May 21, 2018 - 10:00am

We Can Have Better Infrastructure if We Cut Red Tape


Senior Editor, Digital Content

bloomberg_highway_paving_il_1200px.jpg

A worker helps pave a highway in Streator, IL.
A worker helps pave a highway in Streator, IL.

Let's go back to last week's Infrastructure Week one more time by looking at a major impediment to fixing our crumbling roads, bridges, waterways, and other vital infrastructure: the permitting process.

While often well-meaning, the process of getting government approvals for needed infrastructure projects creates delays, often lasting years.

When delays happen, costs mount up. Time is money.

A recent update to a Common Good 2015 study found that a six-year delay in the start of all U.S. infrastructure projects would cost $3.9 trillion dollars.

For example, in 2016, Common Good analyzed the Gateway Rail Tunnel Project that will create two tunnels under the Hudson River between New York and New Jersey. It found that an 18-month permitting delay would add $3.3 billion to the cost of the project, and a three-and-a-half year delay would add an additional $9.8 billion.

The Wall Street Journal reports, last month, the Federal Railroad Administration missed a deadline for finishing its environmental review on the Gateway project.

Not only do permit delays add to the overall costs of infrastructure projects, by injecting uncertainty they hold back private sector investment, as I noted in March:

"For folks like us that are looking to invest in the U.S. that lack of clarity, that lack of certainty about the approvals process is one of the major impediments," said [Tom Osbourne, Executive Director – Infrastructure for IFM Investors].

“One of the things that discourages particularly the private sector, but also the public sector, is lack of certainty over the timing,” Philip Howard, founder and chairman of Common Good, told The Atlantic. “Why would you invest millions of dollars in a project when it might take a decade to get it approved? If you have a one- or two-year window, you might say, ‘Let’s go for it’ and see if [you] can do it.”

The answer is streamlining the permitting process, as U.S. Chamber and CEO Tom Donohue explained earlier this year:

All federal infrastructure approvals should be completed within 2 years. State and local projects benefiting from federal funding or financing should also adhere to a two-year timeline, which should run concurrent to the federal process. And to help streamline permitting and eliminate duplicative reviews, a single lead agency should shepherd a project through the process from start to finish.

It's one component of the U.S. Chamber’s four-part plan for modernizing America’s infrastructure.

Getting government sign-off on projects in a timely and certain manner would not only be friendly to taxpayers’ wallets, instill the confidence of private sector investors, but would provide Americans with a modernized infrastructure they can rely on.

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About the Author

About the Author

Sean Hackbarth
Senior Editor, Digital Content

Sean writes about public policies affecting businesses including energy, health care, and regulations. When not battling those making it harder for free enterprise to succeed, he raves about all things Wisconsin (his home state) and religiously follows the Green Bay Packers.