Bipartisan Senate Committee Leaders Release Permitting Reform Text

U.S. Senate Committee on Environment and Public Works Chairman Shelley Moore Capito (R-W.Va.), Senate Committee on Energy and Natural Resources Chairman Mike Lee (R-Utah), Senate Committee on Environment and Public Works Ranking Member Sheldon Whitehouse (D-R.I.) and Senate Committee on Energy and Natural Resources Ranking Member Martin Heinrich (D-N.M.) on September 30, 2026, introduced the Bipartisan American Affordability and Jobs Act of 2026. The bipartisan proposal seeks to accelerate the federal permitting process while preserving environmental review, public participation and Tribal consultation within more defined procedural boundaries.

The package is divided into two main divisions: Division A, which is under the Senate Environment and Public Works Committee's jurisdiction, addresses environmental review, water, wildlife and project certainty, while Division B, under the Senate Energy and Natural Resources Committee's jurisdiction, addresses electric transmission, energy permitting and historic preservation. View the bill text in full or section by section.

Key Takeaways for Clients

The package's most consequential feature is its combination of permitting speed, permit durability and transmission reform. Developers could benefit from firmer decision schedules, broader categorical exclusions and reduced litigation windows but would also need to frontload stakeholder engagement, establish complete applications earlier and preserve detailed administrative records.

Transmission owners, generators, utilities, distributed-resource providers and data center developers would face proceedings at Federal Energy Regulatory Commission (FERC). The statutory direction is substantial, but many commercial effects – including tariff design, cost allocation, interconnection procedures and market-participation rules – would turn on subsequent regulations and compliance filings.

Tribal, state and local governments would have to operate within shortened review and response timeframes and more precisely drawn roles for participation in decision-making. Tribal government-to-government consultation is melded into the public engagement procedures offered all other governmental and non-governmental interest groups. Specific protocols are provided for projects on reservations and other Indian lands.

Division A: Environment and Public Works

Title I: National Environmental Policy Act (NEPA)

Title I would substantially revise NEPA to make federal environmental reviews more standardized, coordinated and time-limited. The bill clarifies that NEPA is a procedural statute rather than a mandate for particular environmental outcomes, narrows the definition of "major federal action," expands and facilitates the use of categorical exclusions and existing programmatic reviews, and directs agencies to update their NEPA procedures and adopt standardized electronic review tools. It also establishes clearer lead and cooperating agency responsibilities, deadlines for reviews and application completeness determinations, and mechanisms for resolving interagency disputes.

This title also would reshape NEPA litigation by establishing a 150-day limitations period, generally tying eligibility to challenge a review to participation in the administrative process and favoring remand to the agency rather than vacatur when a court identifies deficiencies. Additional provisions extend the presumptive usefulness of programmatic environmental documents from five years to 10 years, strengthen federal permitting transparency through an online tracker, and authorize new funding for Council on Environmental Quality and permitting improvements.

Title II: Clean Water Act (CWA)

Title II would streamline several CWA permitting and review processes. It requires the U.S. Environmental Protection Agency (EPA) to use rulemaking procedures when developing Section 304(a) water quality criteria and gives federal circuit courts original jurisdiction over challenges to the definition of "waters of the United States." For Section 401 certifications, the bill narrows review to applicable water quality requirements, establishes application and prefiling procedures, provides for a waiver when deadlines are missed and imposes additional requirements on certification denials and conditions. Interstate transmission lines and natural gas pipelines would receive additional procedural protections, including a review focused on direct point source discharges and a deadline of no more than nine months.

The title also extends National Pollutant Discharge Elimination System permit terms and Section 404 general permits from five years to 10 years, limits EPA's Section 404 veto window and directs nationwide permitting for certain linear infrastructure, including electric utility and telecommunications lines. Judicial challenges to specified Section 404 actions generally would be subject to a 150-day filing period and administrative record requirements, with courts ordinarily remanding deficiencies rather than disrupting an existing permit unless the activity presents an imminent and substantial danger to human health or the environment for which no other equitable remedy is available.

Title III: Endangered Species Act (ESA)

Title III would revise ESA procedures by defining standards for the "best scientific" data, accelerating Section 7 consultations and more closely coordinating ESA and NEPA reviews. For projects undergoing NEPA review, consultation generally would need to conclude by completion of the NEPA document absent specified extraordinary circumstances. The title also exempts certain activities in operational transportation rights-of-way, creates a program under which qualified states could assume specified Section 7 responsibilities and establishes a 150-day limitations period for challenges to biological opinions.

The title further directs federal agencies to incorporate qualifying state-collected data into listing and delisting decisions and provides additional resources for implementation. It authorizes $150 million annually for fiscal years (FY) 2027 through 2031 to support Section 7 consultations and state participation and establishes a National Fish and Wildlife Foundation coastal-state grant program authorized at $50 million annually for FYs 2028 through 2032.

Title IV: Project Certainty

Title IV is designed to increase the durability and predictability of federal permits. It generally restricts agencies from rescinding, suspending or materially altering permits in effect on or after September 16, 2026, except under specified circumstances such as court orders, legal violations, fraud or urgent harm. Agencies would bear a heightened evidentiary burden for covered actions, while affected project sponsors could seek remedies, including reinstatement, attorneys' fees, delay costs and certain damages.

The title also establishes a one-year decision deadline for covered energy and natural resource authorizations that do not require an environmental assessment or environmental impact statement, and creates judicial remedies for improper delays and intentional, empirically demonstrated patterns of disparate treatment against specific types of covered projects. Covered projects span a broad range of energy and natural resource technologies, including renewable and conventional generation, nuclear energy, transmission, pipelines, mining, storage and carbon management.

Division B: Energy and Natural Resources

Title I: Electric Transmission

Title I would make significant changes to federal transmission siting, planning, cost allocation and interconnection. It expands FERC's backstop siting authority for qualifying interstate transmission projects without requiring a prior National Interest Electric Transmission Corridor designation and makes FERC the NEPA lead for covered projects. The title also streamlines qualifying grid upgrades and certain pipeline work in existing rights-of-way; requires regional and interregional transmission planning using common assumptions, benefit metrics and cost-allocation standards; strengthens oversight of local transmission planning; limits federal rights of first refusal; and directs FERC to better integrate long-term transmission planning with generator interconnection.

The title also addresses emerging grid demands and technologies. It directs FERC to revise transmission pricing for computational loads while establishing separate state-level protections for data center and high-density computing loads of at least 20 megawatts; expands wholesale market access for qualifying aggregations of dispatchable behind-the-meter resources; promotes advanced transmission technologies; and directs greater use of automation, artificial intelligence and machine learning in interconnection studies. Additional provisions improve access to grid data, support FERC and Power Marketing Administration institutional capacity and preserve state jurisdiction over retail sales and local distribution.

Title II: Energy Permitting

Title II would streamline permitting and judicial review across a broad range of energy and natural resource projects. It establishes a 150-day limitations period for challenges to covered energy, mining and forest management authorizations and expedites judicial and agency action on remand. For federal onshore energy, the title reduces federal drilling permit requirements in specified circumstances involving wells on nonfederal land, expands Tribal authority over rights of way, establishes deadlines and categorical exclusions for renewable energy projects, facilitates grid and storage development on existing or disturbed sites, and modifies hardrock mining and abandoned mine reclamation provisions.

The title also contains targeted reforms for geothermal, hydropower and offshore energy. Geothermal provisions expand categorical exclusions, modify royalty treatment, require lease sales and permitting deadlines, and establish an ombudsman and interagency task force. Hydropower provisions address licensing conditions, routine maintenance, emergency operations and expedited licensing for qualifying micro-hydrokinetic projects. Other provisions expand FERC hiring and retention authorities and facilitate offshore electricity transmission, including rights of way through national marine sanctuaries and coordinated federal planning for offshore transmission routes.

Title III: Historic Preservation

Title III would revise the National Historic Preservation Act review process by narrowing and clarifying key definitions, establishing staged deadlines for identifying historic properties and consulting on project effects and more closely aligning historic-preservation consultation with NEPA schedules. It preserves formal consultation roles for state and Tribal historic-preservation officials, Tribes and Native Hawaiian organizations while establishing clearer procedural boundaries and a 150-day limitations period for judicial challenges, with remand generally favored over vacatur or injunction.

The title also strengthens federal oversight of state and Tribal historic preservation programs through recurring evaluations and audits and authorizes consequences for unresolved deficiencies. Separately, it authorizes $200 million annually for the Historic Preservation Fund through FY 2036 and $20 million annually for FYs 2027 through 2030 for Tribal Historic Preservation Officer database grants while protecting confidential information concerning culturally significant properties.

What's Next

The legislation was introduced on September 30, 2026, and the Senate recessed that evening. The Senate is expected to take up this legislation after the midterm elections. On November 9, 2026, the Senate will proceed to a roll call vote on the motion to invoke cloture on the motion to proceed to the legislative vehicle to permitting reform – the first step in the floor process. Near-term items to watch include potential amendments, U.S. House of Representatives engagement, and whether the package moves independently or as part of larger year-end package.

Holland & Knight Can Help

Holland & Knight's Energy and Natural Resources Team is monitoring this legislation, as well as its potential implications for energy, infrastructure and natural resource clients, and will provide updates and further analysis. If you have questions about the potential impact to your business, contact the authors or another member of the team.

Information contained in this alert is for the general education and knowledge of our readers. It is not designed to be, and should not be used as, the sole source of information when analyzing and resolving a legal problem, and it should not be substituted for legal advice, which relies on a specific factual analysis. Moreover, the laws of each jurisdiction are different and are constantly changing. This information is not intended to create, and receipt of it does not constitute, an attorney-client relationship. If you have specific questions regarding a particular fact situation, we urge you to consult the authors of this publication, your Holland & Knight representative or other competent legal counsel.