For those of you who still haven't heard, in a surprising 2-1 ruling, the D.C. Circuit held that the Council on Environmental Quality had no legal authority to issue its regulations governing federal implementation of NEPA. Why was this ruling surprising? First, CEQ's NEPA rules had been in place for nearly 50 years with few questions about their validity—no one expected them to be invalidated in a case about air tours of National Parks in California. Second, neither party argued this point on appeal, so it was a shock to see the majority reach it.
Word of the decision, Marin Audubon Society v. FAA, spread quickly. Almost immediately, parties seized on the ruling to supplement arguments in pending litigation. The parties challenging the CEQ's final Phase 2 NEPA regulations, for instance, provided the court additional briefing on implications of the Marin ruling. The reply briefs in Seven County Infrastructure Coalition v. Eagle County—including the one we filed on behalf of petitioners—also refer to the decision. And anyone involved in a pending NEPA review needs to let the lead agencies know that there may be an issue relying on the CEQ's regulations.
The reality facing parties continuing to deal with NEPA, either during the environmental review process or while defending final documents in court, is complicated.
To start, it isn't clear whether the D.C. Circuit ruling will stand. Either the Marin Audubon Society or the Justice Department could file a petition for rehearing en banc at the end of December. If the full D.C. Circuit decides to revisit the decision, it could reverse. And, whether or not the D.C. Circuit takes another look (or is even asked to), the parties could seek U.S. Supreme Court review. But any such efforts in the Supreme Court would happen after the new Trump DOJ and CEQ is making litigation decisions.
In the meantime, we don't know how the new administration will manage the CEQ's NEPA regulations more generally. We see several options:
- Rescind and Revise the 2024 Phase 2 Rule – Prior to the Marin decision, this was the most likely scenario. The previous Trump administration issued its version of the regulations in 2020. It wouldn't have taken too much effort to recall that Federal Register notice and update that version of the regulations with the most recent NEPA amendments. But now? There are more choices for the new administration.
- Withdraw the 2024 Phase 2 Rule and Leave CEQ Out of the Mix – The new administration might decide that allowing each agency to devise its own rules would be preferable to CEQ doing anything. But this approach could allow too much flexibility. What's more, some important agencies, like the Federal Energy Regulatory Commission, don't have their own NEPA rules. So the new administration may decide that a government-wide set of rules implemented by CEQ might make things easier.
- Allow the Lower Courts to Take the Lead – Not only might the D.C. Circuit rethink the Marin ruling, but the North Dakota District Court will soon chime in on challenges to the Phase 2 Rule. The new administration's work could be done for it by the judicial branch. With so many environmental and natural resources issues on their agenda, it may be a viable strategy to let courts act first and then address any decisions that are not in concert with the new administration's priorities via statute or regulation.
- Advance Further Permitting/NEPA Reform in Congress – This is a likely scenario. While it may take time and effort (especially getting over a Senate filibuster), there could be bipartisan support for legislation consistent with pending proposals that seem unlikely to get a hearing in the lame duck session. The new administration may wish to see what comes out of Capitol Hill before it devotes resources to updating regulations.
- Wait for the Supreme Court Ruling in Seven County Infrastructure – The future of NEPA compliance also lies in the hands of the Supreme Court. After argument on December 10, a ruling in this potential watershed case will arrive no later than the end of June. Just like it could for Congress to act on NEPA and permitting reform, the administration could wait for guidance from the Court about the future NEPA compliance.
For now, a "wait and see" approach is best. But if you're in the middle of a NEPA review, don't presume the CEQ rules apply—look at agency rules and the amended provisions in NEPA itself. And if you're facing a challenge to a completed NEPA review, you may have to make some creative arguments, again focusing on the statute, not the CEQ rules.