Accelerating the Nation's Economic Recovery From the COVID-19 Emergency by Expediting Infrastructure Investments and Other Activities

Background

Impact on Law and Regulatory Framework

Accelerating the Nation's Economic Recovery From the COVID-19 Emergency by Expediting Infrastructure Investments and Other Activities led to significant shifts in how federal agencies approached infrastructure projects. It invoked various emergency authorities, allowing for an expedited process that normally would be subject to extensive review under several federal laws, notably the National Environmental Policy Act (NEPA), the Endangered Species Act (ESA), and the Clean Water Act (CWA). These acts generally require rigorous environmental assessments and consultations, which can considerably delay project initiation and completion. Under the executive order, agencies were directed to consult with the Council on Environmental Quality (CEQ) to identify and implement alternative arrangements for NEPA compliance, thereby bypassing typical procedural norms that would ensure environmental considerations were thoroughly examined.

Agency Directives without Rulemaking

The Secretary of Transportation, the Army Corps of Engineers, and other federal agencies were instructed to expedite projects considered necessary for the economic revival under the shadow of the COVID-19 pandemic. The order mandated reports every 30 days to account for the status of expedited projects, creating a streamlined nudge for agencies to ramp up their internal processes. This directive marked a considerable shift from the status quo, as it compelled agencies to prioritize economic over environmental or regulatory considerations, which typically necessitate comprehensive assessments and stakeholder consultations. By sidestepping rulemaking procedures that often require public input and lengthy evaluations, the order accelerated the timeline of potential infrastructure improvements but at the cost of omitting community and expert insights.

Operational Adjustments and Enforcement

In practical terms, the executive order led to operational adjustments within agencies tasked with infrastructure projects, especially the Department of Transportation and the Department of the Interior. These adjustments included reallocating resources to prioritize projects deemed essential for economic recovery. Operational backlogs were cleared more swiftly, as emergency measures relaxed some of the requirements that typically constrain government action. Enforcement of environmental protections was notably relaxed, which, while effective in accelerating project timelines, raised concerns among environmental groups about the long-term impacts on biodiversity and natural habitats. This regulatory relaxation established by the order was seen as a double-edged sword, accelerating economic activities but potentially ignoring the environmental repercussions.

Reason for Revocation

Shift in Administrative Priorities

President Joseph R. Biden Jr. revoked the order on January 20, 2021, as part of a broader transformation in administrative priorities. His administration placed a higher emphasis on environmental justice and climate change mitigation, diverging sharply from the prior administration's focus on deregulation and expedited development. The Biden administration aimed to reinstate the comprehensive review procedures that the previous order had circumvented, viewing them as essential to ensuring that environmental and community considerations were not sidelined in the pursuit of economic objectives.

Environmental and Ethical Considerations

The revocation was also driven by key ethical and environmental considerations. The Biden administration committed to rebuilding the nation's infrastructure with sustainability at its core, ensuring that projects align with the goals of reducing greenhouse gas emissions and promoting resilience against climate change. This policy shift recognized the potential for climate-friendly infrastructure projects to generate jobs and stimulate the economy without compromising environmental integrity. President Biden's team viewed the Trump-era order as antithetical to these principles, as it prioritized economic expediency over sustainable development.

Legal and Procedural Integrity

Another reason for the revocation lay in restoring confidence in the legal and procedural integrity of federal project approvals. The use of emergency authorizations to bypass typical regulatory checks raised concerns about potential legal challenges and the long-term precedent it might set. The Biden administration sought to emphasize transparency, accountability, and public participation in federal decision-making, ensuring that infrastructure projects benefitted from broad consensus and did not unduly harm environmental or social well-being.

Political and Ideological Alignment

This revocation was unquestionably part of a larger ideological shift that Biden's presidency represented. While the Trump administration prioritized rapid economic recovery often at the cost of environmental concerns, Biden's leadership aligned itself with international environmental commitments, such as the Paris Agreement, which the U.S. rejoined under his directive. This contextual backdrop underscores the ideological divergence concerning regulatory approaches, with Biden aiming to balance economic growth with responsible stewardship of natural resources.

Winners

Environmental Advocacy Groups

Environmental advocacy groups such as the Sierra Club and the Natural Resources Defense Council were among the most prominent beneficiaries of the revocation. These organizations, which advocate for rigorous environmental reviews and protections, viewed the initial order as an existential threat to many ecosystems and habitats. Revoking the order helped restore environmental regulatory frameworks they champion, reaffirming their role in influencing policy and safeguarding biodiversity.

Renewable Energy Companies

Companies in the renewable energy sector, including solar and wind energy firms, stood to benefit from the shift towards a regulatory environment that emphasized sustainable development. By rescinding the executive order, the Biden administration signaled a pivot toward prioritizing green infrastructure projects, aligning with federal incentives and funding opportunities focused on clean energy. This shift likely boosted investment and development in renewable energy sectors, changing the competitive landscape to favor sustainability-focused enterprises.

Local Communities and Tribal Nations

Local communities and tribal nations were positioned to gain long-term benefits from the revocation, primarily due to the reinstatement of comprehensive review processes that take local input into account. These groups often bear the brunt of environmental projects that bypass extensive reviews, from pollution to displacement. By revoking the order, the Biden administration acknowledged the need for inclusive project developments that reflect community needs and respect tribal sovereignty and environmental interests.

Losers

Construction and Infrastructure Companies

Large construction and infrastructure firms, such as Bechtel and Caterpillar, which might have benefitted from quicker project approvals under the executive order, faced slower timelines post-revocation. By repealing streamlined processes, these companies likely encountered increased regulatory hurdles, slowing down their capacity to commence and complete projects. This shift potentially impacted their revenue generation and delayed job creation initiatives underlying government infrastructure plans.

Oil and Gas Industry

The oil and gas industry, historically benefiting from regulatory relaxations that expedite project approvals, saw potential setbacks with the revocation. Projects involving pipelines or fossil fuel extraction often require quick authorizations to capitalize on market opportunities. The reinstatement of stringent environmental assessments and public consultation processes could delay or halt some initiatives, complicating the operational strategies of companies within the sector.

State and Local Governments with Immediate Infrastructure Needs

State and local governments with pressing infrastructure needs potentially found themselves at a disadvantage due to the increased federal oversight reinstated by the executive order's revocation. The swift allocation of federal resources and approvals to projects critical to local economies was slowed, impacting areas where rapid infrastructure improvements were necessary to stimulate economies suffering from pandemic-induced recessions. While long-term environmental and social gains might offset these drawbacks, immediate economic recovery in certain areas could have been less robust.