When you receive federal funding, it can feel like you’ve crossed the finish line. Environmental compliance can feel like an unexpected second race.
Being selected for federal funding often feels like crossing the finish line. The project has been awarded, the community benefit is clear, and it seems like the hardest part is over. What many grantees do not anticipate is the environmental review process that follows, bringing federal, state, and local requirements together, along with public input and timelines that can feel longer than expected. This gap between expectations and reality can be frustrating. Understanding why these steps exist and how they fit together does not eliminate the process, but it does give grantees practical ways to navigate it more effectively and move projects forward with fewer delays.
Federal funding does not move directly to implementation or construction. For most federally funded projects, agencies must complete environmental review under the National Environmental Policy Act (NEPA) before final decisions are made or funds are fully committed.
This article is not a primer on NEPA. Instead, it focuses on the practical missteps that tend to delay projects, and the patterns we have seen over 25 years of working with federally funded work.
Federal, state, and local reviews have different jobs
One of the most common sources of frustration for grantees is navigating environmental review at the federal, state, and local levels at the same time. While these processes can appear duplicative, they answer different questions and are rooted in different legal authorities.
- Federal – At the federal level, environmental review under NEPA informs whether and how a federally funded project should move forward by evaluating potential impacts on the environment and surrounding community. Depending on the project, this review may involve different levels of analysis and incorporates compliance with other applicable federal environmental requirements as part of the overall funding decision.
- State – At the state level, review may include a state environmental review process (often similar to NEPA), state permits, or both, depending on the project and the state’s requirements. These reviews focus on compliance with state environmental laws and resource protections.
- Local – At the local level, governments are typically focused on land use, zoning, and local permits, which determine how and where a project can be built within the community.
No single review replaces the others because each level of government is making its own legally required decision.
Understanding these distinct roles early allows grantees to plan more effectively, streamline information sharing, and reduce avoidable delays.
Parallel reviews do not have to happen in silos
While federal, state, and local reviews serve different purposes, they do not always need to operate in isolation. In some cases, information developed for one review can help inform another, even when each agency is making its own decision.
This does not mean that one review replaces another. However, when agencies are aware of what analyses or documentation already exist, unnecessary duplication can often be avoided.
Grantees who communicate early and often about parallel reviews are better positioned to align assumptions, share background information, and anticipate what will be needed next. That coordination can make a meaningful difference in how smoothly a project moves forward.
When more than one federal agency is involved
Some projects receive funding from more than one federal agency. Even though each agency has its own environmental review responsibilities, there may be opportunities for those agencies to work together rather than running entirely separate reviews.
In some cases, agencies can coordinate their review efforts. In others, a later-funding agency may be able to rely on an analysis that has already been completed.
For grantees, the most important step is communication. If multiple federal funders are involved, it helps to make each agency aware of the others early and encourage communication between them. Raising this issue early during the grant application or award phase can reduce unnecessary duplication and help keep the project moving forward.
NEPA and permitting are not the same thing
One of the most important distinctions for grantees is between federal environmental review under NEPA and permitting, which are often confused but serve different roles in project development:
- Federal environmental review under NEPA evaluates whether and how a federally funded project should move forward, including its potential effects on the environment and the surrounding community. It supports federal decision making before project details are finalized.
- Permitting, which may occur at the federal, state, or local level, authorizes how a project is built and operated and confirms compliance with specific technical and regulatory requirements.
NEPA review typically comes first so that permitting and final design are based on an informed federal decision, rather than assumptions that may need to change.
Why you usually cannot push design or permitting early
This distinction explains a common point of frustration for grantees. While environmental review under NEPA is underway, it can feel logical to push ahead with full design or begin securing permits to save time.
In most cases, that is not feasible. Federal environmental review is intended to occur before full design and permitting so that decisions are informed by impacts, not locked in by sunk costs. Permitting often requires a level of project detail that is intentionally avoided early in the NEPA process, and federal agencies generally limit how much funding can be spent before environmental review is complete.
If the outcome of the environmental review changes how a project moves forward, early design or permitting work may need to be revisited or abandoned altogether.
The avoidable mistake that resets projects
One of the most avoidable ways projects get delayed is when key project details change after environmental review is already underway.
Environmental review is based on the project as it is proposed at the time. When budgets, designs, or major elements shift later, earlier analysis may no longer apply and may need to be revisited or redone.
This often happens when initial proposals are ambitious, costs rise due to inflation or market conditions, or funding assumptions do not hold. Taking the time early to confirm that the proposed project is realistic and supported by available funding can prevent costly resets and protect the environmental review work already completed.
What successful grantees understand
When environmental review is approached with realistic expectations and early coordination, it does not have to be a barrier to progress.
Grantees who clarify project details upfront, communicate openly about parallel reviews, and understand how environmental review fits into the broader project timeline are better positioned to move efficiently from award to implementation.
The most successful projects are not the ones that rush past these steps, but the ones that use them to make informed decisions, avoid costly missteps, and deliver lasting benefits to their communities without unnecessary delays or resets.
About The Clark Group
For more than 25 years, The Clark Group has led environmental compliance efforts for federally funded projects across the United States. In addition to preparing environmental documentation and coordinating federal, state, and local consultations, we have developed NEPA procedures and guidance for federal agencies. Our experience spans both implementation and policy development, giving us a practical understanding of how environmental review works in real-world project settings.