The Trump administration Council on Environmental Quality (“CEQ”) promulgated final rule with the most sweeping changes to the regulations since the CEQ initially promulgated them in 1978. Many of the changes are welcome and will improve the environmental review process under the National Environmental Policy Act (“Act”). But some are highly controversial and appear to undermine NEPA’s goal of placing consideration of a project’s environmental effects on the same level as economic and other considerations.
President Nixon signed NEPA into law on January 1, 1970. Although the Senate sponsor hailed the law upon enactment as “the most important environmental statute ever enacted,” the statute is skeletal in nature and lacks detail. Theodore J. Lowi, a professor of government at Cornell University, in his 1971 book The Politics of Disorder opined that “NEPA states a whole lot of lofty sentiments . . . but there is no law to be found anywhere in the act.” For the NEPA’s first eight years, there were no regulations construing the statute, but there were numerous federal court decisions, including United States Supreme Court decisions, interpreting the law. In 1978, the CEQ promulgated a comprehensive set of regulations governing federal agency implementation of NEPA which largely codified federal decisions in the statute’s first eight years. CEQ has issued numerous guidance documents on statutory implementation since 1978 but has made only limited modifications to its NEPA rules.
The Trump administration’s final rule changes all that. The final rule makes substantial and substantive modifications to virtually substantially every significant CEQ rule. Many of the modifications will improve a NEPA environmental review process that often takes too long and costs too much. For example, the final rule establishes a presumptive time limit of two years for the preparation of environmental impact statements (EISs) and one year for the preparation of environmental assessments (EAs), and presumptive page limits. The presumptive time and page limits, which federal agencies may modify for more complex projects, should encourage more efficient action by agencies. Where NEPA review of a single project involves multiple agencies, which is common for larger projects with a number of environmental permits and approvals, the new rules require federal agencies to establish joint schedules, prepare a single EIS, and issue a single record of decision approving the EIS, where appropriate. Lead federal agencies also will have a stronger role in resolving disputes with other agencies cooperating in the NEPA review process. And the rules should reduce duplication by facilitating use of documents prepared by State, Tribal and local agencies to comply with NEPA..
But certain provisions in the new rule appear to undermine NEPA. The most significant change in the CEQ rules is the modification of the definition of the term “effects.” The term is undefined in NEPA’s statutory language but the former CEQ rules defined both direct and indirect effects. The former rules also required an evaluation of “cumulative impacts,” which it defined as a project’s incremental impact “when added to other past, present, and reasonably foreseeable future actions . . . .”
The new CEQ rule no longer expressly eliminates cumulative impact analysis, as did the proposed version of the rule published for public comment in January 2020. But the final rule still eliminates the distinction between “direct” and “indirect” effects, and repeals the “cumulative impact” definition. In place of the former definitions, the new CEQ rule requires analysis of only those “effects” that are reasonably foreseeable and have a reasonably close causal relationship” to the proposed action. In making these changes, the new rule appears to be an attempt to narrow the scope of NEPA analysis and potentially eliminates the need to assess climate change in NEPA reviews. Although numerous federal courts hold climate change must be a part of a NEPA review, CEQ claims it may change the rule because “the terms direct and indirect effects[,] and cumulative impact do not appear in the statute and thus their use is not required by NEPA.” CEQ Response to Comments at 465. That conclusion is certain to draw a legal challenge.
NEPA Roll Back Changes Construction Permitting
There are two significant changes under the rule which, although controversial, appear to be consistent with NEPA’s purpose of placing environmental considerations on the same level as economic and other considerations ensuring. The first would allow project proponents to assume a greater role in preparing EISs with appropriate disclosure of financial or other interests and with supervision and independent evaluation by the agency.
CEQ’s former rules allows project proponents to provide information for an agency’s use in NEPA reviews and prepare an EA, but prohibited a project proponent or its contractor from preparing an EIS. Some critics allowing project proponents to actually draft some or all of an EIS, which federal agencies would then independently evaluate, is like the “fox guarding the chicken coop” or the “fox guarding the hen house.”
In reality, the change in the final rule simply extends to the EIS the flexibility project proponents have long had in preparing EAs. The process has worked well for EAs and should also work well in preparing EISs, so long as federal agencies carefully evaluate the project proponent’s work product and conduct an independent evaluation of the draft EIS analysis. Public comment on an EIS remains unchanged and provides the public with the ability to submit information criticizing the work of the federal agency. The comment public process should ensure agencies do not act as mere rubber-stamps for EISs, just as it has in the EA process.
A second controversial change in the new rule that appears consistent with NEPA’s purpose is the change in the definition of “major federal action.” NEPA’s statutory language requires a “detailed statement” for “major Federal actions significantly affecting the quality of the human environment,” but does not define the term “major federal action.” Although the CEQ rules offered a definition in the 1978 rules, federal courts have continued to struggle with when NEPA applies. Known as the “small federal handle” problem, the analysis focuses on how much federal funding or control “federalizes” a project and triggers NEPA review. The new rule attempts to resolve the issue by stating NEPA does not apply where a federal agency’s role involves “minimal” federal funding or control. According to the CEQ response to comments on the draft rule, this changes codifies case law distinguishing the federal role (that is, the “major federal action”) from a proposed project’s degree of environmental effects. Other cases that focus on the consideration of effects before determining NEPA does not apply are wrongly decided, according to the CEQ. The clarification in the new CEQ rule may make resolving the issue a bit easier for the courts.
Given its sweeping changes, the new CEQ rule revisions will be challenged. However, those challenges will face some unusual hurdles. Under the NEPA statute, federal agencies to must report the environmental impacts of their actions that significantly affect the quality of the human environment. NEPA’s statutory language commands virtually nothing else. To prevail in a challenge of the new CEQ rules, litigants will have to establish the changes are inconsistent with a law force federal agencies to alter environmental review such that it no longer meets the a statute that Professor Lowi described as having “no law to be found anywhere in the act.