CEQ Issues Final Rule to Update NEPA

Speaking at the UPS Hapeville Airport Hub in Atlanta, Georgia yesterday, President Trump announced that the Council on Environmental Quality (CEQ) has updated the National Environmental Policy Act implementing regulations for the first time in over 40 years. The final rule was published in the Federal Register today (Thursday, July 16, 2020) and will become effective on September 14, 2020.

Since this is a major rule subject to congressional review, the effective date could be changed or the rule could be terminated. Legal challenges are anticipated and Democrats could quickly repeal the rules if they win the White House and both chambers of Congress in the November elections.

In President Trump's remarks at the UPS Hapeville Airport Hub, he said, "Today’s action completely modernizes the environmental review process under the National Environmental Policy Act of 1969. At the heart of the reforms is the One Federal Decision policy. With our reforms, there will be one quick and fair decision.  We’re going to give every project a clear answer: Yes or no."

The National Association of Manufacturers (NAM) issued a press release applauding the NEPA update as setting the stage to incentivize job creation and investment in America. NAM Vice President of Energy & Resources Policy Rachel Jones said, “Manufacturers are committed to smart, strong environmental protections, improving the lives of all Americans and building a more inclusive future together. Amid the COVID-19 pandemic it is more important than ever to strengthen U.S. manufacturing capabilities and operations. Onshoring manufacturing requires first establishing basic infrastructure—from water and energy delivery to transportation—before ground can ever be broken on a major facility. Obtaining permits for these items can take years, especially when environmental reviews are piecemeal, but CEQ’s bold steps today utilize existing authority to strengthen reviews, reduce the time necessary to obtain permits and set the stage to incentivize job creation and investment in America.”

An element of concern to environmentalists is CEQ's proposal to strike references to direct, indirect, and and cumulative effects. Rather, the NEPA update would focus on "those effects that are reasonably foreseeable and have a reasonably close causal relationship to the proposed action." The new rule would generally exclude consideration of effects if they are "remote in time, geographically remote, or the result of a lengthy causal chain." This more narrow focus is viewed by some as removing from consideration impacts on climate change.  In the final rule, the CEQ addressed this concern saying, "Under the final rule, agencies will consider predictable environmental trends in the area in the baseline analysis of the affected environment. Trends determined to be a consequence of climate change would be characterized in the baseline analysis of the affected environment rather than as an effect of the action." The CEQ says that the "the analysis of the impacts on climate change will depend on the specific circumstances of the proposed action."

E & E News, Energywire reported today that the rewrite of NEPA could have major implications for energy projects, including oil and gas pipelines. In addition to the rule's more narrow focus that excludes cumulative effects, the final rule provides that "NEPA does not apply to 'agency activities or decisions with effects located entirely outside of the jurisdiction of the United States,'". This would include projects such as the Keystone XL pipeline which crosses the Canadian border.

Key elements of the new rule from the White House Fact Sheet:

• Establishes presumptive time limits of two years for the preparation of environmental impact statements (EISs) and one year for preparation of environmental assessments (EAs)
• Requires joint schedules, a single EIS, and a single record of decision (ROD) where appropriate, for EISs involving multiple Federal agencies
• Requires agencies to consider environmental effects that are foreseeable and have close causal relationship to the proposed action
• Excludes actions with minimal Federal funding or involvement such as small business and farm loan guarantees
• Recognizes procedures and documents required by other statutes that satisfy the requirements of CEQ regulations to comply with NEPA
• Allows agencies to use other agencies' categorical exclusions (CEs) where appropriate
• Requires more public input earlier in the process
• Includes consultation with affected Tribal governments and eliminates provisions that limit Tribal interest to reservations
• Requires agencies to certify consideration of alternatives, information, and analyses submitted by State, Tribal, and local governments and public commenters