The National Environmental Policy Act (NEPA), signed into law on January 1, 1970, is one of the fundamental pieces of federal environmental law. NEPA requires federal agencies to assess and consider environmental impacts before completing a “major federal action.” NEPA does not dictate any specific result, but its overarching policy (set forth in Title I) instructs the federal government to “use all practicable means to create and maintain conditions under which man and nature can exist in productive harmony.” NEPA’s broad reach applies to agency actions over which the government has substantial control and responsibility, including:
- Review of permit applications and issuance of permits.
- Awarding of a grant or other form of financial assistance.
- Infrastructure projects such as highways and public buildings.
- Federal land management decisions.
Since 1978, federal agencies have looked to regulations promulgated by the White House Council on Environmental Quality (CEQ) in implementing NEPA (40 C.F.R. Parts 1500–1508). The CEQ was established by Title II of NEPA and was tasked with overseeing federal agencies’ compliance with NEPA. For nearly 50 years, federal agencies, courts, and practitioners have generally not challenged the CEQ’s authority to govern the implementation of NEPA through these regulations.
Recently, however, two separate federal courts decided to review the basis for the CEQ’s authority. In Marin Audubon Society v. Federal Aviation Administration, No. 23-1067 (D.C. Cir. Nov. 12, 2024), the D.C. Circuit held that the CEQ lacked the authority to issue binding regulations. Similarly, in Iowa v. CEQ, No. 1:24-cv-00089 (D.N.D. Feb. 3, 2025), the District of North Dakota held that the CEQ lacked the authority to issue binding regulations.
Interim Final Rule and Guidance
On February 19, 2025, the CEQ took two actions that make sweeping changes to the implementation of NEPA. First, the CEQ issued an Interim Final Rule that rescinds all of the CEQ’s long-standing NEPA regulations. Second, the CEQ issued guidance instructing federal agencies to revise their NEPA implementing regulations and procedures over the next 12 months consistent with President Trump’s Executive Order 14154 (Unleashing American Energy). That Executive Order revoked President Carter’s 1977 Executive Order that had directed the CEQ to issue NEPA implementing regulations and directed other agencies to comply with the CEQ’s regulations. Despite being styled as an Interim Final Rule, it will not go into effect until April 11, 2025, after notice and comment.
The CEQ’s guidance specifically directs federal agencies to look to the CEQ’s NEPA regulations as amended during the first Trump Administration – not the regulations as they exist today – in revising their procedures. Significantly, federal agencies are directed to eliminate any requirements in their regulations to perform an environmental justice analysis, which had been included as a requirement in the CEQ’s 2024 update to its NEPA regulations. Many of the specific NEPA procedures currently used by agencies during their reviews differ from what was codified in the 2020 regulations, leaving uncertainty as to what processes federal agencies will include in their revised implementing procedures and regulations over the next 12 months.
Echoing the first Trump Administration’s approach to environmental policy regarding the “cumulative effects” of impacts from multiple sources, the CEQ’s guidance instructs agencies to consider only the “reasonably foreseeable effects of the proposed action consistent with Section 102 of NEPA, which does not employ the term ‘cumulative effects.’”
What to Expect in 2025
The Interim Final Rule must be viewed together with the Fiscal Responsibility Act of 2023. That law amended NEPA to establish time limits for the federal government’s NEPA reviews. For projects with more limited environmental impacts, an agency must complete an environmental assessment within one year. For projects that require a full environmental impact statement, the government must complete its review within two years. Under the new NEPA landscape, it is likely that federal agencies will revise their implementing procedures and regulations to focus on meeting or beating these timelines by providing for expedited permitting processes and approvals.
Without clear implementing regulations or input from the courts or Congress, federal agencies will have to decide whether to follow the CEQ guidance and voluntarily adopt provisions that mirror the 2020 NEPA regulations. For projects that depend on federal agency approval or permitting, such as major infrastructure projects, this could result in uncertainty in the timeline and processes that agencies will use to conduct a NEPA review, especially while agencies are actively amending their regulations. Additionally, because agencies have been instructed to individually develop NEPA implementing procedures, the processes and rigor of NEPA review could vary significantly from agency to agency.
The combination of evolving agency-specific implementing procedures and potential variation in those procedures from agency to agency has the potential to create legal vulnerability for any NEPA review completed during the next 12 months. Project proponents may want to consider taking on a greater role in shaping the NEPA review for their project to increase the defensibility of the record of decision the agency will issue at the end of the NEPA process.
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If you have any questions, or would like additional information, please contact one of the attorneys on our Environment, Land Use & Natural Resources team.