Governors' Wind Energy Coalition

President Trump promised that a newly finalized rulemaking undercutting a bedrock environmental statute would bring an end to “mountains and mountains of bureaucratic red tape” for American infrastructure.

But environmental lawyers say Trump’s revisions to the implementing standards for the National Environmental Policy Act may have the opposite effect, creating fresh legal and regulatory risk for federally funded projects like electricity transmission and water infrastructure, as well as federal management of oil and gas leases and mining authorizations.

“It’s going to backfire and blow up in their face,” said Western Environmental Law Center staff attorney Susan Jane Brown. “The stated purpose and need of this regulatory overhaul was to streamline and increase efficiency and regulatory certainty, and none of those things are going to come from this rule.”

The law center, along with several environmental groups and left-leaning states, pledged yesterday to take legal action against the Trump administration’s changes to the NEPA rule, which aim to streamline permits required for power plants, border walls and other infrastructure.

“This is yet another egregious example of the Trump Administration’s crusade to put industry interests above public health and the protection of our shared environment, which is particularly irresponsible during a global pandemic,” Washington state Attorney General Bob Ferguson (D) said in a statement. “I intend to sue to fight this unlawful, unjust decision.”

The Trump administration’s revised implementing regulations make a host of changes to long-standing guidance from the White House Council on Environmental Quality. The changes include setting tighter timelines for agencies to complete analyses. The regulations also eliminate the use of the terms “direct, indirect and cumulative” to describe the effects of projects, opting instead to simply discuss “significant effects.”

“Today’s action completely modernizes the environmental review process under the National Environmental Policy Act of 1969,” Trump told spectators at a press conference at UPS Inc. headquarters in Atlanta, where he unveiled the new rule (E&E News PM, July 15).

Sixteen green groups represented by the Southern Environmental Law Center are teeing up a lawsuit that focuses on two key complaints about the NEPA overhaul: the regulation’s inconsistencies with long-standing federal law and the Trump administration’s failure to follow the proper process for drafting the rule and assessing its consequences, said Kym Hunter, a senior attorney with the law center.

“NEPA is pretty clearly set out to strike this balance between man and the environment and being action-forcing, and everything about this rulemaking just goes in the opposite direction and undercuts the statutory mandate,” said Hunter.

Scrapping decades of prior standards will be a “high hurdle” for CEQ to mount in court, Brown noted.

“The federal bureaucracy is a big ship, and you can’t turn it on a dime,” she said. “Upending the environmental analysis in public involvement procedures that we’ve all been operating under for the last 50 years [is] not a recipe for efficiency.”

Conflicts with NEPA

Challengers of the revised regulations said the altered scope of what agencies are directed to consider violates the underlying requirements of NEPA, which remain unchanged by yesterday’s rulemaking.

Opponents of the changes emphasized that removing consideration of cumulative and indirect effects is inconsistent with the statute and the intention of NEPA at the time it was drafted.

CEQ stated in the rule that it had eliminated the references to the terms to “simplify the definition [of effects] to focus agencies on consideration of effects that are reasonably foreseeable and have a reasonably close causal relationship to the proposed action.”

The agency also added in the final version that the definition would “generally” apply, acknowledging that agencies “may occasionally” need to consider effects that are “remote in time, geographically remote, or the product of lengthy causal chain.”

Another problem with the rule, critics say, is it restricts the scope of alternatives that agencies must consider and disclose when analyzing projects.

Both changes conflict with the statute’s purpose to force agency action, said Hunter.

“The idea is that with all that information they will be able to make better decisions and hopefully be able to get to better outcomes,” she said. “And so the act of undoing all of that just runs contrary to what the agency should be doing.”

University of Arizona law professor Justin Pidot said the new standards introduce “immense legal risk” for projects that will inevitably get bogged down by regulatory uncertainty.

“If an [environmental impact statement] is produced within two years, as the regulations strongly suggest, there is a high risk that a court will find the EIS to be inadequate,” he wrote in an email.

“If that happens, it may take much longer to break ground on the project than if a more careful EIS had been prepared under the old regulations,” Pidot said.

‘They just haven’t done their homework’

Legal opponents of Trump’s overhaul will also argue that the changes violate the Administrative Procedure Act, which governs how federal agencies are supposed to draft, revise or revoke regulations.

Brian Mannix, a research professor at George Washington University’s Regulatory Studies Center, was not convinced that an APA challenge would be successful.

He suggested that courts would be quick to rule against the regulations for conflicting with the underlying statute, adding that case law since 1978 could also limit CEQ’s flexibility to act.

“But, generally, I suspect that the courts will regard NEPA procedures as properly within the authority of the president to manage,” he said. “CEQ has complied with APA notice-and-comment requirements, and it has explained why the regulations need to be streamlined. That ought to suffice.”

Other legal experts pointed to several failures by Trump’s CEQ to follow administrative law, a problem that has previously undermined the president’s deregulatory agenda. For example, the final rule came out just a few months after CEQ received over a million comments on the proposed regulation in March, suggesting the agency had not taken the time to review and respond to all that feedback, said Hunter.

The agency also failed to provide proper reasoning for its decision to change its rulemaking, she said, and instead stated as a justification that the change would facilitate more efficient reviews under NEPA.

That explanation did not address other factors congressional reports had cited for causing project delays, including insufficient agency or project funding, or a lack of guidance, Hunter said. To follow the APA requirements, the administration would have to consider those factors and possibly take action to address them, such as offering better guidance to project developers, if possible, she added.

“They just haven’t done their homework,” Hunter said.

The election will also likely slow down the implementation of the new standards since the rules are coming very late in the legislative year, noted University of California, Berkeley, law professor Holly Doremus.

“They will be vulnerable to the Congressional Review Act if the Democrats gain control of the White House and Senate in the 2020 elections,” she wrote in an email. “Even if that doesn’t happen, if there’s a new administration in January, they will surely be withdrawn.”

The Trump administration’s process for drafting the NEPA regulations follows the pattern of other high-profile rules that have been thrown out in courts for failing to meet procedural standards, said Hunter.

She pointed to a pair of recent Supreme Court opinions, one allowing the Deferred Action for Childhood Arrivals policy to remain in place, and the other striking down a bid by the administration to add a citizenship question to the 2020 Census.

“It’s just this consistent theme of rushing through and wanting to rewrite the law without following the procedure for how you do that,” Hunter said of the Trump administration.

NEPA ‘modernization’

Industry groups hailed the new rules as a “modernization” of NEPA standards previously marred by lengthy delays.

American Petroleum Institute President and CEO Mike Sommers said he was optimistic the rule change would shorten the time to complete permits while also ensuring environmental reviews move forward.

“I don’t think anybody likes the system that we have now, where there are endless delays, both from the federal permitting process and many, many avenues for activists to take those kinds of permitting delays to court,” Sommers said on a call with reporters yesterday.

“We’ve seen a very detrimental effect on that on pipelines just recently, and what that actually is doing is preventing energy from getting to consumers in the most environmentally safe way,” he said.

Sommers appeared to be alluding to the recent decision by the U.S. District Court for the District of Columbia ordering the Dakota Access pipeline to be closed and drained of oil. The order followed the court’s finding that the Army Corps of Engineers failed to comply with NEPA when it approved a key permit for the pipeline.

The U.S. Court of Appeals for the District of Columbia Circuit this week put a temporary hold on the district court’s order.

“After two decades of discussion about the need for reform, spanning multiple Administrations, we’re thankful that the Trump Administration has made this issue a priority and taken thoughtful action,” Tom Donohue, president of the U.S. Chamber of Commerce, said in a statement.