schedules for agencies to act on a project; creating dispute resolution procedures to address unresolved project issues; identifying solutions to minimize delays, prevent overlap, and avoid disruption of the NEPA process; and, establishing performance measures to evaluate the effectiveness of environmental streamlining efforts. It is our sincere hope that these goals would be established without expanding the burdens of the current environmental review process and without imposing new standards or encroaching on the role of the states in making national transportation decisions.
Important to the Realization of the Goals of TEA-21
It is critical that the goals of TEA-21 be realized. Everyone on this committee supported the conference report. The environmental streamlining provisions are critical to the realization of the goals of TEA-21. In the construction industry it is imperative that we have the equipment, the manpower, and a certain and predictable schedule to build these needed improvements. In Montana our highway construction season lasts only 8 months, so getting the work done in a single construction season can be difficult. The uncertainties and the length of the permitting process often make it even harder to build these projects.
Recent Court Rulings Place Projects in Danger
Recent court cases have put the interest of national environmental activists ahead of the safety of motorists. Specifically, the decision in the Environmental Defense Fund v. EPA Administrator Carol Browner in the U.S. Court of Appeal for the DC Circuit jeopardizes the safety of motorists. This ruling hinged on the statutory basis for a regulation allowing the EPA and the FHWA to approve projects and let them proceed even if at a later date the projects were submitted on state implementation plans that did not meet emissions targets. These were projects that had been approved by the local, state and federal government agencies responsible for maintaining human health and the environment. What it amounts to is that the EDF can challenge the approval of highway projects by the EPA and FHWA after the projects have been approved and millions of federal and state tax dollars have been spent. As a result of this development environmental activists now have the final say on which projects can be constructed.
If this was the intent of the Clean Air Act, it has been realized. If it was not the intent, the intent of the statute must be clarified. The Department of Justice did not ask for a rehearing in this case. FHWA estimates that over $1 billion and 84 projects are at stake. The Federal Highway Administration identified areas in California; Montana; North Carolina; Georgia; Idaho; Kentucky and Tennessee as negatively impacted by this ruling. What this estimate don't tell you is the lives at stake or the local communities that will be disrupted as these lawsuits are settled. Moreover, the estimates do take into account the legal roadblocks national environmental activists can construct in our state, nor do they consider the devastating impact on the construction industry.
Montana may have dodged the bullet of the EDF v EPA ruling, but a final determination has not been made. Montana will hopefully soon have an approved conforming state implementation plan (SIP). However, the Shiloh Interchange in Billings Montana is one project that could be stopped by this legal action. Our colleagues in other states will not be so fortunate. Missouri, Georgia, Idaho and Florida all face lawsuits attacking state and federal approval of important highway projects.
AGC questions the Federal Highway Administration and the Environmental Protection Agency's proposed regulatory change to allow some projects to proceed. AGC questions the legality of a regulatory solution when it was an EPA regulation that the court struck down in this case. In addition, AGC questions the ability of the EPA to negotiate this regulatory proposal with the environmental defense fund when the environmental defense fund is not party to the lawsuits in Missouri, Florida or Idaho, unless this is a coordinated attack by national environmental groups on state highway construction programs. If this is not a coordinated attack, then the FHWA and EPA will have to negotiate with the plaintiffs in the other three cases as well. AGC also questions the Administration's deference to national environmental activists. Very seldom is the federal government held hostage by a single, narrow interest.
AGC supports Senator Bond's efforts to legislatively shield the grandfather clause from further costly litigation through a legislative solution. Senator Bond's proposal would simply codify the EPA rule that allows gradfathered projects to be built. If Congress would clarify this issue there would be little question as to the legality of the EPA regulation allowing the grandfathering of projects.
Future Environmental Threats
In the West, we are very concerned about other threats to highway construction projects that could be mitigated by early incorporation into project decision making. These threats include the rigid application of the Endangered Species Act, new Regional Haze standards and more stringent standards for particulate matter. Each stand as potential stumbling blocks to the construction of projects funded by TEA-21. AGC urges the committee to examine the impact of these threats to highway construction projects.
Conclusion
The streamlining provisions of TEA-21 were necessary. No one disputes that. Congress has been grappling for years with how best to preserve the environment while continuing to progress. AGC supports the efforts of this committee to improve the process. For construction of these much-needed improvements, contractors must be able to line up the material, equipment and manpower to do the job. Streamlining the process will help us to deliver projects on time and on budget. However, failure to adequately defend the goals of TEA 21 in the face of environmental challenges will cause disruptions in project delivery that will cost the construction industry, the government, and the economy billions of dollars and thousands of lives.
Attachment
Lawsuits: EDF V. EPA
Decided: March 2, 1999
United States Court of Appeals for the District of Columbia
Holding: Nullifies the Environmental Protection Agency's grandfather clause. The clause allowed highway projects that did not meet clean air conformity standards to go forward. If the project met previous clean air models, then the project was "grandfathered" into the current clean air models. EPA claimed that would allow these projects to go forward in the spirit of flexibility. The Court held that this flexibility did not exist according to the Clean Air Act. "If this legislative scheme is too onerous, it is up to Congress to provide relief, not this court." On March 16, 1999, EPA announced they would not appeal the case.
Sierra Club v. Browner
Filed: November 1999
Pleading: The Sierra Club claims EPA Administrator Carol Browner did not have discretionary authority to allow Missouri to go forward with road building since, St. Louis was not in attainment with the ozone standard. The Sierra Club is asking that the court instruct the federal government to withhold Missouri's federal highway dollars until the city reaches conformity - complies with the ozone standard. AGC of Missouri, AGC of St. Louis, and Heavy Contractors of Kansas City have filed as intervenors to the case.
Sierra Club v. EPA
Filed: March 1999
United States Court of Appeals for the 9th District
Pleading: The Sierra Club is asking the court to vacate Ada County, Idaho's attainment status for particulate matter. On March 12, 1999 the EPA published a final rule in the Federal Register stating that Ada County reached particulate matter attainment. Prior to this finding, Ada County's road program was on hold. Current estimates are that $21 million of roadwork is on hold with $10 million affected annually for the next few years.
Sierra Club v. US Army Corps of Engineers
Filed: March 1999
US District Court in Jacksonville, Florida
Pleading: Permits for a 41.6-mile tollroad are being challenged by the Sierra Club. The Suncoast Highway stretches across West Central Florida. The Sierra Club believes the Corps of Engineers' environmental impact statement does not adequately address Clean Water Act, Clean Air Act, and Endangered Species Act requirements.
\1\Acceleration of Highway Projects, A Report to Congress on the Everett Bypass Project. U.S. Department of Transportation, 1981.
\2\Federal Highway Administration and Federal Transit Administration TEA-21 Planning and Environmental Provisions: Options for discussion.