Earlier this week, the Court of Appeals for the District of Columbia ruled that the National Environmental Policy Act does not authorize the Council on Environmental Quality to issue binding regulations governing how federal agencies must implement NEPA. I would say that the decision came out of left field, but I think in this case, we have to acknowledge that the decision, in fact, came out of right field. And the question of the day is how much this decision should be taken as further evidence that our current judiciary has the administrative state firmly in its sights.
The decision is remarkable for several reasons, the first of which is that not only did neither party raise the issue, but the court decided it without even asking for a briefing from the parties. Moreover, not only did the Court decide an issue that neither party asked the Court to decide, but it also ignored prior D.C. Circuit opinions declining to examine CEQ's authority because neither party had raised the issue. As Chief Judge Srinivasan noted in his dissent:
Time and again, we have refrained from questioning the CEQ's authority to adopt binding NEPA regulations because the parties did not raise the challenge. See, e.g., Nevada v. Dep't of Energy, 457 F.3d 78, 87 n.5 (D.C. Cir. 2006) ("The DOE accepts [the CEQ regulations] as binding, as do we for purposes of this appeal."); Grand Canyon Tr. v. FAA, 290 F.3d 339, 341 n.* (D.C. Cir. 2002) ("Neither party challenges the regulatory authority of the CEQ, and hence we have no occasion to question the binding effect of the regulations on the FAA."); City of Alexandria v. Slater, 198 F.3d 862, 866 n.3 (D.C. Cir. 1999) ("Because the Administration does not challenge the Council's regulatory authority, we treat the Council's regulations as binding on the agency.").
Not only did the Court ignore prior D.C. Circuit decisions, it also ignored some pretty plain Supreme Court dicta stating CEQ did have authority to promulgate regulations governing NEPA implementation. As the Court acknowledged:
the Supreme Court stated that CEQ was "established by NEPA with authority to issue regulations interpreting it."
The real question now is how this decision will impact NEPA practice going forward. At some level, given the recent Supreme Court decision in Loper-Bright, the answer may be "not much." Either way, the courts will determine, for example, how direct the impacts of a project must be to be subject to NEPA review.
On the other hand, at a practical level, the elimination of CEQ regulations removes a requirement of agency consistency. If each agency must determine for itself what NEPA requires, how will projects subject to review by more than one agency be reviewed? One point seems relatively clear. NEPA has long been criticized for imposing costs on project proponents due to the uncertainty that NEPA review entails. This decision will increase, rather than decrease, the level of uncertainty related to NEPA review.
Originally published 14 November 2024
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