OPINION:
Imagine investing $100 million in land, infrastructure and environmental restoration only to be told years later that the federal government has changed its mind and your permit no longer counts. That’s not a business risk. It’s a failure of the rule of law.
Federal permitting reform is usually framed as a question of efficiency: Why do approvals take so long, and how can agencies move faster? Yet recent bipartisan permitting talks have shown that the problem is not just efficiency but also certainty.
Even when permits are issued, the government often retains broad discretion to revoke them, grinding projects to a halt and stranding investments. Rather than providing the security of property rights or an enforceable contract, federal permits can be more of a promise from one whose fingers are crossed behind their back.
This reality was on display in a recent case far removed from the infrastructure and energy projects that are the usual grist of permitting reform talks. In January, the Bureau of Land Management announced it was canceling permits that allowed American Prairie to graze bison on federal land in central Montana. American Prairie is a conservation group that purchases private ranches from willing sellers and raises native, privately owned bison.
Because the Western range is dominated by federal land, the operation depends on having access to that land to graze their animals, just as all their neighboring ranchers do. The bureau has permitted bison grazing for half a century and has issued permits for American Prairie to graze bison for nearly 20 years.
Relying on those permits, the group has invested more than $100 million in ranches, environmental restoration efforts and public educational and recreational facilities.
Despite its commitment to property rights and voluntary conservation, American Prairie has been a political lightning rod for Western ranchers who view the project as a threat to their way of life.
Bowing to pressure, the Interior Department took the unusual step of reassigning an appeal over American Prairie’s permit from an impartial administrative law judge to a political actor. The agency then promptly rescinded the permits on the basis of a novel and tendentious interpretation of a 90-year-old statute.
Compounding the injury, the agency says American Prairie should go back before the administrative law judge and spend years more in limbo before an independent court can even consider the group’s plight.
In effect, the government claims it has the power not only to revoke long-standing permits but also to do so without timely judicial review and without consequence.
American Prairie’s experience is an important reminder that the consequences of a broken federal permitting process fall on everything the federal government touches, which, unfortunately, is far from limited. Homebuilders, Western water users, and communities exposed to fire risk from mismanaged forests, just to name a few, depend on federal permitting processes not only to be efficient but also reliable.
The law generally provides robust protections for property rights and contracts because it’s usually most important to have a clear, reliable answer to the question of who has what rights and duties to whom. Even if a better answer is discovered, the benefits would be swamped by the consequences of allowing a state of perpetual uncertainty.
In that world, every investment would be a pure gamble rather than a calculated risk.
Permit certainty would extend this logic to the government as well. Agencies should step in when someone violates a permit and causes public harm. They should not be able to revoke existing permits for mere policy or political reasons. No project that requires a big or ongoing investment can proceed under such an arrangement.
Even environmentalists skeptical of permitting reform should embrace permit certainty. After all, conservation is rarely a one-off. Managing forests, restoring wetlands and recovering wildlife require big, ongoing effort and investment. When private, voluntary conservation moves in fits and starts in response to political winds, the environment suffers.
For American Prairie and other Western ranchers, permit certainty would mean that decades-old grazing privileges on federal land are honored as valid property rights. The market already treats them that way. When a ranch is sold, the grazing privileges that come with it are priced into the value of the land.
Yet federal permitting law largely disregards the reliance interests underlying that private investment. Fixing this would benefit not just American Prairie but also every ranching family that has relied on access to this land for generations.
Ultimately, allowing agencies to revoke permits without consequence makes political reversals artificially cheap. Requiring permits to be honored, or their revocation to be compensated, would force the administrative state to internalize the costs of its decisions. That discipline is essential to a permitting system governed by law rather than discretion.
• Jonathan Wood is the vice president of law and policy at the Property and Environment Research Center in Bozeman, Montana.
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