On July 15, 2020, President Trump announced a "top to bottom overhaul" of the National Environmental Policy Act (NEPA) regulations, deriding what he characterized as the "mountains and mountains of bureaucratic red tape in Washington" getting in the way of major federal projects such as pipelines and highways. NEPA, signed into law 50 years ago by President Nixon, requires federal agencies to consider the environmental effects of a proposed project before approval, and to provide the public and stakeholders the opportunity to comment.
With the new rule going into effect on September 14, 2020, the Trump administration hopes to streamline environmental review of major projects requiring federal approvals or located on federal lands. While many of the current NEPA processes will remain in place, the new rule includes at least three major changes weakening the reach of NEPA.
Definition of Cumulative Impact Removed
First, and perhaps most significantly, the rule removes the definition of "cumulative impact" from the regulations, and revises the definition of "effects," effectively eliminating the concept of the cumulative effects analysis. Under former NEPA regulations, "cumulative impact" was defined as "the impact on the environment which results from the incremental impact of the action when added to other past, present, and reasonably foreseeable future actions." The new rule takes the position that consideration of cumulative impacts is not required by NEPA and "can divert agencies from focusing their time and resources on the most significant effects."
However, NEPA implementation has long been premised on the fact that environmental effects do not occur in a vacuum and can only be understood in the context of previous developments. The impact of a discrete action may itself not be significant, but in combination with prior or concurrent actions can be very significant indeed. A good illustration is Sierra Club v. Penfold, a 1987 decision affirmed by the 9th Circuit, in which the district court found that while individual gold placer mines were very small operations with minor impact, taken together they had a significant impact on at least two watersheds, thus requiring an EIS.
The new rule also clarifies that agencies should not consider effects to be significant if they are "remote in time, geographically remote, or the result of a lengthy causal claim," citing Dep't of Transp. v. Pub. Citizen, 541 U.S. 752, 767-68 (2004), for support. Under this revision to the rule, broader environmental degradation, such as climate change, would not be considered. For example, a pipeline carrying shale oil or gas would be analyzed for the effects of ground disturbance where the trench is excavated, but not the effects of facilitating oil and gas exploration, extraction, and consumption in faraway locations. The removal of cumulative and attenuated impacts from consideration under the NEPA process would significantly reduce the reach of the statute and will likely draw legal challenges.
Project Proponents May Prepare Their Own Environment Impact Statement
Second, the new rule allows project proponents to prepare their own Environmental Impact Statement (EIS), whereas past regulations only allowed the project proponent to prepare an Environmental Assessment (EA). Previously, the lead federal agency would either do the review or engage a contractor, paid for by the applicant.
The new rule thus increases the role project proponents may play in assessing the environmental impact of their own projects. Applicants will still need to disclose any financial or other interest in the outcome of the action subject of the EIS, a requirement that the Trump administration originally proposed to abandon but decided to maintain in response to public concerns about transparency.
Scope of Federal Action Narrowed
Third, the new rule narrowed the definition of "major federal action," explicitly excluding actions with "minimal Federal funding or minimal Federal involvement." The new rule also now excludes extraterritorial activities or decisions from the NEPA process.
Industry groups have generally welcomed this new streamlined process, while critics have raised concerns that the Trump administration's action significantly narrows the reach of NEPA and will negatively impact our environment and communities of color that are often disproportionately affected by major pipeline or highway projects.
Absent Legislation, Legal Challenges Sure to Follow
President Trump continues to move forward with his promise to accelerate and weaken the environmental review process applying to industrial and energy projects, as we have periodically reported in our "Trump Track" posts. Like many other actions we reported on, the new rule is sure to draw legal challenges and could be vulnerable to repeal under the Congressional Review Act (CRA), depending on the results of the 2020 November election.
While the NEPA process is no doubt overly expensive and time-consuming, overhauling it by rule is problematic because of decades of case law enforcing the notion that agencies must take a "hard look" at impacts associated with an action, assess them in context, and demonstrate a thorough consideration of alternatives. Undoing this extensive body of case law will require legislation, not simply a new rule which is likely to only generate more litigation. Thus, the likely short-term effect of the rule is to further delay, not accelerate, projects as the inevitable court challenges proceed.