As our first modern environmental statute, the National Environmental Policy Act (NEPA) has come to play a central role in the protection of human and ecological communities.  Signed into law by President Richard Nixon on January 1, 1970, it requires federal agencies to carefully evaluate and disclose the environmental impacts of their actions and allows the public to engage directly with the federal decision process.  The statute’s forward-facing approach, as interpreted in regulation and by the courts, has dramatically democratized federal agency decisionmaking.  But like so much else these days, NEPA’s innovative legacy of transparency and public participation is under serious scrutiny and may be significantly altered over the next few years.

NEPA embodied the mood of Congress at the end of the 1960s, when smoggy skies, burning rivers, and species extinctions took center stage in the national consciousness.  The statute expressly recognizes that “each person should enjoy a healthful environment” and declares a national policy to “prevent or eliminate damage to the environment and the biosphere” and to “enrich the understanding of ecological systems and natural resources important to the Nation.”  These goals remain as important today as they were 55 years ago.  In announcing them, NEPA stood at the vanguard of the environmental movement – the first statute in a parade of innovative federal legislation that unfolded over the next decade.

Yet unlike those subsequent laws, NEPA does not dictate any substantive standards or particular outcomes.  It is, at core, a public disclosure law.  NEPA directs federal agencies to prepare a “detailed statement” for every major federal action significantly affecting the quality of the human environment.  This detailed environmental impact statement – or EIS – forms the heart of NEPA.  An EIS must evaluate the reasonably foreseeable adverse environmental effects of a proposed action, as well as a reasonable range of alternatives that may reduce or eliminate those effects.  Federal agencies retain the ability to make particular decisions, even environmentally harmful ones, as long as they satisfy these basic requirements.  But the public has the ability to challenge the agency’s NEPA compliance in court – and often does.

Courts review an EIS to determine whether the agency took a sufficient “hard look” at the environmental consequences of and alternatives to its proposed action before making a decision.  Critically, agencies must disclose such consequences to the public in a meaningful way and solicit public input.  These “look before you leap” and public participation requirements have transformed how federal decisions get made.  They serve to help balance agency processes that might otherwise be captured by special interests, behind closed doors.  Recent developments, however, threaten to upend NEPA as we know it.

NEPA Is Back Before the Supreme Court – and Not in a Good Way

First and perhaps foremost, a potentially precedent-altering NEPA challenge is pending before the U.S. Supreme Court this term.  That case, Seven County Infrastructure Coalition v. Eagle County, Colorado, is set for oral argument on December 10, 2024.  It presents the question of whether NEPA “requires an agency to study environmental impacts beyond the proximate effects of the action over which the agency has regulatory authority.”  The underlying facts suggest that the Court may view the case as a vehicle to significantly curtail the scope of required environmental review – a development that could be especially impactful with respect to more remote or secondary impacts, like greenhouse gas emissions or growth-inducing consequences.

The Seven County case began as a fairly routine NEPA challenge.  The Surface Transportation Board, which has jurisdiction over the extension of rail lines, completed an EIS for a proposed railway expansion into the isolated Uinta Basin of Utah, primarily to facilitate the development of waxy crude oil reserves.  As required by the NEPA regulations and case law, the EIS identified the potential for upstream impacts from increased oil production in the basin and downstream impacts from the subsequent refining of that oil on the Gulf Coast, but did not analyze them in detail.  Environmental organizations and others challenged the adequacy of the EIS, arguing that it unlawfully failed to evaluate the project’s effects on wildlife in the Uinta Basin or the increase in air pollution emissions near the likely receiving refineries on the Gulf.  The Board argued that such impacts were too speculative to require more analysis.  The D.C. Circuit Court of Appeals agreed with the challengers’ criticisms, holding that the EIS needed to estimate reasonably foreseeable upstream and downstream impacts using some degree of forecasting or explain in more detail why it could not do so.

Particularly important for the posture of the case as now framed before the Supreme Court, the appellate court also briefly addressed and rejected another argument – that the EIS need not evaluate indirect or secondary impacts over which the Board lacks direct approval jurisdiction.  In doing so, the court noted that the Board has authority to deny the project if it determines that the anticipated environmental and other costs outweigh the expected benefits.  On that basis, the D.C. Circuit held that the agency is “not excused” from considering the upstream or downstream impacts merely because it lacks jurisdiction over oil production or refining.

The project proponent successfully petitioned the Supreme Court for review with a strong gesture toward this jurisdictional argument.  Judicial embrace of that concept could radically rewrite NEPA, potentially eliminating the long-standing requirement that agencies evaluate the indirect or secondary effects of their actions.  Presumably for this reason, the Solicitor General, representing federal respondents (including the losing Surface Transportation Board), opposed the petition for certiorari, explaining that there is not a split among the circuit courts worthy of Supreme Court attention.  Following the grant of certiorari, the federal government pivoted to defend the Board’s limited upstream and downstream impacts analysis on the ground that agencies are entitled to draw a “manageable line” around the scope of a NEPA analysis.  That line, the government argued, is based on an agency’s reasonable determination of whether an effect is so “attenuated, speculative, contingent, or otherwise insufficiently material” to the decision that a causal connection is absent or diminished.

As now teed up for oral argument, the merits briefing in Seven County focuses on the degree of causation necessary to trigger an agency’s obligation to evaluate particular impacts.  No party argues for the traditional tort notion of “but for” causation.  Indeed, the Supreme Court’s 2004 decision in Public Citizen v. Department of Transportation (a somewhat sui generis case where a NEPA-exempt act by the President triggered the agency’s subsequent regulatory actions) squarely rejected a “but for” test in favor of a “legally relevant cause” standard.  The project proponents in Seven County are now pressing for an expansive interpretation of that standard to mean that an agency need only consider the “proximate environmental effects” of its decision.

While siding with the petitioners on the ultimate judgment in the case, the federal government forcefully pushed back on the notion of a “proximate cause” test that would limit an agency’s NEPA duty to evaluating only those effects under its direct regulatory authority.  The U.S. has thus positioned itself as staking out the moderate middle ground between “but for” and “proximate” cause.  Its briefs urge the Court to respect the agency’s context-specific line-drawing in applying NEPA’s “reasonably foreseeable” impacts language and not to craft a new bright line rule on causation.  Over the last few terms, the Supreme Court has not seemed at all inclined to defer to federal agency interpretations, and it seems unlikely that the Court took up Seven County only to reaffirm the Board’s approach here.

If the Court adopts petitioners’ approach, federal agencies – especially under the incoming Trump Administration – are likely to significantly narrow their NEPA analyses to a project’s more immediate direct impacts.  As has proven true for the present Court’s other dramatic jurisprudential shifts, the future under this scenario could well be filled with NEPA challenges probing the contours of any new causation test.  And in resolving such challenges, the courts will presumably exercise their “independent judgment” rather than defer to the agency’s expertise, as the Court directed in Loper Bright Enterprises v. Raimondo.  Indeed, if Loper Bright and other recent precedent-altering decisions like West Virginia v. EPA are any guide, Seven County may turn out to be another brick in the wall that the Supreme Court is building to wrest power away from administrative agencies and arrogate that power to itself.

NEPA Regulations Are Also Under Judicial Attack

NEPA itself is a relatively short statute, but it created the Council of Environmental Quality (CEQ) within the Executive Office of the President to assist in its implementation.  CEQ has fulfilled this role, in part, by promulgating regulations that elaborate NEPA’s procedures and requirements.  The first NEPA regulations took effect in 1978, building on CEQ’s earlier guidelines.  The regulations’ stated goal was to standardize NEPA practices across the federal government, enhance coordination, reduce duplication, and facilitate public understanding.  Shortly thereafter, the Supreme Court noted that CEQ’s interpretation of NEPA in those regulations was “entitled to substantial deference.”  And decades on, in the Public Citizen case now at the center of the Seven County dispute, the Supreme Court acknowledged that CEQ’s regulations guide agency compliance with NEPA.

While some individual agencies adopt their own NEPA regulations to mimic or augment the general CEQ rules, CEQ’s interpretation provides uniformity and a degree of certainty around how agencies will implement NEPA.  Indeed, the CEQ regulations remained basically stable for roughly 45 years – until the tumultuous Trump Administration amended them in 2020 and the Biden Administration made restorative revisions in 2022 and 2024.  Over nearly five decades, hundreds – if not thousands – of judicial decisions have relied on the CEQ regulations to help interpret and apply the statute.

But the times they are a-changin’.  In November 2024, the D.C. Circuit Court of Appeals issued a decision in Marin Audubon Society v. Federal Aviation Administration holding that NEPA does not confer statutory authority on CEQ to promulgate binding regulations.  As Chief Judge Srinivasan noted in his dissent, no party to the case challenged the validity of CEQ’s regulations; instead, the appellate court raised the issue sua sponte and then proceeded to upend nearly half a century of legal interpretation.

Similar to the Supreme Court in recent cases like West Virginia and Loper Bright, the two-judge majority in Marin Audubon expressed little interest in the parties’ actual dispute or their desired outcome.  Instead, it used the case to “put to the test” the court’s “long-standing misgivings” about the validity of the CEQ regulations.  In doing so, the majority cited a number of their own prior opinions to illustrate those misgivings, much like Chief Justice Roberts’ self-referential discussion in Loper Bright that the Chevron doctrine was “unworkable” because it led to a “dizzying breakdance” of questioning by his own Court.  Indeed, Senior Circuit Judge Randolph, in the majority opinion he drafted for Marin Audubon, refers to his own Solicitor General brief from five decades earlier, in which he advised the Court that CEQ’s guidance is not binding.

After holding that CEQ’s NEPA regulations are ultra vires and suggesting that they also implicate separation of powers concerns, the Marin Audubon majority opinion leaves us with more questions than answers.  Is it permissible for another federal agency to simply adopt CEQ’s regulations as its own?  Good question, the court muses, but not what happened here – or in most agencies –and thus not resolved by its opinion.  Assuming that other federal agencies have authority to adopt their own NEPA regulations, must they now go back and commence a whole new rulemaking process?  What rules govern ongoing matters in the meantime?  And what becomes of the expansive NEPA jurisprudence built on applying the CEQ regulations?  Questions “worth considering,” the court tells us.

The Marin Audubon court then proceeded to the actual merits of the case “without invoking CEQ regulations.”  It decided unanimously in challengers’ favor on a single claim, holding that the agencies used an improper NEPA baseline against which to compare the proposed plan’s environmental impacts.  For that reason, the court vacated the administrative decision – a remedy that neither party likely wanted, as the dissent points out – and remanded for further agency consideration.  It did, however, uphold the agencies’ decision not to prepare an EIS or even a more truncated environmental assessment for the proposed action.  That administrative decision was premised on the agencies’ invocation of a so-called “categorical exclusions” from NEPA for certain types of projects.  Ironically, until last year’s statutory amendments (see below), the concept of a categorical exclusion, like the concept of an environmental assessment, was purely a creature of the CEQ regulations, not something contemplated by NEPA itself.  Yet in affirming this part of the agencies’ conduct, the Marin Audubon court conspicuously omitted any mention of categorical exclusions.

Marin Audubon thus seems to suggest that courts should independently determine how NEPA works, following the Supreme Court’s direction in Loper Bright, without regard to half a century of interpretative rules and a vast body of doctrinal case law interpreting them.  If we ultimately follow that path – either because other circuits fall in line or the Supreme Court nationalizes the Marin Audubon holding – we are likely to be faced with years of upheaval and uncertainty as litigators parse nuances and the courts struggle to reinvent the NEPA wheel.

Of course, it remains to be seen whether the parties will seek rehearing en banc, what the D.C. Circuit would do with such a request, or whether another cert. petition to the Supreme Court is in the offing.  If D.C. Circuit stands firm, it is not even clear that its judgment is “final” for purposes of appeal by any party other than the government, given the plaintiffs’ partial victory and the court’s remand to the agency.  And because no party in Marin Audubon challenged the validity of the CEQ regulations, despite prior judicial “misgivings,” it is far from obvious how various interests will ultimately align, either immediately or after the new Trump Administration takes office in January 2025.  The only thing we might assume with some confidence is that the road ahead will be a rocky one.

Paving the Way for More Congressional Tinkering?

These judicial developments and others may well collide over the next year in a way that is both unpredictable and destabilizing.  We do have a few early hints, however.

First, even before Marin Audubon was decided, a group of conservative law professors submitted an amicus brief supporting petitioners in Seven County and urging the Court to find that consideration of climate impacts are beyond the scope of the Board’s authority over railway extensions.  Just for good measure, apparently, the amicus brief closed with a full-throated argument that CEQ lacks the statutory authority to promulgate judicially enforceable NEPA regulations – essentially the same argument adopted subsequently by the Marin Audubon majority.  The specific target of the law professors’ ire in Seven County was the CEQ requirement to consider a project’s reasonably foreseeable “cumulative” impacts – an ecologically robust concept embraced by hundreds of judicial decisions and implemented through countless NEPA mitigation measures.  So we might well see further efforts to defang the concept of “cumulative” impacts along with “indirect” impacts.

The Supreme Court has demonstrated some willingness in recent terms to take on issues that are not squarely presented by the case at hand.  Might it see fit to use Seven County as a vehicle to address the legal validity of the CEQ regulations?  Given the absence of more fulsome briefing on the issue, odds of the Court doing so are probably long, especially with Marin Audubon potentially waiting in the wings.  But oral argument in December could provide some clues to the future.

Second, the Biden Administration’s amendments to the CEQ regulations, which became effective in July 2024 and restored some – but not all – of the deletions made in the Trump Administration’s 2020 revisions, are under challenge by 20 “red” states in the federal district court in North Dakota.  Like the original 1978 regulations, the new amended rules are intended to enhance regulatory clarity and certainty, improve efficiency and effectiveness, and promote consistency across the federal government.  As currently drafted, the complaint in the North Dakota case seeks to reinstate the 2020 revisions, not jettison the CEQ regulations altogether.  The decision in Marin Audubon, however, provides a ready opportunity for plaintiffs to add a similar claim to the new lawsuit, teeing it up for full briefing and adjudication.

But here again, the alignment of interests is not entirely obvious.  While the plaintiffs in the North Dakota challenge and their allies plainly seek less onerous NEPA regulations, would those interests be best served by upsetting the entire applecart?  Doing so would likely slow administrative decisions in the short term, as each individual agency grapples with what to do next.  And over the longer term, it would almost certainly mean a “full employment act” for NEPA lawyers, on all sides, even as the already overburdened federal courts assume the increased burden of interpreting NEPA anew.  Development interests generally want more expeditious environmental review, not the kind of uncertainty and delay that a wholesale change in the system would bring.

Finally, there is Congress, which could decide to step in and address the ambiguity being created by the courts.  Until last year, the legislature had not seriously attempted to amend NEPA, which remained virtually unchanged since its passage in late 1969.  It is true that Congress has occasionally used short-term appropriation riders to temporarily suspended NEPA or compel expedited review for certain types of projects.  But until the BUILDER Act of 2023, it had not mustered the political wherewithal to significantly amend the statute itself.

Enacted as part of the Fiscal Responsibility Act of 2023 (a legislative package to avoid a U.S. default under the debt ceiling), the BUILDER Act made a handful of substantive changes that have yet to be fully realized.  A number of these changes merely cemented into statute certain aspects of the CEQ regulations.  For instance, the amended law replaced the statutory directive to evaluate “environmental impacts” with a requirement to evaluate “reasonably foreseeable environmental effects”– a trigger phrase borrowed from the CEQ regulations and used by the courts for decades and the very same one now at issue in Seven County.  Similarly, the BUILDER Act codified CEQ’s creation of an abbreviated “environmental assessment” in lieu of an EIS where an agency determines that environmental effects are not significant and, for the first time, acknowledged the use of “categorical exclusions,” a concept pioneered by CEQ and adopted by other federal agencies.

Along with limits on the size and timing of environmental review documents, these NEPA amendments were intended to both streamline the process and conform the statute to decades of agency practice.  As such, they did not engender as much opposition as more profound revisions might.  Even long-time NEPA champions may be on board with modest further updating.  For instance, the sometimes tortuous pace of NEPA compliance has confounded climate advocates as they push for much-needed new high-voltage electricity transmission capacity through resistant communities.  But Congress would unquestionably spark a much more fierce battle if it proposed to significantly curtail NEPA’s scope along the lines that petitioners urge in Seven County.  Yet we may get there anyway by judicial fiat.

The question now is whether Congress, having just barely cracked open the Pandora’s Box of NEPA reform, is willing to go farther – and what would farther mean here?  One obvious legislative response is to clarify CEQ’s rulemaking authority as a way to restabilize the applicable legal regime, perhaps in return for some additional permit streamlining – a sensible proposition that nevertheless seems quite improbable in the current political climate.  At the very least, the incoming Congress is likely to let the judicial dust settle before taking any further action.  But could the uncertainty created by these recent developments create an opening for compromise that would modernize NEPA and still preserve its legacy of transparency, protection, and accountability?  Only time will tell.

In the meantime, the judiciary’s pursuit of its own agenda has tossed a hand grenade into the middle of an already fraught space.  Unsettling decades of established NEPA practice in the name of ideological purity does no favors for anyone, including those who seek more expeditious development.  The federal judiciary serves the nation best when it stays in its constitutionally-prescribed lane.