Permitting Reform Key to a More Prosperous Pennsylvania
By Luke Bernstein
In recent years, a leading manufacturing company headquartered in Pennsylvania was exploring locations for a $3 billion expansion that would support 900 jobs with an average salary in the six figures.
Many states competed for the project. Ultimately, Arkansas landed the investment due to its “combination of public and private support, logistics and energy supply, and workforce availability,” according to the company.
This raises the question: Why not Pennsylvania? After all, the Keystone State has world-class logistics, a prolific energy supply, and an abundant workforce.
Pennsylvania fell short of Arkansas – and continues to lag too many other states – because of our antiquated and uncompetitive regulatory structure.
As Asa Hutchinson, then Arkansas’s governor, said, the facility would be built in his state “before you could ever get a permit to even start construction in Pennsylvania.”
For Pennsylvania to be competitive on the national and world stage, this has to change.
Pennsylvania’s permitting process needs significant improvement. Long delays and a lack of predictability in permitting often lead to slow-going infrastructure development and financing for all manner of public and private projects, and even causes Pennsylvania to be dropped from consideration for site selection.
Members of both political parties should agree that Pennsylvania losing economic opportunity due to red tape and unwarranted regulations is unacceptable. Policymakers should come together behind a common agenda of supporting jobs and economic growth – and that means reforming our permitting process.
Fortunately, the effort to advance permitting reform is already gaining bipartisan support. Republicans like state Sen. Kristin Phillips-Hill have authored several bills that would streamline the regulatory process. Democrats have indicated interest as well, including Gov. Josh Shapiro, who recently signed two executive orders aimed at expediting licensing and permitting reviews.
I was pleased to represent Pennsylvania’s business community and speak at the governor’s press conference announcing the first executive order, which created the Pennsylvania Office of Transformation and Opportunity. Rather than making businesses go to multiple agencies for permits, approvals, and to apply for funding, this office’s goal is to serve as a one-stop shop for firms looking to invest and grow in the state.
And, importantly, it will be led by the newly appointed Chief Transformation and Opportunity Officer, Ben Kirshner, who has significant private-sector experience.
The second executive order also seeks to reduce the permitting and licensing process time. Effective January 31, state agencies will have 90 days to compile and send the Governor’s Office a catalog of the licenses, certificates, and permits they issue, at which point the administration will review, analyze, and establish efficient application-processing timelines for all occupational permits or licenses based on agency recommendations – with a money-back guarantee if the application is not processed in time.
These executive orders are a great starting point, and the Pennsylvania Chamber of Business and Industry applauds Gov. Shapiro’s decisive action in prioritizing these critical areas early in his administration.
Lawmakers should build on the momentum the governor has started by codifying the programs his administration has established so that they are sustainable and have the power of law.
To provide further certainty to businesses looking to invest and hire here, the legislature should advance additional reforms, such as ruling applications “deemed approved” if an agency fails to meet a required deadline and allowing for third-party review of permit applications. These actions, versions of which have passed the state House or Senate in past sessions, would boost Pennsylvania’s competitiveness, creating a more responsive state government that supports economic growth.
State agencies also have an important part to play in enacting reform. With substantial investments from recent federal infrastructure and pandemic-recovery legislation, now is the time for the Department of Environmental Protection (DEP) and other state agencies to ensure they have the staffing and resources to review and issue permits in a timely manner.
Moreover, further improvements in the permit-review process, including providing certainty to state agencies through legally durable decisions and limiting the ability of courts to award attorney’s fees, are necessary to steward the state’s resources. In addition, we recommend streamlining the permit appeals process. Any interested party should always have the opportunity to provide comments and have their input reviewed by the DEP.
This process would mirror how federal appeals are managed and would give the business community and state agencies greater certainty that permitting decisions will not be subject to lengthy and spurious challenges filed with the goal of delaying a project.
These are not partisan issues; they are issues that will help Pennsylvania businesses invest, grow, and hire here, while attracting companies from around the world to do the same. Pennsylvania has so much potential. Enacting these commonsense permitting reforms would put us on a path to leadership in economic growth and prosperity.
Luke Bernstein is president and CEO of the Pennsylvania Chamber of Business and Industry.