The Nickel Report

On January 9, 2020, the Council on Environmental Quality (CEQ) released its highly anticipated proposed rule to improve its National Environmental Policy Act (NEPA) regulations. The proposed changes would be the first comprehensive amendment of the NEPA regulations since their original publication in 1978. CEQ’s proposed changes are designed to streamline and speed the NEPA review process, clarify important NEPA concepts, and codify key guidance and case law. CEQ’s Proposal is informed by comments it received on last year’s Advanced Notice of Proposed Rulemaking.

NEPA requires that federal agencies analyze the environmental effects of their proposed federal actions. This means that virtually any project that requires a federal permit or authorization could be required to undergo a NEPA review. Development of broadband infrastructure, roads, bridges, oil and gas pipelines, and renewable energy facilities are just a few examples of the types of activities that could trigger NEPA. A NEPA review can take significant agency and applicant resources, can substantially delay permits and can provide a basis for a federal court challenge to the project.

While federal agencies—like the Bureau of Land Management, US Department of Energy, and US Army Corps of Engineers—have their own NEPA rules, CEQ’s regulations govern NEPA compliance by all federal agencies. Therefore, if finalized, the rule would require agencies to develop or revise their NEPA procedures to align with CEQ’s new regulations within one year of the final rule’s publication. Notably, the proposed rule would give agencies discretion to apply the new regulations to ongoing activities and environmental reviews commenced prior to that date.

The Proposal calls for a number of significant changes to the regulations, some of which are changes to the NEPA process and some of which merely codify or clarify existing practices and concepts. The following are some of the key provisions of the Proposal:

• Sets Presumptive Page and Time Limits: The Proposal notes that the average environmental impact statement (EIS) takes over 4.5 years to complete. To promote timely reviews, the Proposal sets presumptive time limits of two years for completion of EISs and one year for completion of environmental assessments (EAs), with the possibility of extensions. The Proposal also sets presumptive page limits of 75 pages for EAs and either 150 or 300 pages for EISs, depending on scope and complexity.
• Amends the Definition of “Effects”: To reduce confusion and unnecessary litigation, the Proposal modifies the definition of “effects” by eliminating specific references to “direct,” “indirect” and “cumulative.” CEQ hopes this change will focus agency time and resources on considering whether an effect is caused by the proposed action rather than on categorizing the type of effect.
  • Causation Standard - The Proposal amends the definition to clarify that “effects” must be “reasonably foreseeable and have a reasonably close causal relationship to the proposed action or alternatives.” CEQ explains that “but for” causation is insufficient to satisfy the proposed rule’s “close causal relationship.” Rather, CEQ states that the standard “is analogous to proximate cause in tort law.” Effects should not be considered significant if they are remote in time, geographically remote or the result of a lengthy causal chain.
  • Cumulative Effects - The Proposal would eliminate the current regulations’ requirement to conduct a cumulative effects analysis. CEQ notes that commenters raised concerns that the terms “indirect” and “cumulative” have been interpreted expansively, leading agencies to create excessive analysis on speculative effects and frequent litigation.
  • Climate Change Impacts - Much attention has focused on how the Proposal’s clarification of “effects” of the action would impact federal agencies’ consideration of climate change-related impacts of proposed actions. The Proposal does not prohibit climate change analysis or suggest that agencies must exclude such analysis from NEPA documents. Rather, the proposed rule would direct agencies to analyze only those effects— including impacts related to greenhouse gas emissions—that are reasonable foreseeable and have “a close causal relationship” to the proposed action.
• Adopts Elements of the One Federal Decision Policy: For EISs involving multiple agencies, the Proposal requires the development by the lead agency of a single EIS and a single, joint Record of Decision (ROD), or a single EA and joint Finding of No Significant Impact (FONSI). The lead agency is responsible for developing a joint schedule and procedures to elevate delays or disputes. These provisions adopt key elements of the One Federal Decision policy established by Executive Order 13807.
• Clarifies When NEPA Applies: The Proposal adds a “NEPA threshold applicability analysis” section that will provide a series of considerations to assist agencies with conducting threshold analyses for determining whether NEPA applies. The Proposal also clarifies that “major Federal action” does not include non-discretionary decisions and non-Federal projects (including those with minimal Federal funding or involvement).
• Refines the Scope of Alternative Analysis: The Proposal clarifies that reasonable alternatives requiring consideration are only those that are technically and economically feasible, meet the purpose and need for the proposed action, and are within the jurisdiction of the agency. Therefore, the Proposal explains that agencies are not required to analyze every available alternative, but must only cover a “reasonable range of alternatives.”
• Increases Applicant/ Contractor Participation in NEPA Process: The Proposal allows applicants/contractors to assume a greater role in preparing NEPA analyses, so long as the lead agency provides guidance, participates in the preparation, independently evaluates the statement and takes responsibility for content.
• Reducing Duplicative Efforts: The Proposal authorizes and requires federal agencies to cooperate with State, Tribal and local agencies to reduce duplication, including through the use of prior and joint environmental review documents and decisions. It clarifies that NEPA does not require reconciliation of inconsistencies with State, Tribal or local laws.

The Proposal was published in the Federal Register on January 10, 2020, triggering a 60-day comment period that ends on March 10, 2020. The Proposal, if finalized, could alter the NEPA landscape by streamlining and clarifying the NEPA process. Undoubtedly, any final action by CEQ to revise the NEPA regulations is certain to be highly controversial and subject to multiple challenges.

For more information, please contact Alexander Woo at awoo@HuntonAK.com or Lauren Bachtel at lbachtel@HuntonAK.com.