The Biden administration’s rollback of NEPA regulations is cosmetic

A recent regulation from the Biden administration has made headlines about restoring vitality and reincorporating climate change analyzes into reviews of the National Environmental Policy Act (NEPA). In practice, these reports are exaggerated and NEPA remains basically the same, at least for now.

NEPA ensures that agencies review and inform the public of the environmental consequences of proposed and discretionary actions by federal agencies before they are taken. Above all, NEPA only guarantees a process, not an outcome; NEPA alone does not prevent agencies from permitting activities that have significant environmental impacts

Nevertheless, NEPA has become a common tool allowing litigants to stop or at least delay projects they disapprove of. And because major infrastructure projects often depend on external funding, substantial NEPA-based delays can on their own doom a project and thus achieve opponents’ goals.

CEQ oversees the implementation of NEPA

The White House Council on Environmental Quality (CEQ) is primarily responsible for overseeing the government-wide implementation of NEPA. CEQ’s NEPA regulations have remained unchanged since 1978.

The years that followed produced a multitude of laws, court rulings and policies affecting NEPA. The result was a jumble of outdated and diffuse guidelines.

As a result, in 2020 CEQ finalized a comprehensive update to its NEPA regulations. These amendments largely codified existing legislation and best practices to ensure effective and efficient reviews of NEPA, and did not alter the extensive body of case law applying NEPA, including the incorporation of climate change considerations.

Nonetheless, the CEQ update has been accused of eviscerating NEPA and has sparked numerous legal challenges. Immediately after taking office, the Biden administration responded to these criticisms and announced its intention to revert to the 1978 regulations and consider adding new requirements.

Proposed dismantling of phase 1

The CEQ proposed a rollback from “Phase 1” in October 2021 and finalized it with few changes in April 2022. This regulation reverts to 1978 regulatory language regarding the purpose and needs of a NEPA document and alternatives, definition of “effects” and individual agency NEPA regulations. This first step should not significantly affect NEPA reviews or the regulated community.

First, a federal agency begins a review of NEPA by defining a statement of purpose and need, and identifying a reasonable range of alternatives to the proposed action. The 2020 rule codified a longstanding practice by adding language requiring federal agencies to consider their statutory authority and the project proponent’s objectives.

That is, a highway project would not need to consider a cycle path as an alternative. Now, to avoid perceived “bias”, CEQ has removed this express guidance.

The 2022 rule still recognizes that the proponents’ objectives are “important” and that a “reasonable” alternative must “meet the purpose and necessity of the proposed action”. There is no indication or expectation that the claimed increased “flexibility” will produce materially different statements of purpose and need or alternatives.

Second, the 2020 rule simplified the regulatory definition of “effects” or “impacts” of the action and proposed alternatives to eliminate separate terms for “direct”, “indirect” and “cumulative” effects, and to clarify effects that are “reasonably foreseeable.” This change did not exclude cumulative impacts or climate change, which agencies and courts have always required in NEPA reviews.

In fact, the 2020 rule incorporated these considerations as part of the baseline for the “no action” alternative. The 2022 rule’s return to the earlier definitions of “effects” does not materially affect the scope of NEPA reviews or case law, but reintroduces confusion over the labeling of various effects. Moreover, none of the 2022 changes require further climate analyzes or the use of specific tools such as the social cost of carbon.

Finally, the 2022 rule removed the regulatory cap for individual agency NEPA regulations. Many agencies developed NEPA regulations or guidelines years ago. None of these agencies changed their NEPA regulations after the 2020 rule.

Even after the 2022 rule, the CEQ monitors agencies’ implementation of NEPA, and agencies cannot adopt NEPA procedures that conflict with CEQ regulations.

The 2022 rule lays the groundwork for greater regulatory uncertainty by licensing agencies to develop NEPA procedures that are more demanding and produce more delays than CEQ regulations. Yet there is no evidence that agencies have more incentive to act on this authority today than they did before 2020.

The CEQ’s ‘Phase 2’ effort is yet to come, but is expected to ‘more broadly review’ the 2020 regulations and may propose further changes to promote environmental justice, climate change and other ‘goals’ of the Biden administration. Such changes will undoubtedly attract considerable attention and additional litigation.

This article does not necessarily reflect the views of the Bureau of National Affairs, Inc., publisher of Bloomberg Law and Bloomberg Tax, or its owners.

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Author Information

Jamie Auslander is Co-Chair of Beveridge & Diamond’s Natural Resources and Project Development practice group, where he focuses on project development and litigation in the areas of energy, transportation, minerals, water and resources natural.

Katrina Krebs is Deputy Co-Chair of B&D’s Litigation Practice Group and Waste Management and Recycling Practice Group. His practice focuses on the defense of citizen suits, enforcement actions, and state and federal class and class actions. She is also familiar with NEPA issues, wetland regulations, federal species protection laws, and land use legislation.

Jonah Reagan is the Vice Chair of B&D’s ESA, NEPA, and Wetlands and Energy and Pipelines Practice Groups. His practice focuses on regulatory compliance and civil litigation with particular emphasis on endangered species, project development and natural resource management. He also advises industry clients on compliance with NEPA, CERCLA and Clean Water Act standards.

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