Federal vs. State vs. Local: The Permitting Coordination Nightmare

The Three-Level Maze

Imagine you're developing a mixed-use project on a brownfield site near a wetland in a historic district. Here's what you might face:

Federal Level

EPA: Brownfield remediation approval, wetland impacts under Clean Water Act
Army Corps of Engineers: Wetland fill permits under Section 404
FHWA: Traffic impact analysis if federal highway funding is involved
Advisory Council on Historic Preservation: Section 106 review for historic properties
USFWS: Endangered species consultation if habitat is present

State Level

Environmental Agency: State environmental review (often in addition to federal NEPA)
State Historic Preservation Office: State historic review (coordinated with but separate from federal)
Transportation Department: State highway access permits
Water Resources Board: Water rights and stormwater management
Air Quality Division: Emissions permits for construction and operation

Local Level

Planning Department: Zoning approval, site plan review, design review
Building Department: Building permits, structural review
Fire Department: Fire code compliance, sprinkler requirements, access
Public Works: Utility connections, stormwater, sidewalks
Historic Commission: Local historic district review

That's potentially 15-20 different approvals from a dozen different agencies across three levels of government.

Where Things Go Wrong

Problem 1: Sequential vs. Parallel Processing

Ideally, reviews would proceed simultaneously—all agencies reviewing the same project at the same time, coordinating their requirements upfront.

In reality, many reviews are sequential. You can't get your building permit until you have zoning approval. You can't get zoning approval until environmental review is complete. You can't complete environmental review until historic and cultural resource review is done.

Each sequential step adds months. A process that could take 12 months in parallel often takes 30-36 months when strung out sequentially.

Problem 2: Conflicting Requirements

Different agencies sometimes impose contradictory requirements without realizing it:

Example 1: Historic vs. Energy Historic preservation rules require maintaining original windows with period-appropriate materials. Energy codes require high-efficiency glazing meeting current U-values. The original windows can't meet energy requirements; replacement windows won't meet historic standards. Resolution requires variances from both agencies—each with its own process.

Example 2: Fire vs. Accessibility Fire codes require certain door widths and swing directions for egress. Accessibility codes require different configurations for wheelchair access. Both can't always be satisfied with the same door configuration.

Example 3: Federal vs. State Environmental Federal environmental review concludes with a "Finding of No Significant Impact" based on federal criteria. State agency applies stricter state standards and requires a full state-level Environmental Impact Report.

Resolving these conflicts requires negotiation, variances, and creative solutions—all of which consume time and resources.

Problem 3: Different Timelines

Agencies operate on fundamentally different schedules:

Agency	Typical Review Time
Local building permit (simple residential)	2-6 weeks
Zoning/site plan approval	2-6 months
State environmental review	6-18 months
Federal NEPA review (EIS)	2-5 years
Army Corps wetland permit	6-18 months

When a fast process depends on a slow process, the slow process becomes the bottleneck for everything downstream. And the slow process may not know it's holding things up.

Problem 4: Incomplete Information Sharing

Agency A doesn't know what Agency B requires. So applicants submit documents to Agency A that don't include information Agency B needs. When Agency B reviews later, they request additional information—restarting the clock.

Common failure modes:

Applicant submits to federal agency; federal agency doesn't mention state requirements
State approval granted; local agency identifies conflicts not raised at state level
All approvals obtained; construction begins; different department identifies issue requiring redesign
Last agency in sequence identifies issue that would have changed earlier agency's decision

Problem 5: No Single Point of Accountability

When a project spans multiple agencies, no one is responsible for the overall timeline. Each agency manages its own queue without visibility into how their delays affect downstream approvals.

If federal review takes 2 months longer than expected, the state agency doesn't automatically adjust its schedule. The local agency doesn't know to prepare for delayed applications. The applicant is left to coordinate across all parties—often without authority to drive accountability.

Real-World Consequences

Case: The Multi-Year Delay

A renewable energy project on federal land required:

Bureau of Land Management approval
State environmental review
County conditional use permit
Interconnection agreements with the utility

The developer expected 24 months. Actual timeline: nearly 6 years.

Why? Federal review took longer than expected due to understaffing. State review required supplemental studies that took 18 months to complete. County approval was contingent on state completion. By the time all approvals were obtained, technology had evolved, requiring partial redesign and additional review cycles.

Case: The Conflicting Conditions

A mixed-use development received approvals from all agencies, but with conflicting conditions:

County required primary vehicle access from the north side for traffic flow
State transportation required access from the south side to protect a state highway intersection
City preferred pedestrian-only design with no direct vehicle access

Resolving the conflict required going back through all three review processes with a revised plan. Added timeline: 14 months and significant redesign costs.

Toward Solutions

Legislative Approaches

Recent legislation has attempted to address coordination challenges:

Fiscal Responsibility Act of 2023

Provisions for lead agency designation on complex projects
Requirements for concurrent reviews where possible
Established timeline targets for environmental review

State Permit Streamlining Initiatives Many states have created one-stop permitting offices or interagency coordination frameworks—with varying degrees of success depending on implementation.

Technology Approaches

Even without legislative reform, technology can improve coordination:

1. Unified Requirements Tracking Systems that map all applicable requirements—federal, state, and local—for a given project type and location. Instead of discovering requirements piecemeal, applicants see the full picture upfront.

2. Document Reuse Ensuring that information submitted to one agency is formatted for reuse by others. Environmental baseline data collected for federal review can automatically flow to state review in the required format.

3. Timeline Visualization Dashboards showing how delays in one approval affect downstream processes. When federal review slips, everyone can see the impact on state and local timelines.

4. Conflict Detection AI-powered analysis of requirements across jurisdictions to identify potential conflicts before they become problems. If historic requirements conflict with energy codes, flag it early so solutions can be developed upfront.

Process Approaches

Pre-application Coordination Bringing all relevant agencies together before formal application submission to identify issues, conflicts, and sequencing.

Consolidated Applications Designing application packages that satisfy multiple agencies simultaneously, reducing redundant submissions and the likelihood of inconsistent information.

Interagency Liaisons Designating specific staff to coordinate with counterparts at other levels of government, building relationships and institutional knowledge about how other agencies operate.

Our Perspective

Here's the uncomfortable truth: the coordination problem isn't primarily a technology problem. It's a governance problem. Different agencies have different mandates, different priorities, different legal authorities. They're not designed to coordinate seamlessly—they're designed to fulfill their specific statutory obligations.

But until governance catches up, technology has to bridge the gap.

"Atlas tracks requirements across all levels of government so nothing falls through the cracks. We can't solve the coordination problem, but we can make sure applicants and reviewers see the full picture."

When you can see all requirements in one place, you can:

Identify conflicts early before they cause delays
Plan for the longest lead-time items
Ensure documents satisfy multiple agencies
Track progress across all approvals simultaneously

It's not a cure for the coordination nightmare, but it's a significant improvement over navigating blind.

The Path Forward

Comprehensive permitting reform across all levels of government is a generational project. In the meantime, practical solutions exist:

For applicants:

Invest in comprehensive requirements research before starting
Build relationships with agencies at all levels
Use technology to track and manage multi-agency processes
Start early and build buffer time for coordination challenges

For agencies:

Communicate with counterpart agencies, even without formal coordination requirements
Standardize information requirements where possible
Adopt technology that provides visibility across agency boundaries
Participate in intergovernmental coordination initiatives

For policymakers:

Prioritize interagency coordination in reform efforts
Fund technology modernization that enables information sharing
Create incentives for agencies to coordinate, not just complete their own reviews
Consider one-stop models where appropriate

The three-level maze won't disappear, but with the right tools and approaches, navigating it becomes possible.

Binoloop's Atlas platform tracks permitting requirements across federal, state, and local jurisdictions. Our AI helps agencies and applicants see the complete picture, identify conflicts early, and manage complex multi-agency processes. Contact us to learn more.

References

Congressional Research Service. (2021). Interagency Coordination and Environmental Reviews. CRS Report R46616.
Government Accountability Office. (2020). Environmental Review: Agencies Could Improve Data Quality and Completeness of Information on Review Timelines. GAO-20-467.
Bipartisan Policy Center. (2022). Permitting for the 21st Century: Regulatory Framework for Infrastructure. https://bipartisanpolicy.org/
National Academy of Public Administration. (2018). Environmental Review and Permitting: Federal Approaches. NAPA Report.
American Bar Association. (2023). Section of Environment, Energy, and Resources: Interagency Coordination. ABA Publications.