A decision issued in November by the D.C. Circuit Court of Appeals has created tremendous uncertainty for the future of regulating the National Environmental Policy Act (NEPA).
In Marin Audubon Society v. Federal Aviation Administration, a divided D.C. Circuit Court ruled that the Council for Environmental Quality (CEQ) was never granted the authority to promulgate regulations to implement NEPA.
“With many agencies explicitly incorporating the CEQ rules into their own NEPA regulations, the opinion not only calls into question the proper methods for NEPA analysis but also casts doubt on hundreds of completed and pending environmental reviews that have relied on the CEQ regulations,” according to law firm Sheppard Mullin Richter & Hampton LLP.
NEPA
NEPA was signed into law on January 1, 1970, and requires federal agencies to assess the environmental effects of their proposed actions before making decisions. The range of actions NEPA covers is broad and includes:
- Making decisions on permit applications,
- Adopting federal land management actions, and
- Constructing highways and other publicly owned facilities.
Using the NEPA process, agencies evaluate the environmental and related social and economic effects of their proposed actions. Agencies also provide opportunities for the public to review and comment on these regulations.
“CEQ issued regulations (40 CFR Parts 1500-1508) to implement NEPA. These regulations are binding on all federal agencies,” the EPA NEPA webpage says. “The regulations address the procedural provisions of NEPA and the administration of the NEPA process, including the preparation of environmental impact statements. In addition to the CEQ NEPA regulations, CEQ has issued a variety of guidance documents on the implementation of NEPA.”
Recent D.C. Circuit Court decision
Penning the majority opinion, Senior Judge A. Raymond Randolph wrote, “No statutory language states or suggests that Congress empowered CEQ to issue rules binding on other agencies—that is, to act as a regulatory agency rather than as an advisory agency. NEPA contains nothing close to the sort of clear language Congress typically uses to confer rulemaking authority. … [T]he Agencies’ actions were ultra vires (outside of the CEQ’s authority) when they determined that their Plan would have no environmental impact as compared with the existing tour flights permitted on an interim basis. The Agencies will now need to take a completely different tack to complete the NEPA review.”
Chief Judge Sri Srinivasan “wrote a partial dissent, disagreeing with the majority’s holding on CEQ’s NEPA regulation and criticizing the majority’s ruling as violating the established ‘principle of party presentation,’ which dictates that courts should only rule on issues that have been presented and argued before them,” law firm Best Best & Krieger (BBK) LLP notes.
CEQ authority wasn’t at question by any of the parties in the Marin Audubon Society case.
What’s next?
The decision establishes a precedent that the CEQ rules aren’t necessarily enforceable.
If the Biden administration decides to ask for an en banc (full D.C. Circuit Court) review, it will do so knowing the matter will have to be handed off to the Trump administration, which is known for its anti-regulatory stance, so it’s unlikely to defend the CEQ’s regulatory authority.
“The D.C. Circuit’s ruling may also impact a pending case before the U.S. Supreme Court (SCOTUS) that is scheduled to be argued on December 10, 2024,” adds BBK. “In Seven County Infrastructure Coalition v. Eagle County Colorado, [SCOTUS] will consider the proper scope of NEPA reviews. The Seven County Infrastructure Coalition is sponsoring the development of a rail line in Utah, which [requires] project approval from the federal Surface Transportation Board (STB). In 2021, the STB approved Seven County’s proposal. Eagle County challenged the Board’s approval in the D.C. Circuit, asserting the NEPA analysis was inadequate because it failed to consider the impacts of the oil wells and refineries served by the rail line. The D.C. Circuit agreed, ruling that the STB’s environmental impact statement was deficient for focusing only on the impacts of actions within its statutory authority. [SCOTUS] granted a review of the case to resolve a split among the courts of appeals over whether NEPA requires an agency to study environmental impacts beyond the proximate effects of the action over which the agency has regulatory authority. Oral arguments are set for December 10, 2024.”
However, not all hope for CEQ authority is lost.
“Aspects of the CEQ regulations were incorporated into the statutory language. Therefore, those statutory requirements, though limited, remain to guide agency environmental review in the absence of the CEQ regulations and should inform the promulgation of new agency regulations as may be required,” advises Sheppherd Mullin. “Given the possibility of further judicial review, the imminent change in federal administrations and the potential for further rulemaking by individual agencies, uncertainty will be the only constant for NEPA implementation in the short term. Project proponents requiring federal funding or approval should anticipate possible delays and work closely with legal counsel to evaluate options and minimize risk.”