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NEPA Environmental Compliance in a Wireless World: A Growing Concern for a Maturing Industry

Terracon Cell TowerSince the late 1990s, cell phone usage and wireless data transmittal have increased exponentially, impacting many American lives in a profound way. For example, the National Economic Council reports that today, 268,000 people are directly employed in the U.S. wireless industry with another 2.4 million American jobs directly or indirectly dependent upon it. This number is up from 54,000 in 1993. The data show that wireless communication has redefined the American economy. While the industry may have taken a permanent place in American life and business, it will continue to mature and change.

With the growth over the last 20-plus years, wireless carriers and tower companies have met high customer demand by building billions of dollars of wireless infrastructure. Each year since the 1990s, carriers worked to add thousands of new wireless “cells” on properties across the nation. Today, this build-out phase has slowed, and ownership of cell tower assets is shifting. For example, we are beginning to see real estate investment trusts (REITs) invest in tower site assets as an example of this shift.

The trend means that as real estate buyers and sellers add tower sites to their portfolios, they face a host of regulatory compliance requirements with which they may not have much experience. In addition to traditional real estate due diligence tools such as Phase I environmental site assessments, real estate assets that include cell towers have another environmental compliance component: the National Environmental Policy Act (NEPA).

About NEPA
NEPA is the basic national charter for protection of the environment. It requires all federal agencies to implement procedures that make environmental consideration a necessary part of the decision-making process. The Federal Communications Commission (FCC), a government agency bound by NEPA, is responsible for issuing wireless frequency licenses.

NEPA requires that for every cell site construction project there must be a review of potential impacts to the environment. The FCC complies by requiring licensees and the tower owners who rent space to licensees to conduct these reviews prior to initiating construction activities.

As with any project construction obligation, NEPA compliance issues take some time. The impact they have on schedules and budgets, however, can be short-term. Owners should recognize that properly documented NEPA compliance can increase the underlying value of these real estate assets – a significant factor for owners who may consider future marketplace transactions.

NEPA: Minimum Requirements?
Prior to the construction of wireless facilities, including phone, radio, television, or any site utilizing wireless frequencies regulated by the FCC, NEPA review guidelines require consideration and documentation of potential impacts to the following environmental areas of concern.

  •     Officially designated wilderness areas
  •     Officially designated wildlife preserves
  •     Threatened and endangered species and critical habitats
  •     Buildings, districts, sites, or objects significant in American history, architecture, or archaeology
  •     Native American religious sites
  •     Flood plains
  •     Wetlands and deforestation
  •     The use of high-intensity white lights in residential neighborhoods
  •     Radio Frequency (RF) exposures

The FCC expects compliance with NEPA rules. If a site houses a wireless facility, lack of compliance or proper documentation may adversely impact construction performance criteria as well as the underlying real estate value.

A reputable, experienced environmental consultant can help clients in the wireless sector properly comply with NEPA regulations and even provide sound recommendations if any of the nine NEPA areas of concern become a factor in proposed tower construction. As wireless facilities become more common in real estate transactions, buyers and sellers should seek assistance from a professional they can trust to navigate NEPA compliance for a positive outcome.

ESA compared to NEPA
Terracon provides Phase I environmental site assessments (ESA) to real estate owners who choose to complete due diligence. On the other hand, National Environmental Policy Act (NEPA) services are for real estate owners who must comply with NEPA rules and regulations. Cell site tower owners fall into this category.

NEPA reviews identify issues which may significantly affect the environment, reaching beyond Phase I ESA concerns and encompassing broader-reaching issues such as floodplains, wetlands, and more (see article for a complete list).

The major difference between Phase I ESAs and NEPA reviews stems from this: The law requires NEPA review documentation for a “federal undertaking,” which is any project that utilizes federal funding or licensing. The law does not require a Phase I ESA. Telecommunications towers require a license from the Federal Communications Commission (FCC) and are, therefore, bound by NEPA .

Many smaller projects now require NEPA review
Most construction project management teams are aware of NEPA requirements as they apply to large construction projects (i.e., dams, highways, pipelines, and rail projects). Not everyone is thinking of federal involvement in smaller projects like cell towers. As a result of more-recent federal fiscal policies meant to stimulate the economy, many smaller construction projects are falling under the NEPA review process. In recent years, the Department of Housing and Urban Development, the Federal Emergency Management Agency, the Department of Homeland Security, and the Rural Utility Service have all been much more active in funding or oversight of construction projects, which is triggering more NEPA reviews of smaller projects.