The "side deal" that Sen. Joe Manchin (D–W.V.) worked out to speed up federal permitting of energy projects in exchange for his vote for the Inflation Reduction Act (IRA) is now dead, and with it the one potential silver lining in Democrats' $740 billion spending measure.
Citing its likely failure, Manchin said Tuesday evening that he'd asked Senate Majority Leader Chuck Schumer (D–N.Y.) to remove the permit streamlining measure from a continuing resolution the Senate was voting on that evening.
"It's unfortunate that members of the United States Senate are allowing politics to put the energy security of our nation at risk," said Manchin in a statement. "A failed vote on something so critical as comprehensive permitting reform only serves to embolden leaders like [Russian President Vladimir] Putin who wish to see America fail."
My statement on the decision to remove the comprehensive permitting reform language from the Continuing Resolution: pic.twitter.com/M0lARzHp8x
— Senator Joe Manchin (@Sen_JoeManchin) September 27, 2022
Manchin's proposal would have made a number of attempted streamlining changes to the National Environmental Policy Act (NEPA). The 1970 law requires federal agencies to perform environmental reviews of their actions, whether that's funding a new highway or permitting a new wind farm.
NEPA has come under increasing scrutiny from both right and left for gumming up infrastructure projects. The most stringent environmental reviews take nearly five years on average to complete, at the cost of millions of dollars to the taxpayer. Gadflies that don't want cellphone towers or solar farms near them can delay things further by suing over NEPA reviews they claim are inadequate.
It's a bipartisan cause.
"NEPA has become a weapon used by special interests to make much-needed infrastructure and maintenance projects throughout our country prohibitively expensive," said Sen. Mike Lee (R–Utah) when introducing his own reform bill last year.
Liberal New York Times columnist Ezra Klein struck a similar note in a column earlier this year, saying NEPA and its state-level equivalents have become "powerful allies of an intolerable status quo, rendering government plodding and ineffectual and making it almost impossible to build green infrastructure at the speed we need."
Manchin's proposed fixes included having the president identify 25 "high-priority" projects for expedited review, imposing an "average" two-year timeline for reviews generally, and requiring courts to more quickly adjudicate NEPA lawsuits.
Most NEPA watchers have said these reforms were pretty toothless.
Giving the president the power to designate high-priority projects "would have little significant consequence. The president would be required to issue executive orders directing agencies to expedite such projects," said the free market Competitive Enterprise Institute's Mario Loyola.
Permitting shot clocks are an idea that's been tried and failed.
"If you give an agency a timeline, they blow right through deadlines all the time and it's hard to enforce," the Center for Growth and Opportunity's Eli Dourado told Reason last month.
Dourado was also unimpressed with Manchin's plan for speeding up NEPA litigation, saying "even if you did get in front of a court, judges are going to enforce NEPA. If they decide [an environmental review] is incomplete in some way, or is deficient" they can still tell an agency to redo it.
Even these exceedingly modest reforms were too much for some Democrats and environmental advocacy groups.
Eight Senators, including Sens. Bernie Sanders (I–Vt.) and Elizabeth Warren (D–Mass.), and 70 House members signed on to a letter saying Manchin's side deal would "short-circuit or undermine" NEPA. CEI, a proponent of far more sweeping permitting reform, also said Manchin's legislation had more negatives than positives, and should therefore be dropped.
Per Politico, the real fatal blow came from Senate Minority Leader Mitch McConnell, who urged his co-partisans to oppose a continuing resolution that included permitting reform provisions.
The continuing resolution, which needed to pass before October 1 to keep the government open, required 60 votes. With NEPA reform out of the equation, it passed the Senate on a 72–23 vote last night.
It's possible permitting reform might have a second chance at life this year. Sen. Shelley Moore Capito (R–W.Va.), per Bloomberg's Erik Wasson, said she would be willing to work to include NEPA changes in a defense spending bill.
gop @SenCapito says she's willing to negotiate new version with Manchin and put on annual defense bill
— Erik Wasson (@elwasson) September 27, 2022
Time will tell if that comes together. It's certainly not a good sign for the federal government's effectiveness that an exceedingly mild bipartisan reform to a permitting process that everyone agrees is fundamentally broken has more trouble passing Congress than trillions in new spending.