Sept. 27, 2018

While this week’s headlines were dominated by the Senate Judiciary Committee’s hearing in which Dr. Christine Blasey Ford testified that she was sexually assaulted by Supreme Court nominee Brett Kavanaugh, House and Senate lawmakers were able to make some degree of progress in the legislative arena. 

For starters, the House overwhelmingly approved a fiscal year 2019 minibus spending package (HR 6157) for the Departments of Defense (DoD), Labor, Education, and Health and Human Services (HHS). The legislation now heads to the president’s desk for his signature.  Incidentally, passage of the Labor-HHS-Education bill represents the first time in over a decade that the departments have received a full year’s appropriation prior to the start of the fiscal year.

As reported in last week’s edition of The CSAC Bulletin, the Labor-HHS-Education title of the bill will provide approximately $178 billion in discretionary funding in fiscal year 2019, or a $1 billion increase over current spending levels. A number of HHS programs are slated to receive slight funding boosts, including a one percent increase to the Community Services Block Grant and the Low Income Home Energy Assistance Program. The Social Services Block Grant would continue to be funded at current levels. All three block grants were slated for cuts or elimination under the president’s budget proposal.  Notably, the minibus does not include any of the controversial policy riders that were approved in the House version of the bill. 

With the start of the new fiscal year just days away – and with a sizeable portion of the federal budget still unfinished – lawmakers had little choice but to include the text of a continuing resolution (CR) in HR 6157.  The CR will provide stop-gap spending authority through December 7 for all federal departments that have not received a full-year appropriation. In addition to the aforementioned DoD/Labor/HHS/Education package, Congress has cleared and President Trump has signed into law spending legislation for Energy & Water, Legislative Branch, and Military Construction-Veterans Affairs. Accordingly, the following appropriations bills are covered by the CR: Interior-Environment; Financial Services; Agriculture; Transportation-HUD; Commerce-Justice-Science; Homeland Security; and, State-Foreign Operations.

Lawmakers Finalize FAA Reauthorization Measure

House and Senate committee leaders recently announced that they had reached bipartisan agreement on legislation that will provide a long-term reauthorization of the Federal Aviation Administration (FAA).  The final bill (HR 302) was approved in the House on September 26 by a vote of 398-23, with floor action in the Senate expected in the coming days.

HR 302 represents the culmination of a multi-year effort aimed at renewing the nation’s aviation programs.  Last reauthorized by Congress in 2012, the FAA has been operating on a series of short-term extensions since 2015. Upon enactment, the legislation will provide five full years of programmatic and budgetary authority for aviation operations (through fiscal year 2023).

It should be noted that congressional leaders incorporated the text of several other key pieces of legislation into HR 302.  In addition to the aviation title, the bill includes, among other things, the Disaster Recovery Reform Act of 2018, a three-year Transportation Security Administration reauthorization, and a four-year renewal of the National Transportation Safety Board. The legislation also provides nearly $1.7 billion in emergency supplemental appropriations for hurricane relief and recovery activities.

Environmental Reciprocity

In a major victory for California’s counties, the FAA legislation includes language that will pave the way for California to take advantage of a new environmental reciprocity pilot program created by the Fixing America’s Surface Transportation (FAST) Act. The provision, championed by Representative Jeff Denham (R-CA) on behalf of CSAC, modifies the Statute of Limitations (SOL) for the program.

Pursuant to Section 1309 of the FAST Act, a select number of qualified states are authorized to participate in a DOT pilot program to conduct environmental reviews and make approvals for both state and local projects under State environmental laws and regulations instead of the National Environmental Policy Act (NEPA). The initiative would build upon California’s long-term and successful execution of the NEPA Assignment Program (23 USC § 327), which has allowed the State to assume FHWA’s environmental responsibilities for review, consultation, and compliance for Federal-aid highway projects.

It should be noted that the FAST Act affords potential litigants a two-year window to file a claim for judicial review of an agency action in connection with a Section 1309 project.  By way of comparison, federal law generally sets the SOL for other highway and transit projects at 150 days, while the California Environmental Quality Act provides a 30-day petition period.  The extended SOL under Section 1309 has effectively precluded states from pursuing participation in the new program because of the heightened litigation risks to state and local governments.

The final FAA bill revises the reciprocity program by bringing the SOL for covered projects in line with the judicial review requirements for other federal highway and public transportation projects (150 days). This modification will ensure certainty and predictability in the transportation decision-making process and will ultimately allow Caltrans to move forward with applying to DOT for inclusion in the program.

FAA Program Funding

HR 302 provides $3.35 billion annually in mandatory funding for Airport Improvement Program (AIP) construction grants, or level funding.  California’s counties rely on AIP grant funds to support critically important infrastructure and safety projects, including the construction and repair of runways, taxiways, and other airfield projects.

The bill also establishes a new discretionary infrastructure grant program for small and medium-sized airports located outside of large metropolitan areas. The measure authorizes $1.02 billion for the program in fiscal year 2019, with the funding level climbing to $1.11 billion in fiscal 2023.  Under the terms of HR 302, the federal share of the discretionary grant program will be capped at 80 percent.

In addition, the legislation authorizes increased discretionary funding for the Essential Air Service (EAS) program.  Currently funded at $155 million, the authorization for the EAS program will grow by $3 to $4 million annually, topping off at $172 million in fiscal year 2023. The bill also provides level funding – $10 million annually over five years – for the Small Community Air Service Development Program.

Finally, while a number of aviation stakeholders, including state and local governments, had called upon Congress to adjust the federal cap on passenger facility charges (PFCs), the final bill does not allow for an increase in the user fee. Airports use revenues from PFCs to fund various FAA-approved projects that enhance safety, security, or capacity, as well as to reduce noise or increase air carrier competition. The cap on PFCs has been set at $4.50 per flight segment since 2000, with airlines strongly opposing any increase in the fee.

Unmanned Aircraft Systems/Drones

HR 302 requires the FAA to develop a comprehensive strategy to provide outreach to state and local governments and provide guidance for local law enforcement agencies and first responders regarding how to identify and respond to public safety threats posed by Unmanned Aerial Vehicles (UAVs). Similarly, the legislation requires the agency to provide guidance to local agencies on how to identify and take advantages of opportunities to use drones to enhance the effectiveness of law enforcement agencies and first responders.

The bill also formally authorizes the Department of Transportation’s Unmanned Aircraft System (UAS) Integration Pilot Program (IPP).  Codification of the IPP will further promote the need to properly balance the roles of federal, state, and local governments in the regulation of low-altitude UAS operations, as well as assist DOT in expanding and implementing drones into the National Airspace System.

Disaster Recovery Reform Act of 2018

As previously stated, the final FAA bill includes the text of the Disaster Recovery Reform Act of 2018 (HR 4460). Among other things, the legislation will increase federal investment in pre-disaster mitigation activities, as well as boost the reimbursement caps for state and local governments on a range of disaster costs.

Notably, HR 4460 includes a section on wildfire prevention, which expands the availability of hazard mitigation assistance for areas that have been affected by a wildfire. The legislation also greatly expands the allowable uses of Section 404 hazard mitigation assistance to help prevent and contain wildfires.

In addition, the bill requires the Federal Emergency Management Agency and the Federal Highway Administration to develop new guidance for local governments to help improve disaster evacuation routes. In developing the guidance, the agencies will be required to consider the need to evacuate individuals with special needs, including residents of nursing homes, children in schools and day-care centers, and individuals with physical or mental disabilities.

Furthermore, the legislation directs FEMA to increase consideration of “local impact” when evaluating whether to recommend that an event be declared a major disaster.The bill also requires FEMA to coordinate emergency response plans with state and local governments and to provide enhanced training to state and local first responders.

Finally, HR 302 includes supplemental appropriations to assist “the most impacted and distressed” areas resulting from a major disaster declared in 2018. Specifically, the bill provides $1.68 billion for HUD’s Community Development Block Grant (CDBG) program. It is expected that most, if not all, of the available funds will be designated for ongoing disaster relief and recovery efforts associated with Hurricane Florence.

FCC Approves Small Cell Preemption Order

The Federal Communications Commission (FCC) approved this week a proposal that will curtail local control of public rights-of-way as it pertains to the deployment of 5G wireless telecommunications technology.  Many of the policies embodied in the Commission’s Declaratory Ruling and Third Report and Order are akin to the preemptions of local government authority that were unsuccessfully sought by the wireless telecommunications industry in California in 2017 (SB 649, Hueso)—including capped rates for pole attachments and limitations on reasonable local government review.

Approved by the Commission on September 26 on a 3-1 vote, the FCC’s order has been met by strong resistance from local governments.  For her part, Commissioner Jessica Rosenworcel, who dissented in part on the order, characterized the preemptive aspects of the FCC rule as “extraordinary federal overreach.”

Among other things, the FCC rule will provide localities with only 60 days to evaluate applications from companies for attaching 5G small cells to existing structures and 90 days for equipment on new structures.  Pursuant to the order, the newly prescribed shot clocks will encompass “all aspects of and steps in the siting process,” including but not limited to license or franchise agreements to access rights-of-way, building permits, public notices and meetings, lease negotiations, aesthetic approvals, and other authorizations needed for deployment of personal wireless services infrastructure.

Additionally, the Commission’s rule will institute a restrictive interpretation of “fair and reasonable compensation” for rights-of-way use, requiring that all recurring fees may not exceed $270 per small cell. The rule effectively preempts current local practices of changing wireless providers “rent-based” fees, which are based on a fair market value calculus.  Furthermore, the rule expressly prohibits local governments from recovering any cost not directly related to rights-of-way maintenance.

Finally, the rule will limit allowable local aesthetic requirements, including minimum spacing requirements, to those that are “reasonable, no more burdensome than those applied to other types of infrastructure deployments and published in advance.” The FCC notes that undergrounding requirements for wireless facilities would constitute an illegal prohibition of service by a local government.

The new FCC rules will go into effect 30 days after they are published in the Federal Register. Once implemented, local governments will be susceptible to enforcement action if wireless providers or other small cell applicants claim a local government is not in compliance with the new requirements.

Looking ahead, legislative options for overturning the FCC’s rules may be limited in the near term. A coalition of local governments, however, is expected to appeal the FCC’s order in federal court.