On Wednesday, April 20, the Council on Environmental Quality (CEQ) published a final rule completing the first stage of rulemaking to revise certain provisions of the National Environmental Policy Act’s (NEPA) implementing regulations. The Phase 1 Final Rule did not significantly deviate from the proposed rule CEQ released for public comment last October. The Phase 1 Final Rule’s major changes are summarized below.
In 2020, the previous administration overhauled the CEQ regulations for the first time since their inception in 1978 (the 2020 Final Rule). The current administration disagreed with many of those changes and embarked on a two-step review process. In Phase 1, CEQ revised certain provisions to revert to the previous regulatory language and intent:
- Definition of “effects” or “impacts”: One of the most controversial components of the 2020 Final Rule was CEQ’s changes to the definition of “effects” or “impacts” to remove the requirement to assess “cumulative impacts,” i.e., the “impacts to the environment resulting from the incremental impacts of the proposed action added to other past, present, and reasonably foreseeable future actions.” The Phase 1 Final Rule restores the prior definition of “effects” or “impacts,” including the sub-definition of “cumulative impacts” in 40 C.F.R. Section 1508.1(g).
- Definition of “purpose and need”: The 2020 Final Rule required federal agencies to base the purpose and need of an environmental impact statement on the applicant’s goals and the applicable agency’s authority. CEQ reverted to the previous definition of “purpose and need” to avoid the potential for federal agencies to prioritize an applicant’s goals over other factors such as the public interest. Similarly, CEQ revised the definition of “reasonable alternatives” in 40 C.F.R. Section 1508.1(z) to remove a reference to the applicant’s goals.
- Federal agency NEPA procedures: As the coordinating agency for NEPA implementation, CEQ oversees every federal agency’s NEPA procedures. The 2020 Final Rule required federal agencies to revise their NEPA procedures if those procedures were “inconsistent” with the CEQ regulations. This change prohibited federal agencies from imposing procedures and requirements beyond those required in the CEQ regulations, deeming the CEQ regulations the “ceiling” for NEPA compliance. The Phase 1 Final Rule revised 40 C.F.R. Section 1507.3 to remove the ceiling requirement and restore flexibility, allowing federal agencies to adopt procedures beyond the CEQ’s regulatory requirements.
The final Phase 1 Final Rule reversed some of the prior administration’s actions to streamline the NEPA review process. However, the Phase 1 Final Rule’s changes likely will be seen by many project proponents—including infrastructure, mining, oil and gas and renewable energy projects—as making the NEPA review process more burdensome. In its Fall 2021 Regulatory Agenda, CEQ stated it plans to propose “broader changes” to the NEPA regulations in the Phase 2 rulemaking to meet environmental, climate change and environmental justice goals, as well as to ensure public involvement in the NEPA process and promote decision making more consistent with NEPA’s statutory mandate. While CEQ has not published a proposed rule for Phase 2, project proponents should be prepared for further changes. Our attorneys and policy advisors are experts in applying the CEQ regulations and guiding projects through the NEPA process and can answer any questions that you may have about the effect of the revised regulations.
THIS DOCUMENT IS INTENDED TO PROVIDE YOU WITH GENERAL INFORMATION REGARDING PROPOSED CEQ CHANGES TO THE NEPA REGULATIONS. THE CONTENTS OF THIS DOCUMENT ARE NOT INTENDED TO PROVIDE SPECIFIC LEGAL ADVICE. IF YOU HAVE ANY QUESTIONS ABOUT THE CONTENTS OF THIS DOCUMENT OR IF YOU NEED LEGAL ADVICE AS TO AN ISSUE, PLEASE CONTACT THE ATTORNEYS LISTED OR YOUR REGULAR BROWNSTEIN HYATT FARBER SCHRECK, LLP ATTORNEY. THIS COMMUNICATION MAY BE CONSIDERED ADVERTISING IN SOME JURISDICTIONS