Improving the Magna Carta of environmental law

A response to Brookings

The National Environmental Policy Act is sometimes called the Magna Carta of environmental law. The law is popular with NIMBYs and environmental activists because it gives them an effective veto over any project that the federal government touches. A NEPA lawsuit can bring an infrastructure project to a standstill; not a shovelful of dirt can be moved until it is resolved. And even fear of a lawsuit often causes federal agencies and applicants for federal permits to go overboard with environmental paperwork, drawing out the review process for many years.

In the spirit of Earth Day, let us be clear: We are strongly in favor of environmental protection. But we are also concerned about progress. We question whether it is such a good idea to distribute veto rights — or at least obstacle rights — so widely. Veto rights mean that it is harder to get anything done, even projects like wind farms or green infrastructure that are good for the environment. That’s why we supported the administration’s recent rulemaking to revise the NEPA-implementing regulations. The existing rules have visible flaws and need change.

Weighing in on the side of the status quo is a blog post published at the Brookings Institution authored by Shoshana Lew and Rebecca White, officials in the Rhode Island and Colorado departments of transportation, respectively. Lew and White make three main claims. They argue that the rulemaking reduces consideration of indirect and cumulative effects of federal actions, that it limits public involvement, and that it would dangerously limit when NEPA review is required.

Where Lew and White see problems, we see solutions. The crux of NEPA’s problems is exactly that it has been applied with ever-increasing scope. As we argued in our comments on the rulemaking, the proposed rules are a good step toward achieving NEPA’s goal of encouraging “productive and enjoyable harmony between man and his environment.”

Allegation #1: the rulemaking seeks to lead states away from considering the indirect and cumulative effects of federal actions

The claim that the rulemaking would limit consideration of indirect and cumulative effects is a common one, and it contains a kernel of truth that is belied by looking at the fuller picture. The current NEPA-implementing regulations, promulgated in 1978, define effects that agencies must consider to explicitly include indirect and cumulative effects, while the proposed rules define effects differently.

But the full picture shows that the 1978 regulations were already hemmed in by case law. NEPA itself says nothing about indirect or cumulative effects, only that agencies must consider the environmental impact and adverse environmental effects of their major actions. This vagueness — where do effects stop? — has had to be interpreted by the courts. The effects that must be considered under NEPA analysis were already cabined by two unanimous Supreme Court decisions: Metropolitan Edison (1983) and Public Citizen (2004).

Metropolitan Edison holds that:

The terms “environmental effects” and “environmental impact” in § 102(C) [of NEPA] should be read to include a requirement of a reasonably close causal relationship between a change in the physical environment and the effect at issue.

This requirement of a “reasonably close causal relationship” already limited, in theory, if not always in practice, the requirement in the existing regulations to analyze indirect and cumulative effects.

The administration’s proposed definition that “Effects or impacts means effects of the proposed action or alternatives that are reasonably foreseeable and have a reasonably close causal relationship to the proposed action or alternatives” harmonizes the regulation with this long-standing unanimous opinion of the Supreme Court, helping to bring NEPA practice into line with the law of the land.

Furthermore, the proposed definition goes on to say, “Effects include reasonably foreseeable effects that occur at the same time and place and may include reasonably foreseeable effects that are later in time or farther removed in distance.” This is quite compatible with the study of indirect effects, provided that they have a “reasonably close causal relationship” as the Supreme Court requires.

Metropolitan Edison further holds that:

Some effects that are “caused by” a change in the physical environment in the sense of “but for” causation, will nonetheless not fall within § 102 [of NEPA], because the causal chain is too attenuated.

Public Citizen reaffirms that:

[A] “but for” causal relationship is insufficient to make an agency responsible for a particular effect under NEPA and the relevant regulations.

It also limits the effects that agencies must consider based on their authority:

We hold that where an agency has no ability to prevent a certain effect due to its limited statutory authority over the relevant actions, the agency cannot be considered a legally relevant “cause” of the effect. Hence, under NEPA and the implementing [Council on Environmental Quality (CEQ)] regulations, the agency need not consider these effects in its EA when determining whether its action is a “major Federal action.”

The last paragraph of the administration’s proposed definition is very similar to the holdings in these two unanimous decisions:

A ‘‘but for’’ causal relationship is insufficient to make an agency responsible for a particular effect under NEPA. Effects should not be considered significant if they are remote in time, geographically remote, or the product of a lengthy causal chain. Effects do not include effects that the agency has no ability to prevent due to its limited statutory authority or would occur regardless of the proposed action. Analysis of cumulative effects is not required.

The administration’s proposed definition, then, brings the regulation in line with case law, which was already binding on federal agencies. It is therefore not quite accurate to say that the proposed regulation would “lead states” or federal agencies away from considering indirect effects. States may continue to consider indirect effects, but they are only required to do so by NEPA if the causal chain is not too attenuated and if the agency has the authority to prevent the effect. This was already the standard under existing case law.

Cumulative changes are another element often dependent on lengthy and questionable causal chains. A requirement for analysis of cumulative effects like climate change would usually fail under the standards the Supreme Court has set. Climate change is the product of an attenuated causal chain and not attributable to any particular agency action. No agency has the authority to stop climate change. Climate change does not have a “reasonably close causal relationship” with building a highway as the courts have defined that term.

Furthermore, it is impossible to reliably calculate net greenhouse gas emissions for many projects over their lifetime. Under the Obama administration’s analysis, the Keystone XL pipeline would not have increased global greenhouse gas emissions; under a different set of assumptions, environmental activists found that it would. Every project is subject to this type of uncertainty. Forecasting tells us little of value, not because pipelines definitely won’t increase emissions, but because reasonable people can disagree about the size and probabilities of those effects.

Climate change is best addressed through direct and substantive measures, like a carbon tax, not by burdening every project that touches federal funds or lands with a requirement to create dubious projections and rehearse a litany of concerns.

Additionally, contra Lew and White, nothing in the proposed regulations prevents agencies or states from using environmental review to document compliance with substantive rules if they wish to do that. NEPA-implementing regulations set a baseline of what is required under the statute, but they do not limit the content that agencies or states can put in them.

We, therefore, see this issue differently than Lew and White. Two unanimous Supreme Court decisions already limited the scope of effects that must be considered under NEPA. The administration’s proposed definitions hew closely to this case law. To the extent that states or other parties went beyond requirements as laid out by the Court, they may continue to do so, as NEPA sets a baseline, not a maximum level of analysis.

Allegation #2: the rulemaking weakens opportunities for public involvement

Lew and White worry that the rulemaking could make it harder for the public to get involved in NEPA proceedings. Specifically, they claim that a) “Identifying stakeholders with equities early in the lifecycle of a project is important for assessing needs as well as for identifying potential concerns that must be resolved in order to avoid conflict and delay during construction,” and b) “short deadlines and page limits that this rule proposes would likely push critical analysis work outside the NEPA framework.”

The proposed rule actually encourages stakeholders to come forward early by forfeiting those issues not raised in comments on the notice of intent. This provision would make finite the universe of concerns that federal decision-makers must consider, preventing stakeholders from lodging complaints at the last minute and bringing the matter to court. So contra Lew and White, we see the rulemaking as a boon to early engagement and an antidote to the weaponization of NEPA by NIMBYs.

We also believe the proposal’s 150 pages and two years is plenty of time and space for thorough public discussion. The 150-page limit is a long-standing provision of the 1978 NEPA-implementing regulations. 40 CFR 1502.7 already provides that “the text of environmental impact statements…shall normally be less than 150 pages, and for proposals of unusual scope or complexity shall normally be less than 300 pages.” Despite this long-standing regulation, most NEPA documents fail to meet this requirement, as a 2019 review by CEQ shows.

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Source: CEQ.

Signs of this excessive paperwork were visible much sooner than 2019. President Clinton’s CEQ found that agencies misunderstand the purpose of the NEPA review process as the documents become ends in themselves, resulting in “endless documentation.” Data collected and analyzed by the National Association of Environmental Practitioners show an upward trend in environmental impact statement preparation times in addition to page count.

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Source: NAEP.

NEPA review’s growing timelines and document lengths reveal the true motivation and merit of the proposed changes: the review process has become a mess. A person affected or interested in a project faces a mountain of paperwork, not a clear statement of the most important issues. Documents that average more than 600 pages, not including technical appendices, are far from accessible to the public.

Clinton’s 1995 study recommended plain language and clear documentation of the most important issues. That recommendation was as right then as it is now. A requirement for a senior agency official to approve an EIS going over 300 pages or taking more than two years to prepare will likely result in documents that are clearer, more concise, and free of bloat. This will improve, not reduce, public understanding of federal decisions affecting the environment.

Allegation #3: the proposed rule would significantly limit when NEPA review is required by exempting projects where the federal role is deemed to be minimal — though the rule is unclear about what, exactly, that threshold would be

The NEPA statute has always required environmental impact statements only for “major” federal actions, although that word was not given any real voice under the 1978 regulations. Consequently, the administration is proposing to clarify the definition of “major Federal action” in the new regulations. Lew and White admit that “There are situations within the transportation sector where a change like what the administration suggests might make sense.” However, they are concerned that “the efficiencies gained by removing small and simple projects from NEPA review would be overwhelmed by the dangerous lack of scrutiny for highly impactful projects.”

The administration’s proposed text, “Major Federal action also does not include non-Federal projects with minimal Federal funding or minimal Federal involvement where the agency cannot control the outcome of the project,” is again based on case law. Even under this proposed rule, projects considered non-major Federal actions could still receive scrutiny. Twenty states and localities have their own environmental review laws, colloquially called Little NEPAs. While we fear that state and local environmental review laws can also dangerously inhibit progress, states are not powerless to scrutinize their own decisions just because the federal government decides that a major federal action did not occur. And in addition to state-level requirements, substantive federal laws like the Clean Air Act and the Clean Water Act still apply.

Lew and White speak from their experience in a transportation context, but NEPA applies to far more than transportation. The federal government performs tens if not hundreds of thousands of NEPA reviews per year, most of which are for minor actions. This enormous burden slows federal decision making, wastes money, and makes the government less effective. If anything, we think the administration’s definition of “major Federal action” does not go far enough to limit the scope of NEPA reviews.

The case for reform

NEPA reform has been a bipartisan effort since before 1995. Presidents Clinton, Bush, Obama, and Trump have all taken steps to address the law’s deficiencies. Alas, none of these actions has successfully reigned NEPA practice in. Timelines are not just long; they’re growing longer. Page counts already exceed defined limits and continue to grow.

Environmental activists have criticized the administration’s proposals as “gutting NEPA.” We see it very differently. In fact, the rulemaking is similar in substance to efforts by previous administrations and by Congress to limit NEPA’s deficiencies. The real risk is that even this proposal won’t work to fix what could turn out to be an unworkable structure. NEPA’s procedural hurdles contrast with substantive standards directly addressing environmental harm that would actually protect the environment.

Now more than ever, we need to build. We need to put aside what Marc Andreessen calls “smug complacency” and “satisfaction with the status quo.” A critical part of that is ensuring that new projects are not strangled with procedural obstacles. NEPA reforms will provide opportunities to build a better and cleaner future.

CGO scholars and fellows frequently comment on a variety of topics for the popular press. The views expressed therein are those of the authors and do not necessarily reflect the views of the Center for Growth and Opportunity or the views of Utah State University.