Permitting Reform Bill Would Let Developers Sue Over Federal Delays

Infrastructure developers have long lamented when opponents use federal permitting laws to delay or block projects, but experience shows that the federal government can also often be the permitting bottleneck. A new bipartisan Senate proposal would create a new pathway to streamline this process, allowing certain developers to sue the federal government when it improperly denies or delays permits.

The Bipartisan American Affordability and Jobs Act of 2026, introduced on September 30, proposes broad changes to federal infrastructure permitting. Section 1402 covers specified energy projects, including electric transmission lines and pipelines carrying natural gas, oil, hydrogen, carbon dioxide, natural gas liquids, ammonia, produced water, or helium. It thus reaches much of the linear infrastructure used to move and deliver energy. It also reaches onshore and offshore wind projects. The bill remains pending in the US Senate.

A New Cause of Action for Infrastructure Projects

Federal permitting litigation traditionally runs in one direction: the government approves a project, opponents challenge the approval, and the sponsor defends it alongside the government. Section 1402 would create an affirmative claim for certain applicants harmed by discriminatory federal permitting practices. An applicant for a covered project could sue if the government improperly denied a permit or authorization because of an intentional “pattern of disparate treatment” against that type of project. A developer also could sue if such treatment delayed an authorization by more than 60 days beyond specified deadlines.

For covered projects that require federal authorization but not an environmental assessment or environmental impact statement, agencies generally would have to decide within one year after the latest covered application is deemed complete. Section 1403 creates a related avenue for judicial review when an agency misses that deadline. Together, the provisions would turn some permitting deadlines from management targets into enforceable constraints.

The Government’s Record Could Become the Evidence

Not every denial or delay would support a claim. Among other requirements, a developer would have to show that its application satisfies federal law and that a pattern of disparate treatment caused the denial or delay. The bill identifies empirical comparisons of permitting outcomes over time as potential prima facie evidence. It also allows executive branch statements, agency policies, executive orders, and other official guidance to show bias in the permitting regime.

That framework could matter most when federal policy changes. A new Administration may favor different approaches to pipelines, transmission, fossil fuels, renewable energy, and other infrastructure. Policy preferences are one thing; a pattern of disparate permitting decisions is another. Processing times, treatment of comparable applications, and official statements could therefore support an affirmative claim against the government — not merely help defend a permitting decision. The bill reinforces that point by requiring the government, after the specified prima facie showing, to produce raw data on permitting outcomes for that project type during the current and preceding five calendar years. Developers may therefore need to build an evidentiary record before a dispute arises — tracking historical outcomes, comparable projects, processing times, and policy shifts across Administrations.

Developers have successfully relied on Administrative Procedure Act claims and recently won preliminary relief on such claims against the federal government for pausing reviews of applications. However, this decision is subject to appeal and may not be the final word. This bill would add a new statutory claim to the developers’ arsenal with a set of specific remedies.

The Remedies Change the Risk

The remedies make the proposal unusual. A successful applicant could obtain injunctive relief, reasonable attorneys’ fees and costs, economic damages tied to the denial or delay, and an additional statutory award equal to 50-100% of the project’s reasonably expected construction cost. In setting that award, a court would consider government bad faith, similar federal interference, and the developer’s actual economic harm.

Those remedies carry substantial limits. An applicant must show the technical and financial ability to build the project, and a developer that receives relief generally must complete it after securing the necessary approvals or repay the award. Section 1403 offers a narrower remedy for missed deadlines on applications that require neither an environmental assessment nor an environmental impact statement: a court may grant injunctive relief, retain jurisdiction, and order a decision within 60 days. Section 1402 targets discriminatory permitting conduct with potential financial consequences; Section 1403 forces an overdue decision.

The Federal Government Could Face Permitting Risk

The proposal may matter most for linear infrastructure, where one project can depend on multiple government decisions along a single route. A transmission line or pipeline may have committed capital, assembled land rights, and negotiated commercial arrangements while still awaiting federal permits, rights-of-way, or other approvals. Delay of one critical approval can disrupt sequencing, financing, and the project’s overall viability. Importantly, the proposal relates mostly to federal permitting authorities; it includes the understanding that state and local permits may also be required before construction for some projects. 

Modern infrastructure projects cannot fully separate permitting risk from commercial risk. As we have discussed elsewhere, access to project critical systems and governmental construction authority can affect financing and execution. The proposal approaches that problem from the opposite direction. Sponsors would still face challenges to federal approvals, but they could gain a new tool when the government itself improperly denies or delays a decision.

Infrastructure developers have long asked what opponents might say to persuade a court to stop the government from approving a project. If enacted, the bill would flip that question: what happens when the government itself improperly says no or fails to answer on time?