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Inhofe interested in Clean Water Act fix as he seeks to nudge bill

Senator James Inhofe, a key subcommittee chairman, plans to gauge support for including in broad infrastructure legislation a Clean Water Act fixthat could make it harder for states to block interstate natural gas pipeline projects. The Oklahoma Republican's optimism about the outlookfor congressional action on a broad infrastructure bill, however, counters the fairly widely held view in Washington that the chances are slim this year.

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Inhofe chairs the Senate Environment and Public Works Committee's transportation and infrastructure subcommittee, which has held several hearings related to a potential infrastructure package.

"I've been outspoken about the need for a [Clean Water Act Section] 401 fix to prevent abuse of the permitting process -- this is something that's been happening all over the country, and it's alarming," he said in an emailed statement Tuesday. "I've introduced bipartisan legislation to ease pipeline permitting, and I will continue my outreach to members of the House and Senate to see what we might be able to do on 401 as a part of an infrastructure package," he added.

Inhofe's interest in acting comes as frustration from the pipeline industry has mounted over the obstacles projects have faced in gaining Section 401 water quality permits from states such as New York, even as federal pipeline approvals have been steadily forthcoming. The New York State Department of Environmental Conservation has denied water quality projects for several major natural gas projects in the last couple of years, including Williams' 121-mile, 650 MMcf/d Constitution Pipeline and National Fuel Gas Supply and Empire Pipeline's 97-mile, 497 MMcf/d Northern Access 2016 project. More recently, NYSDEC conditionally denied Transcontinental Gas Pipe Line's Northeast Supply Enhancement project.


APPEALS PROCESS SOUGHT BY INDUSTRY


That has spurred interest from pipeline companies in legislative fixes such as restricting the scope of Section 401 reviews to water quality standards that have been approved by the Environmental Protection Agency, rather than stretching to other areas such as air emissions considerations. In addition, pipeline companies have been keen on creating an appeals process in the event a state denies a Section 401 permit, modeled on the Coastal Zone Management Act process and perhaps administered by EPA.

Inhofe, speaking at an Axios event on infrastructure Tuesday morning, suggested that a lot of the action on infrastructure could revolve around permitting. He gave a nod to the administration's proposal favoring a "one agency, one decision" structure for environmental reviews, andseeking to complete environmental reviews in two years.

He also drew attention to natural gas pipeline constraints in eastern states, despite abundant domestic natural gas production. "Yet in Boston, they have to import it from Russia," he said, referring to the offloading of a tanker originating from Russia's Yamal LNG plant during a cold snap this winter to replenish stocks at the Everett LNG terminal in Boston. "The reason is that pipelines under our program can go to states and [states] can object to what we're doing. And that's what's happened. They're paying in Boston all this money to import that could be coming from our own production," he said.'

'WE'RE ACTIVELY WORKING' ON INFRASTRUCTURE BILL: INHOFE


He asserted that contrary to some pronouncements, a broad infrastructure package proposed by the president is "not dead on arrival."

"In fact, we're very actively working on it right now," he said, adding his panel had held several hearings. "I think we're on schedule to get it done," he said.

The White House in February proposed a $200 billion infrastructure plan intended to spur $1.5 trillion in infrastructure funding through investments from states, localities and the private sector. It also included a package of legislative proposals meant to streamline infrastructure permitting.

The odds of action in the short term have been seen as long, amid a partisan divide over the level of federal funding, particularly given the tax cuts, and the looming midterm elections -- as well as Democrats' fears that permitting reforms could undermine environmental laws. White House Press Secretary Sarah Sanders last week said, "I don't know that there will be one by the end of this year" when asked about prospects for a bill.

For proponents of Clean Water Act changes, a broad infrastructure bill is seen as an attractive vehicle because of the potential for measures to ultimately by swept along with the momentum for acting on a bipartisan compromise. Moreover, there is the potential for other types of projects to join the push from pipeline developers for CWA revisions.

--Maya Weber, maya.weber@spglobal.com

--Edited by Gail Roberts, newsdesk@spglobal.com