Permit by Rule

With H.R. 1 likely stalled in the Senate, and the debt ceiling bill only making small incremental changes, it is time to look toward the next effort to reform the federal permitting process. H.R. 1 has definite positive changes within it. Clarifying the scope of environmental reviews, limiting the length (both in time and pages), and adding judicial review options are beneficial. But those reforms are merely incremental and are unlikely to improve federal land permitting in a meaningful way.

The real root of the issue is the shift in philosophical approach to governance that this country has undergone since its inception. The United States system of governance was derived from the English common law system of government. In that system, the government seldom involved itself in private decisions until it felt the need to stop behavior by enforcing laws. This “general rule” system, where government presumes that behavior is permissible, is rare in modern society, but does represent the purest form of economic freedom-oriented governance.

Slowly, but surely, the United States has transitioned to a form of governance that resembles historical France, which had a civil law system. This approach to governance requires the citizen to ask permission and have the government “permit” that activity. This is where we stand today, where permits are needed for an increasing amount of activity.

Permits are problematic for a few reasons. First, they often take unnecessary time because the application sits on a bureaucrat’s desk to be advanced according to the official’s priorities rather than a more objective criteria such as first in, first out. Second, permits give bureaucrats too much discretion, making the process unpredictable for the applicant. But many applications are just like the others. Government should not need to approve each similar application individually to know that the behavior is permissible. This is where permits by rule would greatly benefit society.

With a permit by rule system, law would shift back toward the English civil law that helped the United States become the economic powerhouse that it is today. Government would create a pre-set list of standards for a certain type of activity. When an applicant certifies compliance with those standards, it still submits a permit application, but the review process is streamlined and expedited. The government’s focus (and limited taxpayer resources) shifts from being an administrative gatekeeper to being the enforcer of standards. Permit-by-rule would allow projects to begin quickly. It would allow applicants to predict whether they will be granted a permit. It would likely bring more competition into the marketplace because barriers to entry would be lowered.

This system would not lower substantive standards. Rather, the substantive standards would be clearly published for all to know and understand. Government would still be made aware of the applicant’s activities because the application still must be filed and put on record. Additionally, permittees would remain responsible for compliance with the rules put in place to protect public health and safety, among other reasons. For example, the government could require, and regulate, surety bonds that protect against potential societal and/or environmental harms or fraudulent certification by applicants.

Permit by rule is already being used. The EPA and at least 38 states have permits by rule in some form. The states demonstrate the large variety of activities that this system can benefit. It regulates activities that range from rock removal to energy production.

This system should be expanded at both the federal and state levels. Certain permits subject to the National Environmental Policy Act, which regulates federal activity that could impact the environment and has proven to be a costly and lengthy process, could be streamlined but not circumvented by permit-by-rule. Activity that would need quick action, such as water shortage issues, could be timely resolved with permit-by-rule. The potential breadth of activities that could benefit from this approach is endless.

The benefits extend to both sides of the ideological aisle. For example, both renewable energy and oil companies would have access to streamlined permits. The system also would reduce the administrative burden incurred on the front end of the permitting process and freeing up those officials to focus on enforcement and cracking down on bad actors. All sides win, particularly the public who is handed a stronger economy and better-protected environment.

Common law general rule systems would be ideal in some situations. After all, the less the government impedes, the more the citizenry will use its ingenuity. But in certain situations, such as ones that could have potential environmental impact, permit by rule offers many of the same benefits. Congress, and the states, should look to the future by returning to the governing approach that made America great. Permit by rule is a fantastic place to start.