[House Report 115-223]
[From the U.S. Government Publishing Office]
115th Congress } { Report
HOUSE OF REPRESENTATIVES
1st Session } { 115-223
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PROMOTING INTERAGENCY COORDINATION FOR REVIEW OF NATURAL GAS PIPELINES
ACT
_______
July 17, 2017.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
_______
Mr. Walden, from the Committee on Energy and Commerce, submitted the
following
R E P O R T
together with
DISSENTING VIEWS
[To accompany H.R. 2910]
[Including cost estimate of the Congressional Budget Office]
The Committee on Energy and Commerce, to whom was referred
the bill (H.R. 2910) to provide for Federal and State agency
coordination in the approval of certain authorizations under
the Natural Gas Act, and for other purposes, having considered
the same, report favorably thereon without amendment and
recommend that the bill do pass.
CONTENTS
Page
Purpose and Summary.............................................. 2
Background and Need for Legislation.............................. 2
Committee Action................................................. 3
Committee Votes.................................................. 4
Oversight Findings and Recommendations........................... 9
New Budget Authority, Entitlement Authority, and Tax Expenditures 9
Congressional Budget Office Estimate............................. 9
Federal Mandates Statement....................................... 10
Statement of General Performance Goals and Objectives............ 10
Duplication of Federal Programs.................................. 10
Committee Cost Estimate.......................................... 10
Earmark, Limited Tax Benefits, and Limited Tariff Benefits....... 10
Disclosure of Directed Rule Makings.............................. 10
Advisory Committee Statement..................................... 10
Applicability to Legislative Branch.............................. 11
Section-by-Section Analysis of the Legislation................... 11
Exchange of Letters with Additional Committees of Referral....... 14
Dissenting Views................................................. 16
PURPOSE AND SUMMARY
H.R. 2910, the ``Promoting Interagency Coordination for
Review of Natural Gas Pipelines Act,'' was introduced by
Representative Flores (R-TX) on June 15, 2017. The legislation
would help address the critical need to expand and modernize
the nation's natural gas pipeline infrastructure by promoting
more timely and efficient reviews.
BACKGROUND AND NEED FOR LEGISLATION
The Federal Energy Regulatory Commission (FERC) is the
principal Federal agency involved in the review of interstate
natural gas pipelines. FERC has exclusive authority under
section 7 of the Natural Gas Act (NGA) to review and grant the
certificate of public convenience and necessity required to
construct a new or expanded interstate natural gas pipeline.
FERC conducts the environmental review of each proposed natural
gas pipeline project as required under the National
Environmental Policy Act (NEPA). Under the Energy Policy Act of
2005 (EPAct), FERC is designated as the lead agency for
coordinating necessary environmental reviews and associated
Federal authorizations. As the lead agency, FERC often
coordinates with a variety of Federal, State, and local
governments and Indian tribes to balance a wide range of
issues, including potential impacts on environmental and
wildlife resources, land-use, and property rights.
Multiple permits are often required for a natural gas
pipeline project, including permits under the Clean Water Act,
Endangered Species Act, and Clean Air Act. Under current FERC
regulations, Federal and State agencies participate in the
development of the NEPA analysis for a pipeline project and
then are required to complete their respective permit
application reviews no later than 90 days after FERC issues its
final environmental document, unless another schedule is
established by Federal law.\1\
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\1\18 C.F.R. Sec. 157.22
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Despite the increased authority given to FERC under EPAct,
there is growing evidence that pipeline infrastructure
approvals are being delayed unnecessarily due to a lack of
coordination or insufficient action among agencies involved in
the permitting process. A December 2012 study conducted by the
INGAA Foundation found that since the enactment of EPAct's
permitting reforms, the occurrence of Federal authorization
delays exceeding 90 days has risen from 8 percent to 28
percent, while delays exceeding 180 days have risen from 3
percent to 20 percent.\2\ A February 2013 GAO report discussed
the complexities of interstate pipeline permitting and
described the various groups of stakeholders and permitting
steps.\3\ While FERC has established a pre-filing phase to
facilitate and expedite the review, some agencies and States do
not fully participate in the process, leading to delays.
Testimony before the Subcommittee on Energy has shown that the
lack of coordination among Federal and State regulators is
having a negative impact on infrastructure modernization, job
creation, and economic growth.\4\
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\2\INGAA Foundation, Expedited Federal Authorization of Interstate
Natural Gas Pipelines: Are Agencies Complying with EPAct?, December 21,
2012.
\3\Government Accountability Office, Interstate and Intrastate
Natural Gas Permitting Processes Include Multiple Steps, and Time
Frames Vary, February 2013.
\4\See hearing entitled ``Modernizing Energy and Electricity
Delivery Systems: Challenges and Opportunities to Promote
Infrastructure Improvement and Expansion'' held on February 15, 2017.
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H.R. 2910 would improve the permitting process by
strengthening the lead agency role of FERC and further defining
the process for participating Federal and State agencies. The
intent of these provisions is to involve stakeholders sooner so
that they can be involved in the setting of the schedule and
identify issues of concern earlier in the process. The
legislation would require agencies that may consider an aspect
of an application to participate in the review process and
comply with the schedules established by FERC. The legislation
requires that agencies conduct their respective reviews
concurrently, and in conjunction with, the project-related
review conducted by FERC in compliance with NEPA. In
considering an aspect of an application, Federal and State
agencies may accept remote aerial survey data and use that data
to grant conditional approvals, conditioned on the onsite
inspection. Remote aerial surveys are a widely accepted, proven
method of collecting environmental data, and allowing their use
will lead to better, more informed decisions. H.R. 2910 would
increase public accountability, transparency, and efficiency by
requiring FERC to publish the schedule, a list of all actions
required by each applicable agency, and the status of all
pending actions.
COMMITTEE ACTION
On May 3, 2017, the Subcommittee on Energy held a
legislative hearing on discussion draft entitled ``Promoting
Interagency Coordination for Review of Natural Gas Pipelines
Act.'' The Subcommittee received testimony from:
Terry Turpin, Director, Office of Energy
Projects, Federal Energy Regulatory Commission;
John Katz, Deputy Associate General Counsel,
Office of the General Counsel, Federal Energy Regulatory
Commission;
Jeffrey Leahey, Deputy Executive Director,
National Hydropower Association;
Donald Santa, President and CEO, Interstate
Natural Gas Association of America;
Andy Black, President and CEO, Association of
Oil Pipe Lines;
Jeffrey Soth, Legislative and Political
Director, International Union of Operating Engineers;
Bob Irvin, President and CEO, American Rivers;
and,
Jennifer Danis, Senior Staff Attorney, Eastern
Environmental Law Center.
On June 22, 2017, the Subcommittee on Energy met in open
markup session and forwarded H.R. 2910, without amendment, to
the full Committee by a record vote of 17 yeas and 14 nays. On
June 28, 2017, the full Committee on Energy and Commerce met in
open markup session and ordered H.R. 2910, without amendment,
favorably reported to the House by a record vote of 30 yeas and
23 nays.
COMMITTEE VOTES
Clause 3(b) of rule XIII requires the Committee to list the
record votes on the motion to report legislation and amendments
thereto. The following reflects the record votes taken during
the Committee consideration:
OVERSIGHT FINDINGS AND RECOMMENDATIONS
Pursuant to clause 2(b)(1) of rule X and clause 3(c)(1) of
rule XIII, the Committee held a hearing and made findings that
are reflected in this report.
NEW BUDGET AUTHORITY, ENTITLEMENT AUTHORITY, AND TAX EXPENDITURES
Pursuant to clause 3(c)(2) of rule XIII, the Committee
finds that H.R. 2910 would result in no new or increased budget
authority, entitlement authority, or tax expenditures or
revenues.
CONGRESSIONAL BUDGET OFFICE ESTIMATE
Pursuant to clause 3(c)(3) of rule XIII, the following is
the cost estimate provided by the Congressional Budget Office
pursuant to section 402 of the Congressional Budget Act of
1974:
U.S. Congress,
Congressional Budget Office,
Washington, DC, July 14, 2017.
Hon. Greg Walden,
Chairman, Committee on Energy and Commerce,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 2910, the
Promoting Interagency Coordination for Review of Natural Gas
Pipelines Act.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Megan
Carroll.
Sincerely,
Mark P. Hadley
(For Keith Hall).
Enclosure.
H.R. 2910--Promoting Interagency Coordination for Review of Natural Gas
Pipelines Act
Under the Natural Gas Act, the Federal Energy Regulatory
Commission (FERC) is the lead federal agency involved in
approving and regulating interstate pipelines that carry
natural gas. Such projects are subject to a variety of federal
and nonfederal permits and authorizations related to a range of
issues, particularly environmental matters. Under current law,
FERC coordinates those efforts and is ultimately responsible
for granting the certificate of public convenience and
necessity required to construct or expand interstate natural
gas pipelines.
H.R. 2910 would specify timeframes and procedures for FERC
and other affected agencies to follow in conducting
environmental reviews related to natural gas pipelines. Based
on information from FERC and other federal agencies that
regulate aspects of interstate natural gas pipelines, CBO
estimates that implementing the bill would have no significant
net effect on the federal budget. The bill would not affect the
scope of federal agencies' responsibilities in overseeing such
pipelines, and CBO expects that meeting the timeframes
specified in the bill would not require a significant change in
the level of discretionary funding provided to those agencies.
Further, because FERC recovers 100 percent of its costs through
user fees, any change in that agency's costs (which are
controlled through annual appropriation acts) would be offset
by an equal change in fees that the commission charges,
resulting in no net change in federal spending.
Enacting H.R. 2910 would not affect direct spending or
revenues; therefore, pay-as-you-go procedures do not apply. CBO
estimates that enacting H.R. 2910 would not increase net direct
spending or on-budget deficits in any of the four consecutive
10-year periods beginning in 2028.
H.R. 2910 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act and
would impose no costs on state, local, or tribal governments.
The CBO staff contact for this estimate is Megan Carroll.
The estimate was approved by H. Samuel Papenfuss, Deputy
Assistant Director for Budget Analysis.
FEDERAL MANDATES STATEMENT
The Committee adopts as its own the estimate of Federal
mandates prepared by the Director of the Congressional Budget
Office pursuant to section 423 of the Unfunded Mandates Reform
Act.
STATEMENT OF GENERAL PERFORMANCE GOALS AND OBJECTIVES
Pursuant to clause 3(c)(4) of rule XIII, the general
performance goal or objective of this legislation is to promote
more timely and efficient reviews of pipeline certificate
applications.
DUPLICATION OF FEDERAL PROGRAMS
Pursuant to clause 3(c)(5) of rule XIII, no provision of
H.R. 2910 is known to be duplicative of another Federal
program, including any program that was included in a report to
Congress pursuant to section 21 of Public Law 111-139 or the
most recent Catalog of Federal Domestic Assistance.
COMMITTEE COST ESTIMATE
Pursuant to clause 3(d)(1) of rule XIII, the Committee
adopts as its own the cost estimate prepared by the Director of
the Congressional Budget Office pursuant to section 402 of the
Congressional Budget Act of 1974.
EARMARK, LIMITED TAX BENEFITS, AND LIMITED TARIFF BENEFITS
Pursuant to clause 9(e), 9(f), and 9(g) of rule XXI, the
Committee finds that H.R. 2910 contains no earmarks, limited
tax benefits, or limited tariff benefits.
DISCLOSURE OF DIRECTED RULE MAKINGS
Pursuant to section 3(i) of H. Res. 5, the Committee finds
that H.R. 2910 contains no directed rule makings.
ADVISORY COMMITTEE STATEMENT
No advisory committees within the meaning of section 5(b)
of the Federal Advisory Committee Act were created by this
legislation.
APPLICABILITY TO LEGISLATIVE BRANCH
The Committee finds that the legislation does not relate to
the terms and conditions of employment or access to public
services or accommodations within the meaning of section
102(b)(3) of the Congressional Accountability Act.
SECTION-BY-SECTION ANALYSIS OF THE LEGISLATION
Section 1. Short title
This section provides the short title, the ``Promoting
Interagency Coordination for Review of Natural Gas Pipelines
Act.''
Section 2. FERC process coordination for natural gas pipeline projects
Section 2(a) provides definitions for terms used throughout
this section.
Section 2(b) designates FERC as the only lead agency for
the purposes of complying with the National Environmental
Policy Act for an authorization under section 3 of the NGA or a
certificate of public convenience and necessity under section 7
of the NGA. This section requires FERC to coordinate as early
as practicable with each agency designated as a participating
agency under subsection (d)(3) and to take such actions as
necessary and proper to facilitate the expeditious resolution
of its project-related NEPA review.
Section 2(c) directs each agency to give deference, to the
maximum extent authorized by law, to the scope of the project-
related NEPA review that FERC determines to be appropriate,
when making a decision with respect to a Federal authorization
under section 3 of the NGA or a certificate of public
convenience and necessity under section 7 of the NGA.
Section 2(d)(1) requires FERC to identify as early as
practicable, after it is notified by a person applying for an
authorization under section 3 of the NGA or a certificate of
public convenience and necessity under section 7 of the NGA,
any Federal or State agency, local government, or Indian Tribe
that may issue a Federal authorization or is required by
Federal law to consult with FERC on the issuance of a Federal
authorization.
Section 2(d)(2) requires FERC to invite the identified
agencies to participate in the review process for the
applicable Federal authorization. The invitation shall
establish a deadline for when the agency must submit a response
to FERC. FERC may extended the deadline for good cause.
Section 2(d)(3) requires FERC to designate identified
agencies as participating agencies with respect to an
application for authorization under section 3 of the NGA or a
certificate of public convenience and necessity under section 7
of the NGA, unless the agency informs FERC, in writing, that
the agency does not have jurisdiction over the application, has
no special expertise relevant to the NEPA review, and does not
intend to submit comments for the record for the NEPA review
conducted by FERC.
Section 2(d)(4) provides that any agency not designated as
a participating agency may not request or conduct a NEPA review
that is supplemental to FERC's project-related NEPA review,
unless the agency (1) demonstrates that such review is legally
necessary or (2) requires information that could not have been
obtained during FERC's project-related NEPA review.
Additionally, it directs FERC not to consider any comments or
other information submitted by an agency that is not designated
as a participating agency for FERC's project-related NEPA
review and not to include any comments in the record for the
Commission's NEPA review from an agency that is not designated
as a participating agency.
Section 2(e)(1) directs the Commission not to establish a
deadline for a Federal authorization exceeding 90 days after
the Commission completes its project-related NEPA review.
Section 2(e)(2) directs each Federal and State agency
considering a Federal authorization for an application or an
aspect of an application under section 3 of the NGA or a
certificate of public convenience and necessity under section 7
of NGA to formulate and implement a plan to ensure completion
of Federal authorizations in compliance with schedules
established by FERC. When considering an aspect of an
application for a Federal authorization, each Federal and State
agency shall carry out the obligations of that agency under
applicable law concurrently with FERC's project-related NEPA
review, and in compliance with FERC's established schedule,
unless the agency notifies FERC in writing that doing so would
impair the ability of the agency to conduct needed analysis or
otherwise carry out the agency's obligations. Each Federal and
State agency considering an aspect of a Federal authorization
shall transmit to FERC a statement acknowledging receipt of the
schedule established by FERC. The statement shall also contain
the plan formulated to ensure completion of the Federal
authorizations in compliance with FERC's schedule. Not later
than 30 days after the agency receives an application for a
Federal authorization under section 3 of the NGA or a
certificate of public convenience and necessity under section 7
the NGA, a Federal or State agency shall transmit to the
applicant a notice indicating whether the application is ready
for processing. If the application is not ready for processing,
the agency shall provide a comprehensive description to the
applicant of the information needed for the agency to determine
that the application is ready for processing. Each Federal and
State agency shall transmit to FERC a report once every 90 days
describing the progress made in considering an application.
Section 2(e)(3) specifies that if a Federal or State agency
fails to meet a deadline for a Federal authorization set forth
in FERC's schedule, the head of the relevant Federal agency
shall notify Congress and FERC of such failure and set forth a
recommended implementation plan to ensure completion of the
action.
Section 2(f)(1) directs Federal and State agencies
considering an aspect of an application for a Federal
authorization to identify any issues of concern that may delay
or prevent an agency from working with FERC to resolve the
identified issues and grant the authorization. FERC may forward
any identified issue of concern to the heads of relevant
agencies for resolution.
Section 2(f)(2) instructs Federal or State agencies
considering an aspect of an application for a Federal
authorization to consider any data gathered by aerial or other
remote means submitted by the applicant. The agency may grant a
conditional approval for the Federal authorization based on
data gathered by aerial or remote means, conditioned on the
verification of such data by subsequent onsite inspection.
Section 2(f)(3) specifies that FERC, and Federal and State
agencies, may allow a person applying for a Federal
authorization to fund a third-party contractor to assist in
reviewing an application.
Section 2(g) directs FERC, with input from any Federal or
State agency considering an aspect of an application, to track
and make available to the public on the Commission's website
information related to the actions required to complete a
Federal authorization.
DISSENTING VIEWS
H.R. 2910, introduced on June 15, 2017 by Rep. Bill Flores
(R-TX), is almost entirely different from the draft legislation
that was the subject of the May 3, 2017 legislative hearing on
this subject. Proponents argue the purpose of the bill is to
streamline the Federal Energy Regulatory Commission (FERC)
process for approving natural gas pipelines by increasing
transparency, predictability, accountability, and timeliness.
However, these concerns are already being addressed by the
Federal Permitting Improvement Steering Council (FPISC),
established in 2015 through Title 41 of the Fixing America's
Surface Transportation (FAST) Act.\1\ This council is currently
overseeing and coordinating the permitting process for 32 major
infrastructure projects, including seven interstate natural gas
pipelines.
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\1\P.L. 114-94.
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The siting of natural gas pipelines is often controversial
and requires detailed regulatory scrutiny by FERC. At the
legislative hearing, FERC's Director of the Office of Energy
Projects, Terry L. Turpin, noted that ``on average it is 88
percent of the projects get issued within one year'' and the
single greatest factor in slowing down an application was the
license applicant failing to provide FERC and other agencies
with ``timely and complete information necessary to perform
Congressionally-mandated project reviews.''\2\
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\2\House Committee on Energy and Commerce, transcript not
published, Hearing on ``Legislation Addressing Pipeline and Hydropower
Infrastructure Modernization,'' Testimony of Terry Turpin, Director,
Office of Energy Projects, Federal Energy Regulatory Commission, 115th
Cong. (May 3, 2017).
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H.R. 2910 does not address any of the concerns raised by
FERC at the legislative hearing. Instead, H.R. 2910 indirectly
attempts to rewrite key aspects of sections 3, 7 and 15 of the
Natural Gas Act (NGA). Among other things, the bill would
require FERC to establish a schedule with deadlines for
submission of information from other federal or state agencies,
local governments or Indian tribes for a natural gas pipeline
or liquefied natural gas project requiring FERC approval.
Concurrent reviews by these federal or state agencies would be
required, based on the scope of environmental review determined
by FERC, to provide the Commission with timely information for
the purpose of complying with the National Environmental Policy
Act of 1969 (NEPA) and other environmental statutes such as the
Clean Water Act (referred to as ``federal authorizations'').
FERC would be allowed to pursue remedies or implementation
plans if a federal or state agency failed to meet the schedule
established by FERC under this section.
Other agencies conducting environmental reviews for
relevant projects would be further constrained since H.R. 2910
only provides for an agency to be designated as a
``participating'' agency, not a cooperating agency. Mr. Turpin
noted that some of the proposed NGA modifications would alter
the Commission's role from one of collaboration with its fellow
agencies to . . . monitoring other agency execution of their
Congressionally-mandated duties. I am concerned that this . . .
could lead to unproductive tension between the agencies
involved in the review process.\3\
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\3\Id.
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H.R. 2910 also goes further to define a status for certain
agencies called ``non-designation,'' which prohibits such
agencies from being able to ``request or conduct a NEPA review
that is supplemental to the project-related review conducted by
the Commission. . . . '' The bill prohibits FERC from
considering any comments or other information provided by a
non-designated agency or including its comments or supplemental
information in the record.
Furthermore, the bill introduces a number of new terms into
federal law. Some of these terms appear to be duplicative and
unnecessary, while others are a cause for great concern. Most
significantly, language introduced in H.R. 2910 requires
agencies responsible for federal authorizations to deem
applications ``sufficiently complete'' to begin consideration,
regardless of whether the application is complete enough to
fulfil its statutory obligations.
Finally, H.R. 2910 would require federal and state agencies
to accept aerial survey data, and provides that such agencies
may grant conditional approvals based on that data, conditioned
further on data verification via subsequent onsite inspection.
This provision allows companies working to build natural gas
pipelines the ability to circumvent property owners' rights
when surveying land. In a number of cases, companies have not
obtained the requisite permits to survey the land they are
seeking to access, and this language appears designed to allow
them to sidestep that aspect of the application process. At the
legislative hearing on the bill, the Subcommittee received
testimony from a private landowner from Pennsylvania who
described the abuses of eminent domain authority by a company
planning to build a natural gas pipeline through her family
farm.\4\
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\4\House Committee on Energy and Commerce, transcript not
published, Hearing on ``Legislation Addressing Pipeline and Hydropower
Infrastructure Modernization,'' Testimony of Kim Kann, 115th Cong. (May
3, 2017).
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During the Full Committee Markup of H.R. 2910, Democrats
offered several amendments to the bill to address their
concerns. Ranking Member Bobby Rush (D-IL) offered an amendment
to amend the bill so that pipeline applicants cannot use
eminent domain unless FERC makes an additional finding that the
project and taking of private property would be in the public
interest. Rep. Kathy Castor (D-FL) offered an amendment that
would have added a new section that would stop the bill from
taking effect until the Director of the Office of Management
and Budget publishes a determination that the requirements of
the bill would not be duplicative of other Federal streamlining
efforts (e.g., FPISC) and will not result in wasteful
government spending. Lastly, Ranking Member Frank Pallone, Jr.
(D-NJ) offered an amendment that would prohibit the use of
federal eminent domain for pipeline projects after the date of
enactment of the bill. All three amendments failed on recorded
votes.
H.R. 2910 short circuits the process for considering
natural gas project applications at the expense of private
property owners, state and tribal rights, and the environment.
The bill is unnecessary, not only because infrastructure
permitting streamlining is already occurring at FPISC, but also
because 88 percent of these projects are being certificated
within one year. At best, it is a solution in search of a
problem; at worst, it is an assault on private property rights
and the environment in the name of corporate profit and
expediency.
For the reasons stated above, we dissent from the views
contained in the Committee's report.
Frank Pallone, Jr.,
Ranking Member.
Bobby L. Rush,
Ranking Member, Subcommittee
on Energy.