The Council on Environmental Quality (CEQ) recently announced significant revisions to its National Environmental Policy Act (NEPA) regulations (40 CFR 1500 et seq.), which govern how NEPA is implemented across the Federal government. These changes represent the first major update to NEPA regulations in over 40 years and are intended to streamline the NEPA process, in accordance with the federal government’s One Federal Decision policy. The new regulations went into effect on September 14, 2020 and agencies will have 12 months to update their NEPA regulations.

This article focuses primarily on how these changes affect NEPA practice. While the goal of these changes is to streamline NEPA processes and provide additional flexibility to agencies, at least in the short term there may be some growing pains as agencies and NEPA practitioners adapt to the new requirements. In addition, some of these revisions could also have legal implications for future litigation that may be brought against agencies related to their NEPA process and decision making.

What Are the Key Changes?

In terms of the implications for NEPA practitioners, the revised regulations touch on several key areas:

A. Scoping and Inter-agency Coordination

Place an increased emphasis on early scoping and collaboration, including a more thorough consideration of project alternatives and identifying connected actions during project scoping. Also emphasize early interagency coordination to streamline agency reviews and permitting where multiple agencies must make decisions with respect to a proposal, by requiring that needed permits be identified early in the process and agency reviews and approvals occur concurrently.
Strengthen the role of the lead agency in the NEPA process including setting project schedule and recommend the preparation of joint EAs and EISs and the issuance of joint Records of Decision (RODs) where a proposal requires action by multiple agencies.

B. Clarify When NEPA Applies to an Action

Revise the definition of "major federal action" by giving independent meaning to the terms "major" and "significant." Major refers to the type of action, and significant relates to the effects stemming from the action. Actions that are not considered “major federal actions” include "agency activities or decisions with effects that are located entirely outside of the jurisdiction of the United States" (i.e., extraterritorial activities) and "Non-Federal projects with minimal Federal funding or minimal Federal involvement where the agency does not exercise sufficient control and responsibility over the outcome of the project."
Refine the range of “reasonable alternatives” by clarifying that agencies shall limit their consideration to a reasonable number of alternatives that are within jurisdiction of the agency (unless required to address legislative requirements or specific Congressional directives) and that agencies need only consider alternatives that are "technically or economically feasible, meet the purpose and need for the proposed action, and meet the applicant's goals (if applicable)."

C. Environmental Effects

Reject a "but for" test with respect to environmental effects, and clarify that agencies only need to consider effects that are "reasonably foreseeable and have a reasonably close causal relationship to the proposed action or alternatives". Further, the regulations state that effects should generally not be considered if they are remote in time or geography or are "the product of a lengthy causal chain."
Simplify the definition of effects by eliminating the categories of direct, indirect, and cumulative effects, and requires consideration of all effects that have are “reasonably foreseeable and have a reasonably close causal relationship to the proposed action and alternatives”. Additionally, the regulations require that the affected environment include a discussion of “reasonably foreseeable environmental trends and planned actions” as part of baseline conditions and predictable environmental trends rather that consideration in a cumulative effects analysis.

D. Streamline NEPA Documents

Support the use of and increase for categorical exclusions (CATEX) from actions that normally do not have significant impacts, including cross-agency use of CATEX lists.
Establish presumptive time limits for EAs (1 year) and EISs (2 years). Senior lead agency officials may approve (in writing) new time limits for individual projects. Previously, CEQ considered universal prescriptive time limits to be too inflexible, but encouraged agencies to set appropriate time limits for individual actions if requested by the project applicant.
Establish presumptive page limits (excluding appendices) for EAs (75 pages) and EISs (150 pages, or 300 pages for projects of unusual complexity). Senior lead agency officials may approve (in writing) new page limits for individual projects. Note that these pages limits are not new, but the revised language is more prescriptive. Previously, CEQ regulations stated that EAs and EISs shall normally comply with these same page limits. The regulations encourage and support the use of incorporation by reference to reduce document size and costs of preparation.

Each year, federal agencies prepare approximately 170 EISs and over 10,000 EAs, and apply CATEXs to approximately 100,000 actions.

The average length of Final EISs issued between 2013 and 2018 was around 660 pages.
On average, the time from Notice of Intent to Record of Decision was around 4.5 years.

E. Public Involvement

Require Draft and Final EISs to include a summary of alternatives that identifies all alternatives, information, and analyses submitted by State, Tribal, and local governments and other public commenters during the scoping process.
Encourage the use of electronic means to distribute documents and solicit public involvement and comment.
Emphasize that members of the public and other government agencies must submit comments that are as specific as possible, within the provided comment periods, and that any comments not submitted are to be considered “unexhausted and forfeited.” This change does not directly affect agency NEPA processes but may give agencies additional leeway on how to respond to comments received outside designated comment periods. It may also provide some legal basis for agencies to claim in court that any concerns not raised during comment periods may not subsequently be used as a basis for litigation.

Where can I learn more about the new rule?

CEQ has provided several resources to help agencies make sense of the revised regulations on its website. These include:

A presentation describing the drivers behind the regulatory update, and the key changes
A fact sheet summarizing the changes, and
A redline version highlighting changes to the regulations.

How Will These Changes Affect NEPA Implementation?

Overall, CEQ’s new regulations are meant to further streamline the NEPA process and clarify agency roles and responsibilities. However, agencies must first incorporate these changes into their own NEPA implementing regulations. Agencies have 12 months from the effective date of the final rule (September 14, 2020) to propose changes to their NEPA regulations. Only after that will the true impact of these changes be felt, as agencies start to implement NEPA according to CEQ’s new rules.

The impact of these changes is likely to be mixed, especially in the beginning as agencies adapt to the new landscape. The new rules issued by CEQ require (or further emphasize) early coordination and collaboration among agencies, as well as joint decision-making where appropriate. This should have a beneficial effect by shortening overall NEPA timelines. However, the rules also require shortened timelines for NEPA document preparation along with page limits that are significantly lower than current practice, which could present challenges for agencies and NEPA practitioners and may require creative solutions.

Additionally, there are some changes whose impact will be perceived differently by different stakeholders. For example, the new rules try to adhere to a narrower definition of cause and effect in establishing the scope of NEPA analyses, elimination of the specific categories of direct, indirect, and cumulative effects, and the direction to increase the use of categorical exclusions (CATEX). These changes could provide agencies with additional flexibility and may reduce the amount of analysis required. While project proponents and some agencies are likely to see this as a benefit that will lead to shorter NEPA timelines and faster decisions, environmental advocates will likely see these changes as an attempt to circumvent NEPA’s requirement to take a “hard look” at the effects of federal actions. In fact, CEQ’s new regulations have already been challenged in court by environmental groups, as discussed below.

Looking forward, while the regulations are final, their future implementation is likely to be contingent on the outcome of pending litigation. Several lawsuits have been filed claiming that these changes to CEQ’s regulations will negatively affect environmental reviews. These lawsuits claim the current Administration arbitrarily reversed longstanding regulations and violated the Administrative Procedure Act including the failure to consider the 1.1 million public comments received during the public comment process. They also claim the failure to disclose significant environment impacts of removing consideration of cumulative and indirect effects from analysis, and the disproportionate harm the changes could have on environmental justice communities by placing a greater emphasis on public comments that are specific and technical. Watch this space for updates as these lawsuits progress through the courts.

In Summary

Given the scope of these changes, agencies will likely be required to make significant changes to how they plan and execute NEPA projects, including revisions to agency-specific NEPA regulations and procedures. These changes are likely to impact agency NEPA processes in a variety of ways; federal agencies may want to conduct an in-depth analysis of the revisions to determine the extent to which these changes impact existing NEPA policies and programs and the specific changes needed to address the new regulations.

PHE has supported federal agencies with NEPA document development for over 30 years, including public involvement, agency coordination, and supporting studies.We have extensive experience working on complex and controversial NEPA projects for a wide range of federal actions, from military land use planning and construction to complex infrastructure permitting and funding.We have an in-depth understanding of NEPA and are well-positioned to help federal agencies update their own practices and programs in response to CEQ’s revised regulations.For further information or to learn how PHE can help you, contact Rob Naumann, Principal, at robertn@phe.com.

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