Federal Agencies Issue New NEPA Procedures In Response To Executive Order 14154 And The Supreme Court's Seven County Decision

The past month brought a flurry of updates from federal agencies publishing new procedures to implement the National Environmental Policy Act (NEPA), following President Trump's Executive Order 14154 (EO 14154) in January 2025 and the US Supreme Court's May 2025 decision in Seven County Infrastructure Coalition v. Eagle County Colorado (discussed here). Although EO 14154 and the agencies' NEPA reforms are intended to expedite environmental reviews and permitting, as agencies revamp their NEPA processes there remain significant litigation risks that may lead to project development delays, even with Seven County deference.

Background

Congress enacted NEPA in 1970 to establish a national policy that federal decision-making be informed by consideration of potential environmental impacts. Since NEPA was enacted, the Council on Environmental Quality (CEQ), an office within the Executive Office of the President, coordinated NEPA implementation across all federal agencies. CEQ published government-wide NEPA implementing regulations in 1978 and has issued a number of revisions to those regulations since then. Federal agencies generally followed CEQ's centralized regulations while incorporating and adapting certain agency-specific practices in their own procedures and implementing regulations. However, the role of CEQ in establishing a common regulatory baseline across federal agencies in implementing NEPA has been upended over the past year with two federal courts ruling that CEQ lacks authority to issue regulations that are binding on federal agencies (Marin Audubon Soc'y v. FAA, 121 F.4th 902 (D.C. Cir. 2024); Iowa v. CEQ, 765 F. Supp. 3d 859 (D.N.D. 2025)).

Following these rulings, EO 14154 removed CEQ's authority to issue binding regulations, directed CEQ to rescind its regulations and instructed other federal agencies to revise their own NEPA implementing procedures. CEQ has proceeded with rescinding its regulations (90 Fed. Reg. 10610) and issued a template containing streamlined NEPA procedures for each individual federal agency to adopt and amend as appropriate. An array of agencies has now used CEQ's template to develop their own amended procedures in guidance documents and modified their own regulations containing NEPA implementing procedures.

Variation Among Agencies

CEQ's template—and the agency procedures based on it—include several substantive changes from CEQ's past regulations. Like the prior regulations, the new procedures provide basic instructions about preparing environmental assessments and environmental impact statements, establishing categorical exclusions for certain actions, and implementing other core elements of the NEPA process. However, among other changes, the new procedures provide less emphasis on public involvement in the NEPA review process and a narrower definition of the scope of analysis than CEQ's past regulations. For instance, most new procedures no longer specifically require agencies to publish and solicit public comment on draft environmental impact statements, and do not instruct agencies to consider cumulative effects of a proposed action.

The procedures also incorporate elements of the Seven County decision in defining the scope of analysis, such as clarifying that agencies may, but are not required to, "analyze environmental effects from other projects separate in time, or separate in place, or that fall outside of the bureau's regulatory authority, or that would have to be initiated by a third party" (see, e.g., DOI NEPA Handbook at 1.5(d), 2.3(b) and Appendix 3 pp. 13–14).

Some notable, but not exhaustive, features of new procedures published by several agencies are outlined below:

• The Department of the Interior (DOI) has retained certain procedures in regulations (at 43 CFR Part 46) related to emergency responses, categorical exclusions, and applicant- and contractor-prepared environmental documents. Also, DOI has rescinded all other NEPA implementing regulations via interim final rule and instead published a department-wide handbook that, among other things, provides bureaus discretion regarding whether to publish draft environmental documents (DOI NEPA Handbook at 3.3), and directs bureaus to draw "a reasonable and manageable line relating to its consideration of any environmental effects from the proposed action that extend outside the geographical territory of the project or might materialize later in time" (DOI NEPA Handbook at 1.5(d)). An appendix to DOI's handbook provides further guidance to bureaus, including about how "public involvement above and beyond the NEPA's requirements" may be appropriate in some circumstances (DOI NEPA Handbook Appendix 3, pp. 1–5) and how to evaluate the significance of effects (Id., pp. 14–16).
• Agencies within the Department of Defense (DoD), including the Army Corps of Engineers, rescinded most NEPA implementing procedures that were previously in its regulations (90 Fed. Reg. 27857). For example, the Army Corps rescinded its regulations at 33 CFR Part 230 for civil works projects except for provisions on categorical exclusions (90 Fed. Reg. 29461), and promulgated new regulations at 33 CFR Part 333 to replace prior regulations for evaluating permit applications under the Clean Water Act and Rivers and Harbors Act (90 Fed. Reg. 29465). DoD issued department-wide NEPA procedures in a guidance document that, like DOI, provides discretion regarding publication of draft documents but requires environmental impact statements to include a summary of any comments received and a response (DoD NEPA Implementing Procedures at 2.1(e)).
• The US Department of Agriculture consolidated and revised NEPA implementing procedures across the agencies under its umbrella, including the Forest Service, by rescinding agency-specific regulations and adopting modified department-wide regulations by interim final rule (90 Fed. Reg. 29632). The regulations include unique provisions such as requiring a "finding of applicability and no extraordinary circumstances" when relying on a categorical exclusion (7 CFR 1b.3(g)).
• The Federal Energy Regulatory Commission (FERC) revised its regulations at 18 CFR Part 380 regarding environmental reviews to remove references to CEQ's past regulations (90 Fed. Reg. 29423) and issued a "staff guidance manual" on NEPA implementation. Unlike those of most other agencies, FERC's procedures specifically require publication of a draft environmental impact statement and a comment period, which will typically be 45 days (FERC NEPA Manual at (C)(1)(d)).

Judicial Review

Although so far the various federal agencies have issued differing procedures, the Supreme Court has found that NEPA grants agencies broad discretion in implementing the statute and indicated that agencies will receive a high level of judicial deference when analyzing proposed actions under NEPA (Seven County Infrastructure Coalition, et al. v. Eagle County Colorado, et al., No. 23-975 (May 29, 2025)).

That said, the contours of that judicial deference remain to be seen. For example, the form of the new NEPA procedures may affect the level of deference given to an agency's environmental review. When an agency follows regulations promulgated through notice-and-comment rulemaking under the Administrative Procedure Act, it will generally receive heightened deference from courts (see, e.g., United States v. Mead Corp., 533 U.S. 218, 229-231 (2001)).¹ In contrast, when an agency follows procedures established without a rulemaking (e.g., in agency guidance such as manuals or handbooks), it may receive less deference from the courts. Therefore, while agencies are updating their NEPA procedures relatively quickly by issuing interim final rules and guidance, this may create opportunities for litigation challenges to NEPA reviews based on that guidance. It is yet to be seen how Seven County deference may counteract the impacts of shifting away from notice-and-comment rulemaking, and whether agencies will respond to public comments on interim final rules in a way that will make them more likely to receive deference.

Overall Impacts

With rapidly changing and varied procedures, federal permitting remains a complex and uncertain area. Going forward, project proponents will need to become familiar with new NEPA procedures and may need to navigate risks associated with variability in the NEPA process among agencies. Effective advocacy with federal agencies will be critical as the agencies chart new territory. Stakeholders should closely monitor the processes that are developing and participate in those processes as their interests warrant. Amid this shifting landscape, sound planning, appropriate public and stakeholder engagement, and efficient and accurate environmental reviews remain key to long-term project success.

Footnote

1. Although the Mead decision preceded Loper Bright Enterprises v. Raimondo (603 U.S. 369 (2024)), the Seven County decision made clear that deference is still appropriate in the context of NEPA, as discussed above.