Chamber Foundation report finds Minnesota air and water permits far slower than peers; recommends faster timelines and greater transparency

The Minnesota Chamber Foundation told the House Environment and Natural Resources Policy and Finance Committee that significant delays in state environmental permitting are costing the state investment and jobs.

The foundation’s executive director, Jennifer Byers, introduced the study and said the research was intended to add data to a long-running concern from businesses and site selectors that Minnesota’s permitting process discourages investment. “Our flagship report is called Minnesota 2030,” Byers said, describing the Foundation’s work before turning the presentation over to a coauthor of the technical analysis.

The technical presentation, led by Sean O'Neill, summarized permit data compiled by Barr Engineering and economic estimates by Policy Navigation Group. The report distinguished between MPCA’s tier 1 permits, which have a 90-day agency goal and are generally routine, and tier 2 permits, which are facility-specific, carry public comment periods and have a 150-day goal.

O'Neill said most tier 1 air permits were issued rapidly—the median was 29 days—but tier 2 air permits often took many times longer. Between 2018 and 2023 he reported median times for tier 2 air permits in priority cases ranging from 419 to 771 days, with a median of 351 days and an average of 586 days. For non-priority tier 2 air permits he said the median was 887 days and the mean approximately 1,300 days.

Comparing federal air permits across peer states, the report found Minnesota’s average timelines were 1.5 to 6 times longer than several peers. O'Neill said states such as Iowa and Illinois averaged about 110 days while Minnesota averaged 656 days in the same five-year comparison. Policy Navigation Group estimated that reducing Minnesota’s timeframes to peer levels could raise annual output by an estimated $260 million to $910 million and create an additional 960 to 34,100 full-time-equivalent jobs annually, figures O'Neill described as model-based estimates rather than precise counts.

The researchers also examined water permitting and found similar timeline challenges for tier 2 industrial water permits, though those permits were less frequent. From 2018 the agency received only 15 priority industrial water permit applications; of those, three met the 150-day goal. Barr Engineering reported the average issuance timeframe was 377 days for major modifications and 476 days for new permits. The team also identified 152 administratively continued water permits as of Q3 2023, with those permits extended an average of 6.6 years—nearly twice the average reported for other states.

The report’s three primary recommendations were: (1) reduce issuance time for priority tier 2 air and water permits toward the 150-day goal, (2) address backlog of permit renewals and minor modifications, and (3) increase transparency and collaboration with applicants. O'Neill highlighted potential reforms such as separating construction and operating permits (a model used in several peer states) and restructuring the state’s expedited permitting option to make it more accessible and trackable.

Committee members asked clarifying questions about which businesses typically need tier 2 permits and how the authors engaged state officials. Byers said the Foundation had briefed and met with the Minnesota Pollution Control Agency and had taken the study to the governor when it was released. O'Neill cautioned that estimated economic impacts were based on multipliers and acknowledged uncertainty in precise counts. “It’s hard to get a precise number,” he said, noting the estimates are intended to illustrate scale rather than provide a definitive lost-job tally.

The full technical report and supporting slides were made available by the Minnesota Chamber Foundation and its contractors; committee members and the public were invited to review the underlying data and recommendations.