January 2016

[Commentary] A new law will impose significant new legal requirements on how federal agencies complete their environmental reviews and permitting of renewable energy projects, transmission lines, pipelines and other major infrastructure projects. The law became effective on Friday, December 4th. Congress quietly inserted new, stand-alone statutory permitting requirements for infrastructure projects into the FAST (“Fixing America’s Surface Transportation”) Act, its $305 billion transportation bill.

Title I of the bill includes the type of transportation-specific permitting tweaks that we have come to expect in transportation bills, but the real surprise is found in Division D of the legislation, which includes Title XLI, entitled: “Federal Permitting Improvement.” The permitting changes included in Title XLI extend far beyond highway projects and cover “construction of infrastructure of renewable or conventional energy production, electricity transmission, surface transportation, aviation, ports and waterways, water resource projects, broadband, pipelines, [and] manufacturing.” Key new requirements laid out in the new legislation will have broad applicability to “covered projects” that “require authorization or environmental review by a Federal agency involving construction of infrastructure for renewable or conventional energy production, electricity transmission, surface transportation, aviation, ports and waterways, water resource projects, broadband, pipelines [and] manufacturing,” when such projects are subject to NEPA and are likely to required a total investment of more than $200 million. The law places a number of new, permitting-related legal obligations on federal agencies.

[Hayes is the former Deputy Secretary of the U.S. Department of the Interior. He is a Visiting Lecturer in Law at Stanford University.]

Broadcasters who decide to put spectrum in the upcoming incentive auction could have the opportunity to sell it twice. Jan. 12 is the deadline for broadcasters to signal they are potentially putting spectrum in the auction and some of those broadcasters are busy figuring out what auction play makes the most sense for them. According to a source familiar with their thinking, some “major” broadcasters are looking at putting spectrum in the pot and, if they win, taking advantage of tax laws to keep that money in escrow and use more cash, or a loan, to bid on some of that reclaimed broadcast spectrum in the forward auction—they would need to use other money since reverse payments won’t be available until both sides of the auction closes. They could then sell or lease the spectrum to wireless carriers hungry for it. There is some financial risk involved since winning bidders are only provisional winners until the forward auction closes.